Orange County Graphs
A reader posted this link which has some graphs regarding Newport Beach home sales. The OC report list in the left sidebar allows a quick check of many neighborhoods. Not every zip code in California is up.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole. ATTENTION: Backup Blog at: http://thehousingbubble2.blogspot.com/
Tuesday, April 26, 2005
Previous Posts
- Home Price Increase Not Sign Of Econ. Strength
- Real Estate A "No Brainer"
- Fed "Attempts Rewrite Of Macroeconomics"
- CA Rush To Get Out Bids Up Albuquerque
- CA Unsold Inventory Index Doubles
- Admitting Bubble "Not An Option"
- Speculators Buy 25% Of New Phoenix Homes
- Survey Of Affluent Finds Unease
- Bubble-Palooza Coming To LA
- Rental Vacancies Over 10%
Links
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- BlogKits-Building Blog Relationships
- House Price Crash UK
- The Money Files
- San Diego Real Estate Chrono-Collapsometer
- Bay Area Housing Crash Continues
- HouseBubble.com
- Vancouver Housing Market Blog
- housingbubble.com
1 Comments:
AHEAD OF THE TAPE [WSJ]
By JUSTIN LAHART
Home Bound
April 26, 2005; Page C1
The scariest phrase in investing? "It's different this time." Scarier still is when people start acting on that conceit.
This appears to be happening in hot housing markets, where many buyers are justifying heavy debt loads with the belief that the rising price will bail them out if they can't keep up with payments.
"Their attitude is: Get me into that house before the price goes up any more," says Lehman Brothers economist Ethan Harris. "Get me into that rapidly appreciating asset and if I have to, I'll sell it and make a lot of money off of it."
In booming markets in places like California and Florida, Mr. Harris reckons three-quarters of new buyers take out adjustable-rate mortgages, which offer lower payments than fixed-rate mortgages -- but carry the risk of higher interest rates later. And three-quarters of those ARMs buyers are paying little or no money up front.
What's more, 15% to 20% of the people buying in these markets are buying purely for investment, which compares to just 4% or 5% elsewhere in the country. If things went awry, those speculative buyers could bail out quickly. Mr. Harris also worries that because some speculators are operating in more than one region, a downturn in one market could cause problems elsewhere.
Big U.S. homebuilders, too, have been acting on the belief that the good times are going to keep on rolling, argues Greg Jensen, director of research of money-management firm Bridgewater Associates. Although their earnings rose substantially last year, he says, on balance all that money and then some went into increasing their inventory of homes to sell and land to build on.
Those inventories will be a boon so long as sales keep booming. In a cooler housing market, they would be a burden -- particularly if speculative buyers were forced to sell into the slowdown.
Recent signs on housing have been mixed. Last week, the Commerce Department reported that new home construction fell sharply in March; the National Association of Home Builders sentiment index also fell. But yesterday, the National Association of Realtors reported that existing-home sales rose in March.
Economists expect that today's report on March new-home sales from the Commerce Department will show a drop, but it may be just a temporary payback after a strong February. It's easy to tell that housing has become too speculative, says Mr. Harris, but it's hard to tell when the speculation will stop.
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