Home Sales Fall in 38 States, Data Shows

Yahoo! Finance ^ | November 20, 2006 | Lauren Villagran

[RockinRight]

Heck, some of the apps I see I'm happy if they have a JOB.

;-)

[Always Right]

Well California does have a few other assets I can think of...

[John Lenin]

When foreclosures go up like they are doing now in great numbers the easy finacing dries up also. 20% will be the minimum downpayment especially in a falling market.

[brownsfan]

"I get as sick of snow and cold weather as the next guy, ..."

I'm a little odd I guess. To me the first snow is magical. A hike in the woods on a snowy day is as peaceful as it gets. And a white Christmas is extrordinary. I will admit, in late Febuary, I start getting tired of it, but by then, we're getting on to the end of winter.
I love it here.
Oh, and how could I forget, we have the Buckeyes!

[Lakeshark]

It's called supply and demand.........

When the demand shrinks, the price will go back down.

[RockinRight]

The Bucks! Best thing about Ohio!

I like the first snow too.

What does bother me is when we don't get snow all winter and then in SPRING when it's SUPPOSED to be warm...it won't stop snowing!

[GOPJ]

Our local paper did a story on this last Sunday - housing prices are down from a few months ago, but they're still UP from a year ago. So, Florida's doing just fine. Why trumpet only the bad - the whole truth is more interesting.

[bonfire]

Just be nice to see the sun once a week. This grey is depressing!

[brownsfan]

"What does bother me is when we don't get snow all winter and then in SPRING when it's SUPPOSED to be warm...it won't stop snowing!"

I'm with you there, but no place is perfect. :)

[Always Right]

When foreclosures go up like they are doing now in great numbers the easy finacing dries up also.

You know why foreclosures are up??? Because we are coming off a period of historic lows in foreclosures! Home prices have appreciated so much in recent years, no one was foreclosing. We had the lowest foreclosure rates ever. Yes they have increase, but they are still well below the historical average.

[Lakeshark]

Gosh, can I still get one of those if the market crashes?

[Larry Lucido]

So where is everybody living, in refrigerator boxes?

Oh, wait, guess it just means they aren't moving. They still have a house.

[Eva]

The article in a paper that I read over the week-end said that although there were fewer sales that prices had not dropped. A lower median sales price does not indicate falling prices. It simple means that the difference between the lowest and the highest prices was slightly lower. It's basicly a meaningless statistic.

By the way, for anyone who doesn't already already know, stay away from PNC. They're really bad news.

[John Lenin]

In 2005 some ridiculous percentage of homes were bought with ARM's and interest only loans. You ain't seen nothing yet, those loans will have to be refinanced in the next couple of years and with prices falling there are going to be millions upside down on their mortgage.I saw it happen here in So Cal in the mid 90's. People just walked away from the homes and took a beating.

[raybbr]

Yeah, he probably only gained $3 million on his sale instead of $3.5 million. Without more info, that is kind of meaningless. I hear all these stories, but then when you dig into the facts, it is usually not a story of people actually losing money, just not cashing in as much as they would like. Oh there are people who lose, but mostly they are in an unfortunate situation like they lost their job and are forced to sell or foreclose.

Unless you are talking about total wealth which many around here like to spout about. If your total wealth drops that much it affects the total wealth of the American people.

I don't subscribe to home equity as a measure of wealt since it's so fluid.

[Labyrinthos]

Even with 20% down the loss is 6%. What I really find laughable is the argument that prices are way up over the last few years and so if you sell your house now you will still make a big profit, just not as big as you would have made if you had sold a year ago. The problem with that argument is that it fails to consider (a) the number of homeowners who brought a year ago at the peak of the market (there were obviously a lot of buyers because the demand is what pushed prices to record levels in the first place); (b)the number of homeowners who have sucked the equity out of their houses as values+ have skyrocketed to pay for college tuition, big screen TV's, new cars, and other luxories they could not afford if they had to pay for them out of current income, and as a result, their house is worth less than what they owe even though it has doubled in price since they brought it; and (c) the aggregate impact on the housing industry when houses are not selling (this has less to do with price than it does with volume). With regard to the last point, if sales volume is off (as opposed to price), that means mortgage bankers, real estate brokers, title insurance closers, and others in the real estate bsuiness who work for commissions, are not making as much and therefore they have less to spend back in the economy. It means that states and localities who charge transfer taxes and other fees tied to real estate sales aren't raking in as much and therefore, they will have to tax the rest of us to make up the shortfall (God forbid they cut spending), which means we will have less money to spend in the economy. People who buy new houses often buy new furniture. If houses are not selling, then people aren't buying as much furniture, which affects not only the people who sell furniture (the sales people work on commission), but the people who make furniture.

The other point that is often overlooked is the inability to stop loss in the real estate markets as opposed to the equity markets. If I want to limit my losses in the equity markets, then all I have to do is sell my mutual fund or place a sell order that kicks in when the stock drops to a certain price, and there will nearly always be a buyer on a moments notice. If I want to sell my house to cash out my equity, I will need to find a buyer, and that could take months and months or even years if I am unwilling to lower the price.

[GYPSY286]

How's this for a laugh. Bought a small house after my divorce (credit was ok, not wonderful). Took an ARM. Refinanced at better rate in 2004, wasn't taking any cash, got laid off two weeks before closing. Bank wouldn't close cause I was unemployed. Took 10 months to find a job - at $14K less salary. Payments going up, got behind on payments, got a 2nd mortgage to catch up. Holding on by the skin of my teeth. Trying to up my credit rating but will take awhile. Need to either win the lotto or find me a rich hubby, lol. Meantime, there's 14+ sale signs in my plan of 6 blocks.

[Always Right]

The article in a paper that I read over the week-end said that although there were fewer sales that prices had not dropped. A lower median sales price does not indicate falling prices. It simple means that the difference between the lowest and the highest prices was slightly lower. It's basicly a meaningless statistic.

Median price is the price where half the homes sold for more and half of the homes that sold went for less. It is probably the best statistic to tell you were the market is going.

[NY.SS-Bar9]

I am a little surprised that no one has made the observation that homes are not what they were 10 - 20 years ago, making comparisons meaningless.

Houses now tend to be bigger and have more luxury features than in the past.

A typical house 20 years ago was probably a plain, 1700 sqft box on a 50' x 100' lot.

Today, new houses start at 3,500 sqft. The older houses have had additions, new kitchens and baths.

IMO a substantial percentage of the increase in house prices can be traced to "home improvement".

[Labyrinthos]

It also means ther person who bought their house two years ago, saw a 16% rise followed by a 1.2% decline made 292% on his or her investment.<

Not really when you factor out two years of interest on 95% financing, real estate taxes, insurance, and the real estate commission if you have to sell.