US housing market deteriorates at faster pace than expected
 

The deterioration in the US housing market is accelerating, new figures showed yesterday, and at a faster rate than Wall Street had been expecting.

With the number of house sales in April down 2.6 per cent on the same month last year, the average selling price for homeowners who do find a buyer has started to fall. And the data contained little evidence to support the economic optimists who argue that the worst is almost over, since the backlog of unsold homes also climbed.

Analysts blamed the worsening figures on the so-called "sub-prime" mortgage market, which has effectively dried up. Mortgage companies have sharply curtailed their lending to Americans with poor credit histories, after rising arrears sent several lenders into bankruptcy and attracted the attentions of politicians, who are investigating unscrupulous lending practices.

The National Association of Realtors said that the annual rate of second-hand house sales was 5.99 million in April, down 2.6 per cent and significantly below the 6.18 million that had been expected. The worst drop in activity was in the North-east, where sales were down 8.8 per cent. Across the country, the price of the average US home was $220,900 (£111,300) last month, down 0.8 per cent from $222,600 in April 2006.

The backlog of unsold homes at the end of April was 4.20 million, 8.4 months of supply at the current sales pace. There was a 7.4-month supply at the end of March. The figures were bad enough to dent the rally in an otherwise bullish day on Wall Street, where share prices were rising on expectations of continuing strength in the broader US economy. The Dow Jones Industrial Average fell in the minutes after the data was released, although it resumed its climb.

Car Leahey, an economist at Decision Economics, in New York, said: "This report tempers the new-found hope that some analysts had that the housing recession might be over. Forecasts of a better housing market later this year may turn out to be right, but I would be very suprised if you see the old-fashioned V-shaped housing recovery, in part due to the overhang of homes and the coming foreclosures in the subprime mortgage market."

Yesterday's figures snuffed out the little optimism generated on Thursday when figures on the sale of newly built homes suggested a pick-up in activity. Sales had surged in April, rising by 16 per cent on a seasonally adjusted basis, but critics pointed out homebuilders had needed to slash prices to sell their wares.

http://news.independent.co.uk/busine...cle2584331.ece

This is not a very good news for the economy

Depending on who you follow for your financial news, this is just the tip of the iceberg for what's coming.

:disgust

Think you may be right Barefootsies...

It's that iceberg that may turn out to be very bad news - and seriously doubt the worst is known about yet.

I have casual chats with an old guy who is responsible for managing a lot of investment value for US folks - got a wealth of experience and he "knows" the markets/economy backwards. At lot is common sense, but on other stuff he just does not like the look of future years. The ripple effect of about 20 of his top economy measuring tools end up having a massive effect and causing everything from unemployment increases to staggering credit card debts on a personal basis. Don't sound a happy scenario ahead :(

That sounds about right.

I am looking at some real estate options later this year, and between banks and interest rates, and the housing glut, and adjustment of prices among other financials. It sounds like a lot of them are saying to wait out the storm because it's going to get worse.

:Oh crap

getting your US business info from a uk website is not the best of sources.
I know of no one who thought the "housing recession might be over" as all intelligent people understood new home sales were spurred by homebuilders slashing prices to sell off inventory.
I also don't know how 5.99 million can ever be considered "significantly below" 6.18 million.
Meanwhile, the US stockmarket touched a new all time high this week.
But US haters can certainly find whatever news they're looking for on the internet these days.

Keep on going! The Canadian dollar will be at parity with the greenback very soon!

Riiiiiiiiiiiiiiiiiiiiiiiiight.

Plenty of places have said it chum.

http://money.cnn.com/2006/11/27/mark...look/index.htm

http://www.msnbc.msn.com/id/18487353/

http://www.nytimes.com/2007/04/17/bu...xprod=newsvine

http://www.rgemonitor.com/blog/roubini/142759

http://www.builderonline.com/industr...ticleID=408334

http://www.realestatejournal.com/pro...0-frangos.html

http://patrick.net/housing/crash.html

Guess 12clicks can say anything they want on the internet now a days.

:disgust

poor deluded child. from the first link:

Pair of experts think investors don't need to worry about the housing slump and that the markets and economy will be OK.
By Paul R. La Monica, CNNMoney.com editor at large
November 27 2006: 12:55 PM EST


NEW YORK (CNNMoney.com) -- A top economist and market strategist at Citigroup both said Monday morning they did not think the housing slowdown is going to cause the economy to plunge into a recession or the stock market to fall into a tailspin in 2007.

Speaking at a breakfast for financial reporters at the company's headquarters in New York, Citigroup senior economist Steven Wieting said that concerns about a recession due to softness in the housing market are overdone.


An economist and market strategist from Citigroup don't think the housing slump will put a major dent into the economy or stock market in 2007.


In fact, Wieting said that if the housing market had not cooled this year, that would have presented a greater risk to the economy since it most likely would have led to increased inflation and probably more interest rate hikes from the Federal Reserve.

"Without the housing downturn, the economy would be overheating and there would be more inflation and tightening pressures," he said.

Wieting indicated that perhaps too much attention is being paid to the housing market and that there would need to be more than just a real estate slowdown to cause widespread pain to the consumer. He pointed out that consumers have so far withstood weakness in housing as well as a steady rise in the price of oil and gas over the past few years.
-------------------------------------------------------

now, intelligent people will understand that your link supports my position.

god only knows what bullshit you'll read into it.:1orglaugh

fucking kids imagining they know more than me.:1orglaugh

I don't think anyone made that claim. Talk about delusions of grandure.

As usual, you make yourself and ass.

:2 cents:

I know you're embarrassed, don't compound it. :1orglaugh

post ten more irrelevant links. SOMEONE will think you're right.

Republican Banter Channel
 

It only took one click.

:)

hahahaha! classic!

you'll go far covering your ears when you hear a truth you don't agree with.

Why don't you go opine to your flock



:upsidedow

Is it not overly obvious the US has overextended themselves, have too much national debt, are losing every day to China, have been steadily losing manufacturing jobs for decades, credit card debt is well out of control, not to mention the money wasted in the war, the devalued dollar, etc etc etc?

I guess this all adds up to happy times to you somehow?

Agreed.

The housing issue is just a piece in the overall puzzle of this country's financal health. Or lack of it.

Unfortunately, at some point, the scale will have to adjust. It's going to be a tough time for a lot of Americans when the comes. Both citizens, country, states, and government.

If anything, this new data will help the US stock market go to new highs since it will help cool talk of a need for a rate hike. All the sky-is-falling money sitting on the sidelines will finally capitulate and enter the market once they realize the economy is not going into the dumpster over housing after missing out on a great bull run. Too bad for them.

the sad thing is that foreclosure is going to be a lot of peoples only option....

The overall economy will be fine. The people getting hurt are the speculators who thought that housing prices would continue to rise at a 25% annual rate, and mortgaged everything they own to get into the market.

These are the same people who jumped into the stock market when the S&P was trading at 28 times earnings and the NASDAQ was ridiculous. Most of them are getting what they deserve.

You live in a real simple world .... but that is needed when you are a simple mind ....

Been waiting on the sidelines with cash in hand like a patient sniper for the market to slow down. I can vouge that indeed it has slowed down some in Socal, which is usually a bit behind the rest of the economy. We're seeing many more 'short sales', 'highly motivated seller', and 'price greatly reduced' when we go look at open houses and get listings.

Maybe it's not a slowdown per se, it's just a price adjustment and leveling since home prices sored to unrealistic exorbidant prices over the last 2-3 years.

What we are going through is just a simple correction based on the SAME analysts that were hyping up the market two years ago, now talking about a HUGE problem to get ratings on TV and attention for their firms. The thing is with real estate is via zonings, codes, the amount of developable land is drying up. So sooner or later corrections such as what we have will come to a halt, stay in place for a year or two, then go back up.

I guess this is the wrong time for me to submit a bid on a second home. Too bad, printing out the papers as we speak

More than typical. Why not show proof that 12clicks is wrong? Im guessing you cant? :1orglaugh

There is no proof. Yes there is inventory, yes stuff is moving slower. But on my friends project of 19 homes 4 were sold in the first week second week he sold 3.

My parents just sold their house after having it on the market for a week. I am a licensed mortgage broker in Chicago and from experience I can tell you that the subprime market lending has gotten a LOTTT stricter. Foreclosures shot up HUGE due to all the shady brokers putting people in Option Arms or Arms without properly explaining it to the consumer.

The economy will stabilize over time as it always has.

That doesn't seem to apply to Arizona... The houses are sold before they have pictures of the homes to look at.

May 12th, 2007: "former Federal Reserve chairman Alan Greenspan issued a fresh warning that the world?s largest economy could be heading for recession..."

Cover your ears son.

Lots of places it doesn't apply. The article they started this thread with was the northeast, I can understand that.

oh, how cute. still pee peeing up at your betters with that little thing?
At least we don't have to put up with your idiocy during business hours any longer.:1orglaugh

I do not need to prove anything to you, or him. You can read. (I hope)

This is not civics, or the debate team. I could honestly give a fuck of your opinion. I simply posted an article(s) for a discussion from others who are looking to buy this year, or get some feedback. Not get into a 12 millimeter pissing contest.

There are a number of others, like myself, who are waiting with cash in hand to see what's going on with the interest rates, and market.

As you can see from others in the thread, and articles, they speak for themselves. Read, and make your own conclusion(s). Stop trying to instigate shit.

:2 cents:

Yep. I've heard that as well. I guess they were projecting a lot of those 5 year ARMS are coming due. Detroit is one of the worst in foreclosures. Which is pretty sad, but not unexpected I suppose. Who the fuck wants to live in Detroit.

:Oh crap

lol Maybe I have :1orglaugh

Festive.

:winkwink:

It's amusing watching threads like these.

12clicks does his normal troll bullshit. -- BTW, 12clicks, as a board personality, you really do suck. I feel bad for you and your soul-less existence.

Barefootsies - it's a fucking news article. News articles are for shit these days. I keep hearing about declining housing markets and upturned stock markets and all that shit... Blah blah blah. Money's just being spread out in different areas; nothing more, nothing less.

The end of civilization as we know it is far away. The rich get richer, the poor get poorer and a collapse of that system is far from happening.

Well, that's my $.02, I guess. *shrug*

I hear ya.

I guess we'll see how the summer shakes out between mortgage rates, and price adjustments on homes. Socal has been crazy with the real estate from what I've heard.

I know even around my area some of the places, especially lake front, are still insanely priced. Although I am seeing a good percentage now with those "price reduced" signs. Which is nice if you are looking to buy. It would appear a lot of people are trying to get in that housing market up before the correction. I can't blame them.

Apartment buildings and duplex prices are not as bad as some of the single family homes, at least around here. Time will tell.

:thumbsup

I hear ya.

For each one you can find one way, you can find another some other way. In this particular case, some of it mirrors my mortgage brokers comments. The price reduced signs are popping up, and I should see more as the summer progresses.

I'm thinking end of summer fall things should be prime to snag a few. Those who really want to sell will be more reasonable in their asking before the winter slow down. By that time, hopefully things will have corrected some both in mortgages, and real estate.

Board personality?

I guess through the eyes of a part timer, "board personality" is something to worry about.
Listen, tuesday morning when you're at the real job, understand that I'll be here at *my* real job still not paying attention to my "board personality"
:1orglaugh