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Record Drop in House Prices in October
Topic Started: Dec 26 2007, 08:58 AM (1,058 Views)
Frank_W
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Resident Misanthrope
Roger and copy dat!! I suppose there's a certain nobility to working like a dog, but I'd like the opportunity to get bored with a life of luxury. LOL
Anatomy Prof: "The human body has about 20 sq. meters of skin."
Me: "Man, that's a lot of lampshades!"
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TomK
HOLY CARP!!!
justme
Dec 26 2007, 07:57 PM

You're probably right. Out on Boca Grande (where the Bushes are getting ready to spend the week and TomK went fishing not too long ago) and a long the keys that border our coast things are much easier.

I go fishing most Wednesdays from the marina at the foot of the Boca Grande bridge. :thumb:

I fish near the old train causeway for grouper and reds further in back. Me and my good time buddies usually eat lunch at the Tarpon Tide Grille on Boca--you can dock you boat, have lunch and shove off.

All I've seen of the island is the inside of bar room of the Tarpon Tide but from what I understand, it's a nice place. :biggrin:

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TomK
HOLY CARP!!!
JBryan
Dec 26 2007, 08:47 PM
Dope dealers.

Worse: stock brokers. At least dope dealers actually give you something for your money. :lol:

Anyway--some pretty high prices Real Estate. This place cost a mill and a half.

Posted Image
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Jack Frost
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Bull-Carp
TomK
Dec 26 2007, 05:21 PM


For the most part this entire real estate "crisis" is as much a hoax as the real estate "bubble" of a year and a half ago.

Unless you bought "a year and a half ago" with 10% down and now want to sell....

jf
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Let it be said by our children's children that when we were tested we refused to let this journey end, that we did not turn back nor did we falter; and with eyes fixed on the horizon and God's grace upon us, we carried forth that great gift of freedom and delivered it safely to future generations.
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QuirtEvans
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I Owe It All To John D'Oh
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So the article is just looking at a meaningless historical comparison over 12 month given a select and incomplete set of data after a hyper active several years, and making a meaningless story about something that really does not seem to have happened 3 months ago.

Move along, folks, nothing to see.


Apparently, the Wall Street Journal, as well as many economists who concentrate on the housing market, disagree with you that there's nothing to see.

Quote:
 
Home prices in 10 major metropolitan areas in October were down 6.7% from a year earlier, according to the S&P/Case-Shiller home-price indexes, released yesterday by credit-rating firm Standard & Poor's. That exceeded the previous record year-to-year decline of 6.3% in April 1991, when the economy was emerging from a recession. (See a PDF summary of the report.)

New statistics from the Census Bureau, meanwhile, indicate a slowdown in the number of Americans moving to states that led the housing boom, including Nevada, Florida and Arizona. (See related article.)

The silver lining behind the latest home-price data is that they signal the market is making what most economists see as a necessary adjustment, dragging home prices back into closer alignment with Americans' ability to pay. The market is working its way "back to reality," says David Seiders, chief economist of the National Association of Home Builders. He thinks house prices will bottom out by early 2009.

Some other economists say that might not happen before 2010. "The housing shock is only about halfway over, and housing prices will continue to fall well into 2009," says Lehman Brothers economist Michelle Meyer.

During the housing boom in the first half of this decade, fast-rising home prices made it easy for homeowners to take out home-equity loans or refinance their primary mortgages to extract some cash. That helped sustain consumer spending, which accounts for about 70% of U.S. economic activity.

Economists now worry that falling home prices will prompt consumers to pull back on spending enough to slow growth or even tip the economy into recession. "Eventually what's happening in the housing market is going to catch up with us," says Patrick Newport, an economist at research-firm Global Insight Inc.

* * * *

Bette Zerba, a Realtor with Re/Max in Phoenix, says local residents trying to sell their homes can't compete with foreclosed homes selling for $50,000 to $100,000 less than theirs. "The sellers now are having to reduce their prices by 20% to 30% to compete," she says.

* * * *

On average, prices of previously occupied homes, as measured by the S&P/Case-Shiller indexes, are likely to drop another 7% in 2008 before flattening out in 2009, says Thomas Lawler, a housing economist in Vienna, Va.

Inventories of unsold homes remain very high and may increase in the new year as lenders dump more foreclosed houses on the market. The number of detached single-family homes listed for sale in October was enough to last 10½ months at the current sales rate, according to the National Association of Realtors. That was more than double the level of two years ago and the highest since 1985.

Along with inventories, the nation's home ownership rate will have to adjust to today's realities as many Americans who stretched too far to buy homes in recent years go back to renting. The home ownership rate in the third quarter stood at 68.2% of households, down from a peak of 69.2% in 2004. Even a small drop in that rate has a big effect on housing demand. Economists at Goldman Sachs have warned that falling home ownership rates may force a further 40% drop in housing starts next year, to an annual rate as low as 500,000 units, before construction starts to recover.

The mortgage market also needs to adjust further. Most of the funding for home loans comes from investors who buy securities backed by bundles of mortgages. Since August, many of those investors have shunned the market amid fears of rising defaults. As a result, lenders generally are focusing on loans that can be sold to government-sponsored investors Fannie Mae or Freddie Mac, or insured by the Federal Housing Administration. So-called jumbo loans -- those above $417,000, too big to be sold to Fannie or Freddie -- have grown much more expensive, deterring buyers in high-cost areas.

The current scarcity of funds available for mortgage lending creates a chicken-and-egg situation, says Prof. Leamer. Investors who provide funding for home loans don't want to commit more money until they believe the housing market is getting better. But it's hard for the housing market to rebound as long as mortgage credit is tight. Lower prices eventually will break this impasse, by luring buyers back into the market and reassuring investors that the market is finding a bottom, he says.


http://online.wsj.com/article/SB1198677794...=hpp_us_pageone

Was that Phoenix she mentioned?

It so happens that one of my close friends is a real estate developer in Phoenix, and he confirms the reported trend there.
It would be unwise to underestimate what large groups of ill-informed people acting together can achieve. -- John D'Oh, January 14, 2010.
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Larry
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Mmmmmmm, pie!
There are opportunities to make money hand over fist from this, for those who know how....

I know how..........
Of the Pokatwat Tribe

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ivorythumper
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I am so adjective that I verb nouns!
Quirt: You might not have noticed that Case-Shiller is looking at 10 cities (Phoenix not being one of them). I am not sure why you think this is truly indicative data of anything but the real estate market in those 10 cities.

The OFHEO numbers are national, and filter out the speculators and high end volatility, as well as don't value weight but treat all sales as the same sort of data (some econs think that is valid, others don't, choose your poison). Those numbers show a 1.8% increase over last year at the end of 3Q 07. It will of course be interesting to see how their 4Q 07 numbers look, which would include Oct 07. Another source you might look at is RPX, which tracks actual sales based on $/sf in 25 metro areas. According to RPX, Phoenix was only down 2.5% Sept06 to Sept 07.

BTW, the residential bulk real estate developers here have either pulled up stakes or gone to the ground to wait out the duration. Some of them bought vast acreage (Pulte/Del Webb) bought something like 750,000 acres south west of Phoenix and can now only hold it until the market absorbs.

I can understand why your buddy is down in the dumps, but I am not sure what your point is. No one is doubting a market correction, and speculators and those who have to sell are not getting the prices they had hoped for. So? Overall nationally housing prices are still up 1.8% for actual transactions -- that means people are still willing to purchase for 1.8% more than they would have last year. Average people in average homes who buy homes for basic living -- not speculators looking to flip, not million dollar properties.

What in the WSJ article you quotes contradicts what I have been saying all along?
The dogma lives loudly within me.
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QuirtEvans
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I Owe It All To John D'Oh
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Quirt: You might not have noticed that Case-Shiller is looking at 10 cities (Phoenix not being one of them). I am not sure why you think this is truly indicative data of anything but the real estate market in those 10 cities.


There is a concept in statistics of sample size. I'd explain it, but I'm sure you are already familiar with it. At any rate, 10 cities may very well be a valid sample of the country as a whole. Quibbling with the validity of the sample is certainly one way to go, although I'd venture that they know a lot more about nationwide housing markets, and are better positioned to determine the appropriate sample. Quibbling with the concept of a sample seems petty and ignorant.

Quote:
 
Those numbers show a 1.8% increase over last year at the end of 3Q 07.


The third quarter ends Sept 30. The data I've been citing is as of Oct 31. There were some important events in October.

Quote:
 
I can understand why your buddy is down in the dumps


He isn't. He does commercial real estate (and golf course developments). He's based in Phoenix, but he does projects all over the place.

Quote:
 
What in the WSJ article you quotes contradicts what I have been saying all along?


The entire article contradicts your assertion that there's nothing to see here. The fact that it is on page one of the Wall Street Journal contradicts your assertion that there's nothing to see here. And the title of the article ... "Pace of Decline In Home Prices Sets a Record" ... contradicts everything that you've been saying about the notion that there's nothing to see here, and that "nationally housing prices are still up 1.8% for actual transactions".
It would be unwise to underestimate what large groups of ill-informed people acting together can achieve. -- John D'Oh, January 14, 2010.
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ivorythumper
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I am so adjective that I verb nouns!
QuirtEvans
Dec 27 2007, 10:17 AM
Quote:
 
Quirt: You might not have noticed that Case-Shiller is looking at 10 cities (Phoenix not being one of them). I am not sure why you think this is truly indicative data of anything but the real estate market in those 10 cities.


There is a concept in statistics of sample size. I'd explain it, but I'm sure you are already familiar with it. At any rate, 10 cities may very well be a valid sample of the country as a whole. Quibbling with the validity of the sample is certainly one way to go, although I'd venture that they know a lot more about nationwide housing markets, and are better positioned to determine the appropriate sample. Quibbling with the concept of a sample seems petty and ignorant.

I am not quibbling with the sample -- obviously according to the data of Case Shiller based on their selective data in 10 cities they are stating X result.

Other studies, such as OFHEO show other results. You might think that a 10 city sampling produces a better understanding of the overall market than another study that is comprehensive nationally. If so, I'd like to understand your rationale for thinking that.

You might also quite legitimately think that jumbo loans and other nonconformings which are typical of speculator development should be included in the data to give an accurate picture of what the real movements are in the market; and you might think that value weighting also gives a more accurate picture of overall movements in housing prices. I'd like to know why you thinks so, since these are certainly counterintuitive notions.

Quote:
 

Quote:
 
Those numbers show a 1.8% increase over last year at the end of 3Q 07.


The third quarter ends Sept 30. The data I've been citing is as of Oct 31. There were some important events in October.
I already noted that -- " It will of course be interesting to see how their 4Q 07 numbers look, which would include Oct 07. "

What in your estimation were these important events? I don't recall anything momentous happening in October.
Quote:
 

Quote:
 
What in the WSJ article you quotes contradicts what I have been saying all along?


The entire article contradicts your assertion that there's nothing to see here. The fact that it is on page one of the Wall Street Journal contradicts your assertion that there's nothing to see here. And the title of the article ... "Pace of Decline In Home Prices Sets a Record" ... contradicts everything that you've been saying about the notion that there's nothing to see here, and that "nationally housing prices are still up 1.8% for actual transactions".


All there is to see according to your article is a correction after a hyperactive market. I already said that.

My numbers are based on OFHEO. You can argue against those guys if you don't like those numbers. You might not realize it, but both statements can be true -- the the Case Schiller 10 Cities show a 6.9% decline and the OFHEO national study shows a 1.8% increase. These are not contradictory statements.

You don't have to trust me on this, Quirt, you can look for it yourself. According to OFHEO I am not wrong.
The dogma lives loudly within me.
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Daniel
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HOLY CARP!!!
:blink:
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Free Rider
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Fulla-Carp
I live in a bubble of its own.
http://www.jacksonholereport.com/

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Aqua Letifer
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ZOOOOOM!
Free Rider
Dec 27 2007, 10:15 AM
I live in a bubble of its own.
http://www.jacksonholereport.com/

You live in/around Jackson Hole?? Why you lucky bastard! Acres and acres of White Gold at your skitips! You have Corbet's right in your backyard, too.
I cite irreconcilable differences.
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Free Rider
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Fulla-Carp
Aqua Letifer
Dec 27 2007, 10:21 AM
Free Rider
Dec 27 2007, 10:15 AM
I live in a bubble of its own.
http://www.jacksonholereport.com/

You live in/around Jackson Hole?? Why you lucky bastard! Acres and acres of White Gold at your skitips! You have Corbet's right in your backyard, too.

Yes. I work P/T for the ski corp. I ski a lot.

But if I didn't that would be like living on Maui and not surfing.

here's another link. Kinda cold today, I'm letting it warm up.
http://www.jacksonhole.com/weather.snow.report.asp
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justme
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HOLY CARP!!!
Aqua Letifer
Dec 27 2007, 02:21 PM

You live in/around Jackson Hole?? Why you lucky bastard!

OMGosh! You're not kidding!!!

I nominate Free Rider's for the next Coffee Room gathering. :biggrin:
"Men sway more towards hussies." G-D3
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Aqua Letifer
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ZOOOOOM!
justme
Dec 27 2007, 10:43 AM
Aqua Letifer
Dec 27 2007, 02:21 PM

You live in/around Jackson Hole??  Why you lucky bastard!

OMGosh! You're not kidding!!!

I nominate Free Rider's for the next Coffee Room gathering. :biggrin:

SECOND!

If so I'm dusting off my K2s. :biggrin:

They're not getting any use around these parts, that's for darn sure.
I cite irreconcilable differences.
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Free Rider
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Fulla-Carp
justme
Dec 27 2007, 10:43 AM


I nominate Free Rider's for the next Coffee Room gathering. :biggrin:

Do you know how to change diapers? Because we'de love to have you!!!
I live right in the town of Jackson, about 12 miles from the ski resort. It is a nice place to live, expensive, but nice.

If any coffee roomers ever find thier way out into Jackson Hole, PM me and I will help with local info and secrets.

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justme
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HOLY CARP!!!
Free Rider
Dec 27 2007, 02:51 PM
justme
Dec 27 2007, 10:43 AM


I nominate Free Rider's for the next Coffee Room gathering.  :biggrin:

Do you know how to change diapers? Because we'de love to have you!!!
I live right in the town of Jackson, about 12 miles from the ski resort. It is a nice place to live, expensive, but nice.

If any coffee roomers ever find thier way out into Jackson Hole, PM me and I will help with local info and secrets.

Do I know how to change diapers!!!! :lol:

Mark and I spent some time in Jackson before we were married over 25 years ago. I remember eating at one of the fine restaurants. I had a rainbow trout that was out of this world. And the Caesar salad was a REAL Caesar salad made at the table.

It's beautiful out there. Sadly this was during the summer so their was no skiing (other than maybe some grass skiers). Mark has skied there tho', it's among his favorite places to ski for sure.

Let me know if you need a babysitter. I can be a regular Mary Poppins if needed :lol: :lol: :lol:
"Men sway more towards hussies." G-D3
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Daniel
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HOLY CARP!!!
Free Rider
Dec 27 2007, 10:15 AM
I live in a bubble of its own.
http://www.jacksonholereport.com/

For better or worse so do I.
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Free Rider
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Fulla-Carp
justme
Dec 27 2007, 10:59 AM

Mark and I spent some time in Jackson before we were married over 25 years ago. I remember eating at one of the fine restaurants. I had a rainbow trout that was out of this world. And the Caesar salad was a REAL Caesar salad made at the table.

Is this the Mark who posts here and likes Ron Paul?

I can't put all of the coffee-room marriages/relationships together.
Is Plays88keys marries to Ivorythumper? What about musicasacra and improviso?

I should start another thread.
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Daniel
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HOLY CARP!!!
Free Rider
Dec 27 2007, 11:02 AM
Is Plays88keys marries to Ivorythumper? 

No, but Rick is my boyfriend.

:leaving:
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Aqua Letifer
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ZOOOOOM!
Free Rider
Dec 27 2007, 11:02 AM

Is this the Mark who posts here and likes Ron Paul?

I can't put all of the coffee-room marriages/relationships together. 
Is Plays88keys marries to Ivorythumper?  What about musicasacra and improviso?

I should start another thread.

Other way around. MS and IT, plays and improv, M&M's and Luke's Dad, kathyk and jack frost... who'd I forget?
I cite irreconcilable differences.
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justme
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HOLY CARP!!!
Free Rider
Dec 27 2007, 03:02 PM
justme
Dec 27 2007, 10:59 AM

Mark and I spent some time in Jackson before we were married over 25 years ago. I remember eating at one of the fine restaurants. I had a rainbow trout that was out of this world. And the Caesar salad was a REAL Caesar salad made at the table.

Is this the Mark who posts here and likes Ron Paul?

I can't put all of the coffee-room marriages/relationships together.
Is Plays88keys marries to Ivorythumper? What about musicasacra and improviso?

I should start another thread.

No.

My Mark has only posted once or twice at the most and his on-line name is STBXX given to him by Dewey. Meaning Soon-To-Be-Ex-Ex. :wub:
"Men sway more towards hussies." G-D3
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QuirtEvans
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I Owe It All To John D'Oh
Free Rider
Dec 27 2007, 02:02 PM
justme
Dec 27 2007, 10:59 AM

Mark and I spent some time in Jackson before we were married over 25 years ago. I remember eating at one of the fine restaurants. I had a rainbow trout that was out of this world. And the Caesar salad was a REAL Caesar salad made at the table.

Is this the Mark who posts here and likes Ron Paul?

I can't put all of the coffee-room marriages/relationships together.
Is Plays88keys marries to Ivorythumper? What about musicasacra and improviso?

I should start another thread.

I'm assuming at least part of your post is intentional. As for the first part, there are at least three Marks. There's Mark from Wisconsin ... the Ron Paul fanboi. He's the only Mark who posts here. There is Markb from D.C. Both Mark and Markb post over at WTF. And then there's justme's Mark who, as far as I know, doesn't post in either place.
It would be unwise to underestimate what large groups of ill-informed people acting together can achieve. -- John D'Oh, January 14, 2010.
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QuirtEvans
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I Owe It All To John D'Oh
Aqua Letifer
Dec 27 2007, 02:05 PM
Free Rider
Dec 27 2007, 11:02 AM

Is this the Mark who posts here and likes Ron Paul?

I can't put all of the coffee-room marriages/relationships together. 
Is Plays88keys marries to Ivorythumper?  What about musicasacra and improviso?

I should start another thread.

Other way around. MS and IT, plays and improv, M&M's and Luke's Dad, kathyk and jack frost... who'd I forget?

John D'Oh and Jane D'Oh.
It would be unwise to underestimate what large groups of ill-informed people acting together can achieve. -- John D'Oh, January 14, 2010.
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Optimistic
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HOLY CARP!!!
justme
Dec 27 2007, 01:59 PM
Let me know if you need a babysitter. I can be a regular Mary Poppins if needed :lol: :lol: :lol:

*AHEM*

Justme may be a fantastic grandmother, but I am a PROFESSIONAL nanny.

:P
PHOTOS

I must have a prodigious quantity of mind; it takes me as much as a week, sometimes, to make it up.
- Mark Twain


We shall not cease from exploration
And the end of all our exploring
Will be to arrive where we started
And know the place for the first time.
-T. S. Eliot
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