Tuesday, August 22, 2006

NAHB (Un)Affordability Index

2006 Q2 HOI spreadsheets were released by the NAHB today:

NAHB-Wells Fargo Housing Opportunity Index (HOI)

Q2 - Northeast Least Affordable

1 - New York-White Plains-Wayne, NY-NJ
2 - Nassau-Suffolk, NY
3 - Barnstable Town, MA
4 - Ocean City, NJ
5 - Providence-New Bedford-Fall River, RI-MA
6 - Newark-Union, NJ-PA
7 - Boston-Quincy, MA
8 - Atlantic City, NJ
9 - Edison, NJ
10 - Bridgeport-Stamford-Norwalk, CT

Q2 - National Least Affordable

1 - Los Angeles-Long Beach-Glendale, CA
11 - New York-White Plains-Wayne, NY-NJ
22 - Nassau-Suffolk, NY
31 - Ocean City, NJ
40 - Newark-Union, NJ-PA
50 - Atlantic City, NJ
52 - Edison, NJ

Caveat Emptor!
Grim

13 Comments:

Blogger grim said...

Seems that we are not alone in our dismal July performance. From the Boston Herald:

July Single-family home sales drop at sharpest rate in 11 years

Sales of single-family homes in Massachusetts declined in July at the sharpest rate for a single month since 1995, and condominium sales dropped off at the fastest pace since 2003, according to a report released Tuesday by a firm that tracks real estate transactions.

Single-family home sales dropped nearly 27 percent and condo sales fell 23.5 percent, offering fresh evidence that the state’s housing slump isn’t about to end soon. But The Warren Group urged not to read too much into numbers from a single month.
...
The median sales price - the point where half of homes sell for more and half sell for less - fell 6.1 percent to $339,000.

Condominium sales fell to 2,692 last month from 3,518 in July 2005, the sharpest decline since a 23.8 percent drop-off in March 2003. The median price fell 4.2 percent to $277,000.

Single-family home sales have now declined for seven straight months measured against comparable months a year earlier, and for 17 of the last 18 months dating to February 2005. Condo unit sales have fallen each month since April.

8/22/2006 01:40:00 PM  
Blogger grim said...

From Bloomberg:

Mills Reaches Pact With Investors for Xanadu Project

Mills Corp. said it reached a financing agreement with Colony Capital Acquisitions LLC for the Meadowlands Xanadu project in New Jersey, freeing the shopping- mall developer to pursue a sale of the company.

Colony will provide as much as $500 million of equity financing and arrange for construction loans to fund the balance of the expected $2 billion cost of the Xanadu project, Chevy Chase, Maryland-based Mills said in a statement today. After the agreement is completed, Mills will become a limited partner in Xanadu and will have no financial obligations to the project.

``It definitely gives the project that infusion of cash they desperately needed,'' said New Jersey State Senator Paul Sarlo. ``I think everyone realized something like this had to happen. Mills was not going to be able to do it alone.''

8/22/2006 01:42:00 PM  
Anonymous Anonymous said...

It seems no matter what that prices have gone far beyond affordability for most avergae income residents that prices are just sinking of their own weight.

The bad news rolls out daily. A FBer must be losing sleep everynight worrying about being upside down on their loan.

8/22/2006 01:47:00 PM  
Blogger RichInNorthNJ said...

Here are the numbers for July, Bergen County ONLY. These numbers include SFH, Condos, Co-Ops & Twnhses.

The numbers mean the following:
Year Avg$ Med$ Sold UnderContract

1995 $229,172 $205,000 450 598*
1996 $269,956 $218,000 890 741
1997 $265,457 $218,000 1014 826
1998 $282,631 $222,500 1101 878
1999 $321,389 $250,000 1093 850
2000 $324,754 $260,000 986 842
2001 $381,572 $300,000 1059 855
2002 $416,943 $335,000 1069 893
2003 $469,366 $380,000 1130 1138
2004 $608,696 $455,000 1282 967
2005 $588,485 $480,000 1082 944
2006 $607,368 $490,000 902 751

*1995 data may be incomplete as I believe this is the first year this data becomes available.

8/22/2006 02:23:00 PM  
Blogger grim said...

Something really interesting in that Bloomberg piece on Xanadu..

Colony's properties include the Raffles hotel group, the Las Vegas and Atlantic City Hilton hotel-casinos and the Resorts International Atlantic City Hotel and Casino. Colony, run by real estate investor Tom Barrack, also is part of the investor group that is buying Kerzner International Ltd., the owner of the Atlantis casino-resort in the Bahamas.

Anyone want to take a bet on Xanadu morphing from mega-mall to mega-casino?

grim

8/22/2006 03:37:00 PM  
Anonymous Anonymous said...

So who are these people who are always portrayed in the NY Times & NY Magazine in the real estate sections???

What exactly do they do that allows them to buy a one bedroom co-op for 1 million with 20% or more down...

What about all the recent grads who are buying up most of the condos going up in downtown JC, Hoboken, Chelsea & Tribeca??? How do they afford it, and how can these people afford $4,000 + monthly PITI payments??

8/22/2006 04:22:00 PM  
Blogger RichInNorthNJ said...

What exactly do they do that allows them to buy a one bedroom co-op for 1 million with 20% or more down...

I'm guessing wealthy, powerful people with VERY good careers.
It's hard for me to believe at times also, but there are a lot of people out there who make exorbitant amounts of money.

What about all the recent grads who are buying up...

Where did you read about these "recent grads" buying these properties? Can you post a link?

8/22/2006 04:54:00 PM  
Anonymous Anonymous said...

I know one---someone I know from graduate school, whose family has money, bought a 950K condo in Hoboken last year. The maintinance is $800 per month and the taxes are 10K per year. They put $450K down---and this person makes $120 a year, fresh out of school. Too bad an identical condo in her building just went on the market for $660K---albeit, without the view of NY....but still. Just because people have money, doesn't mean they do smart things with it.

8/22/2006 05:02:00 PM  
Blogger chicagofinance said...

Anonymous said...
So who are these people who are always portrayed in the NY Times & NY Magazine in the real estate sections???

who are buying up most of the condos going up in downtown JC, Hoboken, Chelsea & Tribeca??? How do they afford it, and how can these people afford $4,000 + monthly PITI payments??
8/22/2006 05:22:32 PM

people who are successful or soon to be successful and have the benefit of a head start due to family stuffing their pockets

examples:
my first apartmentmate out of college;

smart guy, good job, dad bought him 10 suits, shirts, ties and 4 pairs of shoes.

They bought him a brand new Honda Civic.

Throughout the two years I lived with him, little items, like he'd come back from a weekend at home with enough food for 2 weeks, they'd pay for plane tickets to here and there, he'd get free tickets to sporting events, he had an accout of money that had been set aside for him, nothing crazy, but $75,000 is nice when you are 23 years old in 1992.

Nothing crazy, but when you add it all up, he really looked as if he was making about double the money he actually, and he was making pretty decent money.

8/22/2006 05:07:00 PM  
Blogger Richard said...

chicago, your roomate is exactly the people who are buying these places. they come from families that are well off, some went to private school, most went to top colleges and are starting their working careers making $120k a year. if you are from or part of a family like this, where else would you want to go except NYC or maybe 1 or 2 other places to test your mettle?

8/22/2006 06:23:00 PM  
Anonymous Anonymous said...

{{they come from families that are well off, some went to private school, most went to top colleges and are starting their working careers making $120k a year. if you are from or part of a family like this, where else would you want to go except NYC or maybe 1 or 2 other places to test your mettle?}}

Would you goto Long Island, Bergen County or the 'Other 4 Boros' outside of Park Slope or Brooklyn Heights??

The whole region has gotten shockenly unaffordable for anyone making less than $120,000 a year.

I guess making $70,000 or $80,000 out of school is like making minimum wage in the NYC metro area...

8/22/2006 08:18:00 PM  
Blogger RichInNorthNJ said...

I guess making $70,000 or $80,000 out of school is like making minimum wage in the NYC metro area...

I wouldn't think so as I feel the examples above are outside the norm.
To me, someone who can make that kind of coin just out of school with NO experience has one hell of chance of increasing their income as they progress through life.
Otherwise, if they feel they'll never "move up", I guess they would have to shut-up and move.

8/22/2006 08:46:00 PM  
Blogger RentinginNJ said...

I wonder how NJ would look on the list if you added property taxes and heating/cooling costs to the equation.

Most of the places listed with greater affordability strains than NJ also have lower property taxes and more temperate climates, reducing the need for heating and AC.

8/22/2006 09:07:00 PM  

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