Housing Bubble and Real Estate Market Tracker

by: Judy Weil

Judy Weil submits: Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day- "From the House's Mouth"

"Traffic only decreased from 13.2 to 11.8. There are interested buyers there. The challenge is mortgage qualification and buyer psychology." – Ara Hovnanian, CEO Hovnanian Enterprises homebuilder. Hovnanian believes the traffic figures indicate a recovery could start, but tighter lending standards and negative media coverage is holding buyers back. (Hovnanian Enterprises F3Q07 (Qtr End 7/31/07) Earnings Call Transcript in Seeking Alpha, Sept. 9th)

Real Estate Sales and House Prices

  • House Hunting in a Hurricane Zone (BusinessWeek, Sept. 11th): "[After] Hurricane Katrina… New Orleans area [home prices] bounced back quickly as developers took advantage of [government] aid that became available for reconstruction. National Association of Realtors: Between 2005-2006, the median price of homes sold in the New Orleans area jumped from $159,200 to $173,100. Now the region appears to be undergoing a price correction due to the post-Katrina runup. The median price of homes sold in Q2'07 was $166,000—6.7% lower than the median price a year earlier."

  • Area Home Sales Drop 17 Percent in Aug. (Baltimore Sun, Sept. 10th): "Metropolitan Regional Information Systems: The volume of home sales in the Baltimore area plummeted 17% in August… In August, 2,868 homes were sold in Baltimore and the five surrounding counties, compared with 3,460 homes sold in August 2006… The average price of homes settled in August stayed flat, inching to $323,134, from $323,215 during August 2006, the MRIS said. Sellers, on average, got just under 95% of their asking price. Homes were sold after an average 84 days on the market, a 44% increase in selling time from August 2006."

  • Nashville Home Sales Fall (The Tennessean, Sept. 10th): "The median home price in the Nashville area climbed slightly in August despite more than a year of slowing sales. The median single-family home in the area sold for $189,719 in August – 3% higher than the median price in August 2006… Home sales declined for the 13th straight month in the Nashville area as the number of homes on the market continues to climb. Sales fell 10.9% in August compared to a year ago. There were 22,396 listings of homes, condos and land for sale in the Nashville area last month, a 34% increase from a year ago."

  • Homesick (Wall St. Journal, Sept. 10th): "Kenneth Heebner, manager, CGM Realty Fund: The vulnerable mortgages are… held by pension funds, hedge funds [for institutional accounts and wealthy individuals] and foreigners. There could be some effect on the Manhattan and the Greenwich, Conn., economies [where many hedge funds are based], but no broad effect on the U.S. economy. Housing: [I expect] a 50% decline in the inflated coastal markets.... [When] homebuilders' conference calls talk about the concessions they make in the form of extras at no cost to the buyer, they can be 20% to 30% of the house price. So the full 50%... may come in other forms. In the next six months, I think there is going to be another meaningful leg down in housing. Builders need to sell about one house a week to stay cash-flow positive, so they'll just cut the prices."

  • Building Activity Continues To Lag In August (Minneapolis Business Journal, Sept. 10th): "Keystone Report for the Builders Association of the Twin Cities: Building in the Twin Cities continues to lag compared to last year, and m/m permits issued were also down slightly in August… There were 911 units permitted in August 2007, down from 1,646 units permitted in August 2006… M/m building permits issued were down slightly from July-August as well. In July 2007 there were 947 permits issued, compared to 911 issued in August. For the year so far, there have been 6,408 units permitted, down from 9,402 units permitted through the same point last year."

  • Orlando’s Median Home Price Drops 2.0 Percent To $245,000 (dBusiness News, Sept. 10th): "The median price of an Orlando home purchase in August 2007 decreased 2% to $245,000, over August 2006’s median price of $250,000… Orlando Regional Realtor Association: [New inventory] in August 2007 continues its slowing trend… Orlando area [sales] declined by 40.3% in August 2007 vs. August 2006 (1,343 to 2,249) [and compared to] July 2007 (1,524). Year-to-date sales for 2007 (12,455 through August) are down by 37.2% over the same period in 2006 (19,824)… Homes of all types spent an average of 108 days on the market before being sold; and the average home sold for 95.1% of its original asking price."

  • Local Home Prices Keep Rising, But At Slower Pace (Seattle Times, Sept. 10th): "Northwest Multiple Listing Service: Local home prices continued rising in August, but at a slower pace… The Puget Sound region overall saw a 5% increase in selling prices from last year. Single-family home prices in Seattle [rose] about 10% to a median $501,000, up from $455,000 in August 2006. Seattle condos sold for a median price of $327,500, a 5.7% increase from last August's $309,950. King County single-family homes sold for a median price of $477,345 in August, 9.7% higher than… last August $435,000… Snohomish County saw a 4.5% increase in prices for single-family homes to $375,000 this August, rising from $358,875 in August 2006."

  • New York, California Metro Home Prices May Decline (Bloomberg, Sept. 10th): "Ken Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at UC/Berkeley: Home prices will decline 5%-10% from last year's peak in New York and San Francisco, and by more than that in Washington... Mark Zandi, co- founder of Moody's Economy.com, an economic forecasting agency: Prices may start to drop in the NYC metropolitan area beginning in Q4'07 and continue falling 1%-7% per quarter through 2008… In the San Francisco Bay Area, Zandi forecasts a decline of 3% in Q4'07 and subsequent drops of 4%-6% for the following three quarters. DataQuick Information Systems and the Northern Virginia Association of Realtors: Home sales in the San Francisco Bay Area fell in July to their lowest in 12 years, although prices… remain steady."

Real Estate Investing and Sentiment

  • Midtown’s Biggest Fans May Be Foreign Buyers (NY Times, Sept. 9th): "The credit crunch is likely to [pave] the way for… foreign investors who… now see an opportunity to scoop up coveted Manhattan real estate… In May, there was the $1.18 billion sale of the Deutsche Bank building at 60 Wall Street to the Paramount Group of Germany. In June, Italian real estate investor Luigi Zunino… purchased 660 Madison Avenue… for $375 million… An Israeli-led investor group paid $648m for a 70% stake in the Lipstick Building, In late August, the Dubai investment company Istithmar [bought] Barneys New York [for $942.3m. Real Capital Analytics: There were 46 transactions totaling $5.27b by foreign buyers of commercial real estate in Manhattan through August, up from 28 for all of 2006."

Mortgates and Real Estate Lending

  • Third Avenue Management Boosts Radian Stake to 11% (Bloomberg, Sept. 11th): "Third Avenue Management LLC… more than quadrupled its stake in mortgage insurer Radian Group Inc…. SEC filing: Third Avenue held 8.63 million shares of Radian, or 11% of outstanding shares, as of Aug. 31... Mortgage insurers protect lenders against homeowner defaults… Canadian mutual fund manager AIC Ltd… last week more than doubl[ed] its Radian stake to 10.8 million shares, or 13%, as of Aug. 16. Last month, hedge fund manager D.E. Shaw… increased its Radian ownership to 4.26 million shares as of Aug. 7, from 1.12 million… Inside Mortgage Finance: In 2006… Radian insured $40.1 billion, or 15% of the mortgage insurance market."

  • Brokers Plea: Raise Limit On Home Loans (MLive.com, Sept. 10th): "A proposal pending in a U.S. Senate committee that would raise government home-loan limits in California and other high-priced markets could provide a life raft for thousands of East Bay borrowers caught between softening home prices and skyrocketing adjustable-rate mortgages, mortgage brokers say. The House-passed bill, HR 1427, would allow mortgage repurchasers Fannie Mae and Freddie Mac to securitize and sell loans of up to $625,000, or 150% of the conforming loan limit of $417,000, in areas where the median home price exceeds the conforming limit... DataQuick Information Systems: California's median home price was $478,000 in July."

  • Monday's Options Report: Limited, Countrywide, Southwest, CBS (Andrew Wilkinson in Seeking Alpha, Sept. 10th): "Observers have taken Countrywide Financial's (CFC) [Friday job cuts] announcement as a possible yardstick for job casualties in the mortgage sector at large. Options traded Monday [with] twice as many puts as calls. We noted what may be strangle positioning in the October contract, at the 15 puts and 20 calls. Put-side activity also appeared to favor the January contract, where 17,700 lots traded at the 17.50 strike, and 13,200 lots traded at the 20 strike. Implied volatility on these options stands at 90% - a tender understatement in light of the 152% licking that Countrywide shares have taken in recent months."

  • End of Boom For Housing Hits Title Firms (Wall St. Journal, Sept. 10th): "One of the nation's largest title insurers, First American Corp., recently said paid claims jumped 52% in Q2, vs. Q2'06… A [possible] broader sign of economic pain than foreclosures. Claims are often filed even in the absence of a foreclosure. And they can be triggered not only by homebuyers, but also by complaints from another party, [and] can include commercial properties… First American says average daily title orders were down 6% in July from June and that preliminary results indicate another 9.3% drop from July to August. Fidelity National Financial, a major title insurer… says there was a nearly 8% decline between April and June… First American… swung to a loss of $66 million in Q2'07, after recording net income of $25.5m in Q2'06."

Subprime Fallout

  • Leading Countrywide Investor Cuts Stake (MSNBC, Sept. 10th): "SEC filing: An investor group affiliated with French financial services company AXA SA slashed its stake in lender Countrywide Financial from 63.8 million shares, or 10.7% of outstanding stock, in August, to 23.8 million shares, or 4.1% of shares, this month… Countrywide shares have plunged from a 52-week high of $45.26 in January to a low of $15 in mid-August… In recent weeks, Countrywide borrowed $11.5 billion and sold a $2 billion stake to Bank of America so it could keep operating its retail banking and mortgage lending businesses. The company said last week it would cut as many as 12,000 jobs."

  • Countrywide Cuts Foretell Loss of U.S. Mortgage Jobs (Bloomberg, Sept. 10th): "Josh Rosner, managing director at the investment research firm Graham Fisher & Co.: The U.S. housing slump… may lead mortgage companies to eliminate almost 100,000 jobs, more than double the number already cut this year. As many as 20% of the nation's real estate loan officers and mortgage brokers will be fired… Bear Stearns Cos. (NYSE:BSC), the second-biggest underwriter of mortgage-backed bonds, shed 240 mortgage jobs in mid-August. Lehman is firing 2,050… The mortgage industry's decline may have contributed to a drop of 4,000 U.S. jobs in August, according to a Sept. 7 report from the Department of Labor."

  • Schumer to Seek Mortgage Funding Boost (Wall St. Journal, Sept. 10th): "Sen. Charles Schumer plans to introduce a bill that would temporarily loosen growth constraints on the two government-sponsored investors and increase the size of mortgages they can purchase in high-cost areas… Fannie and Freddie buy mortgages and repackage them as investment securities, but are bound by limits on size and types… Mr. Schumer's bill would raise the portfolio caps at each company by at least 10% for one year, while requiring Fannie and Freddie to devote half of that increase -- roughly $73 billion combined -- to helping borrowers with certain high-risk adjustable-rate mortgages refinance into more-affordable products."

  • The Asset-Backed Commercial Paper Crisis: Just Another Credit Boom Gone Bad (Michael Shedlock in Seeking Alpha, Sept. 10th): "Someone please tell me how interest on all this leverage can be paid, how enormous carry trades that need to be unwound can be unwound without causing a catastrophe somewhere, why there will not be a major debt insurance company blow sky high causing a cascade in defaults, and how $300-$500 trillion in derivatives and swaps floating around all of it marked-to-model as opposed to marked-to-market can all ever be paid out or collected on when asset prices start dropping on a sustained basis? It can't be done. It only appears possible because credit had been expanding fast enough to allow interest on previous debt to be paid."

  • Washington Mutual Sees More 2007 Loan Losses (Reuters, Sept. 10th): "Washington Mutual Inc (NYSE:WM), the largest U.S. savings and loan, may set aside $500 million more than it had previously forecast for loan losses in 2007… The thrift in July had projected setting aside $1.5b-$1.7 billion for loan losses. Any increase would be WaMu's fourth this year…WaMu cut nearly 11,000 jobs, or 18% of its work force, last year, and has fallen to sixth in U.S. mortgage lending from third in 2005 as it reduced risk… WaMuplans to move some "nonconforming" loans, which don't meet Fannie Mae (FNM) and Freddie Mac (FRE) purchase requirements, to loans held for investment from loans held for sale."

  • Countrywide’s Lending Practices on Subprime Loans (Countrywide Financial's Rebuttal to an Aug. 26th NYT article, Sept.9th): "Countrywide provides full and comprehensive disclosures to all borrowers… In 2006, subprime loans comprised only approximately 9% of Countrywide’s entire loan originations… [By] July 2007, this percentage has decreased to less than 5%... Loans are not made based solely on the equity available in the property… Originating a subprime loan is more time intensive than a prime loan and, therefore, Account Executives are compensated for the extra time, effort and resources needed to fund a subprime loan… not by the features of the loan product they originate… We make available to borrowers… a brochure that describes the various elements of broker compensation, including yield spread premiums and prepayment penalties."

  • Mortgage Loan Difficulties Hitting Home (Star News Online, Sept. 9th): "Though the tighter regulations might cut some people out of the housing market, for people with good credit and a down payment - the majority of mortgage applicants - not much has changed… Borrowers of more than $417,000 - the limit on loans that Fannie and Freddie will buy - will see major changes in qualifying for… a mortgage. [Jumbo loans], including certain types of adjustable and hybrid loans, are more expensive than prime loans below $417,000. Walter Moloney, National Association of Realtors spokesman: Most of the disruption in the mortgage lending is concentrated in jumbo loans: "Jumbos are being priced higher, close to 8%"

Foreclosure Impact

  • Goldman Sachs' Take on the MBA Foreclosure Data (Jim Kingsland in Seeking Alpha, Sept. 9th): "Goldman Sachs (NYSE:GS) on MBA foreclosure data: If the "speculator states" of California, Florida, Arizona, and Nevada were excluded, then the national delinquency rate would have fallen, instead of… an annual rate of increase of 17%... GS is bearish on the housing market seeing home prices 13% to 14% over-valued… It could take "several" years for home prices to reach fair value… The peak in subprime ARM resets won't occur until March of 2008, and resets on option ARMs won't reset until 2010! GS favors shorting originators like Countrywide (CFC), and Washington Mutual (WM)."

Global Impact and Alternatives To The Housing Slump

  • How U.S. Housing Bust Can Affect Emerging Markets (Faisal Laljee in Seeking Alpha, Sept. 9th): "The 2-3 year Adjustable Rate Mortgages (ARM's) that were originated from 2003-2006, will reset all the way to 2009. People that get hit with the increase in monthly mortgage dues will have to cut down on non-staple goods like clothes, jewelry and electronics. [Eventually], the average American consumer, despite a solid unemployment rate, will feel the heat and stop spending like crazy… Countries like China and Mexico that export toys, clothes, jewelry and electronics to the US will face a reduction in demand for their exports, and will find themselves having excess inventory and excess capacity. Emerging economies will [see] their growth stall."

Macro Impact, And Will The Housing Slump Cause A Recession?

  • Employers in U.S. to Keep Hiring at Same Pace, Manpower Says (Bloomberg, Sept. 11th): "Manpower Inc., the world's second-largest provider of temporary workers, said its employment index for September-December held at 18 for a third consecutive quarter… Six of the 10 industries surveyed by Manpower -- construction, finance and real estate, non-durable manufacturing, mining, transportation and utilities, and wholesale and retail trade -- projected weaker hiring next quarter compared with the previous three months. Demand for workers at commercial projects has helped offset some of the decline in residential real estate to prevent overall construction hiring from falling even more, economists said. Total construction payrolls have fallen by 96,000 since reaching a high of 7.7 million in September 2006. Manufacturing payrolls are down 203,000 over the same time."

  • Fed Officials See Threat in Housing Turmoil (NY Times, Sept. 11th): "In speeches on Monday, two other Fed officials sent a similar message. Janet L. Yellen, president of the Federal Reserve Bank of San Francisco, predicted that the housing decline would probably continue and would impose “significant downward pressure” on consumer spending. Dennis P. Lockhart, president of the Federal Reserve Bank of Atlanta, admitted that an unexpectedly bleak unemployment report on Friday had made him more worried about a downturn. Neither Mr. Lockhart nor Ms. Yellen are currently voting members of the Federal Open Market Committee, which sets interest rates. But both sit in on the meetings."

  • Growth In Consumer Credit Slows Slightly (Prescott Herald, Sept. 11th): "Consumers kept charging at a rapid pace on their credit cards in July although their overall borrowing slowed a bit... The category that includes credit cards saw an increase as consumers continued to turn to their credit cards to finance purchases [as] home sales plunge and home prices stagnate, [making] home equity lines of credit… less available. That has pushed consumers back to relying more on their credit cards to finance purchases. The July gain still pushed consumer debt to a record high of $2.456 trillion. The Federal Reserve does not included loans secured by real estate, such as mortgages, in its measurement of consumer debt."

  • Housing Market Weakness Could Cause Weyerhaeuser to Close Plants (Roy Mehta in Seeking Alpha, Sept. 10th): "Lumber and paper company Weyerhaeuser said in [an SEC] filing Monday that the market for wood products was not performing as expected, and would cause closures, curtailments, and restricted operations in its wood product factories. Last quarter, the wood-product business, which accounts for 36% of the company's revenue, lost $123 million and caused company sales to slip 11% y/y. The US housing market has severely hurt prices and created challenging market conditions [though] markets for "cellulose fibers and containerboard, packaging and recycling segments continue to improve." The company has considered selling these assets, after receiving pressure to do so from large institutional shareholders."

  • Outlook for The Market, The Fed and Housing (Mike Goodson in Seeking Alpha, Sept. 10th): "US households created $18.5 trillion in wealth over the last 5 years and only $4t (22%) of that came from real estate, according to Tobias Levkovich, Smith Barney's Chief Equity Strategist. [From] the media, one might conclude that ALL US wealth is tied to real estate... [Also,] only 6% of US homes have adjustable mortgages and maybe 4% of the total may in be trouble. [Meaning] 96% of homes in America are not at risk from resets, sub-primes mortgages and the like… It seems unlikely to me that 4% of the US residential home market in trouble [will] cause a significant economic slowdown unless this effect becomes magnified through reports in the media."

Homebuilders And Housing Stocks

  • St. Joe Sells 10 Deland Lots To Volusia Home Builder (Jacksonville Business Journal, Sept. 10th): "The St. Joe Co. has added a fifth builder to its lineup for a master-planned community in Deland [Florida]: LakeRidge Homes Inc., an independently-owned Arthur Rutenberg Homes franchise… St. Joe's list of builders for Victoria Park includes Brentwood Custom Homes Inc., Beazer Homes (NYSE:BZH), David Weekley Homes and Shea Homes. The St. Joe Co. (NYSE:JOE) is one of Florida's largest real estate operating companies. It focuses on real estate development and sales, with significant interests in timber. At the end of September 2006, it owned about 835,000 acres, mainly in Northwest Florida, and had $1.6 billion in assets."

  • Feeling the Pinch, Centex Taps JP Morgan (CFO.com, Sept. 10th): "Centex Corp.'s (CTX) mortgage subsidiary has entered into a $450 million warehouse credit facility with JPMorgan Chase (NYSE:JPM) so that the homebuilder's unit can continue to issue mortgage loans. Until recently, Centex's CTX Mortgage Co. subsidiary funded the origination of mortgage loans mainly by selling them to Harwood Street Funding I LLC, a special-purpose entity [SPE] consolidated with Centex's financial-services segment... But in August 2007, CTX realized that it may not be able to rely on asset-backed funding vehicles, such as HSF-I, for its primary mortgage funding needs… In addition to the JPMorgan arrangement, CTX has a $200 million warehouse facility with another lender."

  • Homebuilders Blown Down By Moody's (Forbes, Sept. 10th): "On Monday, Moody’s Investors Services explained that it expects the housing-market-slump to last at least until 2009. This, in turn, will likely lead to numerous ratings downgrades for publicly traded homebuilders. Moody's said it expects builders to violate the terms of existing credit agreements as conditions on the housing market remain poor. That will lead lenders to "tighten restrictions on credit facilities, either through taking collateral, reducing the size of the facility, or restricting borrowing base calculations," the agency said.

  • At Distressed Yields, Hovnanian May Be Good (Reuters, Sept. 10th): "Credit spreads of Hovnanian Enterprises Inc. (NYSE:HOV) are trading at [distress] levels… but the upscale home builder's debt may be good value… The cost to insure its debt with credit default swaps rose by 22 basis points to 937 bp, or $937,000/year for five years to insure $10 million in debt… Gimme Credit analyst Vicki Bryan: "We expect Hovnanian to generate stronger performance in 2008 [vs.] 2007, and to maintain adequate liquidity through the cycle trough to reduce debt." Bryan has a buy recommendation on Hovnanian's 8% bonds that are yielding 13%. Brian Bogart, analyst at KDP Investment Advisors, also has a "buy" on Hovnanian's bonds: "In August, the company received tax refunds of $60m, and is making progress on the sale of excess lots."

  • Dominion Homes at the Brink of Bankruptcy, Worth a Rescue (Eric Schleien in Seeking Alpha, Sept. 10th): "Dominion Homes (DHOM) is a small company that makes homes around central Ohio as well as parts of Kentucky. During the housing boom of the 1990s, Dominion aggressively purchased as much land as they could upfront with debt to take advantage of what they foolishly believed would be an everlasting housing boom... [But] it can be saved from bankruptcy. If a large investor decided to give the company liquidity, the company could use that cash to pay down its debt and therefore not be forced to liquidate its land inventory for pennies on the dollar. The company then would be able to weather the housing bust."

Commercial Real Estate and Real Estate Investment Trusts (REITs)

  • Fairfield Completes $125M Multifamily Sale (Globe St., Sept. 10th) Massachusetts: "Just weeks after opening, the Highlands at Dearborn apartment complex on a 25-acre parcel has been sold by Fairfield Residential LLC… This North Shore development on Route 128… traded to Simpson Housing for $124.6 million, or close to $280,000/apartment… Simpson Housing VP Spencer Welton Sr.: There has been substantial new multifamily construction north of Boston during the past three years driven by such well-known players as Archstone-Smith (ASN), JPI Properties and AvalonBay (NYSE:AVB), but [it won't be] oversaturated [because] a state law mandating communities accept new housing no longer impacts Peabody and neighboring towns such as Danvers and Salem… “Additional multifamily development is highly unlikely… Highlands at Dearborn will maintain its position as a market leader.”

  • Washington, DC Market Not Hurt by Credit Crunch (Globe St., Sept. 10th): "Delta Associates’ report on the impact the credit crunch is having on the real estate industry: The national office market is being adversely affected by the problems in the credit markets, it found, advising readers to watch submarkets in metro areas that are highly dependent on the homebuilding and home mortgage industries. This could include submarkets in Orange County, CA; Phoenix; and Denver, to name a few… Gregory H. Leisch, CEO of Delta Associates: “Washington [has] a recession resistant marketplace… Home building and home mortgages… are only a tiny part of the local economy… That means there is still plenty of money available for deals and plenty of deals still in the market… All cash buyers are still very active, for example.”

  • Vintage Wine Trust Broadens Property Portfolio With Acquisition of Vineyard in Washington State (JRJ.com, Sept. 10th): "Vintage Wine Trust Inc., a REIT focused exclusively on the wine and vineyard industry, today announced it broadened its property portfolio with the purchase of the Grandview Vineyards in Washington State. The property, located in the Yakima Valley AVA, one of Washington's premium wine regions, was purchased from the Den Hoed family for $12.4 million. The Grandview Vineyards consist of approximately 700 gross acres across four properties, 568 acres of which are planted vineyard and 84 acres are apple orchard. The four properties are known as Desert Hills Vineyard, Andrew Den Hoed Farms, Foothill Vineyard and Rattlesnake Vineyard."

  • Alesco Financial Inc. Maintains Regular Quarterly Cash Dividend for Third Quarter of 2007 (CNN Money, Sept. 10th): "Alesco Financial Inc., a specialty finance REIT, today announced… a cash dividend for Q3'07 of $0.31/share, the same dividend amount paid for Q2'07. The dividend will be payable on October 1, 2007 to shareholders of record as of the close of business on September 21, 2007… James McEntee, President and CEO of Alesco Financial, said, "We are pleased to be able maintain our regular quarterly cash dividend at the same level as our previous quarter. In what continues to be a challenging market for financial services companies, we remain focused on maintaining liquidity and selectively investing in accordance with our previously disclosed investment strategy."

  • Grubb Broker Predicts Good Land Buys Soon (Arizona Republic, Sept. 9th): "Sandi Elmore specializes in state-owned land deals at Grubb & Ellis/BRE Commercial LLC's Phoenix office: The commercial market is still strong: "Buyers are going to see some good deals here shortly, but it's just a matter of getting the sellers to get realistic. And I think we've already started seeing that happen a little bit… There's a lot of money right now on hold. There are people who made a lot of money in the run-up… Homebuilders are not buyers right now; in fact, they've become sellers. Some of them are developers, entitlers, shopping-center developers. We work with industrial developers. The retail (developers) are going ahead and developing. They're not holding."

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