It's really quite fun watching these guys chase the market down with their forecasts. It's as if it's a contest to see how many time they can be wrong before the bottom.
"Fidelity, which says it issues about 28 percent of all U.S. title insurance policies, reported closing 66 percent of orders opened, down from 68 percent a year ago. At 408,700, orders closed during the quarter were down 14 percent from the 473,800 tallied in the second quarter of 2006.
The 131,500 orders closed in June were a low for the quarter, and represented a 21 decline from the same month last year."
Only two tranches off of the all time lows today! 06-2AAA and 06-2AA
Everything else shows immense damage: Markit Homepage
I am beginning to think that everybody involved in this toxic waste holding long is going to have some 'splaining to do when mark to model is put back into the crypt and the accountants show up to proofread the valuations and mark to whatever shred of a market exists for this junk.
Manure in a bright shiny box.
I wonder if my pension fund has bought much of this stuff- I hope not.
Oh, well- it will all be drowned in vast oceans of liquidity.
I am taking the under for New Homes at 860K. Consensus = 890K I may be overshooting with home builders reporting revenue declines around 35%+.
Now, with record new home supplies and decreasing demand along with prices, how does that square with producing 500K more homes than can be sold? OTOH, He may be right. The builders may just build themselves straight into BK court...
AllenM, I didn't think you were "a raving loony"; I always thought there was the potential for a more serious slowdown in the 2nd half of '07. I'm still partial to my prediction.
All: please post any forecasts in the other thread, so we can just look at those comments in January.
Concur re Sam Zell, he knows real estate and undoubtedly picked the top of the market to sell into. Locally, here is Seattle, some of the families who have owned chunks of commercial property for years have sold.
I know it's a different shilling association, but OT, whatever happened to David Lereah?
Joined Move, an online real estate company. HaloScan.com - Comments David Lereah Watch
A very close family friend of 40 years is a medium sized residential bldg owner in Manhattan.
Never sells his properties. In 1990 my father did a valuation of his properties and they were valued at 250 million.
He's very old school. Buys low and hold them forever.
Not anymore. Just found out he has sold 90% of the portofolio in the last year and half.
re: market manipulation-
"Mr. Hunter said on Feb. 24 that he needed for the expiring Nymex contract "to get smashed on settle then day is done." He also bragged about "flexing" his muscles in the markets. In a statement, Nymex said it "played a central role" in identifying wrongdoing at Amaranth in the course of policing its own exchange." Amaranth Case Shows Trading's Dark Side - WSJ.com
Those are great REIT videos. Thanks. Two of the videos make a big point about IYR bouncing off its technical support levels, which indicates upside resilency. Well, now it's crashed through the bottom.
Here's the great line: "Markets are never overbought. They can go as high as they want to."
Sam Zell sold Commercial not residential. We will see if he was right- at this point I would say no based on reports released.
Not saying he isnt a smart cookie.
The Sandlers who owned Golden West Financial/World Savings sold to Wachovia right at the top in Residential. They were close friends of Greenspan. Hmmmmmmmmmmmmmmmmmmm
Those REIT videos made me fall out of my chair. After sitting through a 4 hour meeting with a big bank I needed that. I can laugh and be smug after buying SRS at 80 two months ago.
Will rents rise? Or will the flood of new, unsold inventory piling into the rental market drive rents down in addition to prices? Obviously, since I own SRS shares, I am in part betting on the latter...and so far that bet's paid off. Not to mention the components of the IYR that build shopping centers and the like - I am starting to see more and more ghost-malls in SoCal recently. We'll see.
David: Netcraft - Search Web by Domain..
says Linux... They are probably experiencing scalability problems. I hadn't seen post throttling before today (once every 30 seconds). No responses on the forums: HaloScan.com Forums
They appear to be apart of LiveRack LLC, a hosting service? Maybe they are just not geared for the problem at hand.
Yeah, the technical analysis on those REIT videos were an absolute joke. I'm in Tampa Bay and I'm seeing more and more commercial property for lease, and the signs keep getting more and more desperate.
It was only a matter of time b/f this argument became more widespread. Hey - our blackbox model of historical repayment rates didn't predict that new loan products being given to people who were lying and who couldn't afford the payments would default.
An 800 FICO score with a monthly mortgage nut of 4k and monthly takehome of 4k is not a complicated modeling problem...it's just simple subtraction...
"Will rents rise? Or will the flood of new, unsold inventory piling into the rental market drive rents down in addition to prices?"
Going to depend on the market. Where housing supply is limited -- inner metro areas -- the former, I suspect. That's my personal experience.
In overbuilt areas, however, rents might well fall, especially if and when REO SF homes and condos fall into the hands of ready-cash-heavy investors at bargain prices.
It seems every inner metro area has an overbuilt burb one can commute from. So the real puzzle will be how this swirling mess of overbuilt burbs lowering rents, buyers on the sidelines raising inner city rents, and rising gas prices making people hesitate to move to the burbs all comes together. Is there a tipping point that would favor REIT's or will they follow residential builders into the death spiral.
Bob, "In overbuilt areas, however, rents might well fall, especially if and when REO SF homes and condos fall into the hands of ready-cash-heavy investors at bargain prices"
The speculators that turned their flips into remtals until the "market turns around" will get shellshocked as their already cash-flow-negative investments generate even less cash, empty, as their renters move to cheaper digs. That will mark the 3rd leg down as those hanging on by a thread say uncle.
Yes...I agree Sam Z. is good at what he does, but it should be known that I have witnessed first hand some pretty stupid purchases (and sales) over the past 7 years that EOP has transacted and lost lots of money on (and I mean a shitload on some trophies)...just an FYI. I think he was much more hands off than most realize. Please also note that anyone who owns comre and can trade it damn close to T-notes (100bps above) also realizes that the probability of it ever getting there again is almost zero. Hence, Brian's post above about the guy that sold his portfolio.
I am not bashing Sam...I just don't think he deserves the God like quality he seems to have now...just a thought.
It totally depends on the type of reit...Which type are you talking about?
Just as a general rule retail should get kicked in the head first due to sales percentage lease structure...but after that it totally depends on the reit's asset types and where they are concentrated.
Miguela - I was mainly thinking of Apartment REITS like Archstone, though I think they'll all go together eventually, although I think you are right about retail being the leading indicator. Reason being REITs like ASN are heavily concentrated in metro areas. If consumer spending slows it stands to reason consumers will also have less money to spend on rent. They may seek out deals in the burbs amongst the overbuilt condos instead of Avalon apartments. So ASN and AVB follow primary IYR component SPG into the downdraft. Of course this is my own wishful thinking since I am short via SRS.
It's really quite fun watching these guys chase the market down with their forecasts. It's as if it's a contest to see how many time they can be wrong before the bottom.
Haloscan, is bad today
I tried to tell you that my estimate for 2007 was 4.5 million. I hope this works.
I know it's a different shilling association, but OT, whatever happened to David Lereah?
Was he found face down in the swimming pool of a foreclosed mcmansion, and I just haven't heard about it?
Fidelity National Financial earnings fall 36% | Real Estate and Technology News for Agents, Brokers and Investors | Inman News
"Fidelity, which says it issues about 28 percent of all U.S. title insurance policies, reported closing 66 percent of orders opened, down from 68 percent a year ago. At 408,700, orders closed during the quarter were down 14 percent from the 473,800 tallied in the second quarter of 2006.
The 131,500 orders closed in June were a low for the quarter, and represented a 21 decline from the same month last year."
Preview for next months sales numbers? -21%?
Seiders expects starts to average about 1.38 million per month, at a seasonally adjusted annual rate,
Ummm, I think you mean 1.38m annualized rate based on a SA June (monthly) datum.
Humph, I like how he still manages to predict an increase in 08.
Ridiculous. Trees don't go to the moon and broken markets of slow assets take a long time to heal.
Good luck working in the real estate wealth destruction complex.
Soooo much empty older retail here in Phoenix, and rents have yet to adjust. Too many New York based reit owners still looking at last years numbers.
Sam Zell was the tell- he always wanted maximum value.
Oh yeah, I do own 5 million even from January, when CR thought I was a raving loony. I am, but it is now entering into the realm of possibility.
Someday this war's gonna end...
Only two tranches off of the all time lows today! 06-2AAA and 06-2AA
Everything else shows immense damage:
Markit Homepage
I am beginning to think that everybody involved in this toxic waste holding long is going to have some 'splaining to do when mark to model is put back into the crypt and the accountants show up to proofread the valuations and mark to whatever shred of a market exists for this junk.
Manure in a bright shiny box.
I wonder if my pension fund has bought much of this stuff- I hope not.
Oh, well- it will all be drowned in vast oceans of liquidity.
Someday this war's gonna end...
Don't worry, its contained.
I am taking the under for New Homes at 860K. Consensus = 890K I may be overshooting with home builders reporting revenue declines around 35%+.
Now, with record new home supplies and decreasing demand along with prices, how does that square with producing 500K more homes than can be sold? OTOH, He may be right. The builders may just build themselves straight into BK court...
AllenM, I didn't think you were "a raving loony"; I always thought there was the potential for a more serious slowdown in the 2nd half of '07. I'm still partial to my prediction.
All: please post any forecasts in the other thread, so we can just look at those comments in January.
Best to all.
AllenM,
Concur re Sam Zell, he knows real estate and undoubtedly picked the top of the market to sell into. Locally, here is Seattle, some of the families who have owned chunks of commercial property for years have sold.
OT, if you are short on REITs or own SRS, watch these three videos (in order) for a good laugh:
http://tinyurl.com/37mxyp
http://tinyurl.com/3a37w3
http://tinyurl.com/2o8cjp
I know it's a different shilling association, but OT, whatever happened to David Lereah?
Joined Move, an online real estate company.
HaloScan.com - Comments
David Lereah Watch
Yun is definitely a second string shill.
Lawrence Yun Watch - Follow the NAR's hack as he denies the housing bubble and crash
A very close family friend of 40 years is a medium sized residential bldg owner in Manhattan.
Never sells his properties. In 1990 my father did a valuation of his properties and they were valued at 250 million.
He's very old school. Buys low and hold them forever.
Not anymore. Just found out he has sold 90% of the portofolio in the last year and half.
re: market manipulation-
"Mr. Hunter said on Feb. 24 that he needed for the expiring Nymex contract "to get smashed on settle then day is done." He also bragged about "flexing" his muscles in the markets. In a statement, Nymex said it "played a central role" in identifying wrongdoing at Amaranth in the course of policing its own exchange."
Amaranth Case Shows Trading's Dark Side - WSJ.com
I am a physicist and by definition a Microsoft hater.
Could the HaloScan problems be Microsoft related.
At work I use a Linux machine and my laptop is an apple and all these days
where there has been complaining about HaloScan I've had zero trouble.
Those are great REIT videos. Thanks. Two of the videos make a big point about IYR bouncing off its technical support levels, which indicates upside resilency. Well, now it's crashed through the bottom.
Here's the great line: "Markets are never overbought. They can go as high as they want to."
Sam Zell sold Commercial not residential. We will see if he was right- at this point I would say no based on reports released.
Not saying he isnt a smart cookie.
The Sandlers who owned Golden West Financial/World Savings sold to Wachovia right at the top in Residential. They were close friends of Greenspan. Hmmmmmmmmmmmmmmmmmmm
Those REIT videos made me fall out of my chair. After sitting through a 4 hour meeting with a big bank I needed that. I can laugh and be smug after buying SRS at 80 two months ago.
Will rents rise? Or will the flood of new, unsold inventory piling into the rental market drive rents down in addition to prices? Obviously, since I own SRS shares, I am in part betting on the latter...and so far that bet's paid off. Not to mention the components of the IYR that build shopping centers and the like - I am starting to see more and more ghost-malls in SoCal recently. We'll see.
David:
Netcraft - Search Web by Domain..
says Linux... They are probably experiencing scalability problems. I hadn't seen post throttling before today (once every 30 seconds). No responses on the forums:
HaloScan.com Forums
They appear to be apart of LiveRack LLC, a hosting service? Maybe they are just not geared for the problem at hand.
Yeah, the technical analysis on those REIT videos were an absolute joke. I'm in Tampa Bay and I'm seeing more and more commercial property for lease, and the signs keep getting more and more desperate.
Just heard this:
Stocks Bump Up Amid Gloomy Financial News : NPR
Wyss essentially blames the FICO scores -> they're not predicting as well as they should!
It was only a matter of time b/f this argument became more widespread. Hey - our blackbox model of historical repayment rates didn't predict that new loan products being given to people who were lying and who couldn't afford the payments would default.
An 800 FICO score with a monthly mortgage nut of 4k and monthly takehome of 4k is not a complicated modeling problem...it's just simple subtraction...
"Will rents rise? Or will the flood of new, unsold inventory piling into the rental market drive rents down in addition to prices?"
Going to depend on the market. Where housing supply is limited -- inner metro areas -- the former, I suspect. That's my personal experience.
In overbuilt areas, however, rents might well fall, especially if and when REO SF homes and condos fall into the hands of ready-cash-heavy investors at bargain prices.
It seems every inner metro area has an overbuilt burb one can commute from. So the real puzzle will be how this swirling mess of overbuilt burbs lowering rents, buyers on the sidelines raising inner city rents, and rising gas prices making people hesitate to move to the burbs all comes together. Is there a tipping point that would favor REIT's or will they follow residential builders into the death spiral.
Bob, "In overbuilt areas, however, rents might well fall, especially if and when REO SF homes and condos fall into the hands of ready-cash-heavy investors at bargain prices"
The speculators that turned their flips into remtals until the "market turns around" will get shellshocked as their already cash-flow-negative investments generate even less cash, empty, as their renters move to cheaper digs. That will mark the 3rd leg down as those hanging on by a thread say uncle.
Yes...I agree Sam Z. is good at what he does, but it should be known that I have witnessed first hand some pretty stupid purchases (and sales) over the past 7 years that EOP has transacted and lost lots of money on (and I mean a shitload on some trophies)...just an FYI. I think he was much more hands off than most realize. Please also note that anyone who owns comre and can trade it damn close to T-notes (100bps above) also realizes that the probability of it ever getting there again is almost zero. Hence, Brian's post above about the guy that sold his portfolio.
I am not bashing Sam...I just don't think he deserves the God like quality he seems to have now...just a thought.
Itsallgreek,
It totally depends on the type of reit...Which type are you talking about?
Just as a general rule retail should get kicked in the head first due to sales percentage lease structure...but after that it totally depends on the reit's asset types and where they are concentrated.
Miguela - I was mainly thinking of Apartment REITS like Archstone, though I think they'll all go together eventually, although I think you are right about retail being the leading indicator. Reason being REITs like ASN are heavily concentrated in metro areas. If consumer spending slows it stands to reason consumers will also have less money to spend on rent. They may seek out deals in the burbs amongst the overbuilt condos instead of Avalon apartments. So ASN and AVB follow primary IYR component SPG into the downdraft. Of course this is my own wishful thinking since I am short via SRS.
Gary - Lereah quit back in April, found a better gig as dr strangelove pointed out.
Here's some Housing Haiku, dedicated to Yun:
Yammering FunYun
Telling yarns by the yardful
Only yokels buy
Wow! You can get vertigo looking at the Beazer (BZH) chart.
Is the stock market signaling trouble now Sebastian?
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