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Old 08-24-2010, 08:39 AM
 
49 posts, read 95,072 times
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Existing Homes Sales Plunge 27% - CNN 8/24/2010

Existing home sales plunge 27.2% - Aug. 24, 2010

"The National Association of Realtors reported that existing home sales sank 27.2% last month to a seasonally adjusted annual rate of 3.83 million units, down from the downwardly revised rate of 5.26 million in June. Sales year-over-year were down 25.2%."
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Old 08-24-2010, 09:37 AM
 
Location: Lowcountry
764 posts, read 1,601,422 times
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Key take aways:

- Lowest sales rate in 15 years
- Now have a double-digit supply - an increase of 40% over June - where 6 months of supply is a 'normal' market
- Prices will continue to decline


Sell now or be priced in for a decade....
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Old 08-24-2010, 09:42 AM
 
Location: Central Texas
20,958 posts, read 45,566,451 times
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In our area, at our last sales meeting we were told sales in July were way down over July last year, but sales for the year-to-date at that point were up. There was a shift, in other words, borrowing from Peter to pay Paul.
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Old 08-24-2010, 09:48 AM
 
49 posts, read 95,072 times
Reputation: 41
Existing Home Sales Plunge 27%-chart_home_prices2_top.gif


Existing Home Sales Plunge 27%-home-sales-depressing-lows.jpg
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Old 08-24-2010, 09:58 AM
 
Location: Salem, OR
15,619 posts, read 40,631,686 times
Reputation: 17570
and this was unexpected how?

of course home sales are down. Many areas of the country are doing what THL's area is doing. Home sales down in July but up year-to-date. We are up year-to-date like 23%, but were down like everyone else in July.
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Old 08-24-2010, 10:15 AM
QIS
 
919 posts, read 5,170,880 times
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Hi Everyone,
I'm not an agent or a RE expert,but, I have been in the industry for 21 years as an inspector and I have seen ups and downs.
This situation that peaked in 2006 and collapsed soon after seems to have a lot to do with people getting into homes that should not have even passed prequal. Then they took equity grabs in various forms and bailed. I was there and saw people buy who had no business even looking; why was that? Seems like greed ran the market.
People that bought a house for 650K that could only afford a house for 250K cannot by the same house now that it is worth only 250K because they have a foreclosure and other hits on their credit?
There has to be a way of letting these foreclosed upon past homeowners whose job situation has not changed back into the market: call it foreclosure forgiveness or something.
How can this situation improve if current home owners that have gone down over %50.00 in value cannot refi? The banks see a house go down over %50.00 in value,but are unwilling to contact the owner and work something out unless they begin the shortsale process. More homes are being lost due to this one items as I type. I guess the lenders can't get away from the concept that an appriasal is not relevant for a house that is down over %50.00.
The investors are not going to buy every property that is for sale in my area; there are too many and the buyers are in hunker down mode. The so called bidding war/phony pricing gimmick has just about run its course here. Entire neighborhoods are filled with dead lawns and fallen over for sale signs.
The banks seem to have caused this and they are standing there with their arms folded over their chests. They have a crate of rotting tomatoes and more are coming.
As an inspector I can only describe the future of the condition of the inventory as " reverting back to nature". The level of deterioration between now and next spring will equal BIG $$$ to someone who wants a safe, reasonably well performing abode in reasonable condition. My service has never been more valuable!!
I just got off the phone with a fellow inspector who said more than half of his last clients paid with a credit card.
I can only see FHA/Freddie Mac or whatever acquiring these properties for pennies on the dollar as a way out now.
I really like the level of professionalism on this forum; I humbly submit my comments to you all to elicit your input and I confess my ignorance of the situation at large and across the entire nation. I can't and won't argue any points nor can I offer any explanations. It would be nice to see what this body of experts say after today's release of July's sales numbers.
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Old 08-24-2010, 10:23 AM
 
49 posts, read 95,072 times
Reputation: 41
YOY sales were DOWN 25.2% Even if your sales were up YOY until recently that really isn't saying much considering that the tax credit just expired which helped prop up the market artificially both in the fall and this past spring. Let's see how your market looks going forward. So far it is not looking good throughout the United States. 3 months in row with some dreary numbers since the expiration of the tax credit in April. The economy continues to tank with no job creation. With no jobs comes no housing recovery. Period.
Unexpected for me and most others on here absolutely not, but for the housing cheerleaders on this forum maybe. ( Glenn100, etc.. )
Also, the total housing inventory rose 2.5% to 3.98 million existing homes for sale. That represents a 12.5-month supply at the current sales pace, up from a 8.9-month supply in June. A six-month of supply is considered normal. These numbers do not include the shadow inventory that the banks are holding back. Growing supply of homes will only further weaken prices and the housing market as a whole.
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Old 08-24-2010, 10:25 AM
 
Location: Union County
6,151 posts, read 10,062,491 times
Reputation: 5831
Quote:
Originally Posted by Silverfall View Post
and this was unexpected how?

of course home sales are down. Many areas of the country are doing what THL's area is doing. Home sales down in July but up year-to-date. We are up year-to-date like 23%, but were down like everyone else in July.
YTD is a bogus number... the tax credit made it meaningless. You need to look at YoY and MoM as decent indicators right now.

Existing Home Sales Plunge 27.2%, Record Drop, Trounce Expectations Of 13.4%, Lowest Number Since May 1995 | zero hedge

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Old 08-24-2010, 10:28 AM
 
49 posts, read 95,072 times
Reputation: 41
Exactly Mikey!! Great post.



Quote:
Originally Posted by MikeyKid View Post
YTD is a bogus number... the tax credit made it meaningless. You need to look at YoY and MoM as decent indicators right now.

Existing Home Sales Plunge 27.2%, Record Drop, Trounce Expectations Of 13.4%, Lowest Number Since May 1995 | zero hedge
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Old 08-24-2010, 11:19 AM
 
Location: Salem, OR
15,619 posts, read 40,631,686 times
Reputation: 17570
Quote:
Originally Posted by MikeyKid View Post
YTD is a bogus number... the tax credit made it meaningless. You need to look at YoY and MoM as decent indicators right now.

Existing Home Sales Plunge 27.2%, Record Drop, Trounce Expectations Of 13.4%, Lowest Number Since May 1995 | zero hedge

I agree YOY numbers are the way to go, YOY my area is up 23% from the same time frame YOY last year. I had one buyer eligible for the tax credit and didn't hear of many local agents in my area that had credit eligible buyers. The one eligible buyer would have bought anyway so, in my area, I think the tax credit had very little impact on the overall numbers in my area. I think our YTD is a fair assessment of what buyers were going to be in play anyway since home prices dropped 20% from peak.

I personally think MOM is a horrible way to look at real estate data unless you live in a market that doesn't have any kind of seasonal flux. I mean that would every December in my area real estate is down? No way. It is ALWAYS down in December. That is NORMAL. What we should care about is how is the real estate market doing in relation to the normal real estate cycle.

This year the normal real estate cycle was premature and so the normal gangbuster summer cycle was just pushed forward into spring. The only question that remains is whether or not the fall market returns to the normal cycle, OR if all the fall buyers were out in the spring. Based on the number of contacts I've had by buyers in the past week, I think local home sales will be up from 2009 and yes...I think home prices are still on the decline in my area.
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