A report from the Press Herald in Maine. “Portland’s condominium market reached a fever pitch in 2018, with new and existing units selling faster than ever before – and at higher prices. Portland developers are practically falling over themselves to pump out as many new units as they can, as quickly as possible. But analysts said the market also showed some signs of slowing down at a time when hundreds of new units are either in the planning stage or under construction.”
“Chip Newell, a principal at NewHeight Group, believes that Portland’s condo construction boom is approaching the tail end. High construction and land costs already have put several city-approved condo projects on hold, he said, and those costs aren’t expected to come down again until the next recession hits.”
“Newell warned that condo developers need to be selective about the projects they undertake if they want them to be economically viable, adding that some builders already have misjudged the value of their projects. ‘You can find select projects that have had a hard time selling and have had to reduce prices,’ he said, ‘and I think it’s because they didn’t exactly line up product, location and price.'”
The Tampa Bay Times in Florida. “By most measures, the Tampa Bay area has a robust economy. Job growth is strong, home prices are climbing, construction cranes are everywhere. But there is a troubling sign — after years of decline, bankruptcy filings are again on the rise. It was the first year-over-year increase in filings since 2010. And filings have continued to rise every month since September.”
“That worries Chief Bankruptcy Judge Michael G. Williamson, especially because he’s not sure of the reason. ‘There is definitely something going on when for eight years cases go down and all of sudden they start going up month after month,’ Williamson said. ‘You have to have some cause for concern that something is happening but I don’t know what it is.'”
“With Tampa Bay’s economy strong, overspending might have replaced job loss as the reason people find themselves in financial trouble. ‘It could definitely be (due to) credit cards,” Williamson said of the increase in filings. ‘People are back to work, they’re starting to get credit. Maybe we’ve just gone through a period of easy credit.'”
“But that might be only part of the reason, he acknowledges. ‘he bankruptcy judges saw the Great Recession coming a mile away, you had cocktail waitresses with mortgages on $400,000 houses,’ Williamson said. ‘The tech crash, we could see that one. But I don’t know what’s causing this when you see all those buildings going up and all the apartments and full employment and for some reason bankruptcy cases are starting to go back up. Am I worried? Yes, I am.'”
The Mortgage Reports. “A new report by Redfin had some interesting findings. In January 2019: Only 13 percent of offers written by Redfin agents (for their buyer clients) involved a bidding war. That’s down from 53 percent a year earlier. The home bidding wars rate dropped significantly in every market where Redfin agents serve.”
“The markets with the largest percentage point declines in the rate of home bidding wars were: San Francisco (-64%); Los Angeles (-57%); and Seattle (-54%). The markets with the smallest percentage point declines were: Austin (-11%); Raleigh (-13%); and Chicago (-29%). The most competitive markets were Portland, Denver and San Diego; yet in each less, than one out of five Redfin offers faced home bidding wars, down from more than half a year prior.”
“Meanwhile, the housing supply has been going up. In January 2019: Home sales dropped for the sixth consecutive month. This resulted in the largest inventory increase in a decade, per the latest RE/MAX National Housing Report. Inventory jumped 6.4 percent from a year earlier across the 54 markets RE/MAX studied. Annual inventory grew for the fourth straight month. This reversed a 10-year trend of decreasing supply.”
“Inventory is also rising because buyers are slowing down to look closer, believes Keith Robinson, chief strategy officer at NextHome. ‘There’s a sense that we are near a top of the market, and no one wants to buy at the top. When the buying side demand slows down, it puts upward pressure on inventory,’ says Robinson.”
“‘Buyers know that the market has slowed,’ notes Daryl Fairweather, Redfin’s chief economist. What’s more, ‘over one in five homes for sale nationwide dropped its price in the last month. That’s even further evidence that 2019 is a good year for buyers,’ adds Fairweather.”
From Market Watch. “Investment bank Credit Suisse polls real estate agents around the country every month. Its February edition, released a few days ago, paints a more uniform picture of housing conditions around the country.”
“Dallas: ‘Buyers are in no hurry as they await a shift in the market. Sellers still looking for top dollar and multiple offers. Mismatch in expectations.’ ‘Concerns over the economy’s trajectory.’ ‘Increased number of sellers.'”
“Houston: ‘Market seems to be in limbo.’ ‘Still uncertainty in the market place.'”
“Los Angeles: ‘Buyers waiting to see if rates move lower and how the new tax rules impact the bottom line.’ ‘Still demand for housing but sellers have yet to fully comprehend they are no longer in the driver’s seat.'”
“Phoenix: ‘Buyers feel home properties are priced too high. Investors are low balling properties that have been sitting on the market longer than 60 days.’ ‘Transactional volume down from two banner years; still a good market but 2017/18 spoiled agents and sellers.’ ‘Buyers waiting for tax returns.'”
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‘over one in five homes for sale nationwide dropped its price in the last month’
But, superbowl?
Wouldn’t be running the cards up if so much of the monthly income wasn’t going to that P&I note.
“so much of the monthly income wasn’t going to that P&I note”
yup, add to that property taxes and insurance paid in cold hard cash, plus maintenance and repairs and hoa, when unable to serially refinance the shack any more and credit cards are maxed out, head straight to foreclosure.
I love the progression over the last several months where agents comments have evolved from “going to moon” to “might level temporarily” to “slight blip” to “buyers feeling less urgency” to the new default line: “……yes but dont think were returning to 2008 conditions”
They keep retreating to draw new lines in the sand. The new one I love is “11% uptick in sales means lower interest is revitalizing market to normal”
Well when prices finally reduce to reasonable, then sales return. Yes, lowered pricing is the the new “normal”
Dead cat bounce. Prices are still too high, and just wait until the recession hits, and demand collapses when mortgage rates are already at 3.875 (as they are this morning). There will be nothing left to use to stimulate demand, look out below for prices!
I love the progression over the last several months where agents comments have evolved from “going to moon” to “might level temporarily” to “slight blip” to “buyers feeling less urgency” to the new default line: “……yes but dont think were returning to 2008 conditions”
While UHS lies and dissembling might shift with the changing times, one constant remains: now is always the best time to buy.
None of the REIC shills ever bothers to acknowledge how regrettable it is to find yourself a recent homebuyer who is deeply financially underwater, due to a 30% drop in market value following the onset of a protracted housing bust.
It’s happened to many who bought at the top before, and I don’t expect the next time to be any different.
‘overspending might have replaced job loss as the reason people find themselves in financial trouble…’Maybe we’ve just gone through a period of easy credit’
This whole “loans are hard to get” stuff is a joke. How many years ago was it that Freddie Mac started offering shack loans to illegal immigrants who could use a relatives income, or a roommates rent, to qualify? And IIRC, the number of roommates they could use wasn’t limited. This is a government backed loan!
“This whole ‘loans are hard to get’ stuff is a joke. How many years ago was it that Freddie Mac started offering shack loans to illegal immigrants who could use a relatives income, or a roommates rent, to qualify? And IIRC, the number of roommates they could use wasn’t limited. This is a government backed loan!”
Do any of you guys remember when this was going on? …
“Need Good Credit? Borrow Mine!”
(snip)
“People with bad credit can spend years trying to make up for past mistakes. But an increasing number of people have found a quicker way: buying a share of someone else’s good credit rating.”
😁
“The practice is called piggybacking, and lenders and credit reporting agencies aren’t happy about it. At first, it may sound like identity theft. But people with good credit are voluntarily working with those with bad credit. In fact, according to a recent AP story, you can make decent money selling your good credit — with the financial companies that act as intermediaries taking a cut as well.”
Read on …
https://www.fool.com/credit-cards/2007/06/05/need-good-credit-borrow-mine.aspx
“The practice is called
piggybackingfraud,…”Fixed it.
Nothing screams subprime like 3% down payment mortgages. Nothing.
3% DP mortgages have been 90%+ of all mortgages issued since 2009.
Loans ARE hard to get. For law abiding, responsible people, with good credit. For us, there are several hoops to jump through. Also need a substantial downpayment, proof of funds, proof of income going back years, tax returns, banks statements etc. And God forbid you’re self employed. Get ready to a financial colonoscopy from the underwriter.
On the other hand, illegals and the rest of Obama’s base of lazy welfare recipients, get mortgages with $0 down and all closing feed paid for, with zero underwriting scrutiny. Not only mortgages either. Cat loans too. Do you want to be the sales manager who says no to a car loan from a “protected class”? You many not have a job the next day.
It’s the same dichotomy where homeless people can take a dump on the sidewalk with zero consequence, yet Joe Taxpaying Citizen throws a paper cup into trash bin instead of the recycle bin and is fined $125.
The new Amerika.
‘Portland developers are practically falling over themselves to pump out as many new units as they can, as quickly as possible. But analysts said the market also showed some signs of slowing down at a time when hundreds of new units are either in the planning stage or under construction’
‘some builders already have misjudged the value of their projects. ‘You can find select projects that have had a hard time selling and have had to reduce prices’
Eeee-bola Portland Maine!
‘some builders already have misjudged the value of their projects.
B…b…but I don’t understand. With all these “real estate analysts” incessantly quoted in every MSM article about housing, how is it that builders lacked a true understanding of local market conditions? Could it be these “experts” were nothing but REIC touts and shills? Gosh, if that’s the case, our intrepid Real Journalists will start publishing scathing exposes any day now….
‘Phoenix: ‘Buyers feel home properties are priced too high. Investors are low balling properties that have been sitting on the market longer than 60 days.’ ‘Transactional volume down from two banner years; still a good market but 2017/18 spoiled agents and sellers.’ ‘Buyers waiting for tax returns’
Yeah, that extra couple of thousand bucks can make or break the loanowners in Phoenix. Low balling? They smell blood in the water.
‘Buyers feel home properties are priced too high’
We see this a lot and should consider this: when prices are going up quickly, you won’t hear much about “priced too high.” It validates the purchase in a mania. You could exchange the term “buyers think to peak is behind us.”
Yeah, that extra couple of thousand bucks can make or break the loanowners in Phoenix. Low balling? They smell blood in the water.
^^^ This. Powell’s panicky shift from “interest rate hikes on autopilot” to Wall Street’s Uber-dove bit*ch is the clearest signal yet of what’s coming down the pike: another financial reckoning day after ten years of Keynesian hucksterism and cons aimed at forestalling the inevitable.
From:
GDPNow – Federal Reserve Bank of Atlanta
https://www.frbatlanta.org/cqer/research/gdpnow.aspx
(ta da)
“The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2019 is 1.2 percent on
March 22, up from 0.4 percent on March 13.”
Zowie! Perhaps we are saved!
“The nowcast of the contribution of inventory investment to first-quarter real GDP growth increased from -0.40 percentage points to -0.02 percentage points after this morning’s wholesale trade release from the U.S. Census Bureau.”
An increase of inventory investment. Now all that needs to be done is to increase sales.
(Hmmmm … I wonder what it was that constituted this inventory investment that is destined to save our asses.)
Well, lookie here …
“After this morning’s existing-home sales release from the National Association of Realtors, the nowcast of first-quarter real residential investment growth increased from -4.8 percent to 0.6 percent.”
Why … why it’s real estate! Imagine that!
Yeah I am waiting for Sacramento area housing prices to tank and inventory to rise. I want a place close to work without the nasty commute but I also do not want to spend 800k for a 2 bedroom crapshack.
Looks like the San Francisco housing bubble has officially peaked.
https://sanfrancisco.cbslocal.com/2019/03/22/south-bay-silicon-valley-home-prices-dip-2018-4q-beacon-economics/
Why buy a house when you can rent one for half the monthly cost?
Buy later after prices crater for 70% less
New Port Richey, FL Housing Prices Crater 31% YOY As Market Floods With Foreclosures and Excess Houses
https://www.movoto.com/new-port-richey-fl/market-trends/
Who is that one dude who said California housing prices would never fall?
South Bay Median Home Prices Dip To $1.14M At End Of 2018
March 22, 2019 at 8:35 am
Filed Under:Housing crisis, Real Estate, San Jose, San Jose News, Silicon Valley
SAN JOSE (CBS SF) – Despite continued demand for housing in the South Bay, home prices in the region slipped in the second half of last year, according to economic research and consulting firm Beacon Economics.
…