November 18, 2015

Greedy Bastards Selling At Inflated Prices

The News-Leader reports from Missouri. “Christian County, Nixa and Ozark issued a combined 163 building permits for single family residences in 2011. So far combined this year, they’ve issued more than twice as many — 354. Jason Massengale, a Nixa real estate agent with the Heartland team of Keller Williams, likened today’s sales to the rate during the bubble. ‘This real estate market — it’s kind of like it was in ‘06,’ he said, adding that he this year he has been able to list houses one day and sell some the very next day. ‘We haven’t moved stuff this fast since 2006.’”

“Massengale was at a recent board meeting of the Nixa Chamber of Commerce, and he asked those present to guess how much Nixa houses had been selling for recently, according to chamber director Marc Truby. Truby said everybody in the room started guessing, going higher and higher until Massengale ’spilled the beans.’ ‘I didn’t believe it,’ Truby said of when Massengale told them it was more than $200,000.”

The Bozeman Daily Chronicle in Montana. “Affordable housing — perhaps the single most fraught issue facing Bozeman — will be back in front of the city’s five commissioners Monday. Southwest Montana Building Industry Association chairman Brian Popiel said the building industry remains adamantly opposed to the mandatory portion of the proposal, which would kick in automatically if affordable home production falls short. As Popiel puts it, the policy relies on the assumption that builders are ‘greedy bastards selling homes at inflated prices.’ That’s ‘fundamentally misguided,’ he said.”

“The city’s housing consultant, Daniel Werwath, disagrees with the notion the construction industry is running on thin margins, however. Werwath argues Bozeman’s housing market has been distorted by ‘unnatural demand’ fueled by outside money, as retirees and others relocate to the area having sold homes in pricier markets or built savings in communities with higher wages. ‘Houses are not priced at the cost to build them,’ he said. ‘Houses are priced at what the market will pay. People are making good profits right now,’ he said. ‘People could be building lower-cost housing in Bozeman.’”

KTVN in Nevada. “If you’ve driven around any Washoe county neighborhood, you might have noticed a lot of homes for sale. ‘It was the fourth highest October in history,’ said William Process, the 2016 president of the Reno/Sparks Association of Realtors. ‘But we are seeing our traditional seasonal trends. So sales are down a bit from September, median prices are down a bit, sales are down a bit. But so is inventory.’”

“There are still quite a bit of homes for sale. The average median price for a home in Washoe County is $280,000, an 8% jump from last October, but down 2% from September of this year. But the affordability of homes remains a concern. There were only 71 listings that listed under $200,000. That’s a 42% decline from this time last year. And with thousands expected to move into the area, what we have now isn’t cutting it. ‘All the reports that are coming out right now are identifying that we need more homes in the area. And they are building them, Process said.”

The Press Democrat in California. “Sonoma County home sales picked up in October after an end-of-summer lull, according to The Press Democrat’s monthly housing report compiled by Pacific Union International VP Rick Laws. As activity increased, the county’s median home price dipped 2.3 percent to $529,275 from September. That price remains 8 percent higher than a year ago. The median price reached a high this year of $546,000 in June but has dropped slightly each month since. With a relatively limited supply of homes for sale, ‘you would think prices would continue to rise, but I don’t see it,’ Laws said. ‘There’s definitely a plateau.’”

“Laws calculated that based on current sales, the county has a five-month supply of homes priced between $1 million and $2 million; a 14-month supply between $2 million and $4 million; and about a four-year supply over $4 million. Though the housing market has remained active this fall, buyers are showing more restraint, apparently not wanting to overpay or to pay more than they can afford, said Leon Geisberg, a broker associate in Santa Rosa with Better Homes Realty. ‘It seemed like people are starting to be more cautious,’ Geisberg said.”

The South Florida Business Journal. “Pre-sale contracts for new condominium projects in eastern Miami-Dade and Broward counties got mired in a severe slowdown in the third quarter, according to a new report by brokerage ISG World. By the end of September, there were 17,007 units in the pipeline in 96 projects and 12,946 units, or 76 percent, were sold, according to ISG. Its last report with data from June 2015 said 73 percent of the 16,886 units in the pipeline were sold. That means 537 condos were sold during the third quarter.”

“‘That’s way beneath the expectations of not only developers but also the marketplace of Miami,’ said ISG Principal Craig Studnicky.”

From Park Cities People in Texas. “Home sales in the Park Cities and Preston Hollow declined sharply in September compared to June, for example, and prices showed a modest drop as well, according to statistics from the North Texas Real Estate Information System. ‘I think we’re seeing a little bit of a market adjustment. I don’t think it’s a downturn,’ said Michelle Wood, an agent with Briggs Freeman Sotheby’s International Realty.”

“Sales in the Park Cities dropped by more than 50 percent from summer to fall, and almost as much in Preston Hollow. So it makes sense that as fewer people are buying, inventory is on the rise. The number of local active listings reached their 2015 peak during September, and available properties are spending longer on the market, especially in the Park Cities. ‘We’re starting to see a lot of reductions,’ Wood said. ‘It’s a great time of year to buy.’”

“Wood said that sellers can still get good value, but they might not be able to take advantage of the market as they’ve done previously. ‘Seller expectations on price got a little out of line with reality, so now we’re seeing those properties sit that were overpriced,’ Wood said. She said an influx of new construction is also having an impact on the health of the market. ‘It’s making the houses that are not new have to compete a little harder,’ Wood said.”

WNYC on New Jersey. “In October the Atlantic City region had the highest foreclosure rate of any metropolitan area in the country for four months in a row; the Trenton area is number three on the list. When Staci Berger, president of the Housing & Community Development Network of New Jersey, speaks with housing advocates in other states, she realizes just how different her state’s situation is. ‘I was on a phone call with my colleagues around the country and someone said, ‘Now that we have gotten past the foreclosure crisis,’ and I said, ‘Wait a second, some of us aren’t yet.’ So that was really telling,’ Berger said. ‘There are some who feel like this is in their rear view mirror, and we are not there yet.’”

“At a recent auction for foreclosed properties in Mercer County, Diann Timian of Ewing Township sat in the courtroom and watched her three-bedroom ranch house offered up to the highest bidder. She and her husband borrowed against the house to pay for college tuition for their two kids. After they divorced Timian couldn’t afford the extra loans, or the $16,000 a year in property taxes. She now knows she didn’t understand the risk of the refinancing deals. Bankers ‘weren’t shy in coming by and saying, ‘We can give you this much money to pay off your credit cards and you won’t see the increase,’ which wasn’t true,’ Timian said.”




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67 Comments »

Comment by Senior Housing Analyst
2015-11-18 03:13:33

North Dallas, TX Housing Market Plummets; Prices Crater 30% YoY

http://www.zillow.com/north-dallas-dallas-tx/home-values/

 
Comment by Senior Housing Analyst
 
Comment by Senior Housing Analyst
2015-11-18 03:27:35

Fort Lauderdale, FL Housing Prices Crater 9% YoY

http://www.zillow.com/market-report/11-15/31606/fort-lauderdale-fl.xls?rt=14

 
Comment by Senior Housing Analyst
2015-11-18 03:31:29
 
Comment by Senior Housing Analyst
2015-11-18 03:47:16

28,922 nearby properties found Los Angeles, CA Real Estate and Homes for Sale

http://www.realtor.com/realestateandhomes-search/Los-Angeles_CA?ml=4

9,230 nearby properties found Los Angeles, CA Price Reduced Homes for Sale

http://www.realtor.com/realestateandhomes-search/Los-Angeles_CA/show-price-reduced?ml=4

31% of all sellers in Los Angeles reduced their price at least once.

 
Comment by We P!ss Alot
2015-11-18 04:23:00

Seems like home prices went up by eight percent or so year-on-year in many parts of the U.S. Could someone please explain once more why increases in the price of staple consumption items like shelter are not inflationary?

Comment by Ben Jones
2015-11-18 05:55:58

This was posted last night:

‘I am another who checks ZH a few times per week (more than 3x/week can lead to suicidal thoughts, LOL). I acknowledge that there is a bias there at times, but compared to the MSM in this country, give me a break!’

‘A truly informed reader will look at all sources, and can filter out the truth from the bias. I also listen to NPR during my commute, and similarly am aware of their bias.’

‘WPA’s going ballistic about somebody going to a non-approved media source speaks volumes IMO. After the hundreds of faked (translation: paid-for by the mfgr) reviews I have just finished reading about home appliances online (”I haven’t even plugged this thing in yet but it is the best stove I have ever owned!”), I have no doubt that the powers that be are similarly paying people to comment in online forums and the like.’

Comment by Professor Bear
2015-11-18 07:22:22

The powers that be are wasting their money paying jackwipes like WPA to disrupt the flow of ideas on this forum. Obviously he is both a complete moron and a jerk.

Comment by Mafia Blocks
2015-11-18 11:29:23

And the cowardice is at nosebleed levels. Plain wrapper cowardice.

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Comment by AmazingRuss
2015-11-18 12:36:41

Sounds a lot like delusional paranoia brought on by not being able to defend those ideas against event the slightest contradiction.

When you start insulting people, you’ve lost the debate, no matter what the truth is. You convince no one, and your ideology dies.

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Comment by Mafia Blocks
2015-11-18 12:40:55

Housing ShortLeashLola housing!

Sacramento, CA Housing Prices Dive 5% YoY

http://www.zillow.com/east-sacramento-sacramento-ca/home-values/

 
Comment by Ben Jones
2015-11-18 12:51:50

‘Sounds a lot like delusional paranoia…When you start insulting people you’ve lost the debate’

 
Comment by AnkleBiterMikey
2015-11-18 23:59:03

“When you start insulting people, you’ve lost the debate,…”

Too bad, so sad, for WPA to lose the debate he had with himself.

 
 
 
 
Comment by Mafia Blocks
2015-11-18 06:50:47

Remember……. I can ask $50k for my 12 year old Chevy pickup but where is that buyer at that price?

Comment by Mafia Blocks
2015-11-18 08:28:55

And don’t forget my friend, that’s not “inflationary”.

*Learn* the difference.

 
 
 
Comment by Ben Jones
2015-11-18 06:22:08

‘This real estate market — it’s kind of like it was in ‘06…We haven’t moved stuff this fast since 2006.’

‘Truby said everybody in the room started guessing, going higher and higher until Massengale ’spilled the beans.’ ‘I didn’t believe it,’ Truby said of when Massengale told them it was more than $200,000.’

I remember all the FB stories out of Missouri. Mel, Janet, heck of a job.

Comment by Puggs
2015-11-18 10:12:22

Here’s another Harbinger fer ya…

I know someone who bought in early of 2005 (overpriced house) tried to unload the overpriced property multiple times after 2008. Defaulted and had to move in 2011. Fast forward 10 years….and is repeating the same scenario right now, and yeah, the new place is older and overpriced too.

I find it interesting that if these people would have just stayed in their homes instead of “strategically defaulting” they would be almost whole 10 years later and not have costed taxpayers hundreds of millions of dollars. Yeah, they would have been paying for a depreciating asset but better them than us!

Comment by Puggs
2015-11-18 10:18:17

“Cost taxpayers hundreds of millions…”

 
Comment by onlyspeakingtruth
2016-03-05 20:45:02

The greedy realtors are pretty stupid. Instead of getting a steady income by suggesting reasonable housing prices and getting a steady income instead they have become greedy again and will cause another housing bubble crisis. How did that work out for you last time??

 
 
 
Comment by Ben Jones
2015-11-18 06:27:22

‘the policy relies on the assumption that builders are ‘greedy bastards selling homes at inflated prices.’

I don’t get opportunities for titles like this very often.

‘Houses are not priced at the cost to build them,’ he said. ‘Houses are priced at what the market will pay. People are making good profits right now’

And if you don’t believe it, watch the shack builders shout about their profits in a conference. Who do they think they’re fooling? “Oh, the cost of everything is going up!” That’s the oldest line in the book, you greedy bastards.

Comment by Mafia Blocks
2015-11-18 07:15:15

Yeaup

 
Comment by Blue Skye
2015-11-18 08:43:55

“the cost of everything is going up”

Or…”We are all building bigger houses and pricing them even higher and we are getting away with it.”

 
Comment by BearCat
2015-11-18 09:57:51

To be fair to the builders, their business is very cyclical - within a few years, quite a few probably will be bankrupt. And, yes, costs can go up, much of it due to the real bastards - government.

After all, we can’t cut government spending because it’s “for the children” or the poor, so if you want to cut their spending, you’re a heartless bastard.

Comment by Mafia Blocks
2015-11-18 10:29:43

This “builder” thing…. It’s construction although residential structures are just marginally defined as construction. The construction biz is indeed cyclical. These outfits will find other work besides slapping together shanties.

FYI- This “builder” thing never existed until the late 1990’s with publicly traded outfits like Pulte. None of the publicly traded outfits are construction companies or even defined as “builder”. Residential construction is a tiny fraction of overall construction dollar volume. The publicly traded builders are a small fraction of overall SFR production and unfortunately for the public, they (and dumb.borrowed.money lenders) establish prices. At least attempt to. They’re their as a proxy (cheap counterfeit) to an actual construction firm. Keep in mind they do nothing efficiently. They’d lose their ass if they had to make money in a real market.

It is in everyones best interest to ignore these publicly traded outfits and their noisy benefactors. They are not, nor do they represent reality.

 
 
Comment by Puggs
2015-11-18 10:29:14

In my corner of the world…

Houses - overpriced
New cars - overpriced
Used cars - overpriced
RV’s - overpriced
Food - up a bit
Gas - down
Utilities - up a bit
restaurants wait times and menu prices - up
Costco food court - same/steady

You can still eek out a decent living in the US of A as long as you stay out of the lions den of “overpayin” or “making payments” and doctor offices/hospitals, LOL!

 
Comment by snake charmer
2015-11-18 10:48:02

I enjoyed your YouTube video featuring new construction in the Phoenix exurbs, particularly the dry humor in the narration. Particle board and two-by-fours and styrofoam, and a half-million-dollar price tag.

I don’t have any idea what it actually costs to build a house. Is it possible that those half-million-dollar homes are built with $50,000 in materials and $25,000 in labor? How much would the land cost?

Comment by Mafia Blocks
2015-11-18 10:53:44

Roughly $45/sq foot.

Land? We discussed that extensively here. What is dirt actually worth when there is a globe full of it and 95% of it goes undeveloped.

If you’re paying more than $500-1000/acre, you’re paying too much.

Comment by oxide
2015-11-18 12:02:07

The value of the dirt isn’t really in the dirt. What you’re really buying is a commute that is less aggravating than usual.

I don’t disagree with the $45/sq ft. In addition to the cheap materials, McMansions have a lot of air. You can add a 100 sq ft “sitting area” to the master suite practically for free, and charge through the nose for it as part of the square footage.

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Comment by Mafia Blocks
2015-11-18 12:12:29

Donk,

Most of us have a 30 minute commute at $55/sq.

 
 
 
Comment by Ben Jones
2015-11-18 10:56:57

Thanks! I’ve been unable to make another video lately due to an ear infection, but it’s passing and I’ll get back to it.

On the costs; I don’t know but it isn’t anywhere near what they are asking. How about that ding in the Styrofoam window sill? That complex was insane; you’d have to have a gold cart to get into the garage. I was thinking about the garages in these. In Arizona the Garage Mahal is the standard design. But the garages are almost always to small to park in. So the people fill it up with junk and park on the street or the tiny driveway. So basically the entire look and design of these houses is based on a usage that isn’t.

Comment by oxide
2015-11-18 12:10:26

Golf cart?

It is standard practice to have a two-car garage as the main facade, and then a really short one-car garage off to one side? The little garage looks ridiculous. May as well just rent it out to some hopeful rock band.

[FWIW, those flat foundation slabs make me uncomfortable. No connection to the ground at all. I would always feel like something could just scoop up the house and carry it off a la Wizard of Oz. I really like having a basement. ]

Good luck on the infection. I heard those are painful.

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Comment by snake charmer
2015-11-18 13:11:52

About halfway through the video, I was chuckling at the deadpan commentary. “That’s really a pretty small garage.”

Or how about “car wash, right there in the back” and “this is a nice touch … to have the front doors right next to each other.”

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Comment by AmazingRuss
2015-11-18 12:39:33

If fools will pay it, I can’t say as I blame them for taking the money. It’s just survival of the fittest playing out at an economic level.

Comment by Mafia Blocks
2015-11-18 12:51:55

That’s the problem Short….. nobody is paying it.

US Housing Demand Plummets To 20 Year Low

http://4.bp.blogspot.com/-qRBemWyulY0/VNGrDCBXzOI/AAAAAAAAiMA/jdA2RQkiNDc/s1600/MBAjul42015.PNG

30 year lows for Californicators.

 
 
 
Comment by Combotechie
2015-11-18 06:36:01

“Houses are priced at what the market will pay.”

And can pay. Houses are priced at what the market will pay and can pay.

There are two parts here, the “will pay” part and the “can pay” part.

The will pay part is driven by the price rise - not the price itself but the rise of the price. The rise in the price is what make the house attractive, it’s what drives buyers to willingly commit themselves to pay the high prices. They will commit themselves to pay high prices because they believe prices are going to continue to rise. Rising houses prices magically creates wealth for those who buy houses that have rising prices.

Then there’s the can pay part. People who WILL pay also are people who CAN pay because, even though the price is way beyond the range that they can afford if only the total price of the house is taken into consideration, small chunks of the total price - the monthly payment parts - is usually something that is doable. It’s doable in allowing them to commit themselves to buying a house one chunk at a time.

But committing to buy a house one chunk at a time is not the same thing as actually having bought the house. If the monthly payment plan is used then buying a house is a PROCESS, not an event, and this process may not be completed for years - decades even.

This monthly payment plan that allows people the “can” part also allows prices to go way up out of sight and thus it supplies to people the “will” part - meaning the price rise that drives the attraction will never reach the point of unaffordability if the monthly payments are always allowed to be doable.

But if the monthly payments ever reach the point of not being doable then watch out below; This will be the point when the price rise will halt which means this will be the point when the attractiveness of ever-rising prices vanishes.

Comment by Mafia Blocks
2015-11-18 06:49:44

“that is doable.”

If that were the case, there would be no defaults.

Remember…. Current asking prices of resale housing are 3x long term trend and 4x construction cost*.

* $55/sq ft(lot, labor, materials and profit)

Comment by Combotechie
2015-11-18 07:14:07

“If that were the case, there would be no defaults.”

A never said it would be forever doable just doable, doable at the day of the sale.

Comment by Blue Skye
2015-11-18 08:44:58

Doable as long as the debt keeps making you rich.

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Comment by Puggs
2015-11-18 10:16:29

“What will it take to get you into this crap shack, TODAY?”

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Comment by Puggs
2015-11-18 10:14:41

“Houses are priced at what the market will pay”

- the very reason a large number of us on here WON’T.

Comment by Bad Andy
2015-11-18 11:45:27

The issue is they’re using funny money to demand more rent too.

 
 
 
Comment by Mafia Blocks
2015-11-18 06:57:46

“Housing Starts Plunge To 7-Month Lows As Rental Units Tumble”

http://www.zerohedge.com/news/2015-11-18/housing-starts-plunge-7-month-lows-rental-units-tumble

*With millions of excess empty and defaulted housing units, building more excess makes no sense.

 
Comment by Mafia Blocks
2015-11-18 07:03:57

“The Number Of Real Estate Appraisers Is Falling

http://www.marketwatch.com/story/the-number-of-real-estate-appraisers-is-falling-heres-why-you-should-care-2015-11-18

Happy New Year Marketwatch. With housing demand floundering at 20 year lows and falling, this is no surprise.

Comment by trader jack
2015-11-18 12:59:10

No one ever wants an honest appraiser, no one wants to pay an honest appraiser what it actually costs to do the work, and the risk in appraising has to be covered by insurance which costs the appraiser money

I used to tell buyers and sellers that what I say I think the house is worth is just my opinion, and if they want to pay more , or less , for the home just do what you want to do, and forget what I say.

It is easy to be an appraiser when the prices are rising, and impossible to be an appraiser when prices are falling, because no appraiser can tell how much the price will fall!

the appraiser just says what the appraiser thinks the house is worth at the moment of appraisal, but may offer an opinion on which way the market is trending.

Comment by Mafia Blocks
2015-11-18 13:02:12

Appraising is hocus pocus. Show me one that can actually evaluate the cost of replacement.

 
 
 
Comment by taxpayers
2015-11-18 07:26:46

Single-family house construction declined 2.4 percent. Last month’s drop mostly stemmed from a 25.5 percent slide in the volatile multi-family category that includes apartments, a sector had posted a sharp increase in September. The government also revised downward overall housing starts in September and August.

snow?

Comment by Mr. Banker
2015-11-18 07:37:01

Rising sea levels.

 
Comment by Rental Watch
2015-11-18 09:56:55

“Single-family house construction declined 2.4 percent. Last month’s drop mostly stemmed from a 25.5 percent slide in the volatile multi-family category that includes apartments, a sector had posted a sharp increase in September.”

Huh?

Journalists are morons.

Single-Family and Multi-Family are mutually exclusive.

 
 
Comment by scdave
Comment by Professor Bear
2015-11-18 07:48:37

“Disinflation & deflation = Rush to safety…”

Not to worry! The global central banking cartel has this under control.

Comment by scdave
2015-11-18 08:12:23

The global central banking cartel has this under control ??

Its not about central bankers at least not in the Euro…Its all about “Investor Fear”….I think its the beginning of the end for the Euro…

 
 
 
Comment by Ben Jones
2015-11-18 08:57:36

‘It’s no secret that companies have been taking advantage of years of low interest rates to sell cheap debt to eager investors, locking in lower funding costs that have allowed them to go on a spree of share buybacks and mergers and acquisitions.’

‘When it comes to the hubris of corporate chief financial officers, who have been more than happy leveraging up balance sheets in order to reward shareholders, the analysts didn’t mince words. “We find that corporate CFOs historically are inherently backward-looking when setting corporate financing decisions, relying on past extrapolations of economic activity, even when current market pricing suggests future investment returns may be lower,” they wrote. “Several management teams have been on the road indicating higher funding costs of up to 100 to 200 basis points would not impede attractive M&A deals, in their view.”

‘That leaves downgrades by credit-rating agencies as one catalyst that could spark a turn in the cycle; downgrades of corporate credit have already exceeded upgrades this year at some of the bond graders. “Might the rating agencies spoil the party?” they asked. “In the end we believe strong economic interests will overwhelm rationale considerations. Rating agencies remain heavily dependent on new issuance activity, face significant competitive pressures (as issuers will select two of three ratings) and appear unconcerned with where we are in the credit cycle (e.g., see Moody’s latest conference call).”

 
Comment by Ben Jones
2015-11-18 09:03:40

“Sales in the Park Cities dropped by more than 50 percent from summer to fall, and almost as much in Preston Hollow. So it makes sense that as fewer people are buying, inventory is on the rise. The number of local active listings reached their 2015 peak during September, and available properties are spending longer on the market, especially in the Park Cities. ‘We’re starting to see a lot of reductions,’ Wood said. ‘It’s a great time of year to buy.’”

“Wood said that sellers can still get good value, but they might not be able to take advantage of the market as they’ve done previously. ‘Seller expectations on price got a little out of line with reality, so now we’re seeing those properties sit that were overpriced,’ Wood said. She said an influx of new construction is also having an impact on the health of the market. ‘It’s making the houses that are not new have to compete a little harder,’ Wood said.”

This is the 5 mile filter:

3,584 nearby properties found Preston Hollow, Dallas, TX Real Estate and Homes for Sale

http://www.realtor.com/realestateandhomes-search/Preston-Hollow_Dallas_TX/type-single-family-home,multi-family-home,mfd-mobile-home,condo,townhouse,undefined-condo?ml=2

1,328 nearby properties found Preston Hollow, Dallas, TX Price Reduced Homes for Sale

http://www.realtor.com/realestateandhomes-search/Preston-Hollow_Dallas_TX/type-single-family-home,multi-family-home,mfd-mobile-home,condo,townhouse,undefined-condo/show-price-reduced?ml=2

The UHS I know in Dallas has been telling me there are a bunch of price cuts in the Dallas area. Steve Brown will be the last to know.

 
Comment by Ben Jones
2015-11-18 09:37:37

‘and about a four-year supply over $4 million’

Where are all those Chinese buyers?

Comment by scdave
2015-11-18 09:54:27

Where are all those Chinese buyers ??

Something tells me that Texas is not a “go too” place for the Chinese…Ibbots could likely tell us his observation…

Comment by Rental Watch
2015-11-18 10:00:23

I think the article was about Santa Rosa (CA).

Comment by Ben Jones
2015-11-18 11:18:09

Fear Spreads as China’s Finance Firms Face Arrests

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Comment by scdave
2015-11-18 15:30:30

article was about Santa Rosa (CA) ??

My Mistake…I thought it came out of a couple links Ben posted on Texas…

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Comment by Rental Watch
2015-11-18 09:58:29

I thought this was interesting data.

Yes, I know that Santa Rosa is not SF (it’s an hour+ north–on a good traffic day).

http://realestateconsulting.com/tech-buyers-only-a-small-portion-of-san-francisco-bay-area-cash-transactions/

Comment by Ben Jones
2015-11-18 11:22:15

Exactly 110 purchases by investors composed 34% of the activity and was split as follows:

3% to flippers. Flippers purchased 10 of the 323 homes.
7% investors to rent. 24 of the 323 transactions were completed by investors who intended to rent it out. This group included no international buyers and was all affluent domestic individuals.
24% investors to hold. Exactly 76 of the 323 all-cash transactions were completed by investors who intend to use the property as a second home

34% are speculators IMO.

Comment by Rental Watch
2015-11-19 01:01:17

Regardless of whether you consider a second home speculation or consumption, buying all-cash is markedly different than what was happening with Casey Serin.

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Comment by Mafia Blocks
2015-11-19 05:27:19

The problem with that notion is that 90 some percent of all sales is dumb borrowed money. Basically there are no cash buyers.

 
 
 
 
Comment by Bluto
2015-11-18 13:27:50

I live in Santa Rosa and AFAIK there are not many foreign speculators (Chinese or otherwise) buying RE north of the Golden Gate Bridge…YET. (Santa Rosa is 50 miles north of S.F)
However there were LOTS of domestic flippers and speculators in recent years to the point that is was dang near impossible to buy a 3/2 in a decent neighborhood if you did not have 100% cash (I learned this the hard way)
It looks like the flippers are scraping the very bottom of the barrel at this point…i.e. tiny houses within 100 ft. or so of U.S. 101 in sketchy neighborhoods and they are not selling.

http://www.realtor.com/realestateandhomes-detail/109-Ridgway-Ave_Santa-Rosa_CA_95401_M22163-24327?row=40

 
 
Comment by Senior Housing Analyst
2015-11-18 10:09:01

Davis, CA Housing Prices Crater 6% YoY

http://www.zillow.com/davis-ca-95616/home-values/

Comment by taxpayers
2015-11-18 13:12:25

so much of CA is above the 06 peak=weird

Comment by scdave
2015-11-18 15:32:41

so much of CA is above the 06 peak=weird ??

California is a big state….I am quite sure a small minority of Ca is above 06 peak…

 
Comment by Mafia Blocks
2015-11-18 16:23:39

Doesn’t much matter when there is no buyer at half the asking price. Remember…. housing demand in CA is at 30 year lows.

 
 
 
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