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DINEROS
1156 Posts |
 Posted - 05/27/2008 : 07:16:53 AM
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S&P: US home prices tumble a record 14.1 pct in 1Q By J.W. ELPHINSTONE, AP Business Writer
7 minutes ago
NEW YORK - U.S. home prices dropped at the sharpest rate in two decades during the first quarter, a closely watched index showed Tuesday, a somber indication that the housing slump continues to deepen.
Standard & Poor's/Case-Shiller said its national home price index fell 14.1 percent in the first quarter compared with a year earlier, the lowest since its inception in 1988. The quarterly index covers all nine U.S. Census divisions.
Prices nationwide are at levels not seen since the third quarter of 2004, according to Maureen Maitland, a S&P vice president. However, the index is still up 60 percent versus 2000.
The narrower indices also set record declines in the first quarter. The 20-city index tumbled 14.4 percent, the lowest since that index was started in 2001. The 10-city index plunged 15.3 percent, a record in its 20-year history.
"There are very few silver linings that one can see in the data. Most of the nation appears to remain on a downward path," said David Blitzer, chairman of S&P's index committee.
Nineteen of the 20 metro areas reported annual declines, with 15 of them posting record lows. Six metro areas lost more than 20 percent.
Las Vegas had the worst quarterly performance, falling 25.9 percent, followed by Miami and Phoenix. Only Charlotte, N.C., stayed above water, gaining less than 1 percent over the previous year.
Last week, the Office of Federal Housing Enterprise Oversight said home prices fell 3.1 percent in the first quarter, the largest drop in its 17-year history and only the second quarter of price declines recorded.
The OFHEO index is narrower in scope and is calculated using mortgages of $417,000 or less that are bought or backed by Fannie Mae or Freddie Mac. That excludes properties bought with some of the riskier types of home loans.
http://news.yahoo.com/s/ap/20080527/ap_on_bi_ge/home_prices
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homer5
364 Posts |
Posted - 05/27/2008 : 09:14:16 AM
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BTO said it best with regard to price declines...
http://tinyurl.com/3o7t7z |
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DINEROS
1156 Posts |
Posted - 05/27/2008 : 09:18:08 AM
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It does seem that others take the opportunity to buy a home:
Home sales unexpectedly rise in April By MARTIN CRUTSINGER, AP Economics Writer
1 hour, 1 minute ago
WASHINGTON - Sales of new homes rose in April for the first time in six months although the unexpected increase still left activity near the lowest level in 17 years.
The Commerce Department reported Tuesday that sales of new homes rose 3.3 percent in April to a seasonally adjusted annual rate of 526,000 units.
But the government revised March activity lower to show an even bigger drop of 11 percent to an annual rate of 509,000, which was the weakest pace for sales since April 1991. Economists believe that new home sales will remain weak for some time as the housing industry struggles with falling prices and rising mortgage foreclosures, which are dumping even more homes on an already glutted market.
The Commerce report showed that the median price of a new home sold in April dropped to $246,100 in April, down 4.2 percent from April 2007.
A separate report showed home prices falling during the first three months of this year at the sharpest rate in two decades. The Standard & Poor's/Case-Shiller index fell 14.1 percent in the first quarter compared with a year earlier, the biggest year-over-year decline since the index began in 1988.
The Commerce report on new home sales showed the April rebound was led by a huge 41.7 percent surge in sales in the Northeast. Sales were up 8.3 percent in the West and 5.8 percent in the Midwest. The only region which saw a decline in sales in April was the South, where sales fell by 2.4 percent.
The inventory of unsold new homes edged down slightly to 10.6 months' supply at the April sales pace, compared with 11.1 months in March. However, the April level was still about double the inventory level that was normal during the five-year housing boom.
That boom ended in 2005 and since that time the housing industry has been struggling in a tough environment with falling sales and prices and rising mortgage defaults.
Economists believe that home prices will remain under pressure until the sizable level of inventories is worked down to more manageable levels. Many analysts don't expect to see a rebound in prices until sometime next year.
http://news.yahoo.com/s/ap/20080527/ap_on_bi_go_ec_fi/home_sales
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Nevada LO
298 Posts |
Posted - 05/27/2008 : 09:21:11 AM
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Some more about the increase in sales volume.
http://www.moneyweb.co.za/mw/view/mw/en/page94?oid=208450&sn=Detail
Home sales rise in hard-hit areas
Buyers snatch up foreclosed properties after big price cuts.
James R. Hagerty, Wall Street Journal
27 May 2008 02:07
Home sales are rising in some U.S. metropolitan areas where lenders have slashed prices on foreclosed properties.
Generally, home sales remain weak. The National Association of Realtors reported last week that sales of previously occupied homes in April were down about 18% from the already depressed year-earlier level.
But sales are up sharply in some of the areas hit hardest by foreclosures and falling prices. They include: Las Vegas; Sacramento, Calif.; Fort Myers, Fla.; and inner-city Detroit.
Though Americans remain wary of further drops in housing prices, the data from these areas show that some buyers are trolling for bargains. Sellers "have moved into the acceptance mode" and are pricing homes more realistically, says Thomas Lawler, a housing economist in Leesburg, Va. "I think it is the first stage of good news for the market."
Lenders' inventory of foreclosed homes has steadily increased in the past couple of years and is believed to total around half a million homes. Many lenders initially were slow to slash prices, partly because they hoped to avoid huge losses. But more lenders have been capitulating as it becomes clear that delays often merely result in lower proceeds and higher costs for taxes, insurance and upkeep.
That doesn't mean housing is poised for a quick recovery. In much of the U.S., there is still a huge glut of homes for sale, and foreclosures continue to dump more property on the market. Realtors reported that the number of single-family homes on the market in April was enough to last 10.7 months at the current sales rate, the highest since 1985. During the housing boom of the first half of this decade, the supply typically was four to five months.
For the first four months of this year, home sales in Detroit, excluding suburbs, totaled 3,360, up 48% from a year earlier, according to the Michigan Association of Realtors. The average price dropped 56% to just $20,514. That average is so low because many of the sales involve decrepit homes in neighborhoods with few jobs.
Most of the recent sales in Detroit involve investors buying foreclosed homes, says Carl Williams, president of the local association of Realtors. The homes are selling, he says, because "the prices are dirt cheap."
Sales of "normal" homes, those that haven't been foreclosed, remain very slow, Mr. Williams says. Still, he sees it as a good sign that lenders are finding buyers for the foreclosed homes. To the extent that investors can renovate and find tenants for vacant houses, neighborhoods can start to heal.
In California's Sacramento County, sales of single-family homes totaled 1,669 in April, up 41% from a year earlier, according to DataQuick Information Systems, a research firm. The median sales price was $226,250, down 34%.
Alan Wagner, president of the Sacramento Association of Realtors, says the rise reflects more aggressive pricing by lenders. "They've got to liquidate inventory. They're taking that house and dropping $100,000 off the price, and all of a sudden they've got multiple offers," he says. Some homes that sold for more than $400,000 a couple years ago now go for $225,000 to $260,000, Mr. Wagner says.
That means some renters previously priced out of the market finally can afford homes -- if they can qualify for mortgages. That has become much tougher because lenders have tightened standards, but Mr. Wagner says the growing availability of U.S.-insured loans insured by the Federal Housing Administration is helping.
In the Las Vegas area, sales of single-family homes in April were up 30% from a year earlier. The Greater Las Vegas Association of Realtors says properties being sold by lenders account for more than half of recent sales.
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DINEROS
1156 Posts |
Posted - 05/27/2008 : 09:28:42 AM
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I guess that is a free market in action.
What is bad for some is a win for others. |
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ugaagent
317 Posts |
Posted - 05/27/2008 : 09:32:44 AM
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| Here's the good news. At some point, this will all equal out. THis has been going on for a few years now. |
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