There’s Just No Frenzy Like There Was
The Herald Tribune reports from Florida. “Home sales tumbled again in Southwest Florida last month, but prices continued to climb. For the fourth time in five months, sales of existing single-family homes and condominiums declined over the year in Sarasota, Manatee and Charlotte counties, according to the Florida Realtors trade group. Charryl Youman, a Realtor with Berkshire Hathaway HomeServices Florida Realty in Venice, said sales perked up this month after potential sellers saw the price increases and finally decided to list. ‘As we got into March, we have seen daily price reductions for sellers trying to hook a buyer before they all went home,’ she said. ‘The result was more inventory and lower prices — and so, the buyers are back.’”
“New homes also have helped slow sales at certain price points, Youman said. ‘The only listings that seem to still be in a trance are the $300,000 to $600,000 homes,’ she said. ‘I am hearing from colleagues that these listings are not getting many showings, and not seeing offers.’”
The Orlando Sentinel. “Orlando home-sale prices have grown in the last year but not as much as price growth across the state, according to Florida Realtors. One real-estate trend seen in neighborhoods throughout Orlando and the state — increased for-sale signs. ‘The trends we’re seeing in closed sales and new listings have led to two straight months of rising inventory levels (active listings),’ said Brad O’Connor, chief economist for Florida Realtors.”
The Sun Sentinel. “South Florida home prices continue to climb, even as the housing market loses some of its sizzle. February is the unofficial start of the traditional spring and summer buying season, but sales were mixed last month. ‘Buyers are not in a hurry to buy,’ said Jerry Kopensky, an agent for Century 21 City Real Estate Corp. in South Florida. ‘There’s just no frenzy out there like there was.’”
The Palm Beach Post. “In the Northeast, an important feeder market for Florida, existing-home sales plummeted 17.1 percent to an annual rate of 630,000. That’s bad news for Florida, which depends on people living outside the state to sell their homes and move to the subtropical climes of Palm Beach County and the Treasure Coast. Only 1,146 single-family homes closed in February, a 5.1 percent decrease from a year ago, when 1,208 homes closed.”
“The multifamily market showed a sales slowdown, too. In February, there were 913 closed sales of townhouses and condos, down from 801 in January, and 972 during February this past year — a 6.1 percent decline. The peak in sales appeared to be this past April, when 1,452 sales closed. Since then, it’s been a slow decline, with the lowest dip coming in January, when only 801 sales closed. ‘You need to put things in perspective and look how far we’ve come over the last seven years,’ said Daniel Markow, market executive for Merrill Lynch Wealth Management for the Palm Beach market.”
The Naples Daily News. “Single-family home sales dropped by a larger percentage in the Naples area than anywhere else in the state last month. Existing single-family home closed sales were down 16.8 percent in February from the same month a year earlier, Florida Realtors said. Closed sales for the Naples-Immokalee-Marco Island metro area dropped to 297 from 357 the year before. It was the largest drop out of 22 metro areas the trade group tracks.”
“Elizabeth Mancini, managing broker of Premier Sotheby International Realty in Bonita Springs, said Canadian buyers, which are the biggest group of buyers in Southwest Florida, ‘are not buying, just selling.’”
The News Press. “While Lee County real estate prices continued their upward trajectory in February, sales took a nosedive, according to a report. City for city, every Lee locality saw a drop in home and condo sales led by Sanibel/Captiva, and median prices increased in all markets except Sanibel. Many sellers anticipate the season by putting property on the market early in January and February, asking higher than market prices, observes Jeff Miloff, managing broker for Miloff Aubuchon Realty Group. As the season winds down, their prices come down, too. ‘Buyers are aware of that behavior, and act accordingly,’ he said.”
From Miami Today. “With more ultra-luxury condo units than ever before coming to Brickell all at the same time, brokers specializing in the market are seeing the first signs of rents trending down as supply starts exceeding demand. This cycle is looking at 14 new towers, four of which are already complete, according to Nayla Benitez, vice president and managing broker for EWM Realty International’s Brickell office. Judging from these four, she said a lot of the buyers in this cycle weren’t intending to live in the condos, given that almost a third of these units have come back on the market as rentals and about 10% as re-sales.”
“‘Most units were bought by investors so we are going to see more coming back as re-sales or rentals as sellers realize they will have to hold the units for a longer period than expected if the goal was to flip them when they initially purchased them,’ Ms. Benitez said.”
“Ten additional condo towers are expected in Brickell between 2016 and 2018. These new, ultra-luxury condo units are being built with a high level of construction, aesthetics and amenities that Brickell has never seen before, Ms. Benitez said. That’s certainly going to be popular and make home-life more interesting and special for Brickell residents, Ms. Benitez said. It’s probably not as good for the investors who bought the units for a quick flip and might not find the profits they anticipated, or, at least, not as soon as they’d planned.”
“No one expected so many condo units would come to the market all at once, Ms. Benitez said. ‘By 2018, there will be more than Brickell has ever seen, and we believe the rents will go down, maybe not as low as in 2013, but will drop when there’s more inventory than demand.’”
“While Lee County real estate prices continued their upward trajectory in February, sales took a nosedive, according to a report.”
In a situation like this divergence is not a good thing. In aviation it’s called a “stall” which can lead to a “flat spin” which is usually fatal.
The divergence is old news. This should clarify things some.
US Housing Demand Plummets To 20 Year Low
http://1.bp.blogspot.com/-0q8fIAsczFk/VUANHEhSbnI/AAAAAAAAjRs/oANwXOUviGw/s1600/MBAApr292015.PNG
And it looks artificially propped up from 2010 on…
Yeah how bout it. Our corrupt gov in action.
“New homes also have helped slow sales at certain price points, Youman said. ‘The only listings that seem to still be in a trance are the $300,000 to $600,000 homes,’ she said. ‘I am hearing from colleagues that these listings are not getting many showings, and not seeing offers.’”
This is shocking considering all of the high paying jobs in South Florida not to mention the excellent credit scores of most Floridians. (s)
Heh heh. Laughed out loud at that one. How many people here have the “superfecta” of debts — home, student loan, car, and credit card? Then there’s a possible loan for a boat.
Gotta toss in some medical bills in there. Hehe.
The Orlando Sentinel. “Orlando home-sale prices have grown in the last year but not as much as price growth across the state, according to Florida Realtors
Zillow predicted +6% for Orlando
maybe not
Talking to a friend last night, he put in 3 full price offers on houses in Manassas VA last week and got outbid on them all. This is after getting outbid on 4 others a few weeks ago.
Are you sure?
Manassas, VA Housing Prices Crater 8% YoY
http://www.zillow.com/va-20109/home-values/
‘he put in 3 full price offers and got outbid on them all…after getting outbid on 4 others a few weeks ago’
That would take some time. Does he not have a job?
It is almost like buying a house is a full time job……
And fraught with fraud driven losses.
Has job but works evenings (college teacher.) Has realtor and was looking on weekends.
“Has realtor”
I’m sorry.
uh huh
Orlando, FL Housing Market Caves; Prices Plunge 5% YoY
http://www.movoto.com/orlando-fl/market-trends/
‘Canadian buyers, which are the biggest group of buyers in Southwest Florida, ‘are not buying, just selling’
‘Since then, it’s been a slow decline, with the lowest dip coming in January, when only 801 sales closed. ‘You need to put things in perspective and look how far we’ve come over the last seven years’
Well David, I’m sure the bag holders can take comfort in looking back across the seven years of your commissions for doing practically nothing. So just who is going to give these Canadians their big windfall?
Sometimes less than nothing. Hope they’ve been saving!
So just who is going to give these Canadians their big windfall?
You can start with the currency rates. Every 2013 dollar they invested in US housing returns $1.32 today.
They have to sell it first.
Years ago, and I mean 20 + years ago the saying in Florida was “You could buy a condo, you just can’t sell it.”
Everything comes back in style.
“As we got into March, we have seen daily price reductions for sellers trying to hook a buyer before they all went home,’ she said. ‘The result was more inventory and lower prices —”
Precisely what housing needs.
Remember….. a “housing recovery” is falling prices to dramatically lower and more affordable levels by definition.
‘Rodolfo Rodríguez believed he had made a good investment for his retirement when he bought a condo in Miami at a bargain price after the real estate crisis. The 74-year-old taxi driver fixed up the apartment he bought for $20,000 in August 2011 and rented it to a family for $800 a month.’
‘But there were hidden troubles at the Tropical Point condominium on Northwest 15th Street and 15th Avenue. Like many other Miami-Dade condominiums, its owners’ association faced grave financial problems in the wake of the crisis. Its funds were shrinking as some owners defaulted on their mortgages and stopped paying the monthly maintenance fees.’
‘Barely one month after her appointment, Ortega put a lien on Rodríguez’s unit for allegedly falling behind on payments of a special assessment to repair the elevator and fix up his apartment. The bill totaled $3,754, including late fees. Rodríguez said he had just finished paying about $500 on his debt for maintenance fees, and had no more money.’
“I got a real estate agent and decided to get out of there and sell, because the abuse was pretty clear, and those people had the backing of the court,” he said.’
‘He sold the apartment for about $32,000 in March 2012. But before he could receive the money, Ortega sent him another bill for $14,000, for lawyers’ fees and repairs to the building. If he did not pay, she could not remove the lien on the property.’
“I never understood how those people got there and in just two months I already owed them thousands of dollars,” said Rodríguez, who has driven a taxi for 20 years and used part of his savings to buy his apartment. “That was a nightmare and a headache. I tried to defend myself, but I was told that I needed to get a lawyer, go to court, and all of that costs money.”
Everybody wanting to make a quick buck or supplement their retirement income. There will be a lot more fleecing of buyers like Mr. Rodriguez.
“There will be a lot more fleecing of buyers like Mr. Rodriguez.”
Easy money. More is on its way.
Dumb ‘em down, and profit.
“I never understood how those people got there and in just two months I already owed them thousands of dollars,” said Rodríguez
Florida… a sunny place for shady people.
Condominium HOAs are inherently problematic. They’re typically led by people who have no management experience and even less exposure to Robert’s Rules of Order. The management companies they hire to take care of the properties usually run roughshod over the boards. And there’s little recourse for an individual homeowner if a board starts abusing its power, which it almost instinctually does.
In my experience as a condominium owner, I’ve found that you have to read all the CCRs and bylaws carefully and then go to the board meetings and watch them like a hawk. You also have to threaten legal action at the first sign of abuse.
My only purchase option this time around was a condo–and based on the HOA experience, I’ll never do it again. But it’s a big jump in price from an LA condo (250k) to an LA house (750k), so I’ll be here for a while or until the market cools, which it will.
I get that he’s not going to be able to drive a taxi for a living for very much longer, and that he was looking for a steady flow of money to replace his income, but boy did he get in over his head. Buyer beware.
Sarasota, FL Housing Market Implodes; Prices Crater 16% YoY As Market Floods With Inventory
http://www.movoto.com/sarasota-fl/market-trends/
‘For beleaguered buyers, there’s good news: Choice is coming back to the housing market. After months of tight supply, overall resale inventory rose 27 percent in February, to 5,577 homes from 4,406 homes a year earlier, according to the Naples Area Board of Realtors.’
‘The monthly report covers all of Collier County except Marco Island. “More inventory means more opportunity for buyers,” said NABOR president Rick Fioretti. “That’s a good thing.”
‘The influx of new supply slowed sales dramatically during the height of the buying season, partly due to the volatile stock market, the Canadian exchange rate and a shortage of inventory in the low end of the market, said Mike Hughes, vice president and general manager for Downing-Frye Realty.’
‘Worries about the outcome of the election, which could affect the future of capital gains, also may have spurred some sellers to put their homes on the market now, Fioretti said. Pending sales, or homes under contract, declined 22 percent in February, to 993 from 1,289 a year earlier.’
‘Closed sales were down 23 percent, to 518 from 672 — the lowest number since November 2013.’
‘The slowdown in sales is making more sellers willing to negotiate and to fix up their homes to stimulate sales, Fioretti said. It’s also inspiring new homebuilders to give real estate agents higher commissions for bringing in customers, he said. Buyers are getting more incentives too, ranging from money toward closing costs and upgrades to premiums for prime lots.’
‘Bill Coffey, broker manager of Amerivest Realty Naples, noted February saw the lowest number of closed sales since November 2013, and the highest inventory level in two years, “If we continue to see a dramatic increase in inventory each month like we did for February, then we may eventually see it affect median closed prices,” he said in a statement.’
‘Meanwhile, sales are slowing and inventory is rising on Marco Island, too, noted Gerry Rosenblum, broker associate with Berkshire Hathaway Home Services Florida Realty. Comparing February with the same month a year earlier, pending sales of single family homes dropped 36 percent, to 41 from 64, while condos fell 35 percent, to 55 from 85. Closed single-family sales decreased 13 percent, to 33 from 38, and condo sales were down 37 percent, to 36 from 57.’
‘Overall median home prices rose 7 percent in February from a year earlier, Rosenblum noted. But he also pointed out that out of a total of 1,138 listed properties, there were 295 price reductions during the month, including some sellers who reduced their prices more than once. Only 12 sellers raised their prices.’
“I think it is crystal clear that sellers understand the market is pushing back on asking prices,” he said in an email. “And the sellers are responding appropriately by lowering their prices.”
‘out of a total of 1,138 listed properties, there were 295 price reductions during the month, including some sellers who reduced their prices more than once…’If we continue to see a dramatic increase in inventory each month like we did for February, then we may eventually see it affect median closed prices’
By golly Bill you may be right. Median prices are a lagging statistic and considering price slashing is underway, it may mean lower prices are here and now!
The poorest state in the union:
‘$250K Per Year Salary Could Qualify For Subsidized Housing Under New Palo Alto Plan’
“We have people struggling to make it at a quarter-million dollars a year,” Bean said.’
The insanity is staggering.
I have a much better place than those little cottages and can live comfortably on $25K/yr. That includes all my expenses for the yacht. For all the California snow mockers, I did not have to pay the $20 for snow removal even once this year. Three times the year before.
Somehow I expect their government sponsored subsidized housing will only make it more expensive to live there.
“Some of the small two-bedroom, one-bath homes on her block are worth between $1.5 and $2 million – as teardowns. That’s just what the dirt is worth.”
That ain’t “dirt” fool… that’s soil.
Appraisal tomorrow afternoon
lolz
Rent free ^
And what a costly appraisal it will be.
Nothing beats buying right at the peak!
‘The peak in sales appeared to be this past April, when 1,452 sales closed. Since then, it’s been a slow decline, with the lowest dip coming in January, when only 801 sales closed’
I’ll give you a free appraisal.
You’re a great guy and it’s awful that you will be overpaying and taking on long term debt to do it. Just awful.
Let me know how it goes. I’m not going to jump on your case, because life has to go on. You win some, you lose some. And a lot of times, the decision is based on non-financial factors. If we wanted to stay in our neighborhood, and we did, we had to do it. But believe me, I know full well which institutions are responsible and I will never forget it. I wrote a few years ago that the bubble, and the response to it, has changed the way I view the federal government. And for somebody on the left to lose faith in government, you have to f___ up royally.
lol
“And a lot of times, the decision is based on non-financial factors.”
The wife gave me an offer I couldn’t refuse.
Commercial frenzy endzy too?
Oh bugger!
THE WALL STREET JOURNAL
Markets Property Report
Turning Point? U.S. Commercial-Property Sales Plunge in February
Data may signal the beginning of a more lasting pullback
By Peter Grant
March 22, 2016 5:30 a.m. ET
Sales of U.S. commercial real estate plummeted in February, sending the clearest signal yet that a six-year bull market might be coming to an end.
Just $25.1 billion worth of office buildings, stores, apartment complexes and other commercial property changed hands last month, compared with $47.3 billion in the same month a year earlier, according to deal tracker Real Capital Analytics Inc. In January, sales were $46.2 billion.
…
February 29, 2016
‘Something nasty and ugly is in store for the US commercial property markets. The spike in high yield MBS (mortgage backed securities) risk premia and the plunge in “asset light” hotel chain shares like Hilton and Marriott mean buyers can no longer finance asset purchases in an overheated market. This means US office, hotel and mall prices will fall in 2016 and loan delinquencies will rise, as credit risk continues to spike, especially in oil and gas centric states like Texas, Louisiana and North Dakota. The spillover from the high yield (junk bond) bloodbath and the drastic drop in Asian/Gulf sovereign wealth fund demand for trophy assets will only accelerate price declines. When China sneezes, the New York, LA, San Fran and Boston markets catch influenza. The magic of marginal demand curve shifts, my dear Watson.’
http://www.khaleejtimes.com/business/real-estate/the-coming-disaster-in-us-commercial-property
‘Mar 1, 2016′
‘The Commerce Department said construction spending increased 1.5 percent to $1.14 trillion, the highest level since October 2007, as both private and public outlays rose. That followed an upwardly revised 0.6 percent increase in December, previously reported as a 0.1 percent gain.’
http://www.reuters.com/article/us-usa-economy-idUSKCN0W34VU
The other day I read some discussion about are we at a 30 year high in apartment construction, or is it a 40 year high?
Oil extends losses after big stockbuild in U.S. crude
Dan? Dan? Bueller?
They are having a hard time finding places to ship the stuff.
ft dot com > Markets >
Commodities
Last updated: March 23, 2016 3:41 pm
US oil shipments ease despite end to export ban
Gregory Meyer in New York
Tanker Glut Signals 25% Slump In Freight Rates This Year…
Oil tankers are anchored near the Port of Long Beach, California, U.S., on Thursday, Dec. 31, 2009. A surplus of idled oil tankers, which would stretch 26 miles if lined up end to end, may signal a 25 percent slump in freight rates this year. The ships will unload 26 percent of the crude and oil products they are storing in six months, adding to vessel supply and pushing rates for supertankers down to an average of $30,000 a day, compared with $40,212 now.
Photographer: Tim Rue/Bloomberg
The US government abolished 40-year-old constraints on crude oil exports in December. But since then less US oil has been put on ships headed abroad.
Volumes of US crude exported by tanker have declined 5 per cent in 2016 to an average 325,000 barrels a day, according to Clipper Data, a market intelligence service. Waterborne exports were 342,000 b/d in the first three months of 2015.
The oil industry hailed the ability to freely trade US crude as the dawn of a new era in global energy. The data so far suggest a big net addition to supplies will be slow in coming, however.
The US was already sending hundreds of thousands of barrels per day to Canada before the broad export ban was lifted. The Canada trade has become less profitable this year and exports elsewhere have yet to make up the difference.
Abudi Zein, Clipper Data’s chief executive, said: “Lifting the export ban has firmly tied the US into the global market but the world wasn’t waiting for US crude.”
…
“apartment construction”
Around me there is a big hotel going up in every village, if not two. It’s got to be an hundred year high, based on the existing stock.
EB-5 money. They have to park their ill-gotten gains in high risk commercial real estate. Mixed use/malls/hotels. For $500k-$1m, the whole family gets green cards in 2 yrs. So, one big commercial adventure could mean a whole village of families entering on their newly minted green cards.
http://www.tampabay.com/news/business/realestate/tampa-bay-home-prices-continued-to-soar-in-february/2270172
it’s like announcements in Orwell’s 1984
‘City for city, every Lee locality saw a drop in home and condo sales led by Sanibel/Captiva, and median prices increased in all markets except Sanibel. Many sellers anticipate the season by putting property on the market early in January and February, asking higher than market prices, observes Jeff Miloff, managing broker for Miloff Aubuchon Realty Group. As the season winds down, their prices come down, too’
This was the hottest market in the US a few months ago.
The reality?
Tampa, FL Housing Prices Plummet 19%QoQ; Crater 11% Feb 2016 As Yearly Gain Evaporates
http://www.zillow.com/tampa-fl-33610/home-values/
Demand For New Housing Craters 6% YoY
http://www.zerohedge.com/news/2016-03-23/new-home-sales-plunge-most-june-2014
‘new, ultra-luxury condo units are being built with a high level of construction, aesthetics and amenities that Brickell has never seen before…That’s certainly going to be popular and make home-life more interesting and special for Brickell residents, Ms. Benitez said. It’s probably not as good for the investors who bought the units for a quick flip and might not find the profits they anticipated, or, at least, not as soon as they’d planned.’
‘No one expected so many condo units would come to the market all at once’
You should read about the goofy stuff they are putting in. Expensive stuff.
‘“In the last cycle, units were in lower price ranges and buildings like The Club had basic finishes,” she said. “But now we have over-the-top luxury and unusual amenities like the organic garden and first-level cycle gym at Brickell Heights.”
’she said a lot of the buyers in this cycle weren’t intending to live in the condos, given that almost a third of these units have come back on the market as rentals and about 10% as re-sales’
In some towers it’s 80-90%.
Strapped in at 3.875
The interest rate isn’t the part that should concern you; rather it’s the price, and what eventual interest rate normalization will do to it.
My savings account is only paying me 1.65%.
Japan’s Bond Market Is Close to Breaking Point
‘The market disruptions raise concerns that the BOJ is nearing the limits of its stimulus, even as Kuroda has said the central bank can do more. There are also questions over whether, if the central bank is forced to exit prematurely, the market can withstand the potential shock.’
“How can the BOJ head for the exit?” Dan Fuss, vice chairman of Loomis Sayles & Co., said at an event in Tokyo last week. “If they open the exit door, there’s a fire on the other side.”
“If they open the exit door, there’s a fire on the other side.”
Yup, zirp and nirp are here to stay, further distorting everything. And it’s going to wreak havoc on retirement plans, good luck living off your interest income or an annuity when you have to pay the bank to hold your cash.
The further out on the fragile persimmon branch the possum climbs the more likely the catastrophe. How can this situation be here to stay when it is increasingly unsustainable?
I think we would have already recovered from 2008 if they hadn’t kept pouring on the steam. “Recovered” wouldn’t look like a bubble.
If you think collapsing demand is here to stay, you’re in for the surprise of your life.
Where u gittin 1′65 ?
I’d kill for that
“Realtor Faces Seven Years For Fraud”
http://www.qgazette.com/news/2016-03-16/Features/Astoria_Realtor_Faces_Seven_Years_For_Fraud.html