Good news on the housing front! - PeachParts Mercedes-Benz Forum

Hatterasguy · #1 10-23-2009, 08:08 PM

http://www.msnbc.msn.com/id/33448199/ns/business-real_estate/

Inventory is down, I am seeing this in my local market. The bottom of the market ie the 250k and down range is VERY active. Sellers are seeing multiple offers, usualy above asking!

I hope the market at least hits bottom. Price declines make my life very difficult, stabil markets are nice.

tyl604 · #2 10-23-2009, 10:52 PM

No one quite knows how to interpret the sales due to the impact of foreclosures. However things may have approached, some say hit, bottom. Reports from brokers in Phoenix, one of the hardest hit areas in the country, are that builders are realizing they are out of lot inventory. They are about ready to get back in the market buying improved lots but in numbers of 15-25 lots at a time with rolling options to buy another 15-25 as the newly built homes are sold. They are interested only in entry level homes which are more reasonably priced.

In fact in the early 2000's when we had something like 25,000 new starts per year, approximately 80% of the new houses in Phoenix sold for less than $200k. By 2005 the average price of a new home had risen to $250K (up from $150K average in 2001) and we all knew we were in trouble.

This new demand (15-25 lots per builder at a time) is a far cry from what we were doing but is certainly headed in the right direction.

pawoSD · #3 10-23-2009, 11:10 PM

Quote:

Originally Posted by Hatterasguy

I hope the market at least hits bottom. Price declines make my life very difficult, stabil markets are nice.

Stable markets are nice. I agree.

catmandoo62 · #4 10-23-2009, 11:17 PM

Quote:

Originally Posted by pawoSD

Stable markets are nice. I agree.

well with winter coming on the market for sta-bil should be picking up!

pawoSD · #5 10-23-2009, 11:18 PM

Quote:

Originally Posted by catmandoo62

well with winter coming on the market for sta-bil should be picking up!

Very true.

Sev · #6 10-23-2009, 11:28 PM

stabil

pj67coll · #7 10-23-2009, 11:37 PM

Quote:

Originally Posted by tyl604

Reports from brokers in Phoenix, one of the hardest hit areas in the country, are that builders are realizing they are out of lot inventory.

I don't see how that's possible given the vast numbers of incomplete developments all over the place here. Some with little more than a few models surrounded by vacant lots and incomplete frames.

- Peter.

SwampYankee · #8 10-24-2009, 09:37 AM

Quote:

Originally Posted by Hatterasguy

http://www.msnbc.msn.com/id/33448199/ns/business-real_estate/

Inventory is down, I am seeing this in my local market. The bottom of the market ie the 250k and down range is VERY active. Sellers are seeing multiple offers, usualy above asking!

I hope the market at least hits bottom. Price declines make my life very difficult, stabil markets are nice.

I saw a presentation this past week by an economist at an independent dealer association meeting (distributors to the golf, turf and ornamental market). Very informative, very entertaining, very gloomy! He showed us real world data showing how the "recovery" is little more than a dead cat bounce (even a dead cat will bounce if dropped from a high enough point). The published numbers just don't reflect the reality (and both parties are guilty of spinning the numbers the way they want them to).

BTW, this is the same guy who gave us a presentation 5 years ago, actually he was part of a panel on receivables management and credit policies, and told us that he thought we were due for some serious corrections in real estate, the stock market and the banking industry. Many in attendance thought he was nuts and precisely why we invited him back.

On the real estate side, one stunning number was the sheer amount of foreclosed, bank-owned properties that the banks are holding onto with hopes of the market turning around at some point because they don't want to take the hit of selling that house that they originally wrote the mortgage on at the very peak of the market. When the market does start to really turn around there will be a built up inventory of bank owned properties hitting the market which doesn't bode real well.

Based on his presentation I'm thinking the recovery is going to be a lot longer and a lot flatter than we all hope.

Hatterasguy · #9 10-24-2009, 09:56 AM

I hope not, operating in this market sucks.

Its hard to buy lots because you have to get them at next years prices this year. For example just because I can get $350k for a house this year, I'll probably only be able to get $330k for the same thing next year. So you need to get the land cheaper. The problem is a lot of people think its still 2005 or hope that another 2005 is right around the corner. Reality hasn't hit them yet. They are still asking $150k for lots which was fine when you could get $450k for the house you put on it, but things have changed.

SwampYankee · #10 10-24-2009, 10:39 AM

Quote:

Originally Posted by Hatterasguy

I hope not, operating in this market sucks.

Its hard to buy lots because you have to get them at next years prices this year. For example just because I can get $350k for a house this year, I'll probably only be able to get $330k for the same thing next year. So you need to get the land cheaper. The problem is a lot of people think its still 2005 or hope that another 2005 is right around the corner. Reality hasn't hit them yet. They are still asking $150k for lots which was fine when you could get $450k for the house you put on it, but things have changed.

Not only that but things do turn around they are probably going to get back to lower, more reasonable levels.

"Flat" is the new "Up".

kerry · #11 10-24-2009, 10:50 AM

Isn't a lot of the current activity in the housing market being driven by that $8k buyer credit which is expiring at the end of November?

catmandoo62 · #12 10-24-2009, 11:08 AM

Quote:

Originally Posted by Hatterasguy

http://www.msnbc.msn.com/id/33448199/ns/business-real_estate/

Inventory is down, I am seeing this in my local market. The bottom of the market ie the 250k and down range is VERY active. Sellers are seeing multiple offers, usualy above asking!

I hope the market at least hits bottom. Price declines make my life very difficult, stabil markets are nice.

inventory may be down where your at but here there are a ton of houses for sale.and here it's about the 125,000 and down range that is showing some activity.above that and sales are few and far between.over 300k and forget it.there are lake houses here that have been for sale for well over a year with no offers.but alot of it is what has been mentioned.these people think it's still 2005 and their houses are worth 400k and up,yet they would be lucky to get an offer for half that.

kknudson · #13 10-24-2009, 11:32 AM

I do agree the market is bottoming, but how long before it improves.

With the 8K expiring, don't know if it will be renewed, and only affecting first timers not move uppers it's effect will be limited, even if extended.
And the fraud uncovered in it is going to hurt its renewal chances.

I have also heard that a lot of these "mortgage work out" programs the gov is pushing are failing because in reality it is easier and more profitable for the servicers to let the house go to foreclosure. Even though it affects the mortgage holder negatively.

The report did not provide any details, a blip on nitely news.

And personally I am scared of the recent (huge) FHA uptick in little or no down payment loans. If the job market doesn't improve, or any other minor economic problem occurs Look out.

pj67coll · #14 10-24-2009, 12:14 PM

Quote:

Originally Posted by SwampYankee

On the real estate side, one stunning number was the sheer amount of foreclosed, bank-owned properties that the banks are holding onto with hopes of the market turning around at some point because they don't want to take the hit of selling that house that they originally wrote the mortgage on at the very peak of the market. When the market does start to really turn around there will be a built up inventory of bank owned properties hitting the market which doesn't bode real well.

Based on his presentation I'm thinking the recovery is going to be a lot longer and a lot flatter than we all hope.

Correct. There are a vast number of foreclosed/bank owned houses around here. A year ago they all had fore-sale signs on them. Now they've all disappeared and the houses just sit vacant. And thats apart from the huge number of incomplete developments all over the place.

The "recovery" once the market bottoms out, which it has not yet done in my opinion, will probably be a very long flat period lasting about a decade. Only after 2020 will we start to see a meaningful upswing in the market in my opinion.

Bottom line. No jobs, no economy, no housing market.

- Peter.

- Peter.

Fulcrum525 · #15 10-24-2009, 12:30 PM

Quote:

Originally Posted by SwampYankee

Not only that but things do turn around they are probably going to get back to lower, more reasonable levels.

"Flat" is the new "Up".

I'd rather things be flat and stable then constantly crashing down.

My opinion is that if the market was slower and flatter the first time we wouldn't be in this mess right now..... Learn from others mistakes when you can.

http://en.wikipedia.org/wiki/Japanese_asset_price_bubble
http://en.wikipedia.org/wiki/Lost_decade_(Japan)