More on Existing Home Sales

Submitted by
CalculatedRisk on Mon, 02/25/2008 - 11:14am (28 comments)
in
what a joke wrote on Mon, 2/25/2008 - 11:41 am

Ambac is AAA so what does anything else matter?

Jas Jain wrote on Mon, 2/25/2008 - 11:42 am

--
As pointed out here and obvious from the earlier graphs that inventory deeps during the slow season and we should see a 12 months of inventory by March-April.

No, inventory is NOT being worked off even by the builders if we consider the slipping demand.

Jas

energyecon wrote on Mon, 2/25/2008 - 11:44 am

If we have a typical inventory build and the sales drop off proportionate to the January numbers then we have...how big a clearing time? Really big or really really big?

nades wrote on Mon, 2/25/2008 - 11:45 am

If that trend continues it could get fugly....

I'm starting to gravitate towards the doomsday camp....

Anonymous wrote on Mon, 2/25/2008 - 11:45 am

OT
Greenspan also said a boom in oil prices, which hit a record of $101.32 on Wednesday, will "go on forever".

Greenspan on US Economy - CNBC

Time to short oil.

nades wrote on Mon, 2/25/2008 - 11:47 am

What happened 25 minutes ago that caused the huge jump in the markets? Anyone?

Yal wrote on Mon, 2/25/2008 - 11:48 am

MBI and ABK afarmied as AAA by S&P.

will they now invent a new AAAA (since the AAA is not what it used to be...Smile

BillD wrote on Mon, 2/25/2008 - 11:49 am

Interesting that Market Watch claims that today's rally is due to better than expected home sales, or at least sales not as bad as feared. The first graph doesn't look that great.

What happened to the market around 2:35? Seems that the DOW suddently went up 100 points, but sites that I've looked at have nothing to report yet. I'd like to know before I get back to work.

AZ_Cowboy wrote on Mon, 2/25/2008 - 11:50 am

Someone better tell those monkeys to pump harder.

energyecon wrote on Mon, 2/25/2008 - 11:51 am

AZ,

Aye-firmative, they don't seem to be on their feed - more pump monkey chow for the boyz!

nades wrote on Mon, 2/25/2008 - 11:53 am

ahhh thanks Yal....

nades wrote on Mon, 2/25/2008 - 11:56 am

From Yahoo Finance:

Stocks Rise on Hope for Housing Bottom- AP

Wall Street rose in a choppy session Monday as investors hoped the worst housing slump in a quarter century might be nearing a bottom, a trend that could be the catalyst to revive the badly beaten financial sector.

Comedy. Each low is a new bottom. Albeit a momentary bottom....

Erik wrote on Mon, 2/25/2008 - 12:02 pm

At first I thought the orange was 2008 as I looked over the whole graph since the red column was so low. Then I saw the red column for 2008 and I litteraly said "GOD DAMN!"

How that can be a positive for anyone I don't know. That is nuts.

picosec wrote on Mon, 2/25/2008 - 12:09 pm

I know this has been discussed in the past, but please bear with me...

Does a property reverting to REO count as a sale?

Jas Jain wrote on Mon, 2/25/2008 - 12:18 pm

--
New flash on Faux Business News...

8.8M "homeowners" behind in their payments. This should easily get to 10M 8 months into the recession, when the employment decline gathers momentum, and to 15M when depression begins in 2009.

Jas

Spatch wrote on Mon, 2/25/2008 - 12:19 pm

British home buyers will now have to put 25% down or face higher interest rates -

Homebuyers told to pay 25% deposit or penal interest rate |
Money |
The Guardian

Can you imagine what effect this would have if this spread to this side of the pond ?

Name wrote on Mon, 2/25/2008 - 12:23 pm

Thanks for the longer-scale red chart.

Is there a reason we should not expect to see roughly 1995 sales levels with population correction factor?

I'm not a revert-to-mean guy, but the root causes of the bubble seemed to include:

1) Lower cost of debt. But after there's no one left working on the old cost basis, and the marginal buyers were absorbed.

2) Tax changes. But wave of sellers-down inhibitted by tax losses has had time to subside.

Now if the fed got serious about inflation, there would be a reason for bigger pessimism.

franz wrote on Mon, 2/25/2008 - 12:35 pm

I expect that by June, the SAAR rate will be below 4M per year due to financing issues and the economy down turn. Any other takers?

Ed Sanders wrote on Mon, 2/25/2008 - 12:39 pm

If March is going to tell the tale, where do you figure the line is?

If I had to guess, it's right about 400K. If sales are ahead of that, we stay in "bad but not disastrous" territory, if they fall to, say, 375K, well, I hope your at least friends with a goldbug.

I know predicting are a mugs game, but I'm curious about your take CR.

What will be a good number for March, and what is a bad number?

Mark Carbone wrote on Mon, 2/25/2008 - 12:50 pm

Ed - Love the EA Poe comment!!! Goldbug -

Rob Dawg wrote on Mon, 2/25/2008 - 1:04 pm

Does a property reverting to REO count as a sale?

Depends upon the tracking agency. Most attempt to exclude not-arms-length, name changes, refis and REO transactions with varying success. IMO as long as there is consistency it doesn't matter very much. Just watch for changes in methodology. Those little asterisks can be brutal. The word doesn't start with "ass" and end with "risk" for nothing.

picosec wrote on Mon, 2/25/2008 - 1:15 pm

ISTM that consistency in reporting the data is one thing. Consistency in the environment is something else altogether.

If the ratio of REO's to normal sales changes dramatically (as it definitely has), then interpretation of the data depends greatly on whether they are included or not.

I guess the question in this case is: are they included in the data that CR reports and that we are reacting to?

dd in OC wrote on Mon, 2/25/2008 - 1:51 pm

I posted this on an earlier thread, but most people seem to have moved on to this one...

K. Hovnanian has abandoned a SFR development called "Coastline at Pacifica San Juan" in south OC. These were ocean view homes to be priced in the $1M price range. My husband and I went to looky-loo at the models today and found that they were closed. A call to their office confirmed that they are selling the three models and calling it quits.

John wrote on Mon, 2/25/2008 - 3:33 pm

DD
look a little further south, the pico exit towards the ocean; work seems to have come to a complete stop on the marblehead project for 300+ homes and a shopping center. I'm going to try to find out when this project is scheduled for completion...

DingDong wrote on Mon, 2/25/2008 - 3:54 pm

I was just talking to someone in Sacramento, CA about the market up there. Supposedly the banks are so busy foreclosing on houses up there that they can't even begin to keep up. Right now they are about ONE YEAR behind on filing foreclosures. And whatever bank this was says they are so far behind and the foreclosures are continuing to increase so that in 1 to 2 months , it will take 18 MONTHS for them to start on a foreclosure.

I find that astounding and yet I know here in the East Bay of the SF Bay Area, there are two homes on my block that are vacant and they just sit there. No one does maint., they're not for sale. Not for rent. Nothing. And I'm assuming the lenders just can't even get to them.

We got a long way to go, boys and girls!

dd in OC wrote on Mon, 2/25/2008 - 5:28 pm

John, I heard there's a lawsuit involved in that one. I believe they're both SunCal projects.

Richard wrote on Mon, 2/25/2008 - 5:47 pm

per usual the bears are overreacting to the housing numbers. cyclicals are doing better than anyone expected, the markets continue to hold up reasonably well, the crisis' that were going to knock us all back to the stone age never occurred. yawn. wake me up when you people actually have something interesting to contribute.

nnlld wrote on Mon, 6/23/2008 - 10:55 pm

I know this has been discussed in the past, but please bear with me...

rc helicopter
Tactical Flashlights
video game

Login or register to post comments
Syndicate content