http://www.zerohedge.com/news/guest-post-housing-recovery-based-what
Housing Recovery?
By HEY YOU Follow Wed, 20 Jun 2012, 5:09pm 5,502 views 55 comments
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robertoaribas says
I DID read, and now you contradicted yourself....
So, which is it... sales (volume) recovery per your first comment??
OR
"Sales of existing homes declined in May" as you quoted from the article...??
I don't think you can have it both ways..... so which one??
robertoaribas says
Oh, another secret, price run up because of LIMITED inventory isn't a recovery, just a limited local "supply and demand issue"... ie: mini-bubble, NOT a RECOVERY!!
Go re-read the article!!!
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robertoaribas says
You're wrong four times in one post, possibly a new record. If inventory on the market reflects actual supply, that is good for the market because it means supply and demand can intersect at fair value. If inventory is artificially manipulated, e.g. government propping up banks to keep shadow inventory off the market, that is bad for the market.
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Fremont, CA
Just because banks have decided to halt foreclosure or turn to short sales does not mean this is a healthy market.
Low inventory is bad for the housing market because demand cannot be satisfied.
This time of year is prime selling time. It's not going to get better in the fall regardless of inventory.
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robertoaribas says
You know, I was going to respond to you rant...... nevermind.... Oh boy....
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Housing recovery? Moody's just downgraded 15 major banks including those with enormous liabilities in mortgage based assets (Bank of America anyone?):
http://money.cnn.com/2012/06/21/investing/bank-downgrades/index.htm?hpt=hp_t1
Recovery? No, no, no, things are going to get even worse, and I was one of those who thought that we might be reaching the bottom this year. Kicking the can down the road just doesn't work.
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Goran_K says
Wait, but interest rates are at their all time lows.... I thought it was a GREAT time to buy!!!
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thomas.wong1986 says
Can charts give you an erection. Cause I think I got one.
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recovery [rɪˈkʌvərɪ]
n pl -eries
1. the act or process of recovering, esp from sickness, a shock, or a setback; recuperation
2. restoration to a former or better condition
In the minds of both flippers or homeowners. Recovery means "return to 20% annual appreciation"
"AN ICE CREAM CONE EVERY DAY" Such a cute little fool.
They will have NO RECOVERY.
Real property appreciation will return to normal rates of appreciation,
(3 to 7% per yr.) AFTER gubmint intervention fails. Gubmint will not decide what the market will bear. They just waste trillions fortifying their image.
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Maybe I am one of those sexually repressed business people. No fucking while your on the payroll.
Maybe people like the idea of freedom so much. Because they have to work for their boss who is like a Dictator. Its as close to a Dictator as you can get. You wouldn't want to live under a Dictator now would you? Kind of like Jesus is your personal savior however he's your personal Dictator.
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curious2 says
Rather depends on factors... how much hype you have as we heard during the boom. Places like Palo Alto even double down on over the top "Tech stock IPOs" Bubbles like Facebook... Im sure some people expected FB stock to be trading around $150/share on its way to $500.
All tied to over the top optimistic hype (news) and frankly idiotic overpaying by buyers.
Post 1989 peak saw 30-40% correction, so far we had 50% correction, and still not yet there... 90% correction, maybe not.. 70-80% is more likely.
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Santa Cruz, CA
roberto's perspective is where he is located the situation is not so bad, for several reasons.
So, Phoenix is actually not a housing disaster at this moment.
I was in Phoenix once, sitting in the airport on my way somewhere in late June. I looked out the window and saw the shimmer of the desert heat. The temp outside was 120F.
Now, if you can handle that and the isolation of living in the middle of nowhere, go for it. If you can handle the other gangster shit, mexican illegals, etc. crime then go right down there. You can pay cash for a place, they're $100K.
No thanks, I'm going to walk to the beach in a little bit. It's 70F and clear here today.
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clambo says
yet, time and time again, we have seen native Californians, and our business, leave for Nevada, Arizona and Texas.... have to ask why ?
its amazing how many natives have moved out.. but moved out they did.
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Because Nevada, Arizona, and Texas are much cheaper deserts than California.
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Santa Cruz, CA
thomas is right. Many are leaving.
They are going where the taxes and houses are a better deal.
Also they are going to places where they can buy a house. The houses in Phoenix cost 20% what they cost in Sunnyvale, etc.
I just couldn't handle Phoenix no matter what but maybe it's a fun place, I don't know. I know no one who has been there to report back to me.
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clambo says
I've been here a few times, mostly in the summer and ay, caramba no- It's not my kind of place. That heat is something else if you're not used to it
Kudos for those hearty souls that can put up with the scorpions and heat though.
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New renter says
Hey, don't be knocking on the scorpions, they had a couple of good songs.....
Oh wait, wrong ones....
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robertoaribas
What percentage of home buying in AZ are accounted for investors?
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Call it Crazy says
Here I am...rock you like a hurricane...
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wthrfrk80 says
I was waiting for that..... :)
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People - robertoaribas has got to be a paid NAR shill. One of at least a few on here.
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I don't think Robert is a shill. He's talking about the local Phoenix market he's living in. That area, along with Las Vegas, parts of Florida and Atlanta crashed hard during the post-bubble, so prices may make sense.
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Santa Cruz, CA
Phoenix isn't doing so badly if you lived there and had a job. House prices are low but not falling recently.
Since a house in Phoenix costs just 20% of a house in Santa Cruz or Monterey, it's probably feasible to buy and rent them out.
Why someone would want to do that is beyond my understanding, but everyone needs to do something I guess.
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Goran_K says
I don't think he is a shill either. Phoenix took the dump earlier than most other markets and is trying to stabilize. There must be some good deals at the bottom of the barrel...
What Roberto tries to do is apply the current Phoenix market to the rest of the country... that don't fly.....
There are many areas of the country that are continuing with their downward trajectory and will eventually hit closer the bottom like Phoenix, they just ain't there yet!!
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Yeah, agreed. Phoenix and prime areas of the country are not comparable, at all.
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Call it Crazy says
I don't try to apply my market to anywhere else at all! Even in Phoenix, above $500k, the market dynamic is much poorer, let alone other places.
What I do is counter the normal patrick.net level of nonsense, "Don't buy, all homes will drop another 150%..." with actual data about the market I study and invest in. The same as what IWOG does about his market...
It is about the numbers. Low Supply versus Demand means prices are going up, if your area shows those statistics. Period.
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Call it Crazy says
call you crazy: It helps if you learn how to READ the articles you link... first two paragraphs:
Sales of existing homes declined in May, according to a new report from the National Association of Realtors, not just because the overall housing market is struggling, but because there are simply not enough homes to buy.
There are currently 2.49 million for sale, a drop of 20 percent from a year ago. To make matters worse, supply is lowest on the low end, where so much of the investor activity has been over the past several years.
yes, dropping inventory... does that sound like a bad thing to a market? even to you??????
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HEY YOU says
hmm, let's pull up some of their predictions from 2006 and 2007 for laughs!
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HEY YOU says
well, there you go! If a random British man said it somewhere, it must be true!curious2 says
Really? so if prices fall to $0 would be a great recovery then? Ask your mom about that head drop game she played with you as a child!
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robertoaribas's website
sorry if the sarcasm went over your head... Why do you even profess to say what the definition of "market recovery" would be, when clearly you are clueless?
Here are the actual definitions:
(1) The upward phase of a normal business cycle which follows a depression and precedes a return to prosperity. The opposite of recession.
(2) A rally in the market following a decline.
We have already seen a sales (volume) recovery, now in many markets, we are starting to see a price recovery.
Your notion that "falling prices = recovery" shows your complete and utter ignorance.
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I'm sorry. You two can't help it that you are completely uneducated about economics, asset class markets etc, and are posting completely based on 8th grade educations... Keep it up!
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Oh i see now!
If inventory rises, it is bad for the housing market.
If inventory falls, it is also bad for the housing market...
got it!
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Call it Crazy says
No contradiction at all, you are simply not smart enough to keep up!
sales are up dramatically year over year, but down month over month by 2% or so, due to lack of inventory...
"inventory is being hidden in the shadows... blah blah blah" grow up seriously! the number of loans 90 days delinquent or in foreclosure is actually down by 30% compared to 2 years ago. It isn't going to disappear overnight, but if your theory were true, this statistic would be increasing, not decreasing. And, those tend to be highest in the judicial foreclosure states, i.e. NOT California or Arizona. And btw, those numbers are legally required financial reports for lenders, far more trustworthy than the silly shadow mystery numbers backing your scenario.
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robertoaribas says
Well, it's a bit more complex that than isn't it. Affordability, loan availability and consumer confidence (jobs) are the other main constraints.
Also, foreclosures are actually up this year (but down YOY) in the bay area. It will be interesting to see if the market can sustain the inventory that is waiting to be placed on the market, as soon as prices rise enough for people to be able to sell without bringing a check to the table. I don't think here in the BA it's as hunky dory as many people seem to think.
If enough people see rising prices and increase the inventory to where the market can't absorb them, that will in turn drive prices down again, which would be both ironic and amusing. I seriously doubt this last little mini bubble is sustainable, but we will see.
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robertoaribas says
Dude, what the heck? And you wonder why people are voting your post down and out of the forum? It's post like this.
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Santa Cruz, CA
I never have said that houses are going down another 150%, because I don't believe it, and I have no way to predict it.
However, borrowing 10X your income to buy a house means you are making a huge mistake financially at least.
I think houses on average (exceptions exist) will slowly creep downward less and less as a %, until some "bottom" is hit. How long will this take? Years probably, especially if Obummer is re-elected.
So, anyone even considering buying a house someday has plenty of time to wait and gather his money and his wits.
Rather than put down $120K on a place to satisfy my former girlfriend, I bought more shares of mutual funds and AAPL. Soon I will get more agressive and buy a LEAPS option.
I'm already WAY up compared to the bummer I would be experiencing if I bought a few years ago to take advantage of that bullshit "buyer's credit" nonsense.
Cash is king. There will be also plenty of broke people in the future who want renters or "boyfriends" with benefits. I see lots of them here and there ;)
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Cash is king only when it has perceived value. A couple big banks downgraded to just above junk. Fed just keeps making more of that fiat money. The stock market is still up for now but I would bet it will tumble bad again like 2008. Beware.
Have you seen Zeitgeist on Netflix?
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robertoaribas says
thats how a healthy BA economy works... our employers are unwilling to bankroll high home prices. everything is different here!
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New renter says
I think of all the people who grew up here... and how many have left... its odd, but they each had their reasons... went off to Nevada, Washington, Arizona, Texas, etc etc...