Quote of the Day
“One person said they were seeing investors come back to the market. When they come back, it signals that the prices may have hit the bottom.” - Dave Phillips, head of the Charlottesville Area Realtors Association, who is optimistic about real estate in 2008. (Daily Progress, Jan. 14th)
Real Estate Sales and House Prices
Home Sellers' Pain Is Renters' Gain "Some homeowners forced out by foreclosure are finding rental deals that are at "discounts of 50% to 70% off what they were paying on their mortgages," says Brenda F. Gerdes, of Management Specialists Inc. in Florida. Real-estate research firm Reis, Inc.: Vacancies have risen in 29 markets in Q4'07, including Las Vegas, Palm Beach, Memphis, Orange County, Calif., and Orlando. Ron Witten, a Dallas-based housing analyst, estimates there are 760,000 vacant condos and homes for sale nationwide beyond what the market could normally carry, in addition to a surplus of 350,000 vacant rental properties... In five struggling markets in Florida, average rents have actually declined since Q3."
Home Sales Dip In Region "RealStats, a Pittsburgh real estate information company: Home sales in the Pittsburgh region fell nearly 7% in 2007 compared to 2006, continuing a 10-month slide that included an almost 14% drop in December... Despite the drop in sales, the average price of homes sold in the five-county market rose about 3% for the year. The trend in rising prices slowed in December. There were 31,139 sales in 2007, a drop of 6.6% from 33,338 sales in 2006 in the five counties... The December sales decrease followed a 14.8% drop in November 2007 sales vs. November of the previous year."
MBA Predicts Fewer Loan Originations in 2008 Mortgage Bankers Association: "We expect housing starts and home sales to continue to trend down and reach bottom around the end of Q3'08. Total existing home sales for 2008 will decline by about 13% from 2007 to 4.94 million units. Sales will pick up by about 4% in 2009. New home sales will decline by about 15% in 2008 from 2007 to 666,000 units. We expect sales to increase about 7% in 2009. Median home prices for new and existing homes are expected to decline this year, with nominal median prices falling about 2%. Prices should increase by 1%-2% in 2009."
County Housing Prices Down 13.1% From Year Ago "DataQuick Information Systems: San Diego County housing prices last month tumbled 13.1% from December 2006, the biggest drop in 20 years of record keeping. The overall median price for all homes stood at $430,000 in December, $10,000 less than November's price and $65,000 less than in December 2006. The latest price represented a 16.9% drop from the county's all-time peak of $517,500 in November 2005 and the lowest since March 2004... Sales last year totaled 34,741, a decrease of 22.1% from 2006, making 2007 the slowest year since 1995, when the last major recession was nearing its end."
Charlotte-Area Home Closings Down 22% "Carolina Multiple Listing Services Inc.: The number of houses sold in the Charlotte, North Carolina area fell 22% last month, and the average closing price also declined. The number of closings dropped to 2,559 last month from 3,283 in the year-ago period. The average residential closing price decreased to $218,399 in December from $226,966 in the year-ago period. Houses sold last month were on the market an average of 125 days. The housing data covers homes that have existed for at least a year and some newly constructed residences in Mecklenburg, Union, Iredell, Lincoln, Cabarrus, Gaston and Stanly counties."
Area's Year-End Home Sales Fall "Virginia: Charlottesville Area Association of Realtors report: 2,949 homes were sold in 2007, a decrease of 780 homes from 2006... The median home sales price increased in Fluvanna, Greene and Louisa counties by between $8,000 and $16,000, but decreased by $10,000 in Albemarle and by $15,000 in Nelson. The report showed a $40,000 increase in median home sales prices in Charlottesville, but the large rise was attributed to a higher number of condominiums sold in 2006, new construction in the city with price tags between $300,000-$500,000 and fewer homes sold in 2007."
Median Of $232,000 Signals Market May Have Corrected "The median price of an existing metro-Phoenix home tumbled to $232,000 in December, an 11% drop from... the beginning of 2007... December's median home price was the lowest since the spring of 2005. Realty Studies group at Arizona State University: The median price of an existing metro-Phoenix home in April 2005 was $221,000. The Valley's median existing-home price hit a high of $267,000 in June 2006. December's median is a 13% drop from the peak. Based on the 6%-10% Valley home prices climbed annually before the boom, $232,000 is pretty close to where the median home price would be without the boom."
South Bay Home Prices Up 14.3% "South Bay Association of Realtors: California's South Bay median price for a single-family home in December was $741,500, or 14.3% more than a year earlier... The median price increase came despite a 48% annual drop in home sales in December... The median listing price of a single-family home fell 6.9% in December compared with a year earlier... The median price of condominiums and town houses sold in December was $510,000, down a mere 2.9% compared with a year earlier. "
Market's Bottom Is Coming, But When Is Everyone's Guess "Now is your chance to play a new game I've started called "Bottom's Up." In Bottom's Up all you have to do is pick a month on a calendar, one that you feel will mark the bottom of the market. As with the Super Bowl version, my game doesn't require understanding the tendencies of the real estate market, meaningful statistics or even the economic forecast. You may be playing against some very well respected experts, but don't worry, you won't be at a disadvantage. There is no skill in this game either. The winner will win by pure luck."
Caroline Baum: New Year Brings Another False Dawn For Housing "Economist Ian Shepherdson: In recent months, the inflow (of homes for sale) has been slower than the pace of sales," which has the effect of reducing the inventory of new homes: "In the three months to November, the gross inflow of new homes onto the market plunged at a 60.7% annualized pace compared with the previous three months," a cutback comparable to one last seen in the housing bust of 1981."
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