Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

[Slimprofits]

Anyone else watching Fox News this morning?

I can practically smell the desperate glee through the television and it's not even a high-def set.

They're not mentioning this part though:

Lawrence Yun, NAR chief economist, said first-time buyers accounted for half of all home sales last month, with activity concentrated in lower price ranges. “Because entry level buyers are shopping for bargains, distressed sales accounted for 40 to 45 percent of transactions in February,” he said. “Our analysis shows that distressed homes typically are selling for 20 percent less than the normal market price, and this naturally is drawing down the overall median price.”

http://www.realtor.org/press_room/ne...?LID=RONav0021

Because that would kind of ruin the party.

[vanvaley1]

Anyone else watching Fox News this morning?

I can practically smell the desperate glee through the television and it's not even a high-def set.

They're not mentioning this part though:

Lawrence Yun, NAR chief economist, said first-time buyers accounted for half of all home sales last month, with activity concentrated in lower price ranges. “Because entry level buyers are shopping for bargains, distressed sales accounted for 40 to 45 percent of transactions in February,” he said. “Our analysis shows that distressed homes typically are selling for 20 percent less than the normal market price, and this naturally is drawing down the overall median price.”

http://www.realtor.org/press_room/ne...?LID=RONav0021

Because that would kind of ruin the party.

I suppose you could argue that these sales...even at reduced prices...could be forming a bottom to the real estate market. We'll see. The questions are, "Will the new sales release a hope that will prompt sellers who took their homes off the market earlier to sell them now? And will the economic downturn just increase the inventory as the jobless lose their homes? Will the 'underwater' homeowners seeing no end in sight of falling prices or returning value finally give up the ghost and walk away from their homes? Furthermore, will the banks holding foreclosed real estate from the market be releasing them to the market now?"

If any of these answers are 'Yes', I don't see the inventory decreasing that much nor the value of housing increasing at all. If they're all 'yes' then, in fact, you may have a further decrease in housing values. A final question is "How many homebuyers are there out there now who are confident enough in their job security to purchase a home?" Even this block of homebuyers facing stricker lending requirements will run out sooner than later. And I suspect it will be sooner. What then?

[aaron]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Or, maybe this is saying "The bottom is in... and it is only 25% lower than it is now!"

That would actually be a believable number in my mind. If Poom is starting soon, prices might only go that much lower nominally.

[metalman]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Or, maybe this is saying "The bottom is in... and it is only 25% lower than it is now!"

That would actually be a believable number in my mind. If Poom is starting soon, prices might only go that much lower nominally.

real estate prices will not go up in a poom, though land prices might...

- they already hyperinflated during the bubble when rates were rock bottom
- interest rates shoot up
- housing maintenance costs will skyrocket

poom is not rre friendly.

[cjppjc]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

There is so much inventory not on the market yet. Fannie, Freddie, Hud, the VA, money center banks, have a closet full of homes. I'm sure Bart could come up with a chart.

A) Number of forclosures in the last two years
B) Number of homes/condos sold in the last two years

[strittmatter]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Anyone else watching Fox News this morning?

I can practically smell the desperate glee through the television and it's not even a high-def set.

They're not mentioning this part though:

Lawrence Yun, NAR chief economist, said first-time buyers accounted for half of all home sales last month, with activity concentrated in lower price ranges. “Because entry level buyers are shopping for bargains, distressed sales accounted for 40 to 45 percent of transactions in February,” he said. “Our analysis shows that distressed homes typically are selling for 20 percent less than the normal market price, and this naturally is drawing down the overall median price.”

http://www.realtor.org/press_room/ne...?LID=RONav0021

Because that would kind of ruin the party.

fox's love sheep.

where u been?

[don]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Dow Leaps 497 Points on Treasury Plan


Markets Rise More Than 6% as Rescue Details Are Offered

Whew, glad that's over ;)

[LargoWinch]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Here is another superb piece from Fox:

[metalman]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Here is another superb piece from Fox:

largo, this is part of fox's 'insulting our way to higher ratings' campaign. next, look for a segment on middle age french men in bikini briefs.

[cjppjc]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

largo, this is part of fox's 'insulting our way to higher ratings' campaign. next, look for a segment on middle age french men in bikini briefs.

They did that one 6 weeks ago. Fine piece of journalism it was.

[karim0028]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Or, maybe this is saying "The bottom is in... and it is only 25% lower than it is now!"

That would actually be a believable number in my mind. If Poom is starting soon, prices might only go that much lower nominally.

The way i see it is RE prices are very dependent on interest rates since almost 99% of sales are via debt financing.... Rare is the individual who can/will pay cash for his home... Once interest rates rise (and they will, they have to) the price people will be able to pay goes down.....

If you pay cash, you will get some great deals going forward. You debt finance you will be able to afford less bc of the monthly payment vs the rent/cashflow/income situation....

[Glenn Black]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

As a Canadian, I support our troops. And yet, I don't have a big problem with this news item. It was ironic and satyrical, pushing the envelope as to the intended meaning.

I have personally seen Humvie, Coyote armored personnel carriers, and A-10 Warthogs badly shot up and run out way past their useful life due to extreme need on the battlefield.

For a long time, the US has been stripping US-based units of their equipment and sending it to the front because the stuff was being used in the war, and was being consumed faster than new units could be made plus old units refurbished. That's a lot of materiele.

Same for Canada.

General Patton noted at the end of WWII that 50% of the tanks were out of service at any one time. That's why a major research project was launched after WWII, headed up by Weibul who "invented" modern reliability analysis based on research at Wright-Patterson Airfield.

All armies will need a break when this military and political disaster is over.

At the same time, it's ludicrous to stretch ourselves so thin we cannot defend ourselves at any moment.

Armies never get a holiday. Why do you think the Yom Kippur War started on Yom Kippur?

[Slimprofits]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Anyone else seen the "money summit" on CNN or whatever it was called? It's been playing non-stop for the last few days. Their target audience is Mr. and Mrs. J12P and the message, like the cover of Newsweek from a couple of weeks ago is that we need to get out there and spend spend spend in order to save each other from certain doom. Got giftcards?

[LargoWinch]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

Got giftcards?

Yeah. Still from Xmas, but none so far from the G20. It is coming though, we all know. Ah the smell of fresh federal money ink!

Side note: I am planning to go there to exchange my cards for PMs: http://www.cardavenue.com/

[vanvaley1]

Re: Existing-Home Sales Rise In February - Fox News anchors are partying like it's 2005

The way i see it is RE prices are very dependent on interest rates since almost 99% of sales are via debt financing.... Rare is the individual who can/will pay cash for his home... Once interest rates rise (and they will, they have to) the price people will be able to pay goes down.....

If you pay cash, you will get some great deals going forward. You debt finance you will be able to afford less bc of the monthly payment vs the rent/cashflow/income situation....

You are correct about your assessment of interest rates playing a substantial part in home ownership. When we owned a Coldwell Banker franchise we noticed that the typical 'spring/early summer'' markets where not the only ones that generated buyers. When interest rates were low, buyers bought. Didn't matter what season it was.

But buyers...occupying the residence...only purchased when they felt secure about employment. Right now some are anxious to purchase but are walking on egg shells...in other cases...glass. Before you see an increase in owner occupied houses your probably gonna have to see better economic indicators.

There are some bargain hunters and bottom fishers out in the market now that are giving it a boost... perhaps...'a goose' would be a more appropriate imagine. Don't think either will sustain a FIRE system recovery. Kind of like a 'dead cat bounce' in the stock market. Once interest rates begin to rise because of inflationary pressures, the game is over: unless...ya get a whole bunch of salary generous giftlets from the corporate sector extending to the 'rank and file' folks and not just to the 'exec bathroom' folks. I don't expect that to happen in this market. And I don't think there's enough bargain buyers to sustain this increase in sales 'activity' for an extended period of time.

There may be exceptions. We had a young man in our office who had the good fortune of meeting and representing an Asian investment group back then. They swooped in and bought a ton of real estate in the projected growth area of the community. They were long term land bank investors. It paid off for them when the market turned, interest rates dropped, developers were bidding prices of land up, and the city was willing to expand. Not sure that will happen again. There's a ton of inventory out there. Some of it is hidden...like the toxic assets of the banks...and will only appear when the sellers think the time is right.