Not a good idea.
Still waiting for a bottom?
By iwog Follow Wed, 2 May 2012, 6:37am 20,345 views 261 comments
In Lafayette CA 94549
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Pleasanton, CA
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Skip skip skip, drop, skip skip skip, drop... Repeat.
Very funny the gap between listing and selling prices. :) I thought all the bidding wars were going on? Oh, you mean "underbidding wars". Ahh, now I get it.
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San Jose, CA
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Iwog,
So what? The shadow inventory is huge. It is estimated somewhere between 1.6M to 10.3M. I know, I know. The estimated shadow inventory range is huge. It's an educated guess. Nobody knows for sure.
What about all of the baby boomers? They will sell their homes someday right? Who's going to buy their homes?
But, but, but unemployment is still high. Who can afford all those homes making 10 bucks an hour?
And you mean to tell me that listing price is a leading indicator, and sold price will follow about 3 months later?
You know what? You're full of it. I'm going back to sleep. Wake me up when the housing crash is over. :)
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What wants to attempt this metric?
Measure the proportion of lis pedens properties that have gone to foreclosure petition within 48 months.
I bet it something like 1 in 9.
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47 male
Lafayette, CA
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RentingForHalfTheCost says
Of course there's a gap between listing and selling prices. That's the time it takes to list a home, sign a contract, and close escrow. Generally the gap is 2-3 months.
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Eman hits it right. Who exactly stays where they want to retire? How can everyone downsize?
This year they said it hit bottom
same as last year
same as the year before
same as the year before.
Confidence can be established in other metrics. How many stores is home depot opening? How is Weyerhaeuser doing?
It's almost like watching stocks not by daily volume but by option activity.
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Boulder Creek, CA
E-man says
I agree.
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Boulder Creek, CA
iwog says
You realize the last time you posted this, we waited a year and proved that it didn't come to fruition right? Oh, you probably don't remember that.
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San Diego, CA
iwog says
What's not a good idea? Are you implying that prices are about to take off and those on the sidelines are going to miss it? Even if new lows don't come the bubble's not coming back any time soon, especially not for California.
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Lafayette, CA
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CrazyMan says
You're wrong. Prices rose and then fell back again. I was disputing the assertion (as I am now) that the market is continuing to crash.
Until today every single long term statement I've ever made about this real estate market is that it is FLAT. Every single short term statement I've made regarding this market is that it tends to rise in the spring and fall going into winter.
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Lafayette, CA
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mdovell says
The bottom was in 2009.
Yes I know Case-Shiller says prices have drifted lower since then, but the homes selling in 2012 are not the homes selling in 2009. I bought my last Concord house for $150,000 in March, 2012. It's a wreck that is currently being renovated and will require a minimum of $50,000 to bring it back to decent condition. (and add a bathroom) It's smaller and might bring in $1750 if I'm lucky.
Now here's the house I bought in 2009. 4br, 2ba for $208,000 and rented for $1900 the day I bought it. It would get an easy $2000 per month if I rented it today:
http://www.redfin.com/CA/Concord/1159-Carey-Dr-94520/home/745899
If you're only looking at the raw numbers, you're missing a huge part of the real estate market. I'd trade 2009 for 2011 or 2012 any day of the week. 2009 was the bottom, at least around these parts and as far as I'm concerned.
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Los Angeles, CA
While housing starts were on the uptick this year, they actually fell off quite a bit in the most recent report:
http://money.cnn.com/2012/04/17/real_estate/housing-starts/index.htm
The article proposes that foreclosures and tight credit are the primary reasons for the slow down in housing starts. Finally, much of the rise in starts was for multi-family construction.
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Los Angeles, CA
iwog says
Iwog, I thought Case-Shiller only compares the same home selling from price to price? Isn't that as apples-to-apples as you can get?
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Larkspur, CA
I'd trust Iwog on this. He is, after all
iwog says
a bottom feeder.
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Pleasanton, CA
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iwog says
The market is falling faster than you think. Sorry to be the one to tell you. If you are waiting for it to go up, that would not be a good idea. ;)
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Los Angeles, CA
RentingForHalfTheCost says
who is waiting?
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Pleasanton, CA
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iwog says
Not referring to the time gap. I meant the price gap. The listing pricing is the only thing really moving up. Just means the sellers are trying to milk everything they can out of the buyers. From your charts the gap is the largest it has been since 2009. Look at Contra Costa country. List is 206 to 148 for sale. Maybe I am not reading this right, but to me that is a hell of a lot of underbidding going on. 25% under list price? I have my threshold set at 50%, so maybe I will get a place soon enough. ;)
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Still waiting for the market to re-bound to 2006 levels?
Not a good idea.
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Pleasanton, CA
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SubOink says
No, who is on third.
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San Jose, CA
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CrazyMan says
It's always easy to be on the sideline & make judgment. You don't know until you tried. Don't like the system? Learn to bypass it, or is it much easier to bitch & whine?
You live only once. Don't lie in your death bed and say "I should have ............"
Well, you fill in the blank. :)
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San Jose, CA
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edvard2 says
It will get there in nominal price. Not sure if I'm still alive to see it. :)
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E-man says
Could it get there? Sure. But there is a difference between actual dollars and inflation. Its been over 6 years since the start of the crash. 6 years of having the effects of compounded inflation. Also- as someone who is looking at buying, the vast majority of houses I see out there are being priced at very STEEP discounts over what they were in 2006. So even if the bottom has already been met, the prices are not reflecting it.
Secondly, I am seeing my fair share of flipper/investor houses that have clearly been sitting for a very long time.I can smell one when I see it and so too do a lot of other buyers. What buyers are willing to pay for today is very different from what buyers would pay for in 2003-2006. Crap does not really sell. Not even crap that's had a coat of paint slapped on it.
The difference between then and now I might daresay is a more normalized market. This is likely due to the lack of exotic loan products and the fact that you do in fact need:
A: A good income
B: cash savings
C: A high credit score.
None of those of those were required a few years ago. That they are today means buyers are more careful and there are fewer potential buyers to start with. As mentioned in the news, homeownership is now at a 15-year low. This might reflect what the market under current prices can really support.
So again- if there are those who have a vested interest in housing rubbing their hands together in anticipation of another miracle bubble.... it ain't gonna' happen. Plain and simple.
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RentingForHalfTheCost says
You need to compare listing price from 2-3 months ago with sales price today. If you look at those charts, you can clearly see the sales price lagging the list price.
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rowemoore says
That is why he is complaining,he is outbid so many times. :)
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Boulder Creek, CA
iwog says
Here's what happened last time from your own thread:
Then prices turned lower and didn't just "fall back down again". Remember you claimed the bottom was in (again) last time this happened. You were wrong last time and I don't expect this time to be any different.
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Here's just an ancedotal observation of mine as well. There are many cases where if I look at the overall list of homes on any number of real estate sites, as much as half of the homes listed are foreclosures. While the level of foreclosures has dropped, there are still a lot of them and as long as that is the case, that is going to be yet one more thing that will create more friction in the market in terms of trying to go upwards.
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Santa Cruz, CA
I'm waiting for a bikini bottom and I am gonna get it soon enough.
House price bottom? Who gives a shit, it's gonna scrape along that bottom for years to come.
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Corning, NY
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E-man says
"I should have made more bad financial decisions based on short-term emotional fulfillment and spent my years working for the loan sharks..."
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Lafayette, CA
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CrazyMan says
Why are you lying? What's the point? Quote me or stop representing what you think I said.
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San Jose, CA
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iwog says
Funny Iwog. All your graphs show that price now is lower than in 2009, and next year will be lower than today, and the year after will be lower than next year, and so on, and so on, and so on. The more the banks artificially restrict the inventory, the more shadow inventory will bloat, the more shadow inventory bloats, the lower the prices will go, and so on, and so on, and so on.
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RentingForHalfTheCost says
No, the price gap is the time gap.
The only reason closing prices haven't caught up with listing prices is that there's a 2-3 month lag. You can see this in prior years.
I'm not sure why Contra Costa is so out of whack, but you'll see a corresponding spike in the next month or two.
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dunnross says
I actually explained this in great and glorious detail and even provided examples.
You didn't read any of it did you, because if you DID you would have responded to what I wrote instead of posting this nonsense.
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Santa Cruz, CA
Only half? Try some other towns in California with 2x as many foreclosures as regular sales.
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Corning, NY
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Nationally, the bubble is mostly deflated and prices have nearly returned to historical norms:
http://www.multpl.com/case-shiller-home-price-index-inflation-adjusted/
It looks like there might be another small leg down nationally (from the current 127 to the postwar average of about 120.
Every market is different of course.
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I think what's also going on out there, because yes- I will admit there is suddenly more interest, mainly because there is less inventory, is that its been awhile since there was any real headline risk. As in not a lot of doom and gloom stories. From a topical viewpoint everything seems fine and dandy with the DOW and NASDAQ doing well and the morning news giving little tid-bits of positive news.
That said, there are still many things happening that could easily tip things back towards negative territory- mainly in what's going on in Europe, which as of now has yet to really resolve much of the problems it still faces.
As far as prices and performance returning to historical norms, the US housing market has been fueled by bubbles, investors and speculation for so long that most don't even know what a 'normal' market is. That's especially true on the coasts. People tend to forget that on average home price appreciation is generally fairly small and barely keeps up with inflation. Ultimately this would be better overall because it would mean less of a see-saw type dramatic swing and more of a slow but steady increase, which is good for owners, sellers, and buyers.
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Corning, NY
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edvard2 says
That's why I sold my stocks. The positive news is already priced-in. It's quiet...a little too quiet. ;-)
I'm betting the whole Eurofiasco will be back in the news in the coming months.
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wthrfrk80 says
Not sure if I'd go that far. There's always the threat of headline risk. The thing to realize too is that it would seem that once a "story" has been out there for awhile- as in when the Euro issues first reared its head- the reaction was strong. Its not like the problem has gone away. It more that investors are "used" to the story. We'll see...
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Danville, CA
gregpfielding's website
iwog, for you: http://bayarearealestatetrends.com/2012/05/02/april-2012-stats-for-concord-starter-market/
"-The starter market average sales price was up from the previous year. Last month (April, 2012) had a average sales price of $247,300. April, 2011, had an average sales price of $230,300. This represents an increase of about 7.4% ($17,000) year over year. .
-The current average list price for homes is $268,400. This compares to $263,500 for the previous month.
-Closed transactions continue to be very low due to lack of inventory. There were 18 closed transactions in April, 2012, compared to 45 closed transactions in April 2011. There is a pattern of multiple offers with many buyers bidding over list price in the current market.
-Inventory remains extremely low with only 41 active listings at this time.
-Traditional sales and flips continue to increase in the local market. The pattern of closed transactions in April was as follows..."
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San Jose, CA
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iwog says
Hmm. Let's see:
Iwog's Leap of Faith
A Play with 2 actors (Iwog - the parrot, Dunnross - the realist)
Iwog (shows a graph of prices going down): The prices are going up.
Dunnross: But prices are going down - Iwog look at your own f*n graph.
Iwog: But look, they are going up, can't you see?
Dunnross: I can only see them going down. I can see lower lows and lower highs - typical pattern for a bear market.
Iwog: But look, they are going up, can't you see?
Dunnross: But Iwog, look San Francisco - down, Alameda - down, Contra Costa - down, Concord - down, Lafayette - down, Hayward - down, Castro Valley - down.
Iwog: But not in my back yard. Don't you know - they ain't making any more land. RE Prices are always going up. There is still plenty of money on the sidelines. Look at all the pent-up demand. Stop throwing your money away by renting. Location, location, location!
Conclusion: Just because iwog the parrot keeps repeating the same thing over and over, again, doesn't make him right.
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Dunnross,
Get over it. Iwog is living the entrepreneurial life like Edison and Jobs hammering down the big bucks, including an extra $1000 a month on a box next to his office in Concord.
In a couple of years, he'll be waking up to tongue baths from his harem on his island in the Aegean and spending the rest of the day fucking on the beach and barking instructions to the chef via mute slave eunuchs after he dumps all his property for the 10x you refused to believe was on the way.
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E-man says
Where do those folks whose house is foreclosed stay?
If baby boomers sell their houses, where are they going to stay?
At national level, price of houses varies with employment rate and income level. Situation can be different depending on neighborhood.