Tuesday, April 12, 2005

First Quarter Down "As Expected": Home Builder

A relatively small home builder, MI Homes reported lower numbers this morning for the first quarter. Lower contracts, closings and backlog. "Contracts for new homes fell to 1,078 from 1,312 a year earlier, the Columbus, Ohio, company said. Closings fell to 775 from 871."

"The Company's homes are sold in nine geographic markets: Columbus and Cincinnati, Ohio; Tampa, Orlando and West Palm Beach, Florida; Charlotte and Raleigh, North Carolina; Indianapolis, Indiana, and the Virginia and Maryland suburbs of Washington, D.C."


At 8:51 AM, Anonymous Anonymous said...

People still don't think that housing prices can go down.

"What to Expect

Even in housing's worst years, prices rarely collapse. They usually level off for a while or fall modestly. "Housing booms end with a whimper, not a bang," says Karl Case, an economics professor at Wellesley College. He suggests looking at history. When the housing market dried up in 1990, prices in Boston fell 15% after a long run-up. And that was an extreme case. Less-volatile markets saw prices level off before rising again."

The difference between then and now will be the level of leverage people are using and the amount of speculation and the dramatic rise in interest rates we are going to see.


At 8:58 AM, Blogger John Law said...

it's the amount of people on one side of the trade- owning/speculating and renting those out at a loss.

At 9:08 AM, Anonymous Anonymous said...

UK house prices are teetering.


At 9:16 AM, Blogger goleta said...

What Case said is not true at all. The nation wide average might only fell 15%, but regions with the bubble actually fell much more than that.

How can he explain the recent 40% drop in Sydney in just 9 months? During the same 9 months since last June, Oz's national average probably experienced only 15% drop, but it's because the rest of Oz hardly ever had much bubble to begin with.

In 1993, I bought a house in Somerset NJ at 60% of the price the original owner paid in late 80s, right before the market crashed. If you buy a home in Ohio that was never appreciated much during the past 3 years, chances are it won't even drop more than 5% when California's prices drop 50%.

At 9:31 AM, Anonymous Melissa said...

Good Blog. I've been here and at other financial, housing, and mortgage web sites for weeks now reading.

M/I homes are very nice. This is surprising news. I wonder how it breaks down regionally.

We are here in the outer suburbs of Northern VA. We live in a new NV homes development. The final two lots just won't move at $599K base price. And these are McMansions on 1/2 or more lots. We're selling this week. We don't need a McMansion. I want to build a Craftsman style or Post and Beam home with a well and geothermal heating and cooling.

They tried to change the sign at our development a few months ago to raise the base price above 600K, but then took the sign down after a week and had it back to original pricing.

Otherwise, it seems that the prices here are still doing well.

I imagine the D.C. area would seem inexpensive to some, but I am concerned about buying even a new home for $480K on 3 acres in Culpeper County. Or is that a no-brainer? We can't decide if we want to rent or buy. A 10-acre lot is $190K and that might not break us even if prices fell. We have to be very careful with our money because I'm an at-home Mom in my 30's and my husband is a salaried worker.

We are leaning heavily toward renting because we are tired of being house poor. Of course our real estate agent tells us the houses will appreciate faster than our paycheck . . .

At 9:45 AM, Anonymous Anonymous said...

19% of Canadian owners will be in trouble if mortgage rates rise 2%.


The writer thinks its great that 81% won't have a problem, but what are the other 19% going to do ???

To me this article is illustrative of the incredible bullishness of the press.

A 2% rise in interest rates is nothing. All it would take is a little bit of financial shock in the US and they'd be there.

At 12:30 PM, Blogger Ben Jones said...

Thanks for the links

(We are leaning heavily toward renting because we are tired of being house poor)

First hand accounts really make this blog more interesting. Thanks for that..Ben


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