Moody's Sees Prices 10-25% Lower in 2009 - Housing Tracker

Quote of the Day

"Where in the world does it stop?" - National Association of Homebuilders chief economist David Seiders, on the worsening rate of foreclosures and resulting falling prices. (Star Tribune, May 5th)

Home Price and Sales Trends

Denver Home Values Fall Less Than Nation's. Colorado: Zillow reports homes prices in [the metro] Denver-Aurora area… dropped by 5.1% in Q1’08 from Q1’07. That is consistent with the S&P/Case-Shiller 20-market index… released last week… The median home price in the Denver-Aurora area was $213,000. Eighteen of the metro areas had higher-priced median homes and 21 of the metropolitan areas showed bigger drops… Riverside-San Bernardino-Ontario, California, saw a 26% drop [to] $287,500. Dallas-Fort Worth gained… 1.1% [to] $130,500. Pittsburgh and Cleveland-Elyria-Mentor, had lower median prices, at $105,500 and $124,000, respectively. The median price in Denver, [identical to the national median,] was $213,000.” (Rocky Mountain News, May 6th)

How Low Will Real Estate Go? “Moody's Economy.com/Forbes.com predict that 2008 isn't going to be any gentler than last year on slumping markets like Los Angeles, Sacramento, Calif., Las Vegas and Tampa, Fla., where market weakness is expected to cause 10%-25% drops over the next year. Moody's model incorporates inventory levels, job growth or loss, and the availability and cost of credit based on current mortgage rates and the Federal Reserve's Senior Loan Officer Survey, which asks lenders about their mortgage standards. The model also measures home buyer expectations on a market-by-market level, based on an 18-month moving average of home prices.”(LA Times, May 5th)

Big Island Home Sales, Prices Down. “Hawaii Information Service: The median price of a condo on the Big Island last month was $609,900, a 58% jump over April 2007, when the median price was $385,000… because of a surge of sales in South Kohala, a favorite of affluent vacation homebuyers… Condo sales for the Big Island were 23% down from April 2007, [and down 20%] year-to-date [frm] Jan.-Apr. 2007. Single-family home sales were down 19% in April, YTD sales are down 29%... The median price of a single-family home on the Big Island in April was $385,000, down 7% from the year before when it was $412,000.” (Pacific Business News, May 5th)

Compared With Much Of The Nation, KC’s Housing Decline Is Hardly A Blip. “Kansas City Regional Association of Realtors: The average existing home sales price in the Kansas City area during March was $144,910, down 3% from a year earlier. Existing home sales in March totaled 1,924, down 13% from a year earlier… As a group, the homes were most recently on the market for between five weeks and 10 months. The discount from their final asking price to sales price ranged from 1.8%-5.6%.” (Kansas City Star, May 5th)

Slow Home Appreciation Makes Renting Look a Little More Enticing. Washington: “Northwest Multiple Listing Service: Year-to-date [median] home prices in Kitsap County [are] now $349,900. That's only $100 less than the same period past year... Very slow appreciation for homes that lost as much as 25% of their value make for a double-barreled reason to give up trying to sell, for now. Inventory of single-family homes grew 22% in Kitsap County YTD over the same period last year. Slow appreciation may also be turning some would-be buyers into renters… Kitsap County Consolidated Housing Authority reported a sharp drop in rental vacancy rates, from 7.8% in March 2007 to 4.2% in March 2008.” (Kitsap Sun, May 5th)

Leaning Towers. Portland Oregon: Over 4,000 condos appeared on the market in Portland between 2000-2006... Portland State University’s Real Estate Quarterly: In 2005, buyers snapped up 800 condos in the Pearl, a substantial portion of the total 1,000 sales in the city…Several new towers both in the Pearl and in the newly emerging South Waterfront district are slated for completion in 2008; as many as 1,000 additional units are expected to make an appearance on the scene… adding to an already sizeable inventory: The Regional Multiple Listing Service for condos in Portland [shows] over 1,900 for sale in late March.” (Sustainable Industries, May 5th)

April Not A Bad Month For Home Sales. Washington: “Northwest Multiple Listing Service: In all 19 Western Washington counties, the median sales price for condos and single-family residential homes fell slightly while the average home sale price inched slightly upward… The median home sale price in King County in April was $410,000, up slightly from March's $405,000 amount. The average home in King County sold for $498,861 last month, up from $491,537 in March. In all 19 counties, the median home price fell to $310,000 last month from March's $314,500 level. The average April home sale in Western Washington was $377,800, up [slightly] from $377,617 in March.” (Puget Sound Business Journal, May 5th)

House Sitting -- On A Grand Scale. “Homeowners reach for another tool in the ongoing struggle to sell their properties… Home managers live in empty homes, keep them in pristine condition and ready to show at a moment's notice, and are prepared to pack up and ship out in as little as 10 days once the place sells… Something of a cross between a paying tenant and a free house sitter, it's an option that's winning support among creative owners and real estate agents who say it's giving them an edge in today's mulish market… The use of home managers seems to get fresh legs whenever the market hits a slowdown.” (LA Times, May 4th)

Housing Weakness Isn't Over Yet, Buffett Says. “Warren Buffett: Residential real estate markets in Nevada, California, Arizona and Florida have been hit the hardest, but trouble in those states has a "mild contagion effect," across the whole U.S.. Buffett said he sold two residential units in San Francisco about two years ago. The real estate agents wanted him to list one of the properties for $995,000, but Buffett listed it above $1 million and it sold for $1,750,000 in one day. "There were 20 buyers that day," Buffett said." (MarketWatch, May 4th)

The Accidental Renters. “Hundreds of thousands of former homeowners have been scrambling to find a place to rent. Yet rental properties are in short supply in many markets, pushing prices higher. And some landlords are imposing tougher credit requirements on people who have gone through foreclosure… Harvard University's Joint Center for Housing Studies: Foreclosures have helped swell the ranks of renters… U.S. renter households increased by nearly one million last year -- four times the pace of renter growth from 2003 to 2006 -- to 35.1 million. Competition for rental properties has pushed up average rents to a record $775/month.” (Wall St. Journal, May 2nd)

Luxury On Parade. North Carolina: “Parade of Homes, the free, self-guided tour of more than 140 homes hosted by Charlotte's builders which begins next week, will feature more high-end homes than ever before, including three dozen priced at more than $1 million and one topping $3M... Diane Virkler of the Home Builders Association of Charlotte: The number of expensive homes is unprecedented… Lots of costly homes remain unsold because of the housing slowdown. The parade has always featured a wide array of price ranges, but the high-end builders especially are seizing the opportunity to market their speculative houses.” (Charlotte Observer, May 2nd)

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Comments

[Robert Bragg]

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[Scorpio69er]

I told you so -- LAST YEAR.

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