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/
Sunday, May 15, 2005
Previous Posts
- The New Mortgage Casino
- Across The US, Housing Prices Are A Crisis
- "Urban Living" Boom In Downtown Phoenix
- "The Doctrine Of Pleasure" And Arbitrary Power
- Bloomberg Survey Shows Increase In Starts
- SF Fed President Speaks On Bubble, Economy
- No Renters Wanted, They Just Make A Mess
- Lending Standards Fall At FHA
- Bay Area Sales Volume Drops
- Las Vegas Home Inventory Climbs 71%
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- 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
4 Comments:
I don't think that is unreasonable. Let's say the number is 5%, to keep it simple. That would mean that for the last property to reduce its price, it would take 100/5 = 20 weeks or 5 months.
Unless you assume an average time on the market noticeably greater than 60 days, then 4% is an OK figure -- it is just 4 homes out of 100. Next week it will be a different 4 homes. What might trip you up is if you assume the same 4 homes keep reducing by 4% in successive weeks.
Chip
Did a little more research. The top- 5-priced homes were reduced from 4.2% to 5.8%. These are multi-million dollar homes and the initial prices could well have been fishing. Went to page 8 and the reductions dropped to 2+%.
Reminds me of people who want to sell something for "a fraction of its cost." 99/100ths is a fraction. I think observations of reductions need to take into account the severity and suddenness of the decreases.
Perhaps the shock is just that there are any price decreases at all in Vegas. That would have to be viewed in context with historical sales in that area. People in many seller's markets price their homes too high, then retreat if they don't get an offer very quickly. When Realtors are particularly hungry, they are tempted to "buy" a listing by telling the seller they should ask a price that, ultimately, will not be realized. This may be confusing to people in many areas of California or other areas that have gotten into the habit of under-pricing to create a buying fever.
It will be interesting to see if there are further articles documenting a real turn in the L.V. market. Chip
Goleta -- good tip, though I'm a little wary when the judges are all in the real estate industry. On the one hand, they should be the experts. On the other, many of them will have a decided interest in being cheerleaders for their market.
From 770 to 10. Hopefully the owner of the website is not a Realtor. If he/she were, I cannot believe their original listing of 770 homes would not be construed as fraud.
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