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Southern California home sales plunge 20% in December to the lowest pace in 11 years

By Kakistocracy following x   2019 Jan 30, 12:46pm 1,260 views   64 comments   watch   nsfw   quote     share    


Home sales in the region fell 20.3 percent year over year in December, according to CoreLogic. That is the lowest December sales pace since 2007.

From November to December, sales of new and existing houses and condominiums in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties dropped 8.2 percent.

Sales usually rise in Southern California between November and December, with an average increase of around 12 percent, so this was clearly a huge aberration.

•The housing pain persists in Southern California, as higher costs weigh heavily on potential buyers. Home sales in the region fell 20.3 percent year over year in December, according to CoreLogic. That is the lowest December sales pace since 2007.

•From November to December, sales of new and existing houses and condominiums in the area dropped 8.2 percent in December.

•Sales usually rise in Southern California between November and December, with average increase of around 12 percent, so this was clearly a huge aberration.

"Last month's sharp drop in home sales stands out in several ways," said Andrew LePage, a CoreLogic analyst, noting that it was the slowest pace in 11 years and the largest decline for any month in more than eight years. "This drop in activity reflects a variety of factors. Mortgage rates hit a 2018 high in November, affecting December closings, and stock-market volatility created an additional headwind in high-end markets. Meanwhile, some would-be buyers remain priced out or unwilling to buy amid concerns that prices have overshot a sustainable level."

Sales of newly built homes fared particularly badly, down more than 50 percent from their average over the last 30 years. Much of that is because builders are still building far fewer homes since the housing crash, and part is because prices for newly built homes continue to soar.

"Half of America can only afford a $230,000 mortgage, and the builders in good locations just can't get down to anywhere near that," said John Burns, CEO of California-based John Burns Real Estate Consulting. "Eleven of the top 19 builders, their average sales price is above 400 grand."

More: https://www.cnbc.com/2019/01/30/southern-california-home-sales-plunge-20percent-in-december-lowest-pace-in-11-years.html

If you go back and look what happened not so long ago, it is interesting to see the same type of headlines.

Type in SoCal Housing in the search tab on here.

#SoCal #Housing

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25   RC2006   ignore (0)   2019 Jan 31, 12:29pm   ↑ like (1)   ↓ dislike (0)   quote   flag        

Where are these drops, in ghettos? Haven't seen drops here in nice parts(asian/white) around here in LA. My area is up 10+% over 12 months. Wish it would crash , my house is up 120% since I bought it and I want to upgrade without getting slammed in taxes.
26   Hugolas_Madurez   ignore (4)   2019 Jan 31, 12:37pm   ↑ like (0)   ↓ dislike (1)   quote   flag        

RC2006 says
Where are these drops


27   jazz_music   ignore (6)   2019 Jan 31, 1:39pm   ↑ like (1)   ↓ dislike (0)   quote   flag        

Kakistocracy says
You certainly know how to flatter someone you rascal !


And with that, the "E-Man" commenter disappears forevermore.
28   jazz_music   ignore (6)   2019 Jan 31, 1:43pm   ↑ like (2)   ↓ dislike (0)   quote   flag        

You should post the entire article otherwise you are manipulating the message.

Then the bastards can say that your post is too long and not to do it.

Really to please them just offer them money for nothing, that the only thing that works. Or tell them that they are smart.
29   Hugolas_Madurez   ignore (4)   2019 Jan 31, 2:40pm   ↑ like (0)   ↓ dislike (1)   quote   flag        

jazz_music says
You should post the entire article otherwise you are manipulating the message.

Then the bastards can say that your post is too long and not to do it.

Really to please them just offer them money for nothing, that the only thing that works. Or tell them that they are smart.


Get a room, you two!

30   Booger   ignore (2)   2019 Jan 31, 2:54pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Ceffer says
More cleavage from female real estate agents!


There is a whole genre of porn devoted to this.
31   jazz_music   ignore (6)   2019 Jan 31, 6:41pm   ↑ like (1)   ↓ dislike (0)   quote   flag        

Hugolas_Madurez says
Get a room, you two!

have a nice life
32   Kakistocracy   ignore (6)   2019 Jan 31, 9:57pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

New Home Prices Drop 12% as Supply Surges

Unwinding years of price gains as homebuilders try to make deals.

The Commerce Department has reopened for business, and the good folks there are now in hyperdrive to put together and release the data that was blocked during the partial government shutdown that had also shut down the Commerce Department. This morning, it released the sales data for new homes whose sales closed in November. This report had originally been scheduled for the end of December. In the near future, the Commerce Department will further catch up and release the new-home sales data for December, which had been scheduled for last week.

So, time to catch up, and here we go. The median prices of new single-family houses that sold across the US in November 2018 fell 11.9% from November 2017 to $302,400, the lowest median price since October 2016, and in the same range as the median price in November and December 2014:

What is particularly interesting is how much faster and further the median new-house price has fallen compared to the median price of “existing homes.”

Though the median price of “existing homes” – single-family houses, townhouses, condos, and co-ops – in December was down 7.4% from the peak in June, on a year-over-year basis, it was still up 2.9%. And this, despite a 10% year-over-year drop in sales volume, the biggest such drop since May 2011.

One of the major differences between the two is the entity that is selling these homes. New homes are sold by homebuilders. Existing homes are sold by regular homeowners and investors.

The biggest homebuilders are large stock-market traded companies that have to maintain their sales momentum, no matter what. Through their reach across markets, they have good current market data and know where the market – the buyers – is going. And when buyers don’t materialize at a given price point, then incentives are thrown in, such as free upgrades in the kitchen, and eventually prices get cut a tad, and ultimately less costly homes get built to meet the buyers.

A homeowner or investor who is not forced to sell might pull the home off the market if it doesn’t sell within a few months, and later put it back on the market, and dilly-dally around for years sometimes – though massive job losses, as they occurred during the Financial Crisis, can speed up that pace dramatically.

By contrast, homebuilders have to make sales happen, no matter where the market is. They continue to build homes, and they have to sell homes whatever the market conditions may be. They cannot just wait for a few years until the market turns their way. And so they’re the first to adjust to the reality of the market.

More Including Graphs Etc. https://wolfstreet.com/2019/01/31/new-home-prices-drop-12-as-supply-surges/

Link to Government Report Cited in Article: 5 pages https://www.census.gov/construction/nrs/pdf/newressales_201811.pdf
33   AD   ignore (0)   2019 Feb 1, 12:09am   ↑ like (3)   ↓ dislike (0)   quote   flag        

I recall Patrick saying years ago that you are buying a monthly payment (principal+interest+tax+insurance+HOA fee+maintenance) when you buy a home.

As interest rates go up, the monthly payment goes up. Hence, the home price has to go down. That is why home prices peak when interest rates hit bottom. Ultimately the price of the home is determined based on the monthly payment being no more than 35% of household gross income. And in places where property taxes are increasing, home prices are suffering as well.

HOWEVER, if you have an assumable mortgage then you can sell them home to someone who qualifies to take over the mortgage. I know someone who has a 3% fixed rate, 30 year mortgage (financed starting in 2016) with the Veterans Administration through a local regional bank. They can sell their home with that assumable rate to anyone (not just veterans) who can take on that mortgage. An assumable mortgage makes the home more valuable.
34   Kakistocracy   ignore (6)   2019 Feb 2, 3:17am   ↑ like (0)   ↓ dislike (0)   quote   flag        

American home seller profits hit 12-year high. The average home seller profited $61,000 in 2018.

IRVINE, Calif. – Jan. 31, 2019 — ATTOM Data Solutions, curator of the nation’s premier property database, today released its Year-End 2018 U.S. Home Sales Report, which shows that home sellers in 2018 realized an average home price gain since purchase of $61,000, up from $50,000 last year and up from $39,500 two years ago in 2016 to the highest level since 2006 — a 12-year high.

That $61,000 average home seller profit represented an average 32.6 percent return on investment compared to the original purchase price, up from 27.0 percent last year and up from 21.9 percent in 2016 to the highest average home seller ROI since 2006.



“While 2018 was the most profitable time to sell a home in more than 12 years, those along the coasts, reaped the most gains. However, those are the same areas where homeowners are staying put longer,” said Todd Teta, chief product officer at ATTOM Data Solutions. “The economy is still going strong and home loan rates remain historically low. But there are potential clouds on the horizon. The effects of last year’s tax cuts are wearing off as limits on homeowner tax deductions are in place and mortgage rates are ticking up ever so slowly, so this could dampen the potential for home price gains in 2019.”

Among 217 metropolitan statistical areas with a population greater than 200,000 and sufficient historical data, the highest returns on investment were almost exclusively in western states, with concentrations along areas of the west coast. Those with the highest average home seller ROI were San Jose, California (108.8 percent); San Francisco, California (78.6 percent); Seattle, Washington (70.7 percent); Merced, California (66.4 percent); and Santa Rosa, California (66.1 percent).

The U.S. median home price in 2018 was $248,000, up 5.5 percent from 2017 to a new all-time high. Annual home price appreciation in 2018 slowed slightly compared to the 7.1 percent in 2017.

Among 127 metropolitan statistical areas with a population of 200,000 or more and sufficient home price data, those with the biggest year-over-year increase in home prices were Mobile, Alabama (up 21 percent); Flint, Michigan (up 19 percent); San Jose, California (up 18.9 percent); Atlantic City, New Jersey (up 16.4 percent) and Las Vegas, Nevada (up 13.5 percent).

Along with San Jose and Las Vegas, other major metro areas with a population of at least 1 million with a double-digit percentage increase in home prices in 2018 were Grand Rapids, Michigan (up 10.6 percent); San Francisco, California (up 10.3 percent); Columbus, Ohio (up 10.1 percent); and Atlanta, Georgia (up 10.1 percent).

88 of the 127 metros (69 percent) reached new record home price peaks in 2018, including Los Angeles, Dallas-Fort Worth, Houston, Atlanta, and Boston.

Homeowners who sold in the fourth quarter of 2018 had owned their homes an average of 8.30 years, up from 8.13 years in the previous quarter and up from 7.95 years in Q4 2017 to the longest average home seller tenure as far back as data is available, Q1 2000.

Counter to the national trend, 16 of the 108 metro areas analyzed in the report posted a year-over-year decrease in average home seller tenure including: Vallejo-Fairfield, California (down 5 percent); Reno, Nevada (down 3 percent); Redding, California (down 2 percent); Panama City, Florida (down 2 percent); Chattanooga, Tennessee (down 2 percent); Eugene, Oregon (down 2 percent); Crestview-Fort Walton Beach, Florida (down 1 percent); Tucson, Arizona (down 1 percent), Punta Gorda, Florida (down less than 1 percent); Manchester-Nashua, New Hampshire (down less than 1 percent); and Truckee, California (down less than 1 percent).

Much More to Read: https://www.attomdata.com/news/most-recent/year-end-2018-u-s-home-sales-report/
35   Kakistocracy   ignore (6)   2019 Feb 2, 3:21am   ↑ like (0)   ↓ dislike (0)   quote   flag        

Renting a Home More Affordable Than Buying in 59 Percent of U.S. Housing Markets - Home Prices Outpacing Wages in 80 Percent of the U.S. Housing Markets

IRVINE, Calif. – Jan. 10, 2019 — ATTOM Data Solutions, curator of the nation’s premier property database, today released its 2019 Rental Affordability Report, which shows that renting a three-bedroom property is more affordable than buying a median-priced home in 442 of 755 U.S. counties analyzed for the report — 59 percent.

The analysis incorporated recently released fair market rent data for 2019 from the U.S. Department of Housing and Urban Development, wage data from the Bureau of Labor Statistics along with public record sales deed data from ATTOM Data Solutions in 755 U.S. counties with sufficient home sales data (see full methodology below).

“With rental affordability outpacing home affordability in the majority of U.S. housing markets, and home prices rising faster than rental rates, the American dream of owning a home, may be just that — a dream, “said Jennifer von Pohlmann, director of content and PR at ATTOM Data Solutions. “With home price appreciation increasing annually at an average of 6.7 percent in those counties analyzed for this report and rental rates increasing an average of 3.5 percent, coupled with the fact that home prices are outpacing wages in 80 percent of the counties, renting a home is clearly becoming the more attractive option in this volatile housing market.”

Renting more affordable than buying in nation’s most populated counties

Renting is more affordable than buying a home in the nation’s 18 most populated counties and in 37 of 40 counties with a population of 1 million or more (93 percent) — including Los Angeles County, California; Cook County (Chicago), Illinois; Harris County (Houston), Texas; Maricopa County (Phoenix), Arizona; and San Diego County, California.

Other markets with a population of more than 1 million where it is more affordable to rent than to buy a home included counties in Miami, New York City, Seattle, Las Vegas, San Jose, San Francisco and Boston.

Among the 40 U.S. counties analyzed in the report with a population of 1 million or more, the three where it is more affordable to buy a home than rent were Wayne County (Detroit), Michigan; Philadelphia County, Pennsylvania; and Cuyahoga County (Cleveland), Ohio.

Least affordable rental markets in Northern California, Hawaii, D.C.

The report shows that renting a three-bedroom property requires an average of 38.0 percent of weekly wages across the 755 counties analyzed for the report.

The least affordable markets for renting are Santa Cruz County, California (81.7 percent of average wages to rent); Honolulu County, Hawaii (74.4 percent); Spotsylvania County, Virginia (73.0 percent); Maui County, Hawaii (69.5 percent); San Benito County, California (68.6 percent); Monroe County, Florida (67.3 percent); Sonoma County (Santa Rosa area), California (66.0 percent); Marin County (San Francisco area), California (65.6 percent); and Kings County, New York (63.7 percent).

Most affordable rental markets in Ohio, North Carolina, Wisconsin, Pennsylvania

More to Read: https://www.attomdata.com/news/most-recent/attom-data-solutions-2019-rental-affordability-report/
36   Kakistocracy   ignore (6)   2019 Feb 2, 11:59am   ↑ like (0)   ↓ dislike (0)   quote   flag        

Can't afford SoCal ? Snap this beauty up before the multiple bids get too high ! Plenty of Old World Charm and possibilities galore ! Live like your ancestors - experience history and save on those pesky water bills.

Former squatter house without running water in Oakland priced at $235,000

It's currently the lowest-priced home in Oakland, and might offer a patient, ambitious buyer who wants to squeeze into the Bay Area real estate market an opportunity.

The tiny, ramshackle house with 364-square-feet at 7010 Herbert Guice Way near the Oakland Coliseum is priced at $235,000 — which requires a $47,000 down payment if you put down 20 percent.

The roof leaks and the exterior paint is peeling, but the interior is clean and tidy, if unassuming.

Listing agent Robert Collett of Berkshire Hathaway says there's the opportunity to build a two-story home on the 2,299-square-foot lot. He admits the profit from a quick flip would be slim, as the price of a major renovation would be high and the average sale price in central East Oakland is about $575,000.

The current owner spent countless hours of dealing with the city to address liens on the home, but after only a couple months of owning it, realized she couldn't afford to take the home to the next level.

"She bought it for $225,000 a couple months ago," Collet says. "She's not trying to make a profit. Just wants to break even."


https://www.sfgate.com/realestate/article/7010-Herbert-Guice-Way-East-Oakland-real-estate-13573432.php#photo-16856928

37   Kakistocracy   ignore (6)   2019 Feb 4, 12:02pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Home values see largest single-month decline since 2012. The average home lost $1,361 in value since August

After years of steady recovery in the housing market, home values have begun to decline, experiencing the largest single-month decline in November since housing recovery began, according to the latest data from Black Knight.

Home values fell 0.2% in November, down $580 for the month and marking the first time the market has seen a consecutive three-month decline since early 2012.

Now, the average home is down $1,361 in value since August 2018.

Black Knight also revealed that the annual rate of appreciation fell in November, down 4.9% from last year.

Still, home prices are up from 2017 in all 50 states and in 99 of the largest 100 markets, Black Knight said.

But the rate of growth is certainly slowing, a trend most obvious in the western part of the country.

In California, home price growth is now 3.7%, down from 10.3% just nine months ago.

Washington has also slowed, its current growth rate at 6.7% compared with 12.5% in February 2017.

Here is a map illustrating home price growth rates across the country as of November 2018:



https://www.housingwire.com/articles/48094-home-values-see-largest-single-month-decline-since-2012
38   MrMagic   ignore (11)   2019 Feb 4, 12:07pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Kakistocracy says
Home values see largest single-month decline since 2012. The average home lost $1,361 in value since August

After years of steady recovery in the housing market, home values have begun to decline


Wait Kaki....

Are you telling us that home prices don't go straight up, year after year?? Really?

What would we do without your crackerjack reporting here?

Kakistocracy says
Still, home prices are up from 2017 in all 50 states and in 99 of the largest 100 markets, Black Knight said.


Oh, snap....
39   MrBark   ignore (0)   2019 Feb 4, 4:28pm   ↑ like (1)   ↓ dislike (0)   quote   flag        

Friends bought a place in 2015 for $510,000. Second set of friends just bought the same floorplan, same condition, two doors up, for $565,000.

Both homes original, dated, from the early 70's.

So after 4 years, they've made $55,000 in equity from market movement, $13,750 per year. Better than nothing right?

Of course, the above scenario assumes they didn't spend any time/month on upgrades and just kept a dated house. But, they've sunk money into it, remodeled, so it's probably worth closer to $670-700 now.
40   AD   ignore (0)   2019 Feb 5, 12:36am   ↑ like (1)   ↓ dislike (0)   quote   flag        

30 year fixed mortgage is about 5%

About 3 years ago is was around 3.5%

Over the next 2 years I figure the rate will level off between 6.0% to 6.5% , which was the late 1990's level

That means at best housing prices will remain flat or likely go down 5% to 15% over next 2 years
41   Kakistocracy   ignore (6)   2019 Feb 8, 3:22am   ↑ like (0)   ↓ dislike (0)   quote   flag        

Another Long Leading Indicator, The Senior Loan Officer Survey, Turns Negative

Summary

•Long leading indicators are those which typically peak a year or more before the economy as a whole.

•Credit conditions, particularly as measured by the Fed’s Senior Loan Officer Survey, are one of those indicators.

•The Q4 Survey, published yesterday, for only the second time during this expansion, was uniformly negative.

Introduction

The Fed reported its Senior Loan Officer Survey for Q4 yesterday, and it was not good news. Credit conditions, particularly as measured by the survey, are a long leading indicator (i.e., tending to turn a year or more before a cycle peak (and substantially before a trough as well)). In Q4, they turned negative.

Metrics in the Survey

The premier metric in this survey is whether banks are tightening credit for large firms (blue), and also small firms (green). While there have been several false positives, these have turned negative (i.e., more banks have tightened credit) at least 4 quarters before each of the last three recessions. In the below graph, values are inverted so that tightening shows as a negative number:



Banks tightened credit for both sizes of firms in the 4th Quarter, for the first time in nearly three years.

This is in contrast to the weekly Chicago Fed Financial Conditions Indexes, the Adjusted index of which is shown in red in the graph above. None of those Indexes are negative at this point.

Another portion of the survey which measures demand for loans also has a history of turning well in advance of the economic cycle itself. This has been negative, off and on, for several years. After turning positive at twice in the last 5 quarters, it has turned back negative for the last two:



While the picture isn’t perfectly clear, because the Chicago Indexes have not turned negative, this is the first time outside of the shallow, energy-sector focused downturn of 2015-16 that the Senior Loan Officer Survey has shown a tightening in credit conditions

https://seekingalpha.com/article/4238027-another-long-leading-indicator-senior-loan-officer-survey-turns-negative?page=2
42   Kakistocracy   ignore (6)   2019 Feb 8, 3:29am   ↑ like (0)   ↓ dislike (0)   quote   flag        

Here are the 10 markets where home prices will rise most in 2019 - This year will see significant price softening in the West

After nearly two years of continuous projected year-over-year increases in nationwide residential real estate appreciation, we predict that properties in the largest 100 markets will appreciate at just 3.9% in the coming year – a half-percent drop from the previous quarter's forecast of 4.6%.

While this is a significant change from one quarter to the next, I do not see it as a sign that a crash is coming. The market fundamentals are expected to remain solid and the overall housing market remains healthy. This is simply part of a slowing down as the strength of the past few years dissipates somewhat in most markets.

This projection is based on the VeroFORECAST, which analyzes data from 359 Metropolitan Statistical Areas that include 13,870 zip codes and 1,004 counties, representing 82% of U.S. residences.

Perhaps the biggest surprise in this softening is what is projected to happen during 2019 in the West.

Although western MSAs continue to dominate the report's list of the 10 markets projected to appreciate the most over the next year, all four MSAs in Nevada and California that were in the last report's top 10 have dropped out.

The other characteristic of those top 10 markets is that only one is among the 100 largest MSAs in the report, and that one is Boise City-Nampa, Idaho, which sits atop the list with a projected 9.5% appreciation.

Here is our list of the top 10 cities expected to appreciate the most in 2019. We forecast that, together these 10 will have average appreciation of 8.3%, which is down from 10.3% one quarter ago.

1.Boise City-Nampa, ID MSA...................................................... 9.5%
2.Olympia, WA MSA.................................................................... 8.8%
3.Midland, TX MSA...................................................................... 8.7%
4.Idaho Falls, ID MSA.................................................................. 8.6%
5.Odessa, TX MSA...................................................................... 8.4%
6.Pocatello, ID MSA..................................................................... 8.2%
7.Bellingham, WA MSA................................................................ 8.2%
8.Mount Vernon-Anacortes, WA MSA.......................................... 7.8%
9.Boulder, CO MSA...................................................................... 7.7%
10.Grand Junction, CO MSA.......................................................... 7.5%

Turning back to California, the markets representing the Southern California counties of Los Angeles, Ventura, Orange, Riverside, and San Diego are forecast to appreciate less than 5% over the next year, a considerable drop in projected appreciation.

San Francisco-Oakland-Fremont, the one California market among the previous 10 MSAs predicted to appreciate the most, has dropped from a 9.6% rate a quarter ago, to 7.2% in this report. Likewise, the Los Angeles-Long Beach-Santa Ana MSA has slipped.

Last quarter's projections showed it had a projected appreciation rate of 6.7% for single-family residences and slightly higher for condos and townhouses. That was comfortably above the 4.6% average of the largest 100 markets. This quarter we are forecasting that, on average, its single-family residences will appreciate just 4.5%.

Other areas that will be appreciating at lower rates are the previous hotspots of Denver, Las Vegas, Reno, and Dallas, with Manhattan and its surrounding New York market forecast to appreciate at just one percent through Dec. 1, 2019. There are also lower predictions for Salt Lake City and the rest of the state of Utah.

As further indication of the softening real estate market nationwide the number of depreciating markets has increased from 3% to 5% since last quarter's update. There are now 18 markets, twice as many as in the third-quarter 2018 report, that are predicted to depreciate over the course of 2019.

The projected range for depreciation in those bottom 10 markets is -2.6% to -0.4%, for an average of -0.92% compared with the last report's comparable average of -0.58% depreciation.

While the economy remains strong and nationwide unemployment is continuing to drop, it is the increasing housing supply and rising interest rates that are now key contributors to the softening of the market.

In fact, interest rates appear to be softening the forecasts in many markets by 1-2% over what they would have been had the flat interest rate environment continued as it has for the past several years.

https://www.housingwire.com/blogs/7-pulse/post/48127-pulse-here-are-the-10-markets-where-home-prices-will-rise-most-in-2019
43   Kakistocracy   ignore (6)   2019 Feb 10, 4:35pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Triple digit increases in real estate inventory: Las Vegas inventory up 106 percent year-over-year.

The housing market is in a state of adjustment. Inventory is up dramatically in many places. In the last housing correction, Las Vegas was a leading indicator for California and we are now seeing some dramatic increases in inventory in the area. Las Vegas inventory is now up 106 percent year-over-year. In Seattle, inventory is up 168 percent year-over-year. For anyone looking to buy, the market has dramatically shifted. There is no urgency anymore and the tides have turned as affordability has collapsed. In California, many counties are now renting majority areas and the government is looking to cater to the majority of voters. Last time inventory rose this sharply price adjustments followed. What is in store for the housing market in 2019?

Las Vegas a canary in the real estate mine?

Markets across the U.S. are seeing a sharp rise in inventory. One key area:

“(Calculated Risk) Active inventory (single-family and condos) is up sharply from a year ago, from a total of 4,352 in January 2018 to 8,957 in January 2019. Note: Total inventory was up 106% year-over-year. This is a significant increase in inventory, although months-of-supply is still somewhat low.”

First, the Las Vegas market has been on an incredible uptrend like many markets:



Prices have more than doubled since 2012. This market has been incredibly hot. However, the Las Vegas market is highly dependent on the overall economy doing well. The nature of Las Vegas employment is highly linked to people feeling wealthier to spend on vacations and entertainment. This is a cycle that was seen in the last housing bubble as well. Speculation has been happening for a couple of years now but to a lesser degree from the last housing bubble.

Looking at things as they stand today, why would you expect any sort of correction? The only thing we are seeing is that inventory is rising sharply but prices are still holding steady. However, having inventory rising by 106 percent year-over-year is definitely going to add more supply to the market which means buyers will have more options.

As mentioned before, a good portion of the employment in Las Vegas hinges on people spending freely:



Leisure and hospitality alone is 30 percent of the employment market. The Las Vegas market reacts quickly to changes in the overall economy faster than other areas because it is a barometer on people’s non-essential spending. Obviously someone is going to cut back on taking the family to Las Vegas first before cutting back on other essentials in the home. And since this market is heavily tied to California, it also signals what is happening in the adjoining area.

Sales volume is tapering off a bit in California while inventory is up:



It will be interesting to see if there is any significant bounce in the housing market in spring as winter is usually a seasonally slower period as the chart above highlights. The large rise in inventory in Las Vegas is very telling and signals that a slowdown is here. The only question that remains is if this rise in inventory will translate into price corrections.

http://www.doctorhousingbubble.com/triple-digit-increases-in-real-estate-inventory-las-vegas-inventory-up-106-percent-year-over-year/#comments
44   Kakistocracy   ignore (6)   2019 Feb 10, 4:41pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Number of homes selling above list price drastically declines - Homes selling above list price hits three-year low in December

In the second half of 2018, the amount of homes selling above list price drastically retreated, according to new data from Zillow.

In December, only 19.4% of homes were sold above list price, marking a three-year low.

Furthermore, December was the seventh consecutive month to experience a rate drop.

Zillow attributes December’s decline to several factors including, inventory improvements and increasing mortgage rates.

“Both of these factors shifted in late 2018. Mortgage rates reached above 4.9% in November, the highest level since 2011, causing some buyers to be more conservative in their bidding,” Zillow writes. “The last months of 2018 also saw the first inventory gains in three years, alleviating some of the competitive pressure on buyers.”

Notably, Zillow highlights not only did the share of homes that sold above list decline, but the average price above list dropped, too.

“Among homes sold above list, the typical amount above list has remained above $6,000 for the last several years,” Zillow writes. “As of December, the median amount had dropped to $5,860, while the median discount for homes selling below list held steady.”

Zillow suggests this narrowing means buyers and sellers are syncing up on their price expectations. In fact, across the country, the share of homes that sold above list price has been moving between 15% and 25% since 2012.

That being said, Zillow makes note that national trends don’t always directly represent separate metropolitan data. This is because homes are selling above list price at higher frequencies in some metro areas.

“So while the seller’s market appears to be waning, it’s certainly not over, and this is not a result of weak demand,” Zillow writes. “Homes are more likely to sell at the listed price as a result of convergence in the market expectations of buyers and sellers.”

The image below highlights the metros that experienced increases in homes sold above list price:



https://www.housingwire.com/articles/48135-number-of-homes-selling-above-list-price-drastically-declines
45   Kakistocracy   ignore (6)   2019 Feb 10, 4:48pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

ATTOM Data Solutions just released its Year-End 2018 Home Equity and Underwater report, which showcased graphics on historical data for the nation as well as heat maps narrowing in on zip code level data. However, what about those metropolitan areas that speak to the larger group of people? Areas where homeowners are still feeling the lingering effects of the housing market crash or areas that are seeing great value in their home.

With this latest report, ATTOM Data found that one in four homeowners were considered ‘equity rich’ while one in 11 remained seriously underwater. The number of equity-rich homeowners ticked up to its highest level in five years. However, homeowners in more expensive western states continued doing far better than those in the Midwest or South. In areas where the median home price was at least $300,000 last year, owners were far more likely to be equity-rich and far less likely to be seriously underwater than those in other parts of the country.

Take a look below at some top markets that are seriously underwater and equity rich.



Flip the coin to the other side of the spectrum to see those metropolitan areas where home equity is quite abundant.



https://www.attomdata.com/news/market-trends/figuresfriday/top-10-seriously-underwater-areas/

Year-End 2018 Home Equity and Underwater report: https://www.attomdata.com/news/most-recent/attom-data-solutions-year-end-2018-u-s-home-equity-underwater-report/
48   Ceffer   ignore (1)   2019 Feb 10, 5:27pm   ↑ like (2)   ↓ dislike (0)   quote   flag        

Take out home equity loans to buy monster trucks, plastic surgery and exotic vacations while the iron is hot! The time is NOW!
49   Kakistocracy   ignore (6)   2019 Feb 19, 5:10pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Yet another sign from the housing market of a looming recession

A number of market analysts have pointed to signs of weakness in the U.S. housing market as an indicator of a possible economic recession ahead.

A slowdown in the housing market – evident by dampening home price growth, a decrease in new and existing home sales, and a downturn in housing starts – can be a key signal of the wavering health of the overall economy.

Now, the housing market has revealed yet another sign of a potential economic instability: a persistent decline in single-family housing authorizations.

What some call a key predictor of economic recessions, single-family authorizations represent building permits requesting permission to commence construction. By contrast, housing starts signal that construction has already begun.

According to a report released Tuesday by BuildFax, a provider of data on property conditions, single-family authorizations have declined year over year for the third consecutive month in January, falling 3.48%.

The trailing three-month outlook from November 2018 to January 2019 also showed repeated declines with a 3.04% decrease, the report revealed.

“This is particularly notable as continued year-over-year declines in single-family housing authorizations are historically correlated with economic recessions between 1961 and 2018,” BuildFax stated.

Housing maintenance and remodeling activity also trended downward in the last three months.

Maintenance volume fell 6.47% year over year and maintenance spending declined 7.29%. Remodeling volume decreased 10.85% year over year, while often volatile remodeling spending increased slightly by 1.26%.

“Slowing activity in the housing sector may be symptomatic of global economic tensions and dramatic moves in the stock market,” BuildFax noted.

Nevada, Oregon and Florida were the states that posted the greatest declines in maintenance activity, which BuildFax called “a signal of shifts in consumer confidence.”

BuildFax CEO Jonathan Kanarek said it’s not surprising that the weakened housing activity seen in late 2018 persisted into the new year.

“Given current economic conditions, including the recent government shutdown, sensitivity to interest rate increases and global market stressors, like ongoing trade negotiations, we were not surprised to see persistent declines,” Kanarek said. “It is yet to be seen if an easing of these external factors will alleviate the housing slowdown.”

But one category has been posting consistent gains.

Demolition activity has risen in the past five years by 16.65% across the country.

BuildFax reported that California, Texas, Tennessee and Florida have seen the greatest amount of demolition activity in recent years, reflecting investments in those areas.

Kanarek said that while an uptick in demolition activity does signal opportunities for investment, it also comes with the potential for abandoned construction.

“Demolition activity can be a leading indicator of economic reinvestment in a community, which often precedes larger real estate projects. However, historical BuildFax research suggests intended projects are cut short when timing aligns with an economic slowdown,” Kanarek said. “During the last housing crisis, abandoned construction projects replaced anticipated new housing construction. This is not necessarily indicative of trends in a future economic slowdown, but definitely a cycle we’re tracking closely.”

https://www.housingwire.com/articles/48219-yet-another-sign-from-the-housing-market-of-a-looming-recession?id=48219-yet-another-sign-from-the-housing-market-of-a-looming-recession&utm_campaign=Newsletter%20-%20HousingWire%20Daily&utm_source=hs_email&utm_medium=email&utm_content=70053433&_hsenc=p2ANqtz-8Cg46vpIN_c118LLowCGWbSKEEdCuy1_JEbxmO_Ug1iQsBTDlpJXYDMNJNiVC-aRMs7lh9ExV5BPsqbukcq_C57vh4bQ&_hsmi=70053433
50   HEYYOU   ignore (25)   2019 Feb 19, 5:37pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Also time to bail out the TBTF, again?
51   AD   ignore (0)   2019 Feb 19, 5:38pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

average of 10 year cycle... housing boom-bust cycle from 1999 to 2009 ...and now from 2009 to 2019 ....

By the way, I was incorrect about the 30 year mortgage averaging 5% now..it did so back in November of last year ...

Now it is about 4.3%... It bottomed with an average rate of about 3.4% back in July 2016...

Mortgage rates can actually hold steady or go down regardless if the Federal Reserve continues to raise the fed discount rate .... that is because there is not enough demand for mortgages (i.e., number of mortgage applications decreasing)...
52   Kakistocracy   ignore (6)   2019 Feb 21, 7:36am   ↑ like (0)   ↓ dislike (0)   quote   flag        

US existing home sales fall sharply to 3-year low

•U.S. home sales fell in January to their lowest level in more than three years and house prices rose only modestly.

•The National Association of Realtors said on Thursday existing home sales dropped 1.2 percent to a seasonally adjusted annual rate of 4.94 million units last month.

•That was the lowest level since November 2015 and well below analysts' expectations of a rate of 5.0 million units.

U.S. home sales fell in January to their lowest level in more than three years and house prices rose only modestly, suggesting a further loss of momentum in the housing market.

The National Association of Realtors said on Thursday existing home sales dropped 1.2 percent to a seasonally adjusted annual rate of 4.94 million units last month.

That was the lowest level since November 2015 and well below analysts' expectations of a rate of 5.0 million units. December's sales pace was revised slightly higher.

The drop in January came after months of weakness in the U.S. housing market. Existing home sales were down 8.5 percent from a year ago.

The U.S. housing market has been stymied by a sharp rise in mortgage rates since 2016 as well as land and labor shortages. That has led to tight inventory and more expensive homes.

At the same time, the 30-year fixed mortgage rate has dipped in recent months and house price inflation is slowing.

The median existing house price increased 2.8 percent from a year ago to $247,500 in January. That was the smallest increase since February 2012.

Last month, existing home sales fell in three of the country's four major regions, rising only in the Northeast.

There were 1.59 million previously owned homes on the market in January, up from 1.53 million in December.

At January's sales pace, it would take 3.9 months to exhaust the current inventory, up from 3.7 months in December. A supply of six to seven months is viewed as a healthy balance between supply and demand.

https://www.cnbc.com/2019/02/21/existing-home-sales-january.html
53   MrMagic   ignore (11)   2019 Feb 21, 8:43am   ↑ like (0)   ↓ dislike (1)   quote   flag        

Kakistocracy says
At the same time, the 30-year fixed mortgage rate has dipped in recent months


Kakistocracy says
The median existing house price increased 2.8 percent from a year ago to $247,500 in January.


Kakistocracy says
At January's sales pace, it would take 3.9 months to exhaust the current inventory, up from 3.7 months in December. A supply of six to seven months is viewed as a healthy balance between supply and demand.


Sounds like a pretty good market, wouldn't you say, @Kakistocracy ?

Rates down, prices still rising, plenty of inventory. Are you ready to move out from mom's basement yet and buy a house?
54   Kakistocracy   ignore (6)   2019 Feb 21, 2:42pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

LendingTree: Pool of mortgage borrowers receiving interest rates under 5% is shrinking

84.2% of borrowers received mortgages under 5%

LendingTree's latest Mortgage Rate Competition Index revealed that borrowers with interest rates under 5% slid further for the week ending Feb. 17, 2019.

The report states that for 30-year fixed-rate mortgages, 84.2% of purchase borrowers received offers with interest rates under 5%, falling from 87.8% last week. Notably, this is a decrease from 2018’s rate when 88.2% of purchase offers were under 5%.

The report also highlights that across all 30-year, fixed-rate mortgage purchase applications made on LendingTree’s website, 21.2% of borrowers were offered an interest rate of 4.625%, making it the most common interest rate.

Furthermore, 80.5% of 30-year fixed-rate mortgage refinance borrowers received offers under 5%, rising from 78.8% one week prior. This is moderately down from 2018’s rate when 85.1% of refinance offers were under 5%.

Lastly, across all 30-year, fixed-rate mortgage refinance applications, the most common interest rate was 4.625%. This rate was offered to 20.7% of borrowers, according to the report.

When it came to mortgage competition, LendingTree reports that across all 30-year fixed-rate mortgage purchase applications on its site, the index came in at 0.68. However, the refinance market index was wider, coming in at 0.78.

“The distribution of rates — and as a result, the Mortgage Rate Competition Index — has widened as rates increased, reflecting how mortgage lenders may change the rates at which they can offer consumers loans, depending on their unique business circumstances,” LendingTree writes.




NOTE: The LendingTree Mortgage Rate Competition Index measures the spread in the APR of the best offers available on its website.


https://www.housingwire.com/articles/48240-lendingtree-pool-of-mortgage-borrowers-receiving-interest-rates-under-5-is-shrinking
55   APOCALYPSEFUCKisShostikovitch   ignore (37)   2019 Feb 21, 3:35pm   ↑ like (2)   ↓ dislike (0)   quote   flag        

That settles it!

OPEN! FIRE!
56   Kakistocracy   ignore (6)   2019 Mar 13, 4:53pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

California housing seen cooling further going into 2020: UCLA forecast

•While job growth and the California economy remain strong, weakness is apparent in the state's housing market and it is likely to cool further going into 2020, says the latest UCLA Anderson Forecast.

•The housing slowdown could put a damper on Democratic Gov. Gavin Newsom's plans to step up the pace of new homes built to help ease the state's housing shortage.

•The director of the forecast says home prices are falling in many major markets of the Golden State, calling the decline "widespread and substantial."

While job growth and the California economy remain strong, weakness is apparent in the state's housing market and it is likely to cool further going into 2020, according to the latest UCLA Anderson Forecast, released Wednesday.

"The housing markets are softening in California, and it's not just the tony neighborhoods of San Francisco, Silicon Valley and West LA," said Jerry Nickelsburg, an adjunct professor at UCLA and director of the Anderson School of Management's forecast. "This is a statewide phenomenon."

The economist said anticipated demand for housing throughout the state has been lacking despite the strength of the state's overall economy and positive trends in the job market.

Nickelsburg said the slowdown in the state's housing market also has implications for the California economy going forward. In addition, the housing slowdown could put a damper on Democratic Gov. Gavin Newsom's plans to step up the pace of new homes built to help ease the state's housing shortage.

"With our national forecast for slowing economic growth, continued discussion on when the next recession will be, and the Fed indicating that the peak of the interest rate cycle could be near, we now expect weaker housing markets into 2020," Nickelsburg wrote in the forecast report. "As a consequence, our forecast for housing starts in 2019 and 2020 has been revised downward, with a recovery in building beginning in 2021."

While the housing market is slowing, the state's job growth remains strong, according to the forecast. It said California's average unemployment rate is expected to rise to an average of 4.5 percent in 2019 with slower national economic growth, and then at a pace of 4.3 percent in 2020 and 2021.

California added the highest number of construction jobs nationally between January 2018 and 2019, according to the Associated General Contractors of America. The state added 28,500 jobs, or an increase of 3.4 percent during the period.

Meantime, Nickelsburg said home prices are falling in many major markets of the Golden State, calling the decline "widespread and substantial."

The economist said the impact of the cooling is even being felt in the Central Valley of California, where home sales have fallen by more than 10 percent.

In Southern California and the San Francisco Bay Area, home sales fell to an 11-year low in January, according to CoreLogic. The analytics provider reported sales have fallen on a year-over-year basis in the Bay Area the past eight consecutive months, while in Southern California sales have fallen on a year-over-year basis in the last six consecutive months.

At the same time, the nation's most populous state continues to suffer from a chronic housing shortage.

"Home prices are falling in California as is the level of building," Nickelsburg wrote. He said one possible explanation is "higher mortgage interest rates are depressing prices but not the underlying demand."

Another possibility behind the housing slowdown is prices are "so expensive that everyone (well a lot of everyone) is leaving," the economist added.

Newsom, who assumed the governorship in January, this week announced an updated plan to ease the state's "housing cost crisis." The Democrat proposed a $1.75 billion housing package, including $1 billion in loans and tax incentives to spur low-, mixed- and middle-income housing production.

The governor wants to build 3.5 million new housing units in the state by 2025, or an average of about 500,000 a year. But there were only about 120,000 new homes built in 2018.

Newsom is pressing cities and counties to meet those ambitious housing expansion targets. Some of the steps are controversial, such as threatening to take away transportation funds from cities that fail to meet targets.

https://www.cnbc.com/2019/03/13/california-housing-seen-cooling-further-going-into-2020-ucla-forecast.html

Anderson Forecast: http://newsroom.ucla.edu/releases/ucla-anderson-forecast-points-to-weaker-economic-growth

It's still not getting any better from these reports either

Someone took credit and ownership on the way up - they own it lock, stock and barrel on the way down as well, and it is going down.
57   WineHorror1   ignore (1)   2019 Mar 13, 8:22pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Kakistocracy says
California housing seen cooling further going into 2020: UCLA forecast

•While job growth and the California economy remain strong, weakness is apparent in the state's housing market and it is likely to cool further going into 2020, says the latest UCLA Anderson Forecast.

•The housing slowdown could put a damper on Democratic Gov. Gavin Newsom's plans to step up the pace of new homes built to help ease the state's housing shortage.

•The director of the forecast says home prices are falling in many major markets of the Golden State, calling the decline "widespread and substantial."

While job growth and the California economy remain strong, weakness is apparent in the state's housing market and it is likely to cool further going into 2020, according to the latest UCLA Anderson Forecast, released Wednesday.

"The housing markets are softening in California, and it's not just the tony neighborhoods of San Francisco, Silicon Valley and West LA," said Jerry ...

Did I read this wrong? It says less housing will be built. How does that help anything other than higher prices?
58   AD   ignore (0)   2019 Mar 13, 9:34pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Zillow now shows San Francisco, Los Angeles and San Diego all as neutral markets (i.e., neither buy or sellers market).
59   krc   ignore (0)   2019 Mar 13, 9:46pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

As IWOG would say - get ready to buy. I think a lot of his argument was that - yes - there will be fluctuations in the pricing of US real estate. But, when you look at the global market, the US is undervalued and has been so for decades. That will continue. Just to give some perspective here:

https://moneyinc.com/the-20-most-expensive-cities-to-buy-a-home-in-the-world/

And, yes, foreigners buying real estate does have an impact to pricing. And, yes, they may stop for a while, but when you look for asset purchase deals - the US still a bargain.

I do miss IWOG. I think his point on the real estate bears on this board would be "a broke clock is right twice a day." Of course there will be a pull back. :)
60   MrMagic   ignore (11)   2019 Mar 13, 9:47pm   ↑ like (1)   ↓ dislike (0)   quote   flag        

krc says
I do miss IWOG.


He has an office in Concord. Go over and visit him and have lunch.
61   Kakistocracy   ignore (6)   2019 Mar 20, 5:08am   ↑ like (0)   ↓ dislike (0)   quote   flag        

March 2019 Housing Market Reports

Orange County, March 2019

Irvine, California, March 2019

Los Angeles County, March 2019

San Diego County, March 2019

San Jose Metro, March 2019

San Francisco Metro, March 2019

Riverside County, March 2019

San Bernardino, March 2019

Ventura County, March 2019

You can access a link to each specific report here: http://ochousingnews.com/march-2019-housing-market-reports/
62   RC2006   ignore (0)   2019 Mar 20, 11:41am   ↑ like (0)   ↓ dislike (0)   quote   flag        

Wish you could see valuations over google maps, to see price changes on more local level. Are declines more in shitty areas?
63   AD   ignore (0)   2019 Mar 20, 11:55am   ↑ like (1)   ↓ dislike (0)   quote   flag        

RC2006 says
Wish you could see valuations over google maps, to see price changes on more local level. Are declines more in shitty areas?


I think the best you could do is type in zip code at https://www.zillow.com/los-angeles-ca/home-values/

Also check Zillow Research such as https://www.zillow.com/research/local-market-reports/

https://www.zillow.com/research/data/
64   AD   ignore (0)   2019 Mar 20, 12:06pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

RC2006 says
Are declines more in shitty areas?


Please define "shitty areas" in terms of demographics, test scores at local public schools, amount of people living under one household roof, etc.

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