Posted on 11/29/2005 7:03:30 AM PST by SoFloFreeper
WASHINGTON (AP) -- The Commerce Department reports that sales of new homes surged to a record annual rate of 1.42 million units in October.
Surging new home sales are more indicative of a bubble than not. What you're witnessing is a "blow-off top". Mortgage rates are rising and anyone on the fence is deciding to jump in now before they're priced out.
Whether or not there's a "bubble" is debatable, but in some real estate markets, it's pretty clear that prices have gotten way out of hand (e.g. San Diego)
It's not just the liberal media to blame.
Would you take gardening advice from your dentist?
Would you take engineering advice from a taxi driver?
Would you take stock market advice from your real estate broker?
Probably not.
Why then do we take as gospel real estate advice from stock and bond peddlers?
Stock and bond people are the ones behind the bad-mouthing of the real estate boom. Stock and bond peddlers compete /against/ real estate brokers for your money. Since the dot com bust, real estate has soared and the stock market is about as exciting as watching a parked subaru for years on end.
If you want stock and bond advice, go to one of their peddlers. If you want to know what's going on in the real estate market, talk to your broker. My broker is busy as hell with potential buyers and complains about a lack of inventory (sellers) under $500k.
One last bit of advice: Though I love Fox News, when it comes to real estate, don't believe a word out of Neil Cavuto's mouth.
"bubble burst" Ditto. But what I really hate are all the doomists on this forum who perpetually wring their hands and predict DISASTER!!! ...even when good economic news comes out. For these people it's never a case of maybe we'll have a slight dip or decline. Oh no, we're headed for DISASTER!!!THE SKY IS FALLING!!!! I guess for some people being constant pessimists satisfies a large inner yearning to be eternally miserable.
The time frame is 18-24 months for the housing bubble to pop. I'm patient and will stick by my prediction until they repeal the laws of market economics.
Tiny bubbles....
Yep - they were gloating about a decrease in used home sales, now we find that new home sales are on the rise - still...
Wow!
Houses down here have really appreciated, it still amazes me when I see what a house has sold for. I imagine your area's seen even more appreciation.
I told my husband we could never afford to change houses because the "new" house taxes after the property was reassessed would be more than our mortgage ever had been. Under "save our homes" we do really well because we've owned the same house for 17 years.
Alan Greenspan is deeply saddened..........
I am unable to afford a house in South Florida at this time, I may have to move to another state. I have been sorta hoping for a bubble "burst", not a full burst, just a tempering of pricing. Prices down here are insane, really, I think we will make California pricing look decent.
Judging from the DC area market, a good reason they "soared" was the new incentives and lower prices. Everything on the market now has free upgrades, help with closing costs, and yes, priced about 10% lower than they were last spring.
I assume that’s viewed a bad news, but it also implies future shortfalls in supply as homes scheduled to sell next year are already sold. And prices generally held even through the accelerated dumping.
Generals always fight the last war. Same goes for investors and reporters. Market crashes were predicted for 20 years until no one believed them, and the tech bubble resulted. Now real estate is rising, and the same group is referencing the tech bubble model to predict the future. Because so many people are predicting a housing bubble burst, there will not be one. Excess air is being let out every day. The market is managing it.
My brother visited from Orlando over Thanksgiving. He is planning to make the move to Norman, OK, within the next few years and cannot believe how much cheaper house prices are here in Norman. His house has more than doubled in a short period of time in Orlando. He could pay cash for the same type house here and have probably $100,000 or more left over.
Good advice!
NPIDS
Would you agree that any housing bubble will only be regional in nature?
LOL! He's the first one I thought of when I read the headline.
I would agree that we will see differing severity, with the least impact on high-demand urban/suburban areas. But excepting Manhattan and downtown San Francisco, I don't think anyone will be unaffected.
Yes but the degree of "affectivness" on some will scarely be felt
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