Worst new homes sales since 1963 (Houston, Bellaire: apartments, foreclosures, renters)

[EasilyAmused]

Does this apply to us, or just a nation trend? You're experiences please. Since this applies to NEW, I don't have any first hand experience with it in Houston.

Hot Air » Blog Archive » Media shocked by “unexpected” record low in new home sales


take in mind this is a more right wing website, but the numbers don't take political sides.

Edit for a more "straight" news site http://wtop.com/?nid=111&sid=1896314 (broken link)

[jfre81]

I'm sure it's convenient for this to be formed into some kind of political statement, but there are lots of possible explanations...

-The credit markets are still tight
-People may be less likely to throw money that's harder to come across these days at the mass production crap that's been the norm since the boom, preferring instead to put a little work into houses that are built better
-More people may be taking to renting instead of owning, at least for the time being, which might make more sense than sinking money into an asset that's declining in value
-This doesn't seem to make clear whether "new" = newly built or simply that nobody's lived in it before, even if it's been sitting for a couple years as unsold inventory
-"House = investment" mentality of the boom years has turned more into "house = dry place to lay your head"

Just a few possibilities I suppose.

[SteveArmy]

or people bashed the hell out of neighborhoods that noone can decide where its safe to buy

[RVD26]

It's all Obama's fault I'm sure somehow.

[Malvie]

Seems to me I've heard about some "Recession" thing---like the worst since the Great Depression---I'm sure I've heard of it somewhere...

Yes, it would make sense that nobody's buying new houses during the tightest credit market and slowest job market in 70 years. I would think that's logical.

But then, that's just me.

And while it doesn't apply to us as much as some other places, we're not off scot-free.

[crbcrbrgv]

With property taxes being so high I think you will find a lot more professional couples and families will choose to rent as opposed to buy. There aren't many places in America where you can live in lower-middle class income level apartments and still have your children be zoned to schools like Stratford or Bellaire high. With the economy the way it is, it only makes sense that those with better means will also choose to rent. The argument "you are throwing your money away" rings increasingly more hollow as one could easily argue with the state running a 15 billion dollar deficit, you are throwing your money away via taxes if you buy. I bet we see a lot more renters in the future and less buyers.

[astrohip]

Originally Posted by jfre81

but there are lots of possible explanations...

-The credit markets are still tight

Absolutely agree. It is so challenging to get a mortgage now, and even harder for a builder to get credit to build. There was an article in the WSJ this week about how bank-to-business lending was at the lowest level in the last half century. No money greasing the economy makes for sloooow times.

Originally Posted by jfre81

-People may be less likely to throw money that's harder to come across these days at the mass production crap that's been the norm since the boom, preferring instead to put a little work into houses that are built better

Not sure I agree with this. People will always buy the Pulte & KB type products. It's affordable, and in all reality, it's good enough. It's not craftsman construction, but it's safe, cheap and will last longer than us.

Originally Posted by jfre81

More people may be taking to renting instead of owning, at least for the time being, which might make more sense than sinking money into an asset that's declining in value

Agree. See my point below.

Originally Posted by jfre81

-"House = investment" mentality of the boom years has turned more into "house = dry place to lay your head"

And this is the way it always should have been. The primary purpose of a house is shelter. If it can also appreciate at some glacial pace, maybe 2-4% a year, then great. I have no sympathy for people who bought houses for investment purposes, or to flip, and can't understand why we are bailing them out.

Originally Posted by Malvie

Seems to me I've heard about some "Recession" thing---like the worst since the Great Depression---I'm sure I've heard of it somewhere...

Yes, it would make sense that nobody's buying new houses during the tightest credit market and slowest job market in 70 years. I would think that's logical.

This I agree with. Tough times=put off major life changing purchases.

Originally Posted by crbcrbrgv

With property taxes being so high I think you will find a lot more professional couples and families will choose to rent as opposed to buy. There aren't many places in America where you can live in lower-middle class income level apartments and still have your children be zoned to schools like Stratford or Bellaire high. With the economy the way it is, it only makes sense that those with better means will also choose to rent. The argument "you are throwing your money away" rings increasingly more hollow as one could easily argue with the state running a 15 billion dollar deficit, you are throwing your money away via taxes if you buy. I bet we see a lot more renters in the future and less buyers.

I disagree. It's just tough times. There will be more renters than buyers in times like these, but I don't think it will be a long term trend. People still want to own their house, and it still makes sense to buy your house over the long haul.

To pick on just one point of your post, you say you are throwing your money away via taxes if you buy. Don't you think renters pay property taxes?You do realize it's built in to the rental costs?Assuming stable housing prices, assuming long term employment, assuming stability within the family--buying makes more sense than renting. Do we have this situation now? No. But it will return at some point. And people who can afford to buy in the depths of depression (like now) always come out ahead. I know many people who snapped up houses in the early 80's for a steal, rented them to cover their notes, and watched them appreciate steadily over the years.

[desertsun41]

When are America going to admit we are in the 2nd great depression? By all neutral sources including by definition of every dictionary, this is a depression. Ya'll been listening to your Govt. too much. This Govt. only just publicly admitted "recession 2 Decembers ago when in fact the recession was already 2 years old. They will never ever admit that dirty filthy curse word "DEPRESSION". Think what the domestic and international markets would do if some one leaked out that dirty filthy D word.

America is in the worst depression since 1928. Unemployment is the highest since records were kept. Factory production is at it's lowest level since 1916. Foreclosures are now higher then the first depression with some cities having 70% of the entire home inventory in some stage of foreclosure. Retirement nest eggs have lost $100 billion dollars....poof....all gone. Home equity loss has exceeded over $3 trillion. Banks dropping off like flies in heat on the window sill. In recent times even Walmart and Bank of America are closing stores. GM and Ford, once the symbol of American might is dead and buried. All of America's greatest companies now reside in China. How is that helping America? It does help the wealthy elite though through larger profits.

We here in Texas are not as bad off as some areas of this once great country. I still see homes selling here. There still are a few jobs here. Restaurants and stores are still crowded on weekends. The fear of losing ones job is not as great here. For sure we are not as bad off as Vegas, Phoenix, Detroit, Miami and southern California where one in every 26 homes are in foreclosure.

For now, I'm working though my income is off 80% from 4 years ago and all I care about is the Rodeo coming to town and I can forget all about the economy for 3 weeks.

[Reivax]

Originally Posted by jfre81

-The credit markets are still tight

Personally, I believe that's the one single reason right there. many things caused it, for sure. But realistically, just because the housing market went to crap because a bunch of people received loans on homes they could not really afford and subsequently lost them, doesn't mean that this would have stopped more people from doing exactly the same had credit availability stayed the same.