Thursday, August 03, 2006

in florida wird es immer schlimmer

die berichte die mish auf seiner genialen seit von mike morgan (einer der besten weil ehrlichsten immobilienmakler in florida) zeigen immer wieder schön die ungeschminkte wahrheit abseits der schnöden pressemitteilungen und zeigen vor allem auch in welcher verfassug z.b. die homebuilder sind.

müßte mir eigentlich gg meine überzeugung mal miami vice ansehen und gucken ob die die skyline ohne baukräne haben abfilmen können (condomania). ist im zweifel wohl am digital nachbearbeitet worden.......

Is Housing Bottoming Out?

The question (and answer) of the day comes from Mike Morgan at MorganFlorida.

Morgan asks himself Is Housing Bottoming Out?

Here is Morgan's answer:

Some might be thinking that the housing market has bottomed out based on today’s mortgage apps. We’re at a 4 year low for mortgage applications. Is this the bottom?

Not a chance. No way. No how. Well, maybe in a sweet dream. But realistically this is just the start of the decline in the numbers that will reported for the next 6-8 months (at least). I am in the field everyday with buyers, sellers, flippers, homeowners, builders, the subs that are out of work, and the mortgage brokers and title companies that are slow as molasses. I see it. I hear it. I live it, and now I am sweating it. We are in more trouble than I thought a month or two ago.

For those of you that have not been on a tour of the real estate market with me, now is the time. In the past 3 weeks things have started to crumble on the outside, meaning builders are publicly making deals and “accepting offers”. Since when do home builders wheel and deal like used car salesmen?

Private sellers are becoming desperate and slashing prices, as well as accepting low ball offers. Flippers are dead. These people have mortgage their primary residences to buy flip houses that are now driving them to bankruptcy.

Things can only worsen as more inventory comes on line and more flippers walk from contracts AND homes they bought and cannot afford to continue to carry. Builders and flippers are in a horrific dogfight over prices. Some builders are giving homes away just to get them off the books. How about a $490,000 home sold at $315,000. The contract read $490,000 top line, but within the contract are "builder’s incentives" of $275,000. Not sure how they get away with this, but they do. (soviel zu den durchschnittlichen hauspreisen die lt. einigen statistiken immer noch steigen. als preis wird dann gerne untercshlagen das in form von inventives real oft genug bis zu 20% rausgerechnet weredn müßten. noch mehr accountingproblems in the us....)

And for those of you that don’t realize sales for all Florida builders are off 50-100%, I will kindly nudge you gently to wake you up.


Thanks to Mike Morgan for his interpretation of today's numbers.There are those that think a pause will fix this problem.I do not think so and neither does Morgan.It's time for a game. Mish says "Let's play 10 questions".

Ten Questions for Optimists:

-How will a pause help flippers stuck in "Soft Market Debris" that they can not sell?
-Where is pent up demand?
-How will a pause help homebuilders who can not sell current inventory let alone the stuff hey keep building?
-How will a pause help lenders who keep throwing money down this sinkhole?
-What would a rate cut of even a full point do? Would rate cuts necessarily drive down mortgage rates when bankruptcies and foreclosures are soaring?
-Will a pause or even a series of cuts change consumer psychology? If so why?
-Even if prices stabilize where is job growth going to come from?
-Where is wage growth going to come from?
-What are real estate agents going to do if prices level off but sales do not pick up?
-What is everyone going to do with all those second homes they do not need?
-What will REOs do to prices when lenders dump them on the market?

I have a bonus question: How prepared is the housing industry for the "Big R" that is about ready to hit? I am of course referring to a recession. It is coming. For many real estate agents it is right here right now (and it might last for years).

If this is the bottom then let's see Ten Answers.

Most Realtors as well as the National Association of Homebuilders are still in denial (at least publicly) about what is happening. Most still deny there was a bubble even as it explodes in their faces. Most talking heads seem to be expecting turnaround later this year, and if that does not happen then a turnaround for sure in 2007.

I have some news items for Lereah and all the rest of the cheerleaders to consider:

-Twenty year bull markets do not bottom in half a year or even three years.
-Home prices do not always go up.
-Homes are not affordable by any reasonable measure that includes wages and rental prices.
-It was bubble psychology and loose lending standards not demographics that allowed home prices to get 4-5 standard deviations above wage increases and rental prices. All bubbles eventually burst. This one just did and the aftermath will not be pretty.
-Most of the gains in prices since 2000 are likely to be given up, if not a lot more.
-Condo prices in the biggest bubble areas will fall in half if not more.
-We are just now seeing the start of foreclosures and bankruptcies.
-Things will get a lot worse before they get any better.
-An overall panic has not yet hit. It will.

Mike Shedlock / Mish

toller bericht. werde die updaten die sicher noch kommen und ebenfalls posten. im archiv (unter der echte linkseite) müßtest ihr noch andere berichte von mike morgan finden. alternativ oben im such morgan eintippen sind alle durchweg lesesnwert.



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