Another Housing Bottom This Year (Maybe)
invite response
2012 Jun 29, 5:53am 51,012 views 89 comments
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tclement
2012 Jun 30, 11:43am
APOCALYPSEDUCK is Shostakovich says
It is a great time to eat a realtor
Do I get 6% regardless of whether they eat you or you eat them?
MisdemeanorRebel
2012 Jun 30, 12:04pm
1.) "Joe {Last Name}, a real estate agent in the Minneapolis suburb of Eden Prairie, said he recently concluded a streak of 13 consecutive bidding wars over homes that his clients wanted to buy. Each sold above the asking price."
-- I just don't buy these stories and every time there is an opportunity to search for the sales record I can't find it.
Earlier today, I driving and listening to an AM "Financial" show, they were interviewing a Space Coast (FL) Realwhore who made the same "Getting multiple bids" BS.
She also trotted out the "3 months of increasing sales" (which we've seen before nationally and in many locales, only to reverse again) BS and the "You'll regret not buying when blood is in the streets."
The blood in the streets will begin when the Boomers who DO still have jobs go to sell their 3-4 bed/2 baths in the burbs to fund their retirement - and realize there are no buyers, and the $300-500k they planned on for it ain't comin'.
SJ
2012 Jun 30, 12:45pm
Well these days with unstable employment, buying real estate is way too risky especially in overpriced bay area. I am waiting few more years, saving and will find job where I can work remote and move to south Florida.
evilmonkeyboy
2012 Jun 30, 1:08pm
I mean, they claim it's a good investment. Can you imagine a stock broker saying:
"It's a great time to buy or sell AT&T".
Well if you don't buy now you will be priced out and if you don't sell now no one will buy your home later because they will be priced out.... do the math.
David9
2012 Jun 30, 1:32pm
no buyers
Right. I'm not comfortable buying unless I know I have a reasonable chance of selling it, 1.) Period, just being able too. 2.) Near the price I paid for it.
Here in Sonoma County the low end is on fire. Winning bids are all cash or at least 50% down. 18 offers in one case, many go for above the appraised value. This is the $250k-$400k range. There is more or less normal activity up to $650k where it drops off dramatically. There is very low inventory except in the $1MM-$2MM range, where there is a glut. I suspect we are seeing people buy who are trying to preserve capital instead of chasing yield.
Stop calling people Liars unless you are actively looking to purchase a home.
You really don't understand pricing until it's your money your plunking down for a house. For example, I need a three-four bedroom home with two living spaces a large backyard in a relatively safe area (if you can call Oakland Safe). Six months ago I could have found a house having 2,000-2,500sf. well within my price range. Now I am looking at paying over $100,000 MORE for a 1,200-1,650sf house with a smaller yard. I am also being out bid on the nicer homes for sale. This is a FACT. You don't know Jack diddly until you actually look.
This market is absolutely being manipulated.
The Banks are hording their supply of foreclosed houses.
Foreign Investors are buying up houses in the US.
American's with money are buying houses for rentals.
Investment firms are buying foreclosures in bulk.
And now I'm noticing articles popping up about the poor home owner who needs a mortgage reduction.
Rents will continue to rise, underwater home owners will be bailed out, investor will dominate in the housing market (they already do), Banks will
release one house at a time (same as burning all the empty houses ~Greenspan~) average people will continue to pay exorbitant prices for a basic necessity of life.
I agree.
I called a very well known bank where I keep money and asked if they had foreclosures or REO's and had to fight like crazy to get someone on the phone. Finally, after days on end, someone called back.
I knew prices in S. Florida had plummeted and were still going down, but after talking a while to the lady from the bank, she was got really irritated when I told her the prices she quoted over the phone were the same or higher than in R.E. offices around town.
In other words, they didn't want to budge even for one of their bank customers who was ready to plunk down a lot of cash on a home. Maybe they'll always be banksters and our country is getting fatter, dumber and sicker (health-wise and many other ways). In housing, we're playing an "adult" version of musical chairs and the media is calling the shots by confusing everyone.
Yep, America the brave. Lock up your houses, your cars, the bathrooms (yeah, remember when you didn't need a key to get into a bathroom?) and everything else. Don't let your kids play outside and watch them 24/7. Are we really still a free country or simply a country being manipulated so well that we think we're free....
REpro
2012 Jul 1, 12:27am
Another Bank backed investment firm entering market:
Job Title
Acquisition Analyst
Job Summary
Leading, well-capitalized, national single-family buy and hold firm seeking an Acquisition Analyst for its Southern California office. We specialize in acquiring single-family assets with a long-term buy and hold strategy.
-- I just don't buy these stories and every time there is an opportunity to search for the sales record I can't find it.
How about this...
I bought my house about a year ago...for $XX - on my street there were two identical homes for sale, same sqft, same lot, similar floorplan in similar shape...they sold within 1 month for $XX + 10% more than we paid for ours. Obviously, interest rates are more than 1 point lower now, but...no landslide crash going on here.
Look guys, we were right in 2007, 2008, 2009...maybe 2010...but any crash has an end to it, just like every bubble has an end. It goes both ways and housing is friggin' cheap as of now. Does that mean there isn't an overpriced home out there? No. Does it mean you can find a decent home for what you pay in rent for it? YES.
dunnross
2012 Jul 1, 3:32am
Look guys, we were right in 2007, 2008, 2009...maybe 2010...but any crash has an end to it, just like every bubble has an end. It goes both ways and housing is friggin' cheap as of now.
There is absolutely no difference between now and 2008. The same sheeple fools who bought at the peak, in 2005-2006, foreclosed, and are now back in the market buying, using FHA loans, margined to the gills. Anybody who proposes that this time is any different, is either joining the ranks of these sheeple fools or is a realtard.
How can they buy if their home was foreclosed on in 2006 -- it takes a long time for their credit to be restored after a foreclosure.
dunnross
2012 Jul 1, 5:06am
How can they buy if their home was foreclosed on in 2006 -- it takes a long time for their credit to be restored after a foreclosure.
I know people who got back into the market after 3 years. Some couples even get a "fake" divorce, just to get back into this giant Ponzi scheme.
There is absolutely no difference between now and 2008
If you call prices being 30-60% less no difference then yes, no difference...
dunnross
2012 Jul 1, 5:21am
If you call prices being 30-60% less no difference then yes, no difference...
Although the prices are less, the attitude is exactly the same as it was at the height of the boom. It's amazing that after 5 years since the crash, people have already forgotten the crash, most still think that RE is a good investment, trust realtors, and ready to plunge into this market, head first, when realtors tell them that both prices and interest rates will not stay this low for long. Just, this fact, alone, is enough to keep any intelligent person out of the market.
Dunnross addressed the people but not the other factors effecting home prices. I would also like to to when she thinks prices will fall to affordable levels.
dunnross
2012 Jul 1, 7:52am
I would also like to to when she thinks prices will fall to affordable levels.
As I pointed out on numerous occasions, before, prices need to be "ridiculously cheap", and not, just "affordable", before a bottom can be declared. There is no way we could have a mega-bubble like the one we had in 2006, end up with prices just being "affordable". Right now, Phoenix is "affordable", but it's not "ridiculously cheap". Bay Area is not even "affordable", so it has a very very long time to go, before, the bottom is in. In 2006, at the height of a market, almost anyone with a pulse could "afford" to buy, because of lax lending standards. This could happen again, but, this time, it will be because of low prices. In 2006 the sheeple bought, but they couldn't hold on to the house. When the bottom is finally in, the sheeple will be able to buy, once again, but they will be too scared.
PockyClipsNow
2012 Jul 1, 7:52am
The pension funds, hedgies, and big time investors are buying up SFR's left and right. This with 2.5% mortgage rates (on a 5/1 ARM) and foreclosures taking 3 years and loan mods and principal reductions everywhere makes this year look like the nominal bottom to me.
If you are still renting waiting for bottom you should be really concerned. Intrest rates are only going lower and lower and lower.
dunnross
2012 Jul 1, 7:57am
Intrest rates are only going lower and lower and lower.
Interest rates are going lower, not because we have a great economy. Interest rates are going lower, because Americans are hooked on credit, and this economy will completely collapse if interest rates were to go higher. This is why we are in a "Depression" for a long time to come, unemployment will only be rising, and there will be no floor to how low house prices will drop, in spite of the low interest rates.
Why all the name calling? This is a serious discussion - name calling detracts from the discussion.
tatupu70
2012 Jul 2, 3:28am
True internet duckshit. Dunross's overall big picture assertion is correct, all you can do is harp on "completely". The reason your question gets no answer is because it doesn't deserve any.
So what is the magical debt as % of income number when the US is "recovered"? 90% 91%, 95%? Does it change based on the interest rates?
And why?
"I think a recovery can do just fine with current debt levels,"
We have to remember to revisit this one for a good belly laugh in the the future.
Virtually all past declines have had mini rallies along the way down, this is just that, a mini rally. The eventual trend is downward because some of the key fundamental problems - unemployment, foreclosures, private market financing etc. remain unresolved.
"I think a recovery can do just fine with current debt levels,"
We have to remember to revisit this one for a good belly laugh in the the future.
Good idea. Let's check back in 1,2,3 years...let me make a prediction...no one of you permabears is ever going to admit that a recovery is taking place. You'll keep going the ..."the worst is still to happen" route...
If you make claims like no recovery at current debt levels then show some data to back it up. Anybody can make wild claims. Doesn't mean they are right.
Goran_K
2012 Jul 2, 5:58am
no one of you permabears is ever going to admit that a recovery is taking place.
SubOink, what is driving this recovery? Is it employment? Are wages rising?
Good idea. Let's check back in 1,2,3 years...let me make a prediction...no one of you permabears is ever going to admit that a recovery is taking place. You'll keep going the ..."the worst is still to happen" route...
If you make claims like no recovery at current debt levels then show some data to back it up. Anybody can make wild claims. Doesn't mean they are right.
1 out of 50 residence in the CA is a licensed realtor. Factor in mortgage brokers and others tied to the housing industry, there is alot of self interest in their version of a "twisted recovery". Any other industry does not matter.
We come down to selling over priced shacks as the biggest industry in the state. This is not sustainable! Getting off this RE mania is like getting off a cocaine epidemic. But you should already know this.. your in LA.
tatupu70
2012 Jul 2, 6:44am
that is the whole argument behind the libs.. buy a home, Govt will help, and the poor will grow wealthy with RE. That is why Glass Stegall was repealed during Clintons era, why Clinton pressured Fannie mae to take on greater risk... why Waters, Franks and Dodds all denied a bubble existed.
Wow--you can't make this shit up.
Oh wait--you just did.
Goran_K
2012 Jul 2, 3:11pm
no one of you permabears is ever going to admit that a recovery is taking place.
SubOink, what is driving this recovery? Is it employment? Are wages rising?
Anyone know what is driving this so-called "recovery"? I think SubOink has not-so-gracefully bowed out of answering that question.
Some even argue that no true long lasting recovery occurred until U.S industry was mobilized for World War II.
Or more over the economy didnt recovered until after 1945, since we were the only standing economy rebuilding the European and Asian economies from our own factories. So 1933 was rather meaningless, and during the WAR we didnt have an economy since all means of labor and production were converted to fight the war. We simply produced as much bombs, fighters, bombs, tanks, ships until end of war.. no demand and supply curve need apply here.
The situation in the USA is not "worse" than the Depression in some ways, and in some ways it IS worse.
Also, the situation regarding house prices in the USA has to do with other factors, such as growth in the economy and demographics, and population growth and aging.
Without wage growth and without GDP growth over 2%, there can not be rising prices for houses.
bmwman91
2012 Jul 2, 8:06pm
Without wage growth and without GDP growth over 2%, there can not be rising prices for houses.
Sure there can. All it takes is various low/no-down government loan programs and a large number of people that do not think about the ramifications of borrowing large sums of money. Virtually all of the economic growth we saw in the 2000's was illusory, stemming from massive infusions of reckless debt and leveraging.
Maybe what you meant to say was that SUSTAINABLE house price increases require solid fundamentals. Very little about our economy is sustainable, but we are so dependent on it that we seem unlikely to do anything other than find new ways to spend more money that we don't have, collectively, until something breaks beyond the financial engineers' control. Sure, consumers are deleveraging right now, which is good, but the government and its private backers are doing everything they can to goad people into borrowing again.
Just because so many of us on here WANT a reasonable system by which to buy a house does not mean that we will get it (even something as simple as an all-encompassing requirement for 30% down payments on all mortgages, leaving all the tax breaks and Prop 13 as they are now). It is far more profitable to far more powerful people and entities to have it be like it is now: nonsensical.
bmwman91
2012 Jul 2, 8:19pm
Oh Apocalypse, you are like the reincarnation of Hunter S Thompson. I LOVE it. I am going to go ahead and tell myself that Matt Taibbi has found and frequents Patrick.net, posting as APOCALYPSEFUCK.
tatupu70
2012 Jul 3, 1:04am
I know you roll in dough, but the prices are still far out of reach of dual income middle class people
Maybe in very specific local markets, but not in the majority of the US>
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http://www.nytimes.com/2012/06/28/business/economy/new-indications-housing-recovery-is-under-way.html?_r=1&hpw
Okay, this is my first posted Real Estate Discussion, please feel free to tear apart at will. I expect nothing less.
Articles like this irritate me, so I thought I would take quotes from the article and write my housing bear thoughts, which the article did evoke.
1.) "Joe {Last Name}, a real estate agent in the Minneapolis suburb of Eden Prairie, said he recently concluded a streak of 13 consecutive bidding wars over homes that his clients wanted to buy. Each sold above the asking price."
-- I just don't buy these stories and every time there is an opportunity to search for the sales record I can't find it.
2.) "Millions of people remain underwater" & "Millions of families still face forclosure"
-- So how in the hell is there a housing recovery and / or bottom?
3.) "Our sense is that the market is recovering"
-- Well, isn't that reassuring. Data? A thread of evidence?
4.) "The trend is clear in the data. The widely respected S.&P./Case-Shiller index reported earlier this week that sales prices for existing homes rose in April for the first time this year." & "Indeed, in a growing number of areas demand for homes is outstripping supply."
-- Yes, that is true. There is no inventory. Why? Please refer to # 2
5.) "This is the fourth consecutive year that the housing market has shown signs of revival, and each previous episode ended with prices renewing their downward slide."
-- And this year is different because?
6.) "Government efforts to help homeowners have intensified, allowing more borrowers to refinance or avoid foreclosure."
-- Yes.
7.) "The influx of investors is a major reason that the market is looking stronger"
-- Really? Ok, in what way? True, Wall Street is a cash cow for a few.
8.) "And the rise in prices is happening despite the vast number of vacant houses awaiting buyers, up to two million more than the normal level, with several million more houses still at risk of being foreclosed."
-- Again, this indicates a recovery?
9.) "There are still reasons for caution."
-- Agreed.
#housing