Why has this property not sold?
The bubble is getting major media coverage now, and the tone of the articles has quickly moved from "what bubble" to "when?".
Overheated housing market is cooling off
Signs of cooling have created angst among real estate agents. "You now have agents in the office walking over to other agents asking, 'Why has this property not sold?' " says Martinez, an agent at Century 21 Lois Lauer Realty in Redlands, Calif.
In what could signal a mood shift in the feverish real estate market, tales of bidding wars and 30% annual price gains are quietly fading.
Instead, there's nervous chatter about the recent increase in the number of homes for sale, sellers cutting their asking prices and builders wooing buyers with incentives.
The reason: There are signs that the overheated market might finally be cooling. The Commerce Department, for example, said sales of new homes in September fell shy of expectations, median prices declined 5.7%, and the number of new homes for sale shot up to a record 493,000. Freddie Mac also said October mortgage applications seem to be "tapering off."
While confident real estate agents rule out a double-digit price downdraft, such as the one Dallas saw in the early '80s, the risk of sizable price drops can't be ruled out, a recent PMI study said. Its "Market Risk Index," based on an analysis of the 50 biggest markets, found a 22% chance of a price decline in the next two years. PMI estimates home prices are overvalued by 33.7% in Los Angeles, 25.6% in central New Jersey, 25.5% in Las Vegas, and 18.2% in Washington, D.C.
Caveat Emptor,
Grim
Overheated housing market is cooling off
Signs of cooling have created angst among real estate agents. "You now have agents in the office walking over to other agents asking, 'Why has this property not sold?' " says Martinez, an agent at Century 21 Lois Lauer Realty in Redlands, Calif.
In what could signal a mood shift in the feverish real estate market, tales of bidding wars and 30% annual price gains are quietly fading.
Instead, there's nervous chatter about the recent increase in the number of homes for sale, sellers cutting their asking prices and builders wooing buyers with incentives.
The reason: There are signs that the overheated market might finally be cooling. The Commerce Department, for example, said sales of new homes in September fell shy of expectations, median prices declined 5.7%, and the number of new homes for sale shot up to a record 493,000. Freddie Mac also said October mortgage applications seem to be "tapering off."
While confident real estate agents rule out a double-digit price downdraft, such as the one Dallas saw in the early '80s, the risk of sizable price drops can't be ruled out, a recent PMI study said. Its "Market Risk Index," based on an analysis of the 50 biggest markets, found a 22% chance of a price decline in the next two years. PMI estimates home prices are overvalued by 33.7% in Los Angeles, 25.6% in central New Jersey, 25.5% in Las Vegas, and 18.2% in Washington, D.C.
Caveat Emptor,
Grim
3 Comments:
We have ONLY started folks.
The drops are going to be shocking!
Things over shoot both upside and downside.
Can you say 50% drops?
Condos absolutely Houses I hope so to get excesses out of the system.
lots of home owners who have relied on house appreciation to save and spend are in for a deep deep surprise when their paper net worth goes up in smoke.
HEEE HAAAWWW
Maybe just maybe prudence and thriftiness will be rewarded for once!!!!!!
I define Northern New Jersey as:
Bergen
Essex
Hudson
Morris
Passaic
Somerset
Sussex
Union
Warren
Unfortunately, I need to look at counties on an aggregate in order to come up with a large enough sample size. Otherwise, the noise is just too great. Looking at activity on a town by town basis is almost useless. It's only when you begin to aggregate upwards to the county levels where you can see real trends develop.
My data does in fact show that North Jersey is "feeling it". However, maybe we differ in exactly what "feeling it" means. To me, it means a noticable shift in activity, a noticable shift in the trend, a reduction in the rate of change. I'm not sure what you mean, but if you are expecting a fire sale, we're a long time away from that point.
grim
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