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Real Estate Agents Say Last Year’s Market Fever Has Broken

A report from the Tampa Bay Times in Florida. “Tampa Bay home sellers take note — the steady price gains of the past few years might be coming to an end. Charles Richardson, senior regional vice president for Coldwell Banker, thinks there is still room for bay area prices to grow despite a few months of overall price decreases.”

“‘I think (prices) are cycling, I don’t think they’ve peaked,’ he said. ‘We’re in a little bit of downturn from a pricing perspective but based on other evidence out there, there shouldn’t be an extended type of downturn.'”

From Boston.com on Massachusetts. “The cost of a buying a condo in Massachusetts has dropped again, according to a report. ‘The median condo sale price has now declined on a year-over-year basis for three consecutive months,’ said Cassidy Norton, The Warren Group ’s media relations director. ‘Year-to-date, the median condo sale price is now down 3.6 percent. I don’t view this trend as a softening in the market, but rather a return to normalcy.'”

“The number of units on the market jumped 15.3 percent, rising for an eighth consecutive month. ‘While condo sales have eased, we believe this reflects the healthier supply of units on the market,’ said Jim Major, association president and an agent with Century 21 North East in Woburn. ‘As a result, buyers now have a little more breathing room. We’re seeing median selling prices begin to plateau or even dip a bit.'”

From Nevada Public Radio. “For the first time since the Great Recession, home prices fell last month in Las Vegas. Is the sky next? Tom Blanchard with the Greater Las Vegas Association of Realtors said the exponential appreciation we’ve had over the last few years is not sustainable. Blanchard believes a small dip in prices is a good thing.”

“‘To have a slow down or some stability in the market is a very, very good thing because otherwise we would be going toward the end of the canyon and falling off the edge of it,’ he said.”

The Salt Lake Tribune. “Utah’s homebuilding boom led the nation last year, adding homes and apartments at a rate nearly three times the national average. A dip in home prices during the first quarter this year ‘is an indication that buyers are pushing back on prices,’ said James Wood, a fellow at the University of Utah’s Kem C. Gardner Policy Institute, adding it may be a turning point at which ‘prices still are going to go up, but just not as fast.'”

The Bay Area Newsgroup in California. “The number of homes for sale in the first three months of the year in the San Jose metro area rose 55 percent from the same time last year, the highest jump in the nation, according to Trulia. In Oakland and San Francisco, housing inventory grew 28 percent from the first three months of last year.”

“‘Definitely a big jump in inventory,’ said Trulia economist Felipe Chacon. ‘Demand is ebbing a little bit.’ Nationally, inventory has edged up for the first time, year-over-year, since 2016, Trulia found. ‘The coastal markets are cooling,’ Chacon said.”

“The supply of starter homes — listed for around $760,000 — on the San Jose market grew by 78 percent, according to Trulia. In San Francisco and Oakland,  less-expensive starter homes priced at around $530,000 increased 38 percent.”

“Real estate agents say last year’s market fever has broken and buyers have become more willing to wait. ‘Buyers are very picky now,’ said Alan Wang, based in Santa Clara. After years of ever-escalating prices and bidding wars, he added, ‘sellers are slowly adjusting their expectations.'”

This Post Has 62 Comments
  1. ‘Definitely a big jump in inventory…Demand is ebbing a little bit’

    Wa happened to my shortage bay aryans?

  2. “Tom Blanchard with the Greater Las Vegas Association of Realtors said the exponential appreciation we’ve had over the last few years is not sustainable. Blanchard believes a small dip in prices is a good thing.”

    “‘To have a slow down or some stability in the market is a very, very good thing because otherwise we would be going toward the end of the canyon and falling off the edge of it,’ he said.”

    Now he tells us!

    So if a small dip is a good thing for buyers, if they just wait for the crash that would be a greater thing. For reference see 2007 again.

    1. “…Tom Blanchard with the Greater Las Vegas Association of Realtors…”

      “… because otherwise we would be going toward the end of the canyon and falling off the edge of it,’ he said….”

      Hey Tom, What ever happened to our “permanently high plateau”?

      Did it disappear into the Grand Canyon along with your “shortage”?

    2. Did he mention to the FB 3-4 years ago that it was unsustainable?
      It’s similar to the on hold message I hear from a local brokerage
      It’s a good time to sell or buy real estate.
      It’s actually one or the other.

    3. Blanchard believes a small dip in prices is a good thing

      It would be more probable to see an exponential dip, don ‘t you think?

    1. As if builders and realtors aren’t avaricious enough already, now they’ll get taxpayer support.

  3. Dow @ 11:52 … 25,346.70 5/23/2019

    Dow @ 1:00 (pst) … 26,743.50 9/16/2018 (day eye removed my$elf from Equitie$)

    Same numerical digit$ 234567 … (-1396.8) … 8 months later

    $trange

    Bugs: “eh, got organic carrots?”

  4. ‘$ellers are slowly adju$ting their expectation$.’

    It’$ Velocitie$ … Ver$es … Price$!

    Go dog! Go! By: P.D. Eastman

  5. Amazing how many ways that realtors can use happy words to describe declining market conditions.

    To the Las Vegas realtor a math lesson. Exponential means by at least the square of its subject. I do not think this has been the case. Of course, it makes as much sense as anything else they say.

    Getting a front row seat for second half of 2019. Opening act is the stand up comedy routine of realtor explanations. The main event is the drama of further declining market conditions. It will be a long show and worth the ticket price

    1. “…It will be a long show and worth the ticket price…”

      With deep apologies to Blazing Saddles movie,

      ‘ Is that a ten gallon hat your wearing or are you just enjoying watching the market ?’

    2. “Amazing how many ways that realtors can use happy words to describe declining market conditions.“

      Right! My all time favorite is “price gains are decelerating”. They use this when prices are actually going negative which is one of their patented Realtor lies. Always Be Closing!

  6. Update to yesterday (Weds) HBB topic
    “Sitting Mostly Empty And In Trouble With Its Lenders”

    https://www.cnbc.com/2019/05/22/celebrity-surgeon-goes-all-in-on-180-million-bel-air-mansion.html

    “…When celebrity plastic surgeon Raj Kanodia started building his 34,000-square-foot mansion to flip for a profit, his real estate friends gave him a warning…”

    Check out Nightly Business Report 22-may-19

    https://www.youtube.com/watch?v=43TkLrN2doA

    START 23:10

    “has become the empty white elephant”

    “perhaps it was originally overreaching”

    FINISH 25:50

    Dr. Kanodia is obviously a very talented physician.

    But Would really like to understand what wheels were turning inside his head when he concocted this monster?

    To float a project like this, wonder what Dr. Kanodia charges for an office visit? Bet it isn’t 20 bucks (co-pay) like my own PCP!

      1. “Greed.”

        How about Greedy? (His Gramma gave him that name)

        He won’t tackle but he is fast not to mention the best name for an NFL corner back that I have ever heard

        Greedy Williams signs rookie contract with Browns

        By Kevin Patra
        Around the NFL Writer
        Published: May 21, 2019

        Questions about Williams’ strength and willingness to aid in run defense could have led to his draft fall, but the talented LSU product’s ability to cover in space should earn him snaps as a rookie in an underrated Cleveland defense.


        @Browns
        Pen to paper 🖊@Greedy has signed his rookie deal!

        http://www.nfl.com/news/story/0ap3000001031405/article/greedy-williams-signs-rookie-contract-with-browns

    1. He should have recognized that the housing recovery was getting old and in need of a facelift

  7. “…the steady price gains of the past few years might be coming to an end.”

    For how many more years will Ben have to post the evidence for there to be open acknowledgment that the steady price gains of the past few years are done?

    1. “For how many more years will Ben have to post the evidence”

      Ben’s work will never be done… he’ll have to cover the next bubble, and the next one, and the next one.

      This cycle of boom and bust that the Fed is hell bent on enabling will continue to keep Ben occupied…at least until Amazon’s self-aware UsedHouseSalesBot 3.0 tracks him down and terminates him.

    1. New realtor adds,

      BUY A HOUSE THAT YOU NEVER PAY OFF BECAUSE LIFE ENDS. NO BETTER DEAL!

    2. “Young people blame climate change for their small 401(k) balances”

      In my day it was, “The Omega Man” starring Charlton Heston.

    1. So is this person saying if a person is 12 years old today they are permanently screwed and will never be able to own anything because prices will be too high naturally?

      If this is true, what incentive does an 8th grader have to study in school so they can get a good job? If you’re doomed to lifetime poverty, may as well enjoy your youth!

      1. From the article:

        “But have you ever noticed the baseball player taking a few practice swings before stepping up to the plate at a baseball game? Instead of swinging one single bat, he grabs three or four bats, bunches them all together, and swings all of them together. Why? Because his muscles get quickly accustomed to the weight of three bats. When he drops the extras and approaches the plate moments later, the single bat in his hand feels light as a feather, giving him the ability—and confidence—to knock the ball into the left field bleachers!”

        “In the same way, becoming an experienced real estate investor now by developing the skills necessary in today’s market will help you knock it out of the park when the market does decline. Your skills will be sharp, your reputation will be solid, and your finances will be in order. You’ll be ready to dominate.”

        What a terrible analogy! To extend the athlete metaphor, imagine a weightlifter who puts on more weight on the bar than he can squat (e.g. taking on too much debt). He strains, contorts, and does everything he can to keep the bar up, but eventually his knees buckle and the weights come crashing down to the floor. He took on too much debt and it ruined his body.

    2. Biggerpockets promotes real estate as one of the key investments to gain wealth IF (if is operative word here) it is going to produce positive income. The guy who started it made money with all his “investments” at the bottom of a cycle. We are now at the peak of the current cycle which is snowballing back down. I am sure he knows anyone buying at this peak would not do well but here he is promoting the dream of wealth creation through RE that only benefits current shack owners / landlords to maintain these bubbly values for as long as they can. The model of buying a house, renting it, pulling equity, buying, renting, rinse / repeat can only work so long until it doesn’t. I think now we are in the “it doesn’t” stage.

  8. “‘I think (prices) are cycling, I don’t think they’ve peaked,’ he said. ‘We’re in a little bit of downturn from a pricing perspective but based on other evidence out there, there shouldn’t be an extended type of downturn.’”

    Pray tell, what “other evidence” might this be, Charles? Oh, right, you REIC touts and shills are fabricating it as you go along.

  9. I don’t view this trend as a softening in the market, but rather a return to normalcy.’”

    In that case, Cassidy, we’re not talking about a “softening in the market,” but rather a precipitous plummet back to 3X median income.

    1. back to 3X median income

      You think he meant that kind of normalcy? I think he means the kind where he gets paid.

    2. “3X median income”

      Historic price/income is 2.5x for a new house, 2x for a resale.

      1. Historic price/income

        Given the historic extent of the current distortion, we’re likely to not even pause at the station called “Normal” when the credit pyramid and house mania crashes and burns.

        1. we’re likely to not even pause at the station called “Normal”

          Kind of like when an airplane crashes into the ground at top speed. There’s one extremely small moment in time when the plane is actually just sitting safely on the ground, perhaps at an odd angle. If it wasn’t for that pesky momentum that can’t be stopped from crushing everything into a crater…momentum that started building at the top long before the actual moment of death.

  10. Something I meant to mention a week or so ago about my industry.

    It’s interesting/odd that both Oracle and Seagate have announced closure of whole facilities with thousands of employees each in the last few weeks. In China.

    1. Mabye they did the math and operations / exports out of China would hurt profit margins with the tariffs. I have heard rumors of a few other high tech companies looking to follow suit

      1. Also just heard a rumor that the Chinese govt may require Tencent to not allow Wechat to be installed on iPhones in China. If so, Apple is done in China.

    1. Poof! Trump investment boom is gone
      By Jeffry Bartash
      Published: May 24, 2019 12:04 p.m. ET
      Trump trade fight with China offsets gains from business tax cuts
      Getty Images
      President Donald Trump has tried to go to bat for U.S. manufacturers and their workers, but his trade fight with China is also hurting the economy the longer it drags on.

      The Trump investment boom is gone.

      Well, mostly gone. A key measure of business investment slowed 1.3% in the 12 months ending April from 3.8%, marking the smallest increase since the last month of Barack Obama’s presidency in January 2017.

    1. A legacy of failure: Theresa May was a disaster as Prime Minister
      Analysis by Luke McGee, CNN
      Updated at 1045 GMT (1845 HKT) May 24, 2019
      Theresa May tears up as she resigns as UK Prime Minister 06:31
      Editor’s Note:Luke McGee is a senior producer at CNN based in London.
      London (CNN) — Brexit has destroyed another British Prime Minister.

      Three years after voters in the UK mandated their government to take Britain out of the European Union, Theresa May’s failure to do so has finally caught up with her.

      “I have done my best,” she said in an emotional statement on the steps of Downing Street. But as she admitted, it wasn’t enough.

    2. With the Plunge Protection Team on high alert, today should be a very good day for Wall Street.

      1. A wonderful day and age we live In where our stawk market is driven by our presidents tweeters and the PPT.

  11. ‘sellers are slowly adjusting their expectations.’

    Any thoughts on how long from now the race to the exits and panic will ensue?

  12. P. Bear,

    Me thinks the pop and plunge is going to be faster this time. Just a gut feeling.

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