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| 2007/4/24-27 [Reference/RealEstate] UID:46429 Activity:moderate |
4/24 Existing home sales drop 8.9% in March, largest since 1989. Median
home values drop 8th straight time. Where's smug housing guy?
http://urltea.com/fbq
\_ Ooh, another huge 0.3% year-over-year drop! RUN FOR THE HILLS!
\_ Super-inflated Santa Clara / SF is going to take a long effin' time
to drop significantly in price. Podunk-ville, I can see real drops.
There are three major categories of people in America:
- Median wage earners
- Professionals
- Professionals (the future wealthy) and the wealthy
- Fucking-super-wealthy bastards
I call it "three America's".
I think that the latter two are doing much better in terms of growth
in net worth than the first group, which is reflected in the real
estate environment we see today. It's not a stretch to say as
housing slows down, we'll see this trend more clearly.
I call it "three America's".
estate environment we see today. Translation: Regions with lots of
professionals and/or the super-wealthy will maintain values --
professionals and/or the super-wealthy will maintain value --
because they can afford it, and they can stretch.
professionals and/or the wealthy will maintain value -- because they
can afford it, and they can stretch.
\_ I think the profressionals are going to do worse and worse every
\_ I think the professionals are going to do worse and worse every
generation from now on till they more or less don't exist
anymore.
\_ It's happening right now and has been for 20+ years. Look at
doctors for a start.
\_ What about them...? I agree that over time professionals
are doing worse in ways that matter: hours worked,
vacation, benefits etc. Most doctors I see are doing very
well though. Maybe they suffer more getting started though.
\_ Their incomes have eroded and their work hours have
increased. My neighbor is a doctor and he said that
his life is much different than his father's was
(his father was also a doctor) and that he's not
recommending that his 17 year old son go to medical
school at all when the time comes. Yes, doctors
still do well, but the above states "worse and
worse" which is true. That's not even accounting
for "getting started" which involves (for many)
$200K in student loans.
\_ When prices drop 8.9% *and* I'm trying to sell my house during that
drop, let me know. A co-worker was reading too many blogs and
convinced himself that a 40% drop in prices was coming (due about
6 months ago). I'd love to see a 40% price drop. Then I could
afford to move to another house and buy a few more as investments.
Or housing prices can stay where they are or keep going up. Then
when I sell my house I have a huge profit. Either way, as a home
owner I win big time.
\_ I'm not saying there's going to be a 40% drop, but if there
WAS a 40% drop here is how it would start. Prices on houses
drop a little. The market gets a bit skittish. People trying
to sell their residences take places off the market/stay where
they are for longer. If this reduction in supply doesn't
bring prices back people who have to sell or new construction
has to drop because the owners are losing money if they don't
sell. Thus starts the death spiral. Once again I'm not
saying this is going to happen. |
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| urltea.com/fbq -> www.nytimes.com/2007/04/24/business/24wire-homesales.html?ex=1335067200&en=1001eb4fbc010653&ei=5090&partner=rssuserland&emc=rss Article Tools Sponsored By By THE ASSOCIATED PRESS Published: April 24, 2007 WASHINGTON (AP) -- Sales of existing homes plunged in March by the largest amount in nearly two decades, reflecting bad weather and increasing problems in the subprime mortgage market, a real estate trade group reported today. The National Association of Realtors reported that sales of existing homes fell by 84 percent in March, compared with February. The drop left sales in March at a seasonally adjusted annual rate of 612 million units, the slowest pace since June 2003. The steep sales decline was accompanied by an eighth straight fall in median home prices, the longest such period of falling prices on record. The median price fell to $217,000, a drop of 03 percent from the price a year ago. The fall in sales in March was bigger than had been expected and it dashed hopes that housing was beginning to mount a recovery after last year's big slump. That slowdown occurred after five years in which sales of both existing and new homes had set records. David Lereah, chief economist at the Realtors, attributed the big drop in part to bad weather in February, which discouraged shoppers and meant that sales that closed in March would be lower. Existing home sales are counted when the sales are closed. Lereah said that the troubles in mortgage lending were also playing a significant part in depressing sales. Lenders have tightened standards with the rising delinquencies in mortgages especially in the subprime market, where borrowers with weak credit histories obtained their loans. There was weakness in every part of the country in March. They were down 91 percent in the West, 82 percent in the Northeast and 62 percent in the South. "The negative impact of subprime is considerable," Lereah said. Lereah said he didn't expect a full recovery in housing until 2008. He predicted that sales of existing homes would drop by about 3 percent this year with the decline in sales of new homes an even steeper 15 percent. He said that the median price for homes sold in 2007 would fall by 1 percent to 3 percent, which would be the first price decline for an entire year on the Realtors' records, which go back four decades. The steep slump in housing over the past year has been a major factor slowing the overall economy. It has subtracted around 1 percentage point from growth since mid-2006. Tips To find reference information about the words used in this article, double-click on any word, phrase or name. A new window will open with a dictionary definition or encyclopedia entry. |