WatchRecently, some posters have wondered why the banks might be holding back inventory, when to do so also has a cost to the banks and investors.
I was wondering, could it be that they are waiting for the 1099 Forgiveness to expire at the end of the year, which indirectly would push the fence-sitters to just keep their losing investments when they realize they'll receive a substantial tax penalty?
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Call it Crazy says
Well, if you actually look at the graph, contra costa county median price is up 2.6% YOY. sales are up 3.7% YOY, price/sq. ft is up 1.3% YOY.
So, I'd call that a fail.
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tatupu70 says
Man, you never give up.... you wanted data proving that this year's Spring bump is smaller than previous years.
tatupu70 says
I give you the data you asked for, now you are spinning it again off into another topic... count your losses and move on...
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Call it Crazy says
I did. And you gave me data showing this year's bump is LARGER than last year's bump. That's why I call it a fail.
Call it Crazy says
Your data proved my point. So, thanks...
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Laguna Beach, CA
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tatupu70 I have you on ignore, have for about a month or so, couldn't stand trying to slog through the pro-bull/pro-bear arguments you and another individual were engaging in (trying to clear the clutter so to speak). I can only see your post if someone quotes you, so I'm not purposefully slighting you, I just can't see your post unless someone else quotes you.
There is plenty of data on Redfin for the cities I am shopping in. Inventory down, sales down, and recently within the past few weeks, the median sold price is now starting to drop, somewhat early for the Spring/Summer rally. Housing is still trying to reach bottom despite the banks and gov't intervention.
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tatupu70 says
OK, try this, here is your target city of Scotch Plains... now show me how you can spin the data from 2012....
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Laguna Beach, CA
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That chart is very telling. It's what I'm seeing here in my area too, the spring/summer bump is already fading away.
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Goran_K says
I just gave him my last piece of data for his target area... I give up... I wish him good luck as his new investment goes underwater in the coming years..
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Goran_K says
It's really, really sad but some people are so heart set on buying no matter what the data tells them... the rose colored glasses must be really dark...
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Laguna Beach, CA
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Call it Crazy says
Yeah I wish him and other home buyers luck in the coming market. I don't have any ill will towards people who own homes, looking to buy (I am myself) or tatupu70 as an individual. I just don't have the time to slog through the bear/bull trolling that constantly goes on here, so I ignore him, and others who tend to get too emotional about the whole thing.
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Laguna Beach, CA
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here's data for a city I'm looking in:
Homes for Sale Apr '12 : Prev. Month : Prev. Year
# Homes for Sale 69 down 18.4% down 53.4%
# Homes Sold 25 down 45.1% down 3.4%
Median Sold Price $512K down 2.1% down 7.6%
The previous month, the middle column figure for "median sold price" was up 3.4%, which is amazing to me. Now it's one the way down again, and it's barely June.
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Goran_K says
I don't either have ill will.... I drank the kool-aid for many years and believed you HAVE to own a home... I finally put the glass down last year, sold, and took my chips off the table and put them in my pocket. The casino is rigged now, so I decided to sit on the sidelines until the dust settles...
I kick myself for not realizing this earlier, I'd have a whole lot more money in my pocket. Everyone will learn at their own pace (and at a cost). I'm just hoping my experiences and knowledge might help someone else from making costly mistakes trying to fulfill the "American Dream"..
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tatupu70 says
Since I'm the bearer of such great news, here's some more "data" for the surrounding towns of Scotch Plains. Don't look good, Sorry!!!!
Hey but the GOOD news.... mortgage rates are DOWN!!!!
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Call it Crazy says
Seriously. I didn't spin anything. I just pointed out what the data actually was since you didn't bother to look yourself.
The Scotch Plains chart you posted is zillow home values. That dataset is notoriously unreliable. You'd be better off posting sales prices--which are down 3.9% YOY. So you're right. Sales are up 75% YOY though, and prices certainly appear to be continuing to rise, so I wouldn't expect the bump to be over.
Call it Crazy says
See--I would say the exact opposite of you. You seem hell bent on telling everyone that buying is a horrible idea no matter what the data says. I happily rented when the data said renting was the better option in the late 2000s. I only seem like a housing bull when compared to the average poster on pat.net
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Appraisers Are Corrupt says
How would you know, you posted zillow home values?? How about posting the same chart using actual sales prices?
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tatupu70 says
Alright, here is another chart for you from Prudential New Jersey for Scotch Plains, I'm sure you can find a way to negate and spin this data too!! There's your Spring bounce.... prices are really rising today!!
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31 male
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It is nonsensical to look at localized house price data over a couple month time, and declare an inflection point. Nothing but noise. Filter out the noise,,,,,look at interest rates, they have been declining for 30 years. The question you need be asking yourself is, where do they go from here?
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Boulder Creek, CA
Down.
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Housing Prices Are Cratering says
absofuckinglootly. I don't care if it takes another half decade of bank corruption and interest rates rising, I'll wait here in California for what I think is a decent deal.
Just discovered even Boston is more 'cratered'. (Redfin)
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There are virtually ZERO homes in South Orange County, California that are below $400,000. Almost all the homes I have searched for are in "Pending Offer", it almost seems like the market has gone crazy overnight.
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Jaz5, it has because the banks are holding back from foreclosing across the country. Almost makes me wish I would've gotten a bubble house, I could have saved 3-4 years of salary just squatting, or "negotiating" a loan mod. It's just a credit score anyway.
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Tarzana, CA
jaz5 says
'Pending Offer', yeah right. Take this example below, I have seen this plain, sad, bank bile listing since June 9, 2011 when it was first listed. 9, price changes, 'pendings', and relistings later it is 'sold' at a foreclosure auction (whatever that means) Then it's relisted again in April 2012. 3 more price changes, relistings, and a 'Pending' and VOILA! I get the privilege, honor, and respect of being able to purchase this beauty again just yesterday!
http://www.redfin.com/CA/Tarzana/18601-Collins-St-91356/unit-D24/home/4059423
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If I were a bank, I'd dump repos as quickly as possible so that other banks would have to let go of their repos for lower average prices.
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jaz5 says
Is some one on this site good at doing research. I would be really interested to see what the "actual" numbers of houses that were on the market in the past (2 or 3 years ago) versus what actual number of houses are on the market today.
My gut feeling, as Goran mentioned above, that the total inventory of available houses is A LOT less, which is causing the bidding wars and mini bubble. I believe many are being held off market or in the shadow but it would be nice if someone can do a look-back to a few years ago at this time for true numbers.
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All I know is, all those homes underwater from 2004-2009 didn't suddenly just "cure" for some reason, and seeing as sales from 2009 to now have been at their lowest levels since before the bubble, they didn't get absorbed either. The homes are there, but not on the MLS.
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Goran_K says
That's why, if you can force the remaining suckers to stay through EOY, the tax albatross may nudge a large percentage over to the "resigned to be screwed" side.
Keep in mind that most people don't even know that they'll be taxed on the forgiven debt, much less that the provision expires this year.
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bgamall4's website
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The 1 percent, through hedge funds, are buying up a lot of real estate, and prices declining are evidence of this.
There are very few foreclosures available in Nevada as they are being gobbled up. How long that can continue is anyone's guess.------------------
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CL says
You may be right about your original theory, but what is the result for house prices? If people are forced to stay in their homes, that means less inventory/supply. Typically resulting in higher prices.
Another issue is that if something changes where all of these people cannot make their payments and start defaulting, the banks will just go back to the gov't and ask/force them to extend the tax forgiveness.
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tiny tina says
My guess is, it won't be the banks asking for the extension. I would bet Obama will extend it so he can "buy" some votes for November...
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Goran_K says
Exactly, they are sitting in the "shadow"..
Goran_K says
FWIW.. I did a quick look at sales data from the town I just sold my house from. It's a small "snip" of the overall picture, but very telling.
The number of house "transactions" in 2011 were only 1/3 of what the were in 2008. I say "transactions" because it includes all transfers, foreclosures, tax sales, traditional sales, trusts, REO, etc. That's a lot of revenue taken out of the system..
But the WORST part, even though the total number of transactions were 1/3 of the years before, upon closer look, at least 75% of the 2011 sales were "distressed" sales. Only about 25% were traditional party to party sales. The distressed sales put major downward pressure on home prices!!!
That's the TRUE pulse of the economy and housing market, and it ain't good!!
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Call it Crazy says
Either way it would make this thread moot.
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DAMN! I missed it. Never thought about the 1099 possibility.
We've seen all the different forecast for the coming % decline in home values. If an individual thinks the decline would be ~20% then offer less than 20% of the asking price or wait for 30%
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Goran_K says
It's not too late to do it now. You can buy with 3-3.5% down & then squat 3-4 years until you get kicked out. In fact, you can ask the seller to credit you the down payment, and you have no skin in the game.
Come on, go for it. Be a man & step up to the plate. Tell us how it goes after you've done it. :)
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errc says
3% interest for 30-years fixed here I come............... Get ready for the next refinance boom.
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San Jose, CA
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Goran_K says
Then why the hell are you looking & making offers on houses? The trend is clear down in your neck of the woods. A 5% drop in home prices annually would wipe out $25k of equity. Isn't it better to keep on renting at this time?
You let your emotion do the walking. That's not wise.
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Laguna Beach, CA
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CL says
Is that true? Wow, this could really bite some people.
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E-man says
I haven't made an offer in a few months, and that was a lowball offer for the neighborhood (about 10-15% below market). I ended up walking away because of black mold.
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Emeryville, CA
Goran_K says
Partly anecdotal, but many people I know seem to be in a holding pattern, waiting to decide what they should do. They don't seem to see the urgency.
Plus, I figure most people aren't very sophisticated regarding finance and such under normal circumstances, and these aren't normal.
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CL says
I believe your right. There are MANY people sitting underwater and don't know what to do. They most likely don't know about the loan forgiveness law expiring in Dec. Many are the ones that didn't understand the loan documents and weren't smart enough to know they couldn't afford the house payments.
I bet many don't even understand the short sale process. As the MSM starts talking more about the forgiveness program ending later in the year, I expect "selling" activity to pick up to avoid the 1099 from the IRS.
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E-man says
I like that idea!!! 3% down, no payments for years... sounds like Raymour and Flannagan.
I bet I can "play the game" and be able to squat for 4 or 5 years in my state. Just think of ALL the cash I would save!!!!
Oh Honey........ wanna buy a FREE house???
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Housing Prices Are Cratering says
You must not have seen my article at Business Insider. You smarten up. :)
http://www.businessinsider.com/the-1-percent-is-buying-up-all-the-real-estate-beware-of-tom-lee-of-jpm-2012-5