WSJ Quarterly Housing Survey: More Pain to Come
I meant to get to this last week, but the day it came out, I was mostly drunk (my bday), and I somehow missed it:
“Despite some tentative signs of recovery, the U.S. housing market remains vulnerable to further price drops—especially in areas where large numbers of mortgages are headed toward foreclosure over the next few years.
The Wall Street Journal’s quarterly survey of housing-market data in 28 major metro areas shows sharp drops in the number of homes listed for sale across the country. But the potential supply of homes is far larger because banks are likely to acquire significant numbers of foreclosed homes in some areas, notably Las Vegas, Atlanta, Detroit, Phoenix, Miami and other parts of Florida, and Sacramento, Calif., over the next few years.
Sales of those homes may depress prices further. By contrast, metro areas with relatively low foreclosure and mortgage-delinquency rates include Boston, Denver, Minneapolis, San Francisco, Seattle, Raleigh, N.C., and Portland, Ore., making them less vulnerable.
Homeowners and potential buyers have been whipsawed by conflicting signals about the state of the market in recent months. Ulani and Mike Thiessen found the market surprisingly hot when they went shopping for their first home in Las Vegas during the summer. With the help of Kim Kelly-Reed, an agent from One Source Realty & Management, the Thiessens finally bought a foreclosed house in September for about $136,000—but only after being outbid on three other houses.”
And of course, the chart:
chart courtesy of WSJ
>
Source:
Waiting for the Next McMansion to Drop
JAMES R. HAGERTY
WSJ, OCTOBER 22, 2009
http://online.wsj.com/article/SB10001424052748703816204574487240805281318.html
October 27th, 2009 at 8:48 am
Hey… happy birthday! (My birthday was last week, too).
October 27th, 2009 at 8:56 am
Another side effect of those foreclosures is that they reduce the demand side since these people will no longer qualify for loans. So double shock: extra supply; decreasing qualifying buyers. It will also affect car buyers. A friend of mine who did a short sale is no longer able to get a car loan from her bank (BAC)
October 27th, 2009 at 8:56 am
“It’s been almost a year since Horatio Bernard effectively lost his Baltimore row house to foreclosure and roughly 15 months since he last made a payment on his primary mortgage.
And yet to his amazement and those following his story, Bernard continues living in the home with his ailing mother without any sign of an eviction notice or word from his lender, in this case JP Morgan Chase and then US Bank.
“I haven’t paid a dime,” Bernard told me, sounding gleeful over the phone.
Earlier this year, Bernard was defiant on staying in his home even though the bank had already tried selling it at auction last November. Bernard, a Liberian immigrant, took a shot at the American dream at a time in 2005 when that dream involved risky subprime loans. On top of that, he’d been victimized by a foreclosure prevention scam by New Hope Modifications, which the New Jersey attorney general since indicted on fraud charges.
“We’re as mystified by it as he is,” said Joe Cox, a community organizer with the Association of Community Organizations for Reform Now in Baltimore. ACORN, under fire for unrelated allegations that two branches may have helped an activist posing as a pimp avoid taxes, actually spends considerable resources dealing with cases like Bernard’s…”
http://www.miller-mccune.com/business_economics/shadow-market-delays-recovery-helps-defiant-homeowners-1558
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Detroit Attempts to Auction 9,000 Properties for as Little as $500; 80% Had No Bids
October 26th, 2009
Via: Reuters:
“In a crowded ballroom next to a bankrupt casino, what remains of the Detroit property market was being picked over by speculators and mostly discarded.
After five hours of calling out a drumbeat of “no bid” for properties listed in an auction book as thick as a city phone directory, the energy of the county auctioneer began to flag.
“OK,” he said. “We only have 300 more pages to go.”…”
http://cryptogon.com/?p=11863
should be ’self-sustaining’, any moment now..
October 27th, 2009 at 9:55 am
Numerous houses are still being held off the market here. Tend to be above $250. Ones below seem to move. Rent vs buy. Houses below $200 go, others slow.
Might help if there were jobs here. There are not.
October 27th, 2009 at 10:13 am
If people aren’t paying their mortgages, do you think they are paying their property taxes? Hawaii has just declared a 4 day school week; I can’t help but think CA will be next.
October 27th, 2009 at 11:40 am
If the delinquency rates are as high as 26%, but foreclosure rates are 5% in the worst states, what does this tell us about the latest round of record-breaking bank profits?
Thanks Barry, and happy birthday!