A Market About Patience Or Price
Boston.com reports from Massachusetts. “If you are looking to buy a home in Cambridge, expect to struggle a bit. In a new Zillow study, Cambridge ranked as the number one sellers’ market in the Boston metro area, meaning homeowners are likely to get the price they want when they put their house on the market, and buyers are likely meet stiff competition and pay a steep price. Zillow looked at two metrics – the share of listings that have had to cut their asking prices, and the length of time homes stay on the market. Though inventory remains low around the state, places that ranked as more of a buyers’ market included: Hingham, Scituate, Plymouth, Wareham, and Marshfield.”
“‘In buyers’ markets homes are more likely to have a price cut and more likely to stay on market for a long time,’ said Zillow senior economist Aaron Terrazas. They also were further from Boston proper. ‘They tend to be out toward the Cape,’ Terrazas added.”
The Daily Chappaqua on New York. “With prices per square foot down some 20 percent for NYC’s top 100 condos since a year ago, unexpected tactics are still moving the needle at some Manhattan properties. ‘We have been very spoiled in the past few years with buildings selling out in the first few months,’ says Leonard Steinberg, president of Compass real estate-brokerage firm. ‘Now we have to get real. This is a market about patience or price.’ He that the frothiness really lies in the $10 million-and-up market. ‘Buyers at that level know there are options, and there isn’t really any urgency to close now,’ he explains.”
“‘Buyers asking for closing costs to be covered by the sponsor is sort of typical in this climate,’ says HFZ president Alicia Goldstein. Other firms have reported clients demanding concessions on mansion, title and transfer taxes — which can amount to 5 percent off the total sale price. Rather than asking for discounts or coming in with low-ball offers, ‘this is our customer’s way of saying, ‘We’d like a little something.’ says Goldstein. They just might get it.”
The Sun Sentinel in Florida. “Condominium sales sputtered in South Florida in January, and Craig Studnicky insists that was no abberation. ‘The market has slowed down a little bit,’ said Studnicky, principal of ISG World, an Aventura firm selling units across the region. ‘Nobody wants to admit that, but it has.’”
“Foreign buyers, the backbone of the Miami-Dade market, aren’t as active amid concerns about worldwide economies. Even some domestic buyers are spooked by large down-payment requirements and recent stock market woes. In Miami-Dade, builders have tempered project plans, cut prices and boosted incentives for real estate brokers as another condo glut looms there.”
“Another problem for Miami-Dade: Starting March 1, cash buyers of $1 million-plus properties in the county won’t be able to shield their identities. To combat money laundering in Miami-Dade and New York, federal authorities are temporarily requiring title insurers to reveal the actual owners behind holding companies that buy pricey properties. The names won’t be made public, but they will go into a law enforcement database. The order expires Aug. 27, though it could become permanent, some industry observers say.”
The Washington Post on Maryland. “The 3,800-square foot colonial formerly owned by Robyn and Juan Dixon — the divorced couple that acts like anything but on Bravo’s ‘Real Housewives of Potomac’ — just hit the open market after being foreclosed on in 2015. Juan and Robyn bought the three-bedroom Silver Spring home in 2002 for $725,000. Nearly 14 years later their dream house, located in the upscale Hampshire Green golf course community just outside the Beltway, is now on the market for $715,000. ‘It’s priced to sell,’ said our source in the local real estate community.”
“In the halcyon days of the housing market homes in the area — big, estate-style affairs made for entertaining and sitting on leafy one-acre lots — could sell in the million-dollar range. These days not so much. The Dixons’ financial trouble — they both filed for bankruptcy in 2013 — has been a central plot point on ‘Housewives,’ charting the couple’s joint climb out of bankruptcy. In a recent interview with OK Magazine, Robyn said she was ‘bank on track’ but not yet fully recovered. ‘It’s not perfect. It’s not where I want it,’ she said. ‘We are still dealing with repercussions from everything that’s happened to us.’”
The Reading Eagle in Pennsylvania. “There were 222 foreclosures in Berks County for the fourth quarter of 2015. According to figures released by the Berks County prothonotary’s office, that brought the yearly total to 1,067, the lowest since 2011 and a 12 percent drop from 2014. ‘While it is encouraging to see that the foreclosure trend is declining in Berks County,’ said Eva Eisenbrown, president of the Reading-Berks Association of Realtors, ‘it is still a factor. In January 2016 alone, we had 210 properties considered to be in foreclosure or pre-foreclosure.’”
“Eisenbrown said those numbers could keep Berks a buyers’ market for homes. ‘This is unfortunate for sellers, but an opportunity for buyers along with the forecast of continued low interest rates,’ Eisenbrown said.”
The Jamestown Sun in North Dakota. “Although the housing market is facing an excess in properties and increase in prices compared to last year, real estate agents in the Jamestown community remain hopeful the market will stabilize in spring. Beth Keller, president of Keller Appraisal Services in Jamestown, said after CHS announced the company wouldn’t be building a fertilizer plant in Jamestown in August, some community members, and some potential community members, no longer thought of Jamestown as a place to locate, contributing to the current number of availabile properties on the market. ‘It’s like an atomic bomb, we’re going to be scared for a while,’ she said. ‘I really think in May things will stable out again.’”
“Becky Thatcher-Keller, executive director for the Jamestown Area Chamber of Commerce, was a part of the South Central Dakota Regional Council in 2012 when the group conducted a nine-county study to determine where and if additional housing was needed in Jamestown. The study showed the Jamestown area was lacking available single-family units and multiple-family units, or townhouses, and identified a need for lower-price homes, Thatcher-Keller said.”
“Thatcher-Keller believes findings from the study are relevant today. ‘We have been able to build some housing, unfortunately it isn’t necessarily the type of housing that was needed and identified in that study,’ she said.”
“There were 222 foreclosures in Berks County for the fourth quarter of 2015. According to figures released by the Berks County prothonotary’s office, that brought the yearly total to 1,067, the lowest since 2011 and a 12 percent drop from 2014. ‘While it is encouraging to see that the foreclosure trend is declining in Berks County,’ said Eva Eisenbrown, president of the Reading-Berks Association of Realtors, ‘it is still a factor.
Reading, PA is one of the most depressing cities in a depressing corner of the state. Used to do a bit of work there and it struck me that they never got out of the depression. The Great depression that is…
Yet it’s doubtful housing demand has collapsed anywhere near like it has in California, OR, WA, NY and MA.
Have you checked?
can’t forget the very high crime rate today….
http://www.neighborhoodscout.com/pa/reading/crime/
“THE NEW CALIFORNIA CRIME WAVE”
http://www.frontpagemag.com/fpm/261977/new-california-crime-wave-john-perazzo
“Another problem for Miami-Dade: Starting March 1, cash buyers of $1 million-plus properties in the county won’t be able to shield their identities.
If only they did this nationwide….and why only $1,000,000 and up? You can hide lots of money by buying numerous $500,000 houses for cash.
this happened in NYC some luxury premium tax at $1mill, so watch out for the $999,900 listings to explode!
I know a man from China who purchased 27 houses in CA, all for less than $1,000,000. He had know interest in renting them until, but people kept finding him and asking to rent them. I know of 5 houses he had vacant in 2010, which are all rented today. He uses a corporate tax ID number so no one can connect him to the houses. $15,000,000 in value, free and clear.
I keep thinking about China melting down and if he needs the dollars to cover renminbi, tossing 27 houses on the Nor Cal housing market could contribute to a potential downdraft.
As an aside, I believe there should be a tax on vacant houses, escalating each month or year they are vacant.
$15million is imaginary given the fact that;
1) There is no buyer in sight at that price.
2) 27 houses can be built brand new, with profit for $3 million.
I wouldn’t call it a bargain at $17/sq ft considering he had to buy 60,000 sq ft of rapidly depreciating structures.
So truthfully, just how many are empty?
“‘Buyers asking for closing costs to be covered by the sponsor is sort of typical in this climate,’ says HFZ president Alicia Goldstein. Other firms have reported clients demanding concessions on mansion, title and transfer taxes — which can amount to 5 percent off the total sale price.”
So by absorbing these costs the sellers are effectively cutting the prices but are not officially cutting the prices. This is a nifty thing to do because:
1. Not officially cutting prices preserves the illusion that the price trend is strong and buyers of real estate want the price trend to be strong because buyers do not want to buy at the top.
2. Not officially cutting prices preserves the illusion that value of the equity of the comps is intact, equity that is produced by prices, the prices of the latest real estate sales. This makes a lot of people happy (including the tax assessor).
There are a lot of people who have an interest in high prices being maintained and few people against the idea.
This is a huge part of the game right now. Quoted selling prices do not come anywhere close to telling the whole story in many, many instances. Very well noted. Discounting that hurts the seller but has no effect on the tax man or the banker.
Buyers often negotiate cash back at closing, legally and it is on the contract, and this is not reflected on the recorded sale price either. Experienced this myself when selling my last place in early 2007, it was $10K IIRC, and I gladly agreed as thanks to the HBB and OTM blogs I was (correctly) convinced that the bubble pop was imminent.
debt-to-income ratio of is no more than 43%.
3% down
gots to be poor
attend counseling classes
=default city
‘‘In buyers’ markets homes are more likely to have a price cut and more likely to stay on market for a long time,’ said Zillow senior economist Aaron Terrazas. They also were further from Boston proper.’
He goes on to say the city is boom boom. Meanwhile, not far away:
‘At the very top of his newly constructed condo tower in SoHo, developer Kevin Maloney saw a problem: a triplex penthouse priced at $45 million that he knew wouldn’t sell in a Manhattan market where luxury deals are slowing. So he ripped up the floor plan and chopped the apartment with about 8,400 square feet (780 square meters) of space into two more-manageable units. Had the building, at 10 Sullivan St., not been almost complete, he would have carved the penthouse into three, he said.’
“We thought it was too expensive for the market and where the market was,” Maloney, principal and founder at Property Markets Group, said in an interview. “The air is very thin up there in that buyer pool.”
‘Manhattan’s luxury-condo boom, symbolized by record-setting price tags for extra-large and lavish penthouses, is idling while inventory swells and demand from global investors slackens. Four years after a duplex at Extell Development Co.’s One57 found a buyer for $100.5 million, Manhattan investors who want a trophy home in the sky have many to choose from. Chetrit Group has priced its planned 21,500-square-foot triplex atop the former Sony building at $150 million. Zeckendorf Development LLC is asking $130 million for a penthouse at 520 Park Ave. A Jean Nouvel-designed skyscraper next to the Museum of Modern Art has a duplex for more than $70 million spanning its upper floors.’
‘Those aren’t even reflected yet in listings on StreetEasy. The real estate website shows at least 13 other newly constructed penthouses for at least $20 million that are being officially offered for sale. All but two have spent more than 100 days on the market. Among them is a 7,000-square-foot penthouse at Toll Brothers Inc.’s 1110 Park Ave. with a $29.5 million price tag — a 16 percent cut since its listing in January 2015. At Aby Rosen’s 100 E. 53rd St., designed by Norman Foster, a four-bedroom penthouse was listed just last month for $65 million.’
‘The plan to split the penthouse is awaiting approval by the state attorney general’s office. The apartment was by far the priciest in the development, where the other condos — most of them in contract — range from $2.55 million to $10 million, according to StreetEasy. The price disparity between the penthouse and the rest of the building was conspicuous, Maloney said.’
“I don’t think that today’s $45 million buyer necessarily wants to live in a building where every other apartment sold for 25 percent of that price,” Maloney said. “You don’t want to be that guy that paid $45 million and everyone else paid 10. It’s a cultural thing.”
45, 65, 100 million dollar boxes of air all over the world. But there’s no bubble. Buncha dummies if you ask me.
Movoto appears broken
http://www.movoto.com/houston-tx/market-trends/
numbers make no sense
45, 65, 100 million dollar boxes of air all over the world. But there’s no bubble. Buncha dummies if you ask me ??
What it tells me is that for the very few, 45, 65, 100 million dollars is irrelevant….It just does not move the needle for them…And, it reeks of dirty money…At least some of it…
‘We have been able to build some housing, unfortunately it isn’t necessarily the type of housing that was needed’
Huh, kinda like the condos in Miami and New York. Or this past weekend topic with the high end houses and luxury apartments. Just think, kicking people out of apartments they can afford and then making them un-affordable. Sounds crazy when you think about it.
All this construction and remodeling for nothing. But that’s what happens when prices distort markets.
As if demand hadn’t collapsed already.
“Pending Home Sales Plunge Most In 2 Years”
http://www.zerohedge.com/news/2016-02-29/pending-home-sales-plunge-most-2-years-soaring-prices-blamed
‘The Federal Reserve will be acting in defiance of its most steadfast guidance if it doesn’t raise interest rates at its next meeting, according to RBC Capital Markets. “For all of the effort the Fed has put into communicating to markets that monetary policy decisions are data dependent, a no move at the March meeting (our base case) will prove the exact opposite,” wrote Chief U.S. Economist Tom Porcelli.’
‘The bigger-than-expected jump in January’s core PCE index to 1.7 percent over the previous year underscores the appropriateness of delivering another interest rate hike, according to Porcelli. The Federal Reserve’s preferred gauge of inflation is now running hotter than what the median policymaker projected it would be at by year’s end.’
‘Meanwhile, a jobless rate of 4.9 percent rests in the middle of the range of what the Federal Open Market Committee considers to be full employment.’
“Note that a Fed forecast for core PCE prices to hit 1.6 percent by the end of 2016 and for the unemployment rate to be at 4.7 percent was justification enough to usher in a baseline view of four rates hikes this year,” wrote Porcelli, referencing the projections monetary policymakers made in December. “Not only has the trajectory toward those explicit goals not changed, it has accelerated!”
“The personal consumption expenditure (PCE) measure is the component statistic for consumption in gross domestic product (GDP) collected by the United States Bureau of Economic Analysis (BEA). It consists of the actual and imputed expenditures of households and includes data pertaining to durable and non-durable goods and services. It is essentially a measure of goods and services targeted towards individuals and consumed by individuals.”
“The PCE price index (PCEPI), also referred to as the PCE deflator, PCE price deflator, or the Implicit Price Deflator for Personal Consumption Expenditures (IPD for PCE) by the BEA, and as the Chain-type Price Index for Personal Consumption Expenditures (CTPIPCE) by the Federal Open Market Committee (FOMC), is a United States-wide indicator of the average increase in prices for all domestic personal consumption. It is benchmarked to a base of 2009 = 100. Using a variety of data including U.S. Consumer Price Index and Producer Price Index prices, it is derived from the largest component of the GDP in the BEA’s National Income and Product Accounts, personal consumption expenditures.”
thanks Wiki.
That is quite the convoluted manipulated imputed “what stuff costs” index. I don’t believe at all that the Fed targets to this or the BS unemployment number.
In my narrow view prices of the things I buy are all flat or falling. Is anything going up besides the rent (and chocolate)?
I posted a quote back in December that touched on this. The guy mentioned Yellen talked about data dependent over and over, refusing to raise rates. Then raised it shortly after when the data hadn’t changed. I still have this funny feeling they are up to something. Setting up a new crisis on purpose? We’ll see.
There certainly seems to be a “seat of the pants” component to their decision making too.
Bend, OR Housing Market Caves; Prices Crater 16% YoY As Excess Inventory Balloons
http://www.zillow.com/bend-or-97701/home-values/
North Dakota oil bust shatters, shifts dreams of transplants
“We Are In A Recession”: Dallas Fed Respondents Admit The U.S. Economy Is In Freefall
http://www.zerohedge.com/news/2016-02-29/we-are-recession-acording-these-dallas-fed-respondents-us-economy-freefall
Boston is insane. Some asshat is going to pay $750K for this shitty flip on a 3100 SF lot in the Boston suburbs:
https://www.redfin.com/MA/Arlington/15-Elmore-St-02476/home/8458763
List Feb 2016: $749,900
Last sold Apr 2015: $500,000
Or maybe not. After all, this other shitty flip on a 7000 SF lot, just 10 minutes away, hasn’t sold:
https://www.redfin.com/MA/Arlington/27-Hancock-St-02474/home/8441208
List Jan 2016: $789,000
Reduced Feb 2016: $749,900
Last sold August 2015: $465,000
For a good laugh, pull the permits on this shitty flip. Developer put in a pretty kitchen and pretty baths, that’s about it. Floors look polished, and we all know how this pretty shit is so very important.
Anything from redfind is sketchy but irrespective of that, it looks like housing prices have a very long way to fall in Boston too.
How’s it sketchy if it’s public record, pulled from the registry of deeds?
it’s redfind
wtf is your point? make yourself clear, man.
Point is housing prices have a very long way to fall. In Boston too.
There must be gold buried on that 7,000 ft2 “oasis” of land.
‘For those interested in hearing some horror stories from ground zero of America’s recession, look no further than Texas, where the best recap of sentiment on the ground comes straight from the Dallas Fed respondents, who have not been this depressed since the Global Financial Crisis.’
‘Here are some key examples, starting with the one that summarizes it best: “We are in a recession. Oil prices are a symptom, not the cause.”
Said here months ago.
Liquidation cycle on deck:
1) Housing’s FOUR UNSTABLE PILLARS atop a sand foundation that drove house prices since 2011 at a greater pace than from 2003 to 2007;
2) Liquidation Cycle on Deck: Institutional/private buy-to-rent/flip & foreigner tailwinds turn headwinds in 2016
3) QE for the Homeowner’s…Getting directly to the pocketbook of the primary US consumer demo has never been easier now that the Gov’t owns or controls the mortgage market and most mortgages.
http://mhanson.com/2-16-hanson-qe-h-qe-for-the-homeowner/
How bout them falling housing prices.
Fort Lauderdale, FL Housing Prices Crater 30% YoY
http://www.movoto.com/fort-lauderdale-fl/market-trends/