moeronn

One thing to note:
While this will affect the market as a whole, the fact is that these were fairly risky loans to begin with.

fdl

Record drop for home prices
Sales of existing homes fall for sixth straight month, prices sink 2.2 percent.
October 25 2006: 11:15 AM EDT

NEW YORK (CNNMoney.com) -- Home prices posted their biggest drop on record in September while sales fell for the sixth month in a row, a real estate group said Wednesday - the latest signs that the housing market is still weakening.
Top 10 cities: Where to buy now

The National Association of Realtors said sales of existing homes fell to an annual pace of 6.18 million last month from 6.3 million in August, marking the sixth straight monthly decline in sales.

Economists surveyed by Briefing.com had forecast a rate of 6.25 million in the most recent period.

The median price of a home sold in September fell 2.2 percent to $220,000 from $225,000 a year ago. It was the biggest year-over-year drop since the record 2.1 percent decline recorded in November 1990, when the nation was in recession..

The group's August sales report was the first in 11 years to show a year-over-year decline in the price of a typical home.

http://money.cnn.com/2006/10/25/news...ex.htm?cnn=yes

MR1

My big problem with this is that it is all averages based on a moving supply. The numbers are really only valid if you track sales of the same houses over a period. With the reporting method used you oly get possibly distorted information. If last year $350,000 houses were selling then that is your average. If this year only $340,000 houses are selling then that is your average. Can't argue with the sales decline in total numbers though. Just my

fdl

When $350K houses arent selling, they sell for $340 K and the average goes down.

At the very least it tells us on average what people are spending on houses.

Silver™

Depending on whom you ask, the winds may already be shifting for the housing market. All year, economists have warned of a bursting housing bubble and its potential impact on economic growth. However, a recent stream of encouraging data has some prominent prognosticators changing their tune.

http://www.msnbc.msn.com/id/15416909/ (full article)

zamo

http://www.sun-sentinel.com/news/loc...tory?track=rss

MR1

1. Possible but the data does not prove this however logical it may be.
2. I agree

Fibonacci

Guru ---> <--- Silver

Silver™

Greenspan > Silver > our resident guru :gheylaugh:



Former Federal Reserve Chairman Alan Greenspan said on Thursday the U.S. economy was pulling away from the shoals of a sharp housing-sector downturn and that the outlook for growth was "reasonably good."

"Most of the negatives in housing are probably behind us," Greenspan said at a conference sponsored by the Commercial Finance Association "The fourth quarter should be reasonably good, certainly better than the third quarter."

---

"There are early signs of stabilization," Greenspan said of the U.S. housing market, although he added: "It's not over."

"The evidence is that we're beginning to see a flattening in statistics for sales of new homes," he continued. "The rate of construction is well below the rate of purchases."

http://today.reuters.com/news/articl...AN.xml&src=cms

Fibonacci

Nice try. But, since Greenspan was chief architect of the housing bubble, he'd be the first to paint a beniegn explanation of the current so called soft landing.

Silver™

Greenspan = true guru

Fibi = detroit hack

tinter

well housing foreclosure rates are starting to ramp up in certain areas.

Silver™

But within historical norms.

Many people are eager to compare the current situation to the red hot market of a couple years ago. Go back 5, 10, 20 years and the rates are nothing to be concerned about. Now if they double or something, then it is time for concern

Fibonacci

Fixed!

Silver™

The slumping housing market could get a $200 billion boost from new immigrant home buyers if mainstream lenders start using alternative methods to score credit, a national group of Hispanic real estate agents said Friday.

Creditors like Citigroup Inc.’s Citibank see recent immigrants as a growing market niche, but those who lack Social Security numbers or legal status in the United States often are rejected by the three major credit bureaus.

http://www.msnbc.msn.com/id/15551056/

zamo

I thought Citibank already offered loans to illegals using Personal Tax ID Numbers (anyone can get one).

http://www.diggersrealm.com/mt/archives/001610.html

Silver™

This would be for the legal immigrants that have SS #'s but no real credit established credit.

MR1

There are lots of alternate documentation choices that the lenders have created. They want to continue loaing money and this is a developing, partially untapped market.

AdamNJ

Is it legal for an illegal alien (lack Social Security numbers or legal status to me would mean illegal alien) to own property if he's not supposed to be here in the first place?

MR1

Just like jobs it's don't ask don't tell.

Money Talks!

zamo

I will revert the question. Is it illegal for a US citizen to own a property in Cancun, Mexico, although he is not legally allowed to live there for more than x months?

Fibonacci

fdl

U.S. housing starts plunge
Nov. 17, 2006. 08:41 AM
ASSOCIATED PRESS

WASHINGTON — Housing construction plunged to the lowest level in more than six years in October as the once-booming housing market slowed further.

The Commerce Department reported today that construction of new single-family homes and apartments dropped to an annual rate of 1.486 million units last month, down a sharp 14.6 per cent from the September level.

The decline, bigger than expected, was the largest percentage decline in 19 months and pushed total activity down to the lowest level since July 2000.

http://www.thestar.com/NASApp/cs/Con...d=968332188492

Silver™

Careful what you wish for FDL...



The shock wave caused by the bursting U.S. housing bubble is hitting British Columbia faster and harder than the rest of Canada, and is expected to drag down the total value of B.C. exports by three per cent in 2007, according to an outlook prepared by Export Development Canada.

Declining forest products revenues are already bogging down the province's export economy as demand for building products shrinks in the U.S.

Forest products account for 40 per cent of the province's total exports and the decline in that sector is darkening the export picture, according to EDC senior economist Stephen Poloz.

"We continue to see a significant split in the province's performance, with the forestry sector contracting while almost all other sectors continue to grow," Poloz said Tuesday.

He said declining forest revenues in 2006 are holding B.C. growth this year at two per cent. The three per cent decline next year will be largely caused by continued erosion of forest products prices, he said. The high-flying Canadian dollar is also a factor.

The EDC forecasts that the value of Canadian exports will decline one per cent in 2007. However, it also released an alternative downside scenario if the housing downturn brings on a recession in the U.S. In that case, provincial export revenues will drop deeper and Canadian exports overall would be expected to fall 3.4 per cent.

http://www.canada.com/vancouversun/n...d-d765965147e5

Silver™

The sizzle has gone out of Calgary's housing market as rising inventories and cautious buyers have ended the bidding wars and soaring prices that marked the first half of the year.

Price reductions of $40,000 or $50,000 have become common, realtors say, and some top-end buyers have even tried to back out of deals after realizing they may have overpaid by hundreds of thousands of dollars.

It all adds up to a drastic change from this spring, when it was common to get 30 offers for a single property and homes in desirable areas were snapped up as soon as they were listed. The change, also being felt in Vancouver, is happening at a time when the national-home market is treading water and cities such as Toronto and Montreal are seeing only modest price gains.

“Anybody who thought it was going to continue forever was smoking something funny,” said John Riseborough, a 23-year veteran of the industry who owns Re/Max First in Calgary.

“Bizarre,” is how Mr. Riseborough sums up the first half of the year in the Calgary market. “It was too much. It was a scary thing.”

Sales of existing homes took a tumble last month in both Calgary and Vancouver, two of the country's strongest markets. Numbers released Thursday by the Canadian Real Estate Association show that Calgary sales were down last month by almost 18 per cent over the same month last year, while listings were up by more than 50 per cent. Houses are sitting on the market for longer, and agents say many buyers are waiting on the sidelines, hoping asking prices will fall even more.

http://www.theglobeandmail.com/servl.../Business/home

fdl

Not really wishing for anything.

But Calgary is def. a huge bubble, Vancouver as well. They need a correction. Toronto is more mature market and price increased have moderated. Some analysts are suggesting just under 2% price increases for next year, which would put it slightly below inflation. Hardly a good investment, but for a primary home I suppose it doesnt matter as much.

Fibonacci

I still regret not investing in a condo downtown about 5 years ago - doh!

My best friend is looking for a place in Forest Hill currently and is not having luck finding anything decent under $600,000.

fdl

Ya, I wouldnt imagine finding anything decent for $600K in Forest Hill. And if he's looking for something in Forest Hill "South" (south of eglington) I would bump that to over $1M to start. Mats Sundin just recently sold his house there, which to me didnt look like anything too special (50 foot lot, etc) and got just over $6M for it.

http://www.theglobeandmail.com/servl...ek0519/BNStory

Personally, if I had the money and wanted a house in an old, character area, I would choose Rosedale (although the lots and homes are considerably smaller).

fdl

Even thought the Toronto condo market is arguably saturated and bubbly right now, I wonder about the new Trump International Tower - Toronto . Not I don't have the money for it (prices start at $1.4M for a 1200 sq ft condo), but I still wonder what these prices will do. Some speculate its guaranteed to appreciate, based on the track record of his other towers Then again take his name away and its just another overpriced condo.

Silver™

The worst of the United States’ housing market slowdown is over, economists forecast by nearly 2-to-1 in a Wall Street Journal online economic survey, the paper reported on its Web site on Tuesday.

http://www.msnbc.msn.com/id/15829153/

Fibonacci

Don't get me wrong, I truly wish was right on this debate, but am afraid he is not.

p.s. congrats on 20,000 posts!

Silver™

Frank Nothaft, Freddie Mac's chief economist, said the high percentage of cash-out refinancings is occurring in part because more borrowers with adjustable-rate mortgages are choosing to refinance into fixed-rate loans or adjustables with lower rates than their original loans now have, and are borrowing additional amounts against their equity when they do so.

But another important factor is homeowners trying to get out of their high-interest-rate home equity loans. Many of those borrowers are replacing their first mortgage and home equity line of credit, for example, with a new first mortgage big enough to cover both loans. The goal, of course, is either to secure one lower monthly payment, or to refinance into a fixed-rate loan that protects the borrower from future payment shock when interest rates rise.

http://www.mercurynews.com/mld/mercu...s/15905278.htm

Fibonacci

Median price sinks 3.5 percent from a year earlier, trade group see more price declines ahead.

http://money.cnn.com/2006/11/28/news...ex.htm?cnn=yes

moeronn

http://news.yahoo.com/s/ap/20061128/...i_ge/greenspan

Fibonacci

^^ see post #609

moeronn

It's a completely different article. If that is a repost then we can call on ALL of your posts

Fibonacci

^^ touche.

5o9

We are maybe at the beginning of the second act, so a third of the way down the cycle.

My markets, looking at 2+ years of price declines, followed by stubborn flatness, as inflation takes a toll, and fundamentals catch up. Remember, everybody declared the market turn after the second quarter 2005 results were in. We are talking old news.

The whole thing is the product of the credit cycle. Ben is boxed in by housing and currency, does not move interest rates. The credit cycle will kick in, as underwriting is tightened, and mortgage spreads return to normal. Ben has secondary tools available, to manage real estate.

Fibonacci

^^ Stagflation baby, get ready. Milder version than 70's malaise, but ugly nonetheless since consumers are tapped out and already have negative savings rates. The top 10% will make out fine, but the rest will be scrambling to keep bill collectors at bay.

Silver™

The National Association of Realtors said Tuesday that existing home sales edged up 0.5 percent to a seasonally adjusted annual rate of 6.24 million. It was the first sales increase since February.

http://www.msnbc.msn.com/id/15933474/