Housing Market in Free Fall

[unlawflcombatnt]

Today's Existing Home Sales numbers further verify that the housing market is in free fall. Today's annual rate of Existing Home Sales fell for the 5th straight month. This marks a 14% decline since August 2005. Home prices fell for the first time since May 1995. The median price is now down -1.7% since August of last year. Median price increases have been steadily declining, from August 2005's annualized rate of price increase of 15.8%, to the current annualized rate of -1.7%.

The unsold inventory of homes continues to rise. Measured in terms of months' worth of supply at current sales rate, the unsold inventory has increased 60% since August of 2005.

Below is a copy of a page from the current Briefing.com report on Existing Home Sales. At the bottom is a composite chart showing the 12-month changes in sales, unsold inventory, and price changes.



Despite the abundance of negative news, real estate propagandists such as NAR president David Lereah. Regardless of the false optimism of real estate propagandists, the housing bubble is bursting. With unsold supply increasing, prices have nowhere to go but down.

unlawflcombatnt

EconomicPopulistCommentary

EconomicPatriotForum

___________
The economy needs balance between the "means of production" & "means of consumption."

[NMDemDist2]

1. once again I thank my "intuition" that got me out of the PHX market

in May and netted me enough to pay CASH for my current home in a smaller community

WHEW!

[unlawflcombatnt]

3. Yes

Yes, indeed. That was great timing. Prices in the Phoenix market reportedly are down about 10% since last year. I think Phoenix prices are falling faster than anywhere else.

unlawflcombatnt

EconomicPopulistCommentary

EconomicPatriotForum

___________
The economy needs balance between the "means of production" & "means of consumption."

[enid602]

7. Queen Creek

I work in Quality Assurance for a company that manages appraisal orders for mortgage companies. This week I saw an appraisal for a new home in Queen Creek, AZ (a series of recent 'drive-by' developments on the outskirts of nowhere) being sold by the developer. He listed it on MLS eight months ago for $320K. After several price reductions, the home finally entered into a contract this month for $220K. For a brand new home!

[NMDemDist2]

9. I got more than that for my 1100 sf, 16 year old home

double whew!

[bullimiami]

2. well once the bottom falls completely out i can buy a nice place

right on the beach.

[unlawflcombatnt]

4. The Bottom

I think we've still got a ways to go before we hit bottom.

Interestingly enough, I read a so-called "expert" said he thought we'd hit bottom already. I think he went to the George Bush school of reality creation.

unlawflcombatnt

EconomicPopulistCommentary

EconomicPatriotForum

___________
The economy needs balance between the "means of production" & "means of consumption."

[tanyev]

5. It is not, so stop saying that!

*fingers in ears* la-la-la-la-la-la-la

[unlawflcombatnt]

6. Great Article by Roubini on Housing Crash

Economist Nouriel Roubini's blog has an excellent posting today on the Housing Crash, along with some interesting comments. It can be found at:
http://www.rgemonitor.com/blog/roubini/148366/

[PsycheCC]

8. Thanks for the link. Interesting stuff. n/t

[Tiggeroshii]

10. It looks like it's happening....

Hopefully it'll be down just in time for me to buy a house in 7 years :P

[unlawflcombatnt]

11. Chart: Prices & Sales-from Natl. Assoc. of Realtors

Below is a modified chart of Existing Home Sales from the National Association of Realtors.

The top half of the chart shows Existing Home Sales while the bottom half shows Existing Home Prices. The left side of the bottom chart shows median prices while the right side shows average prices.



Year-over-year prices have declined in all regions except the West, where prices have risen 0.3% over the last year. Also note that the number of homes on the market (inventory) has increased almost 1 million in the last year, from 2,841,000 in August 2005 to 3,918,000 in August 2006. Supply increases of that size are almost guaranteed to drive prices down, and drive them down a lot.

unlawflcombatnt

EconomicPopulistCommentary

EconomicPatriotForum

___________
The economy needs balance between the "means of production" & "means of consumption."