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GRDadof3

U.S. Housing Market slowdown articles

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I thought our housing market and Michigan in general were the only housing markets feeling a cool-down this past year, but some of the Nation's hottest markets and the Country's biggest builders are starting to feel the pinch.

Some areas are reporting that cancellations are way up, with buyers walking away from $20, $30 and $40,000 + deposits, in both suburban and urban projects.

Salt Lake Tribune

Bay Area

San Diego Market

Baltimore Sun

South Florida Markets

Orlando Sentinel

Housing Affordability erodes builder confidence

Massachussetts South Coast

San Diego housing market in negative territory first time in 10 years

20,000 new inventory homes currently on market in San Diego - DR Horton slashes outlook

M/I Homes quarterly orders drop 35%

Lennar Homes changes outlook despite good quarter

Housing market and Homebuilder Stocks confusion and uncertainty

Foreclosures heating up in Florida, Georgia and Midwest

Home builders hit by bearish call

Housing market decline "orderly" - Fed Chief

There are plenty more articles from around the country.

How is your area doing? And not a rundown of how many new "condo towers" are going up and that they "have to be filled because they wouldn't be going up" rhetoric. As mentioned, people are walking away from massive deposits to get out of already signed contracts.

Not trying to cause a panic, just curious what people are hearing from relatives and friends who work in the building and real estate industry. :thumbsup:

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I'd heard that about some of the nation's hottest housing markets. But I just read this news item the other day and it says our local housing market is still booming with home sales still increasing at a record pace. It doesn't break down existing home sales vs. new home sales, but I can assure you from driving around numerous new subdivisions that things haven't slowed down at all. My company builds homes all over the south, so I honestly couldn't say that our sales in metro SBC are any higher than normal because I spend most of my time working on things for so many markets, including one really hot market, Houston... particularly Bay Area Houston!

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I'd heard that about some of the nation's hottest housing markets. But I just read this news item the other day and it says our local housing market is still booming with home sales still increasing at a record pace. It doesn't break down existing home sales vs. new home sales, but I can assure you from driving around numerous new subdivisions that things haven't slowed down at all. My company builds homes all over the south, so I honestly couldn't say that our sales in metro SBC are any higher than normal because I spend most of my time working on things for so many markets, including one really hot market, Houston... particularly Bay Area Houston!

I think Houston and your market may be anomalies based mainly on Hurricane Katrina.

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Inventory is way up here where I live, 1 hr north of NYC. Prices are holding pretty ok, maybe down 1-2% this year. It doesnt help that there are a few major devolpments that have started construction/ still getting approved (one of them under construction is a multiphase 1500 townhouse devolpment that is a poor excuse for new urbansim).Things should turn around late in the year when interest rates start to fall

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Didn't take long to sell our house in CA, and we got about 40k more than our asking price. It's been a year since, but I can't think that it's slacked off all that much.

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The market here has never really been on "fire" per say. Price growth here is usually positive, but not at the same pace as Charlotte or Raleigh. I will say that exisiting home sales are suffering due to an oversupply of new construction. It has taken me close to a year to sell my mother's 50 year old brick rancher with 2 price drops.

:cry:

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Our market (Greenville, SC) may be an anomaly as well. Throughout the housing boom of the last ten years, housing prices have remained surprisingly affordable. There are indications that it is starting to change. The price of land for new residential development has increased significantly over the last year. With growth not expected to slow down, pressure to move housing prices upwards is coming.

In regards to a panic in other portions of the country... one of real estate's most important characteristics is its lack of liquidity. Real estate is not the stock market. Prices are not volatile. If there is a big downward trend across the country, worst case scenario has it playing out over the course of several years.

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Our market (Greenville, SC) may be an anomaly as well. Throughout the housing boom of the last ten years, housing prices have remained surprisingly affordable. There are indications that it is starting to change. The price of land for new residential development has increased significantly over the last year. With growth not expected to slow down, pressure to move housing prices upwards is coming.

In regards to a panic in other portions of the country... one of real estate's most important characteristics is its lack of liquidity. Real estate is not the stock market. Prices are not volatile. If there is a big downward trend across the country, worst case scenario has it playing out over the course of several years.

I wouldn't say "panic", but yes, but you'd be surprised what a housing slowdown does to the "psyche" of a region. Housing slowdowns have also marked the beginnings of every recession in the past 50 or 60 years. The one thing that may be exasperbating the problem is the record number of home equity loans and HELOC's that people are doing to pay for stupid things (boats, cars, credit card debt), putting them upside down on their largest investment (their home mortgage) if housing values drop just 3 - 5%.

BTW: Every market that has started to enter a slowdown also had significant increases in property values similar to Greenville, with "no end in sight" language from local experts. Run away from anyone who gives you that kind of line. :lol: If interest rates go up just slightly, the affordability of a rapidly-increasing market nosedives for average middle class families.

The anomaly I was referring to is that a natural disaster uprooted hundreds of thousands of people and displaced them to other parts of Louisiana and Houston. Not a natural market condition.

Another Article Here about the national housing market

The reason why so many families were able to get into a "step-up" homes was due to the record low interest rates making the payment on a $200,000 manageable for a family making $60 - $70K a year. What happens to the housing market when interest rates level off at their past 30 year average of around 8 - 9%? We've seen a blip in sales when rates jumped up to around 6.00% this year, so can we expect a larger "blip" if they move up 2 - 3%? (which is very likely before the end of this decade).

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I wouldn't say "panic", but yes, but you'd be surprised what a housing slowdown does to the "psyche" of a region. Housing slowdowns have also marked the beginnings of every recession in the past 50 or 60 years. The one thing that may be exasperbating the problem is the record number of home equity loans and HELOC's that people are doing to pay for stupid things (boats, cars, credit card debt), putting them upside down on their largest investment (their home mortgage) if housing values drop just 3 - 5%.

That may be true to a certain extent, but it is still something that will only play out over the course of years. Don't get me wrong. Housing values are important. But the implications of a housing "bubble" or "panic" are false. They just don't happen.

I think the term "slowdown" is probably the most appropriate.

BTW: Every market that has started to enter a slowdown also had significant increases in property values similar to Greenville, with "no end in sight" language from local experts. Run away from anyone who gives you that kind of line. :lol:

Actually, we really haven't experienced rising home prices like the rest of the country. Until the past year, developable land has been in plentiful supply. But infrastructure is starting to get a little bit tighter, resulting in rising home prices. One of our selling points has always been that people who move here can actually afford to live here. There are indications that the dynamic is changing.

The anomaly I was referring to is that a natural disaster uprooted hundreds of thousands of people and displaced them to other parts of Louisiana and Houston. Not a natural market condition.

Sorry... misunderstood.

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I think Houston and your market may be anomalies based mainly on Hurricane Katrina.

You would think so, according to that article, but up until that, the effects of Katrina on this market had been played down totally. Basically every other news story related to it said the number of people relocating to this area due to the hurricanes was negligible... mostly homeless people and poor people who are now homeless. I'm just not sure whose estimates to trust on hurricane transplants, but I do know that even without the hurricane transplants, the market here has remained steady. The thing you have to understand about the hurricanes is that most people displaced by them have remained in the I-10 corridor, anywhere from the Louisiana/Mississippi line all the way to Houston. Some have relocated to Shreveport and even some to Texarkana, but like I said the amounts have been greatly downplayed except in this article.

I know Houston had an influx, but Houston has also been growing for some time. Of the houses I've personally designed for customers in the Houston market over the past year, none of the customers have been people relocating due to the hurricanes, but rather just new people moving to that market from elsewhere in the country and world.

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That may be true to a certain extent, but it is still something that will only play out over the course of years. Don't get me wrong. Housing values are important. But the implications of a housing "bubble" or "panic" are false. They just don't happen.

I think the term "slowdown" is probably the most appropriate.

You're right, I wouldn't use the word "bubble" or "panic" either. Unless it's a market where real estate is treated as a commodity, with a lot of speculation and flipping going on, and very few real "homeowners". Buyers in those markets are very flaky and will dump their investment looking for the next big market.

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I'm seeing decreasing inventory, and more pending sales, along the future light rail corridor in Charlotte. The increasing gas prices may actually be helping some areas, while others languish.

Raleigh, TTA, are you paying attention ???

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You would think so, according to that article, but up until that, the effects of Katrina on this market had been played down totally. Basically every other news story related to it said the number of people relocating to this area due to the hurricanes was negligible... mostly homeless people and poor people who are now homeless. I'm just not sure whose estimates to trust on hurricane transplants, but I do know that even without the hurricane transplants, the market here has remained steady. The thing you have to understand about the hurricanes is that most people displaced by them have remained in the I-10 corridor, anywhere from the Louisiana/Mississippi line all the way to Houston. Some have relocated to Shreveport and even some to Texarkana, but like I said the amounts have been greatly downplayed except in this article.

I know Houston had an influx, but Houston has also been growing for some time. Of the houses I've personally designed for customers in the Houston market over the past year, none of the customers have been people relocating due to the hurricanes, but rather just new people moving to that market from elsewhere in the country and world.

The Texas markets - DFW, Houston, San Antonio, and Austin don't seem to be slowing much if any. This is largely because housing in all of these markets is well below the national average and is undervalued by a significant amount. These areas also stagnated when the rest of the country was hot and I think a lot of what you're seeing now is investors getting out of hot markets like Southern California and Florida and investing in undervalued markets like Texas and the mid-South. It's similar to the shift you see from growth stocks to value stocks in a Bear market.

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There's a discussion about this in the Atlanta thread. Apparently, the Atlanta market is very healthy right now. The number of housing permits in many metro counties have seen large increases this year compared to 2005. The area is avoiding a housing bubble due to the relatively equal wage growth and housing appreciation.

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Ok call me stupid... I'll take it... but I never really understood this... what's going to happen? Are people going to stop buying houses or something? Will houses be worth like $15,000 or something? Would it mean there will be forests left?

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Ok call me stupid... I'll take it... but I never really understood this... what's going to happen? Are people going to stop buying houses or something? Will houses be worth like $15,000 or something? Would it mean there will be forests left?

It certainly is nice if it contains sprawl and preserves rural land for another decade or so, but much of the economy would be adversely affected by a housing slowdown.

Earnings fall 20% at Pulte Homes

Pulte's largest markets on are in the Southwest.

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I recently read an article that said that while new housing starts have been hot in the Twin Cities, the rate at which the area is growing (land wise) is slower than during the 1990s and is back to the average of the last several decades but continues to slow.

This has been attributed to development in older areas and denser developments. The market has certainly cooled there, though.

In my area the housing market is hot as people move north to seek refuge from the city and jobs pour into the area.

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A big reason why I think in the next 5yrs or so you are going to see a big resurgence in the Rust Belt and NE.

All those so-called manufacturing depressed areas are going to see quite a bump w/people leaving the sun belt, mega-growth areas and going back home where they can buy real estate dirt cheap.

Southern/Southwestern home prices were dirt cheap years ago when the big migration to those areas started, now they are high and becoming unaffordable to the relocating masses. No longer are the days of moving to FLA, AZ, ATL, etc. and buying real estate dirth cheap and making a mini-fortune from selling a few years later. Once the cost of living in the "high-growth" areas has evened w/the cost of living in the northern cities, I think we are going to see a re-emergence of growth in the so-called 'economically depressed' areas of the north. It's all cyclical, and largely based on the cost of real estate and job growth. And job growth is often based on real estate prices.

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Locally, the real estate market is very healthy.

On the coast, though, prices have receded somewhat, as inventories are very high.

I view this as a great buying opportunity. My brother and I bought a condo a couple weeks ago

in Daphne (nice suburb of Mobile), less than a block from Mobile Bay (and on a hill, so flooding is no issue + complex received only very minor damage from the hurricanes) for just $56,500.

What you're going to see in the coastal markets is "compression," meaning that the high-end stuff of which there is clearly a vast oversupply, should continue to struggle for some time, but the lower end of the market is bound to keep moving forward, because these areas are still adding jobs & there isn't a large supply of affordable worker housing.

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A big reason why I think in the next 5yrs or so you are going to see a big resurgence in the Rust Belt and NE.

All those so-called manufacturing depressed areas are going to see quite a bump w/people leaving the sun belt, mega-growth areas and going back home where they can buy real estate dirt cheap.

I agree with that... except five years is too way too short... it may take a generation or two to come full-circle.

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Developers nix or delay condo projects

Hopefully this won't put a dent in the resurgence of people returning to urban living. And I'm not using the words "bubble" or "pop".

I wonder if there really was a resurgance at all. Many of these things were never occupied over 50%.

I also wonder how the market is for suburban homes that people are actually living in.

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I'm in the industry (Apartment Hunters) and the experts here in Florida (Orlando) say there may be a major devaluation in Miami, Ft. Lauderdale, West Palm, and even Tampa. Orlando is expected to maintain it's median home price and even increase it some each year (due to undervaluation.) After the peak last summer, a record number of people put their existing homes on the market and the average sales time it is taking now for a resale has gone from 3 weeks in June 2005 to about 47 days in June 2006. Besides the downtown high rise condo boom, Orlando has lead the nation in the number of apartment units converting to condos with Tampa a close second. This has caused my company (Apartment Hunters) to consolidate locations in both cities due to the severe shortage of rental units. Now we are starting to see some of these conversions allowing tenants to renew their leases instead of "buy it or your out!" Our median resale price has remained around $270,000 for the past few months and new home prices averaging in the mid $400's. One thing I'm noticing is a lot of for sale signs in new neighborhoods (1-2 years old) probably due to rising interest rates and adjustable mortgages and "creative financing" that has been being used the past couple of years. Foreclosures will definetly be on the upswing! There is also a lot of older suburban homes for sale, it seems people are wanting to take their "newfound wealth" of their equity and either move to a downtown high rise of move to the Carolinas or Tennessee to get more home for their money. Seems everyone is talking about the Carolinas or Tennessee and getting out of the crowded conditions and rising cost of living here in Orlando. But unless something drastic happens they are predicting the median resale in Orlando to be aroung $320,000 by the end of 2007 and new home average around $550,000. There has been a ton of new townhouse construction due to the fact they average around $300,000 in price. Most crappy condo conversions are starting at around $150,000 for the worst of them. But job and population growth is keeping things stable here (unemployment last month in Metro Orlando was 2.6%.) and we've added over 52,000 new residents since Jan of 2006. Thanks for listening, that's where Orlando stands as of now! :rolleyes:

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