It is truly amazing sometimes, how the NAR can make bold forecasts about how great the housing market is, and how it always appears to be "a great time to buy!". Witness for yourself, this quote from September 2005:
'“David Lereah, NAR’s chief economist, said the fundamental factors for housing remain positive. “With a general background of growing population and favorable affordability conditions, home sales are staying at very healthy levels,” he said. “Housing inventory improved in August but remains tight, and we have some way to go before we get into a range of balance between home buyers and sellers. As a result, we’ll continue to see above-normal home price appreciation for the foreseeable future.”'
Now, a year later, and this is what's coming out of the same "guru's" mouth:
'“The housing boom ended more than a year ago, but sellers are having a tough time accepting that fact, says David Lereah, chief economist at the National Association of Realtors. The result has been tumbling sales as buyers stay on the sidelines.”
“This correction is different from any others because it wasn’t triggered by a recession, high financing costs or job losses. With unemployment below 5 percent, mortgage rates still below 7 percent and a growing economy, "all you need is a price correction, a price adjustment, to bring the market back."
This is starting to sound like a spiel from a used-car salesman. Here in Florida, we now have nearly a year's supply of houses sitting on the market, and the numbers are growing by the week. David, who is going to move into all of these empty houses, and where are these buyer's going to come from? Remember, there is now a housing surplus in every major state.
So I ask again: Where are these buyers going to come from? Mexico? Canada? Russia?
The sad and pathetic thing about the reports from the NAR, FAR and others under the NAR umbrella is that there is absolutely NO REGULATION on their reports to the media, and the media never questions the authenticity of their numbers. And when I say, "Never", I mean it - 100% and unequivocally. With the exception of a few independent websites (such as yours truly) who track their reports and compare what they are saying with what is actually happening, there is no external oversight on what they report.
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6 comments:
I don't know how many times in the past 3-4 month's that I've read about someone in the home selling business blaming the media for the current perception that housing is in a slump.
Wow - and the same person had no problem when the media was adding fuel to flames as prices skyrocketed over the past 3 years. What a bunch of hypocrites.
It's the price, stupid!
Hey Jerry, I like your site.
I thought real estate near the water was immune to any downturn at any time. At least that's what I've been told over and over and over.
I submit to you:
http://tampa.craigslist.org/rfs/209850272.html
5155 COQUINA KEY DRIVE # 5155a, ST. PETERSBURG
WATERSIDE AT COQUINA KEY
Unit 5155a
For $259,900 you can have a 2 bedroom 775 square foot condo on deep sailboat water (not that it matters if you are deep water because you can't keep your boat there, but it's one of those things that 'oohed' and 'awed' specuvestors for years)...
According to the property tax records at http://www.pcpao.org/ this place was purchased in July 2006 for... hold on, are you ready? $289,900.
That's right, these people are ready to take a $30K/10% hit after 2 months of ownership. This is there asking price. It will be interesting to see what it actually sells for.
They actually say in their CraigsList ad that current resale is $325K. Then WHY are they only asking $259,900??
Between insurance, taxes, and mortgage; it is not scientific but VERY realistic that the carrying costs are around $3,000 per month.
By the way, this place is right next to the slums, and it was/is kinda crappy. To wit: http://www.apartmentratings.com/rate/FL-St-Petersburg-Coquina-Key-Arms.html
Go figure...
Sweet. Coquina Key - an overpopulated "Island" next to St. Pete. I once toured some town homes there were being built in 2004-2005. Small, cramped, and very little parking. But they got bought out quick, mostly by investors. The place is mostly occupied by renters now. What a dump.
David, nice link. 2 questions:
1. Are you part of the problem, or the solution?
2. How's business?
Keep the pressure on this gang of unethical salespeople
Man, I've been tracking some houses in Orlando that went for ~$250K just 3 years ago, and are now on the market for $400K. The interesting part of the story? There are 8 of these, and all have been on the market since May. That's 4 months and counting....
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