Here's my chance to post high, so I might get an answer. CFC's ranking of mortgage risk by county doesn't include any Indiana counties in the three worst categories, even though Indiana as a whole stands among the top ten states for mortgage default rates. Anybody able to figure out why? Are Indiana counties so uniformly bad that none stand out sufficiently to get a bad rating? Doesn't make sense.
The amazing part is how many bought at the top. Just look at CR's charts showing the huge volumes of sales from 2004 through 2006. All with leverage too.
No question in my mind people will walk. Make that RUN!
What does fractional reserve banking look like in reverse???
Obviously the composite is not weighted by MSA size or home price medians. 13 million people in Los Angeles losing 8.8% is a heck of a lot more pain than a half dozen Charlotte's could erase.
Wait a minute, the realtor I met at a homebuying seminar over the weekend told me that Boston-area prices were down "maybe 1%". You mean she was wrong?!?
Here is Seattle, we are told that are markets will not fall because we are special. Lots of jobs, everyone wants to live here, not making anymore real estate, the growth management act.
Case-Shiller has been saying that we are just late to the party.
I would like to point out that the so called fundamentals here are the same song and dance that was used in markets across the country to justify the high prices.
19 of 20 are seeing losses accelerating or gains slowing, are those Boston beans creating gas to help it reinflate. -8.6% y/y, nationwide, so much for the theory that a) housing prices are sticky downward and move in slow motion, and b) all real estate is local.
K Harris - my guess is that the foreclosures in IN are due to traditional reasons (job loss) rather than falling home prices? Homes in IN may not be in danger of experiencing dramatic price decreases since they're already cheap by comparison.
When these reports refer to Chicago are they taking about:
a) the city proper?
b) Cook Couunty?
c) the five county area?
Just wondering.
Its the MSA, so more like the 5 county area, although perhaps not precisely that. It def includes places like Evanston, and perhaps even out of state areas like Gary
Housing Inventory data just came out. Another BLOW to CRs Estimate of Demand.
For 2007:
Increase in Total Occupied Units = 950K
DECREASE in OWNER Occupied Units = 600K
I expect CR to slip-and-slide to 1.2M annual demand. Once the depression begins, he will slip-and-slide to 0.5M. There is lot of room to slip-and-slide from unfounded 1.7M annual demand estimate.
Calling people when they are flat out wrong,
Jas
PS: It is obvious why pushing people to ignore me was being pushed so hard.
They are sticky and they are local. The stickiness is temporary. It always expires. It has now expired. The markets are local as witnessed over the past couple of centuries, but the mortgage market is national and when house folly is driven by mortgage folly, the housing markets adopts the characteristics of the mortgage markets. This is all connected to what Tanta described as a telemarketer in CT selling a mortgage to some old lady in AZ.
I live in Boston. Not quite as weak as some of the country of course, but my wife and I have been following the local real estate prices for the last couple of years.
What's happening is that people are just holding off on selling as long as possible, hoping things pickup in the Spring.
High housing prices have been a big drag on the economy, sucking money out of people's pockets into non-productive assets, like residential RE and MBSs. The quicker this adjustment happens, the quicker the money can go back into productive uses.
Ouch, Miami. Ouch, ouch, talk about buyer's regret! I feel like such a jerk! I have been telling people that my house will soon be worth half of what I paid for it and that my down payment is gone forever but they scoff. Looks like it will be sooner than I thought, especially with the crime rate skyrocketing to help along the effect of all the foreclosures. Ouch this is pretty painful. I must stop reading this blog. It just makes me feel like an a**hole.
It start's small, like a bug bite...
NO ONE wants to predict that it's going to eat your arm&legs off and kill you, so you go easy on the patient...
By the time the patient figures out he's a goner, the DR has taken your insurance money, bot his 911, and is surfing malibu.
What's the benefit of predicting armageddon, Sir? yes you!
Boston has been wobbly down for the last three years if you look at the historical index.
My personal opinion is that Boston is going to slowly grind lower for a lot longer given the unfavorable demographics in New England. I wouldn't be surprised if Bostonians don't see price increases for 7-10 more years.
k harris, sorry, I don't know. I think the CFC list is based on info from the GSEs and private mortgage insurance companies - and I guess they don't think prices will fall that far in Indiana.
Whiskey, yes, the composite 10 is down 8.4%, the composite 20 is down 7.7%.
If I understand things correctly, Case-Shiller's Chicago is
"Chicago-Naperville-Joliet, IL
Metropolitan Division"
Cook IL,
DeKalb IL,
Du Page IL,
Grundy IL,
Kane IL,
Kendal IL,
McHenry IL,
Will IL
They're probably holding that constant over time so it won't track any changes in the US Census defined MSA/CBSA definition. But I've not done any research to be sure about that. There are other ways to approximate trend-lines with variable geographic bases.
Paul Atkins, one of the five commissioners at US regulator the Securities and Exchange Commission, said he expects hedge funds to help solve the market turmoil surrounding sub-prime US mortgage loans.
Atkins told French business school Edhec that, as far as he was able to see, hedge funds could not be blamed for the sub-prime problems. Moreover, he said: "Most importantly, we must remember that hedge funds are likely to be an important part of the solution to the sub-prime crisis."
Boston sellers are still in denial and the market is in a standoff in many communities. Local data sources reported today that sales dropped 23-27% YOY in December.
"Given the current state of our economy, the only thing worse than a new bubble is its absence."
Keep in mind that this blog only exists because of the internet bubble and the over-investment in fiber-optic cable, routers and attendent technologies. Unfortunately the RE bubble will not likely have such positive leftover effects. However, if the green energy bubble the article talks about leaves us with an overcapacity in solar panels, that's fine by me.
Here's my chance to post high, so I might get an answer. CFC's ranking of mortgage risk by county doesn't include any Indiana counties in the three worst categories, even though Indiana as a whole stands among the top ten states for mortgage default rates. Anybody able to figure out why? Are Indiana counties so uniformly bad that none stand out sufficiently to get a bad rating? Doesn't make sense.
Hey, some of us ALWAYS post high.
But seriously--Some markets appear to have had subprime lending, but no big runup in prices--I'm guessing a lot of this was refi, not people buying and selling homes. The refi activity didn't push up prices. Indianapolis, for example, has been often listed among "most affordable" home markets, and a friend of mine who moved to Muncie from the West Coast got three times as much house as he could formerly afford.
Now, some of these unwise (or in many cases, perhaps, predatory) mortgage refinancings are stressing people and leading to foreclosures. But Countrywide still doesn't expect a big future drop in prices in these markets, since they are not coming off a market bubble. So if that is right, lenders would face less jingle mail risk in making new loans in these markets. Time will tell.
"Unfortunately the RE bubble will not likely have such positive leftover effects." -Aheadofthecurve
Respectfully, and perhaps too optimistically, I hope there IS a positive outcome to all this:
- Cheaper/Affordable Housing
- Better corporate and banking governance
- New politicians
- Burnt specuvestors
- Generalized deflation that will offer us savers some reasonable investment opportunities
- Free pony?
I am almost certain they are not. I have not found an explicit statement that they are not, but I skimmed the methodology document and did various searches, and found no mention of adjusting the indices for inflation. Also, some astute watchers (e.g. Rich Toscano) publish an inflation adjusted version.
In case anyone is wondering if you click through the link they have a pdf of the methodology, including what counties were included in each metro area.
I don't know how many people track thier local counties sales but it is pretty easy here in SW Florida. I just pulled the YTD for Sarasota,Lee,Collier and Charlotte Counties.
Whooo boy,talk about a credit crunch!!! If a whole mess of sales do not appear in the next week or so this could be the ugliest month for sales I could find.
Also in all four counties FC's are running neck in neck with sales.
Usually the final numbers clear by the first/second week of the following month...
--
"Whisakey: "Bloomberg has the YoY drop for the 20-city index as 7.73% and not 8.4%. Based on the historical indices on your link, Bloomberg is correct."
For the correct data you need to read the correct source! I posted on the previous thread:
Another UGLY Case-Shiller Index --down 2.14%, MoM, and 7.74%, YoY (Composite-20). Composite-10 even worse.
Some people know their FACTS and math better than some others.
k harris - even though your question is posted on the wrong thread, I think you get credit for 'posting high', particularly at 10 in the morning.
The answer, I suspect, lies in the how they define their rating, which the document doesn't include. Maybe someone could post it? Anyway, a similar system I am familiar with uses the likelihood of a housing decline within the next 24 months to set the rating. In this view, Indiana markets may be rated better, cos hey - when you are already at the bottom, there's nowhere to go but up.
...
The interesting question is why the U.S. economy, beneficiary since 9/11 of the largest military spending binge in history, now requires $150 billion more in the form of a short-term stimulus package. Why hasn't the $1 trillion in defense spending, in addition to the 2001 and 2003 tax cuts, been sufficient to keep the economic boom going? ... Does that mean the fundamentals of our economy are weaker than we thought, and a deeper slump might have occurred without all that spending?
...
I'm jealous of all you people who can find good data for their areas. Where I live both the realtors' association and localities (the millions of "towns") don't make the information available online, or even have it.
--
Thanks, Bilbo. Some of us cranks knew all that and that is why the US e-CON-omy is on road to the Greater Depression.
Conmen (NYC Banking and Finance Cabal) operate con games and we know how it ends for the players who get sucked in to a con game. Needless to say, ehe Fed and the Federal govt do what the Cabal demands.
"How are the prices around the golf neighborhoods in SW FL? "
Dropping,but not really fast. I honestly think that the credit crunch is going to increase the drops. The only way people are going to be able to sell is to drastically drop prices. Heck,banks haven't even gotten serious about unloading REO yet.
How serious is it you ask ??? Lee county shows 2,not 20,200,2000,that is TWO freaking sales of SFR thru the 20th of Jan.
Can it actually go to ZERO in a couple of months??? Heck next month...
Oh, to put the drop for Lee county into perspective...I don't have the January 07 numbers but in Febuary of 07 they show 1056 sales...What is that,like a 99% drop ???
Thanks to all (Host included) for trying. I hope Indiana is largely immune from price decline. Indiana is far from immune from economic decline. Man, that place knows how to have a recession!
"The interesting question is why the U.S. economy, beneficiary since 9/11 of the largest military spending binge in history, now requires $150 billion more in the form of a short-term stimulus package. Why hasn't the $1 trillion in defense spending, in addition to the 2001 and 2003 tax cuts, been sufficient to keep the economic boom going?"
Very simply, too much capital went into non-productive assets-RE and the attendant financing. Now we have a great opportunity to see the capital go to more productive uses. If that happens then the Newsweek cover will be seen in retrospect just like the Time cover from June 2005
Shnaps- While house prices and sales are still rising in Canada (though they are slowing), no place in Canada has mortgages for 11% of income. In fact if you want to see prices that make California look reasonable, check out Vancouver.
I've been following NW FL as it more affordable. Neat area. Less developed than SW FL. Much cooler than SW FL Dec. thru Feb. More like Jacksonville.
FYI, inventory is huge in NW FL. Sales are exremely slow and way off peak. I suspect many of the unrealized gains since 2002 will turn into realized losses. I'm seeing 50% off peak prices on distressed sales in nice beach and golf communities.
This site helped me remain patient. I would have been ruined financially had I bought during the boom. I definitely sense massive fear and regret amongst the many who bought around the peak.
My suggestions for next month's post is that you show the % decline from peak, not just yr/yr.
Here are a couple I just ran (peak in parens):
LA: -12.23% (9/06)
PHX: -14.50% (6/06)
SD: -16.03% (6/06)
Not just a West Coast thing:
DC: -11.00% (5/06)
Remember, these are just through November! And remember, these are larger % declines that anyone "mainstream" believed could ever happen in any one or two markets, much less in basically every market. Amazing.
The Nov/Oct decline was more severe than the Oct/Sept decline in 19 out of 20 markets (Tampa is the one exception, where Nov was only down 1.4% vs. Octobers 1.8% drop).
Tampa/St. Pete,Sarasota are still sorta in the "denial" phase. I look for severe bleedover into these markets in the next few months. If the pending sales for Jan stay even its going to start efeecting them as much...
Jas,
Here is the truth that will set your mind at ease.
After this debt bubble finally blows,
China, Russia, Middle East, and Europe will all be on their knees,
bowing down to the last superpower,
the USA. All the Debt will be written off and forgiven and things will continue "as is" for another 200 years.
Way too early to predict a Depression. We are still debating the possibility of a recession. Greenspan is not the dummy you think.
I'm expecting a really hard, fast, house price crash now. Once prices start dropping, and people believe they're dropping, nobody will want to buy until we hit rent saver levels, where the monthly cost of owning is below that of renting. (and that's a long way down in many markets) Otherwise, why not wait another month? One notable datum from the Southern California housing blogs is that we are already seeing houses 40% below peak and sometimes even more. It's only a few houses now but once you have one the whole neighborhood is pushed down to that price. Once prices start falling they can fall very fast.
The total time for the decline will be less than we've seen in the past. The bigger bubble means the decline is faster, making it more beneficial to wait. At the same time the foreclosure meltdown keeps dumping houses on the market.
Greenspan is a Crook. He was one of the three Elders of NYC Banking and Finance Cabal -- Weill, Rubin and Greenspan -- that help make what was illegal legal by repeal of the Glass-Steagall Act.
Chris wrote: Tampa/St. Pete,Sarasota are still sorta in the "denial" phase.
Hey, I see denial everywhere I look, but Tampa is down 14.4% from peak, which is in line with the worst markets. The only way in which Tampa is different is that at least for the last month's data, the slope was decreasing, unlike every other market.
It looks like Boston is rising MoM. Must be the Patriots?
OUCH! I thought they always went up?
My realtor and David Lereah said it was always a good time to pay a commission?
Tequila shots seemed like such a good idea last night.
Here's my chance to post high, so I might get an answer. CFC's ranking of mortgage risk by county doesn't include any Indiana counties in the three worst categories, even though Indiana as a whole stands among the top ten states for mortgage default rates. Anybody able to figure out why? Are Indiana counties so uniformly bad that none stand out sufficiently to get a bad rating? Doesn't make sense.
Huh the NY Metro area stops just short of the millionaire belt out west on 78, would be interesting to see how their inclusion would effect the fall.
Will be meeting Mr. Case in next couple weeks at a speech/breakfast.
Should be interesting to watch reactions in room (it's a Chamber of Commerce).
Best regards,
Falcor
P.S.
1. Grease Monkey rocks
2. Thanks for names at top of posts
The amazing part is how many bought at the top. Just look at CR's charts showing the huge volumes of sales from 2004 through 2006. All with leverage too.
No question in my mind people will walk. Make that RUN!
What does fractional reserve banking look like in reverse???
Anyone? Anyone? Anyone?
Houston we have a problem!
NYC down 4.1%. Can't be!
Wow, the bottom half of that chart is just fugly.
Oh, btw, it appears that Europe's having tiny problems too.
ECB aid to Spanish banks matches Rock rescue - Telegraph
Metrics Wonk.
I live in Northern NJ at the 78 border. Prices are definitely down more than 4.8%. My best guess is 15%. Sales are extremely slow to boot.
Obviously the composite is not weighted by MSA size or home price medians. 13 million people in Los Angeles losing 8.8% is a heck of a lot more pain than a half dozen Charlotte's could erase.
The trend is the house prices are falling in larger cites that is not good to invest in real estate you should start your own business.
Lively Money: Business owners are banking on banks for money!
'We reached another grim milestone in the housing market in November.' Robert J. Shiller
I think it would be far grimmer if prices were still going up.
Question:
When these reports refer to Chicago are they taking about:
a) the city proper?
b) Cook Couunty?
c) the five county area?
Just wondering.
"Grim milestone?"
Do people say that when food or gasoline prices drop?
Wait a minute, the realtor I met at a homebuying seminar over the weekend told me that Boston-area prices were down "maybe 1%". You mean she was wrong?!?
Here is Seattle, we are told that are markets will not fall because we are special. Lots of jobs, everyone wants to live here, not making anymore real estate, the growth management act.
Case-Shiller has been saying that we are just late to the party.
I would like to point out that the so called fundamentals here are the same song and dance that was used in markets across the country to justify the high prices.
All,
Size of losses is increasing/accelerating. Newton's law: A body in motion tends to stay in motion.
The trend is no longer your friend.
Its starting to look like the bust maight be quicker and more decisive than I originally thought.
Seattle is down. That's all you need to know. If Seattle is down, everything's down.
Boston is interesting. The past 8 months or so have been around -4% yoy. Sticky prices or indication of a faster recovery?
Yes, I know. I was pointing out what the realtors here have been saying and that I do not agree.
19 of 20 are seeing losses accelerating or gains slowing, are those Boston beans creating gas to help it reinflate. -8.6% y/y, nationwide, so much for the theory that a) housing prices are sticky downward and move in slow motion, and b) all real estate is local.
K Harris - my guess is that the foreclosures in IN are due to traditional reasons (job loss) rather than falling home prices? Homes in IN may not be in danger of experiencing dramatic price decreases since they're already cheap by comparison.
Consumer confidence - 87
Vito writes:
Question:
When these reports refer to Chicago are they taking about:
a) the city proper?
b) Cook Couunty?
c) the five county area?
Just wondering.
Its the MSA, so more like the 5 county area, although perhaps not precisely that. It def includes places like Evanston, and perhaps even out of state areas like Gary
--
Breaking News
Housing Inventory data just came out. Another BLOW to CRs Estimate of Demand.
For 2007:
Increase in Total Occupied Units = 950K
DECREASE in OWNER Occupied Units = 600K
I expect CR to slip-and-slide to 1.2M annual demand. Once the depression begins, he will slip-and-slide to 0.5M. There is lot of room to slip-and-slide from unfounded 1.7M annual demand estimate.
Calling people when they are flat out wrong,
Jas
PS: It is obvious why pushing people to ignore me was being pushed so hard.
--
Link:
Housing Vacancies and Homeownership - Fourth Quarter 2007:
Table 4
Dirk,
They are sticky and they are local. The stickiness is temporary. It always expires. It has now expired. The markets are local as witnessed over the past couple of centuries, but the mortgage market is national and when house folly is driven by mortgage folly, the housing markets adopts the characteristics of the mortgage markets. This is all connected to what Tanta described as a telemarketer in CT selling a mortgage to some old lady in AZ.
Bloomberg has the YoY drop for the 20-city index as 7.73% and not 8.4%. Based on the historical indices on your link, Bloomberg is correct.
Jas,
Blog prosecutor and judge:)
I live in Boston. Not quite as weak as some of the country of course, but my wife and I have been following the local real estate prices for the last couple of years.
What's happening is that people are just holding off on selling as long as possible, hoping things pickup in the Spring.
Massachusetts, in general, is in trouble:
Mass. housing market decline offers little hope for '08 recovery - Milford, MA - The Milford Daily News
No recovery in sight yet!
High housing prices have been a big drag on the economy, sucking money out of people's pockets into non-productive assets, like residential RE and MBSs. The quicker this adjustment happens, the quicker the money can go back into productive uses.
Ouch, Miami. Ouch, ouch, talk about buyer's regret! I feel like such a jerk! I have been telling people that my house will soon be worth half of what I paid for it and that my down payment is gone forever but they scoff. Looks like it will be sooner than I thought, especially with the crime rate skyrocketing to help along the effect of all the foreclosures. Ouch this is pretty painful. I must stop reading this blog. It just makes me feel like an a**hole.
It start's small, like a bug bite...
NO ONE wants to predict that it's going to eat your arm&legs off and kill you, so you go easy on the patient...
By the time the patient figures out he's a goner, the DR has taken your insurance money, bot his 911, and is surfing malibu.
What's the benefit of predicting armageddon, Sir? yes you!
Boston has been wobbly down for the last three years if you look at the historical index.
My personal opinion is that Boston is going to slowly grind lower for a lot longer given the unfavorable demographics in New England. I wouldn't be surprised if Bostonians don't see price increases for 7-10 more years.
k harris, sorry, I don't know. I think the CFC list is based on info from the GSEs and private mortgage insurance companies - and I guess they don't think prices will fall that far in Indiana.
Whiskey, yes, the composite 10 is down 8.4%, the composite 20 is down 7.7%.
Best Wishes
If I understand things correctly, Case-Shiller's Chicago is
"Chicago-Naperville-Joliet, IL
Metropolitan Division"
Cook IL,
DeKalb IL,
Du Page IL,
Grundy IL,
Kane IL,
Kendal IL,
McHenry IL,
Will IL
They're probably holding that constant over time so it won't track any changes in the US Census defined MSA/CBSA definition. But I've not done any research to be sure about that. There are other ways to approximate trend-lines with variable geographic bases.
If you are looking for a gloom and doom article.
In America, the land of bubbles, the next pop will be the biggest Paul B. Farrell - MarketWatch
"Given the current state of our economy, the only thing worse than a new bubble is its absence."
Paul Atkins, one of the five commissioners at US regulator the Securities and Exchange Commission, said he expects hedge funds to help solve the market turmoil surrounding sub-prime US mortgage loans.
Atkins told French business school Edhec that, as far as he was able to see, hedge funds could not be blamed for the sub-prime problems. Moreover, he said: "Most importantly, we must remember that hedge funds are likely to be an important part of the solution to the sub-prime crisis."
US Edition - Financial News Online
Yeah, I'm sure they'll do so in a spirit of altruism and charity to their fellow man. Bc they've done SO much to benefit people in the past.
Boston sellers are still in denial and the market is in a standoff in many communities. Local data sources reported today that sales dropped 23-27% YOY in December.
"Given the current state of our economy, the only thing worse than a new bubble is its absence."
Keep in mind that this blog only exists because of the internet bubble and the over-investment in fiber-optic cable, routers and attendent technologies. Unfortunately the RE bubble will not likely have such positive leftover effects. However, if the green energy bubble the article talks about leaves us with an overcapacity in solar panels, that's fine by me.
Cr, Tanta, Anyone,
Are the Case-Shiller numbers adjusted for inflation??
Here's my chance to post high, so I might get an answer. CFC's ranking of mortgage risk by county doesn't include any Indiana counties in the three worst categories, even though Indiana as a whole stands among the top ten states for mortgage default rates. Anybody able to figure out why? Are Indiana counties so uniformly bad that none stand out sufficiently to get a bad rating? Doesn't make sense.
Hey, some of us ALWAYS post high.
But seriously--Some markets appear to have had subprime lending, but no big runup in prices--I'm guessing a lot of this was refi, not people buying and selling homes. The refi activity didn't push up prices. Indianapolis, for example, has been often listed among "most affordable" home markets, and a friend of mine who moved to Muncie from the West Coast got three times as much house as he could formerly afford.
Now, some of these unwise (or in many cases, perhaps, predatory) mortgage refinancings are stressing people and leading to foreclosures. But Countrywide still doesn't expect a big future drop in prices in these markets, since they are not coming off a market bubble. So if that is right, lenders would face less jingle mail risk in making new loans in these markets. Time will tell.
"Unfortunately the RE bubble will not likely have such positive leftover effects." -Aheadofthecurve
Respectfully, and perhaps too optimistically, I hope there IS a positive outcome to all this:
- Cheaper/Affordable Housing
- Better corporate and banking governance
- New politicians
- Burnt specuvestors
- Generalized deflation that will offer us savers some reasonable investment opportunities
- Free pony?
I am almost certain they are not. I have not found an explicit statement that they are not, but I skimmed the methodology document and did various searches, and found no mention of adjusting the indices for inflation. Also, some astute watchers (e.g. Rich Toscano) publish an inflation adjusted version.
above comment referring to the indices, response to Fl Watcher
I think it is important to remember that these are nominal declines; real declines, adjusted for inflation, are even worse.
OT: But what is an earmark? Bush talked about it a lot last night. Is it the mortgage pigs ear that has been sowed into silk and sold to investors?
In case anyone is wondering if you click through the link they have a pdf of the methodology, including what counties were included in each metro area.
I don't know how many people track thier local counties sales but it is pretty easy here in SW Florida. I just pulled the YTD for Sarasota,Lee,Collier and Charlotte Counties.
Whooo boy,talk about a credit crunch!!! If a whole mess of sales do not appear in the next week or so this could be the ugliest month for sales I could find.
Also in all four counties FC's are running neck in neck with sales.
Usually the final numbers clear by the first/second week of the following month...
Chris
Cobradriver,
How are the prices around the golf neighborhoods in SW FL?
I'm looking for a place in FL to own not flip. I was priced out during the boom.
Eric,
Thanks
I can't resist mentioning this:
Time magazine cover June 2005 "Home $weet Home" more or less marked housing top.
Newsweek cover Feb 2008 "Road to recession"
Have a nice day
--
"Whisakey: "Bloomberg has the YoY drop for the 20-city index as 7.73% and not 8.4%. Based on the historical indices on your link, Bloomberg is correct."
For the correct data you need to read the correct source! I posted on the previous thread:
Another UGLY Case-Shiller Index --down 2.14%, MoM, and 7.74%, YoY (Composite-20). Composite-10 even worse.
Some people know their FACTS and math better than some others.
Jas
k harris - even though your question is posted on the wrong thread, I think you get credit for 'posting high', particularly at 10 in the morning.
The answer, I suspect, lies in the how they define their rating, which the document doesn't include. Maybe someone could post it? Anyway, a similar system I am familiar with uses the likelihood of a housing decline within the next 24 months to set the rating. In this view, Indiana markets may be rated better, cos hey - when you are already at the bottom, there's nowhere to go but up.
OT: This blog post entitled "The Three Trillion Dollar War" says it all to me.
Economist's View: "The Three Trillion Dollar War"
...
The interesting question is why the U.S. economy, beneficiary since 9/11 of the largest military spending binge in history, now requires $150 billion more in the form of a short-term stimulus package. Why hasn't the $1 trillion in defense spending, in addition to the 2001 and 2003 tax cuts, been sufficient to keep the economic boom going? ... Does that mean the fundamentals of our economy are weaker than we thought, and a deeper slump might have occurred without all that spending?
...
"- Free pony?"
Drew, is there any way to go long on pony breeding ? It could be the next hot enterprise
--
"Newsweek cover Feb 2008 "Road to recession"
Newsweek cover Feb 2009: Road to Depression
Newsweek cover Feb 2010: Road to Greater Depression
Its all baked in the cake. Greenspan bakes great cakes!
Jas
In my town...
...home sales up 11% in December
...home prices up 3.4% in 2007
...mortgages 11% of household income
Ellen -
Glad to see CR attracts some Canadian readers.
I'm jealous of all you people who can find good data for their areas. Where I live both the realtors' association and localities (the millions of "towns") don't make the information available online, or even have it.
--
Thanks, Bilbo. Some of us cranks knew all that and that is why the US e-CON-omy is on road to the Greater Depression.
Conmen (NYC Banking and Finance Cabal) operate con games and we know how it ends for the players who get sucked in to a con game. Needless to say, ehe Fed and the Federal govt do what the Cabal demands.
Jas
Nope, not in Canada.
Shnaps writes:
Ellen -
Glad to see CR attracts some Canadian readers.
Be careful who you're calling Canadian:
National Post Story
"How are the prices around the golf neighborhoods in SW FL? "
Dropping,but not really fast. I honestly think that the credit crunch is going to increase the drops. The only way people are going to be able to sell is to drastically drop prices. Heck,banks haven't even gotten serious about unloading REO yet.
How serious is it you ask ??? Lee county shows 2,not 20,200,2000,that is TWO freaking sales of SFR thru the 20th of Jan.
Can it actually go to ZERO in a couple of months??? Heck next month...
Chris
We like to call this place "Old America."
Oh, to put the drop for Lee county into perspective...I don't have the January 07 numbers but in Febuary of 07 they show 1056 sales...What is that,like a 99% drop ???
Chris
Thanks to all (Host included) for trying. I hope Indiana is largely immune from price decline. Indiana is far from immune from economic decline. Man, that place knows how to have a recession!
"The interesting question is why the U.S. economy, beneficiary since 9/11 of the largest military spending binge in history, now requires $150 billion more in the form of a short-term stimulus package. Why hasn't the $1 trillion in defense spending, in addition to the 2001 and 2003 tax cuts, been sufficient to keep the economic boom going?"
Very simply, too much capital went into non-productive assets-RE and the attendant financing. Now we have a great opportunity to see the capital go to more productive uses. If that happens then the Newsweek cover will be seen in retrospect just like the Time cover from June 2005
Shnaps- While house prices and sales are still rising in Canada (though they are slowing), no place in Canada has mortgages for 11% of income. In fact if you want to see prices that make California look reasonable, check out Vancouver.
--
"We like to call this place "Old America.""
Ellen, you must live in a ghost town because the "Old America" died.
Jas
Cobradriver,
Thanks for info re SW FL.
I've been following NW FL as it more affordable. Neat area. Less developed than SW FL. Much cooler than SW FL Dec. thru Feb. More like Jacksonville.
FYI, inventory is huge in NW FL. Sales are exremely slow and way off peak. I suspect many of the unrealized gains since 2002 will turn into realized losses. I'm seeing 50% off peak prices on distressed sales in nice beach and golf communities.
This site helped me remain patient. I would have been ruined financially had I bought during the boom. I definitely sense massive fear and regret amongst the many who bought around the peak.
Its really a bad situation for so many.
My suggestions for next month's post is that you show the % decline from peak, not just yr/yr.
Here are a couple I just ran (peak in parens):
LA: -12.23% (9/06)
PHX: -14.50% (6/06)
SD: -16.03% (6/06)
Not just a West Coast thing:
DC: -11.00% (5/06)
Remember, these are just through November! And remember, these are larger % declines that anyone "mainstream" believed could ever happen in any one or two markets, much less in basically every market. Amazing.
One more cool numbers things:
The Nov/Oct decline was more severe than the Oct/Sept decline in 19 out of 20 markets (Tampa is the one exception, where Nov was only down 1.4% vs. Octobers 1.8% drop).
This thing is still accelerating.
Price Stout | 01.29.08 - 11:55 am |
Tampa/St. Pete,Sarasota are still sorta in the "denial" phase. I look for severe bleedover into these markets in the next few months. If the pending sales for Jan stay even its going to start efeecting them as much...
Chris
Jas,
Here is the truth that will set your mind at ease.
After this debt bubble finally blows,
China, Russia, Middle East, and Europe will all be on their knees,
bowing down to the last superpower,
the USA. All the Debt will be written off and forgiven and things will continue "as is" for another 200 years.
Way too early to predict a Depression. We are still debating the possibility of a recession. Greenspan is not the dummy you think.
I'm expecting a really hard, fast, house price crash now. Once prices start dropping, and people believe they're dropping, nobody will want to buy until we hit rent saver levels, where the monthly cost of owning is below that of renting. (and that's a long way down in many markets) Otherwise, why not wait another month? One notable datum from the Southern California housing blogs is that we are already seeing houses 40% below peak and sometimes even more. It's only a few houses now but once you have one the whole neighborhood is pushed down to that price. Once prices start falling they can fall very fast.
The total time for the decline will be less than we've seen in the past. The bigger bubble means the decline is faster, making it more beneficial to wait. At the same time the foreclosure meltdown keeps dumping houses on the market.
--
"Greenspan is not the dummy you think."
I never said that, did I?
Greenspan is a Crook. He was one of the three Elders of NYC Banking and Finance Cabal -- Weill, Rubin and Greenspan -- that help make what was illegal legal by repeal of the Glass-Steagall Act.
Legalism is a morally bankrupt ideology.
Jas
Chris wrote: Tampa/St. Pete,Sarasota are still sorta in the "denial" phase.
Hey, I see denial everywhere I look, but Tampa is down 14.4% from peak, which is in line with the worst markets. The only way in which Tampa is different is that at least for the last month's data, the slope was decreasing, unlike every other market.
denial everywhere...must be talking about Santa Monica...
--
"denial everywhere...must be talking about Santa Monica..."
Only down 17%% from the Jun'07 price. At this rate it might sink into Pacific.
Jas
I have posted some charts on the cities in the Composite-10. The charts also show what the CME futures market are reflecting through 2012.
Financial Sight: S&P/Case-Shiller Home Price Indices