Posted on 09/15/2010 10:39:26 AM PDT by fightinJAG
The trouble with many of the "indicators" we report is that some are pretty current and others are severely lagging. Home sales are generally the former and home prices the latter.
That's why, given the combination of the expiration of the home buyer tax credit and the increasing number of loans moving to final foreclosure, we knew that home prices overall would take a hit, but it would take a while.
Well we're here.
Two new reports out today prove the consequences of oversupply of organic inventory (12.5 months on existing homes in July according to the National Association of Realtors) and the shadow inventory of foreclosed properties (estimates vary widely and wildly). CoreLogic's Home Price Index shows home prices "flat" in July as transaction volume continues to decline. "This was the first time in five months that no year-over-year gains were reported," according to the release. In June, prices were up 2.4 percent year over year. In addition, "36 states experienced price declines in July, twice the number in May and the highest number since last November when prices nationally were still declining."
And there's the rub.
Prices have been recovering since last Fall, largely thanks to the artificial stimulus of the $8000/$6500 home buyer tax credit. But prices were also benefiting from a slight bump in confidence in the housing market, fed by an apparent drop in the foreclosure numbers. In reality, the foreclosure numbers were dropping only because banks and states were delaying the process, as they tried to cram as many borrowers as possible into what we now know is a largely unsuccessful government-backed mortgage modification program.
(Excerpt) Read more at cnbc.com ...
Yup , that stimulus is really working....tell us again Mr. Media
GEESH!
We subsidize those that had
NO BUSINESS BUYING A HOUSE TO BEGIN WITH.
Watch, we'll REPEAT the money throwing that just doesn't work. Obama will not be satisfied until he runs our economy totally in the ground.
Double dip....BS. How about zero as a value. Because of the new rules/regulations, I can not get financing for my dome home. That means I can’t refinance or sell because no one will lend on it. Thanks barry. (OK yea, someone could offer cash that will work.)
People who bought homes just a few months ago with minimal downpayments are already underwater on their mortgages. My husband and I have been waiting for almost two years for prices to bottom. I guess we’ll keep waiting for now. I’m not going to overpay for a home.
Out here in Wino Californicator Land, banks are being pushed to foreclose on the so called home owners who haven’t made a payment on their homes, valued from 500k to several million before the meltdown.
The only problem is there aren’t really any buyers for the high ticket homes. Homes that sold for 2 to 3 Million before the meltdown can’t bring in 800-900k even in auctions.
My wife and I have noted several homes in our area taking down their for sale signs because there is no market for their homes.
Out here in Wino Californicator Land, banks are being pushed to foreclose on the so called home owners who haven’t made a payment on their homes, valued from 500k to several million before the meltdown.
The only problem is there aren’t really any buyers for the high ticket homes. Homes that sold for 2 to 3 Million before the meltdown can’t bring in 800-900k even in auctions.
My wife and I have noted several homes in our area taking down their for sale signs because there is no market for their homes.
It’s been happening here in Central MA for a couple of months already.
And the second wave of flippers gets carried out on their shields....
We are in the market to buy so we are keeping a sharp eye on the market. It is going down fast. There are still some buyers looking for those great deals, so for those homes there is competition. Still, we are happy with what we are seeing. Prices were extremely overinflated to begin with.
Banks can keep foreclosures on their books at full value.
So they really don’t want to sell them and take the loss on their books even though the value on their books is just an illusion.
Growth or inflation are the only ways to save the housing market.
Builders here in Houston are selling them as cheap as they can without taking a check to closing. That tells me they’re as low as they’re gonna’ go in this market.
Just down the street from us are two developments with only 1/3 of the lots having homes on them and weeds growning on half the homes built that are unsold.
Both are touting "$100.00 Moves You In!" "Free Gas for One Year" "Mortgage Payments from $395.00 to $695.00/mo."
Next door neighbor, who was renting, just bought a house in another development that has a monthly mortgage payment that is 1/2 of what he was paying for monthly rent.
Growers have started replanting orange groves to get something from the land they can no longer afford to try and sell.
It’s after the builder goes bust that the real deals happen.
Do not discount the probability the pendulum will swing way beyond equilibrium as the market price crashes downward.
Erin Burnett is never going to have Diana Olick on again as a guest I believe. Olick IS SO RUDE!!!
They tried to catch the falling knife. Perhaps some of them were on this board (remember the "Now's the time to buy!" crowd?
$100 - 150,000 can buy a very nice new house in the Houston area if you don’t want extravagant finishes and stay under 2700 SF.
McMansions= McMassacre
Orange juice is good food!
The truth is that hardly anybody qualifies for lower rate bank mortgages today. You must have A +++ credit and lots of cash to throw down to make a deal.
A very wealthy woman I know was trying to buy a foreclosure through a major bank for cash. She was fit to tied by the greedy attitudes of the bankers. And she was buying the home for her brother who plans on retiring from his own banking career from Sacramento. Long and short of it is they paid $ 250,000 cash for a home in a nice area that needs a lot of work. By the time her brother moves into the house he will have over $ 300,000 invested.
But the family is rich and have lots of time on their hands. In 2011, the truth will finally begin to hit in Oregon. I believe prices will start to move lower rapidly and add more surprises to people trapped in their underwater homes in Portland.
In 2001, I was looking at a beautiful four bedroom house with a large landscaped yard and swimming pool in the village of West Linn. Asking price was only $ 164,000. People came in behind me and offered $ 20,000 cash over the asking price. Crooked realtors bid up the price to $ 200,000. Now I really anticipate prices will fall back to levels we were at in 2001 - 2002.
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