[Plantagenet]

Housing prices have fallen dramatically. Now the sales of existing homes showed an "up-tick" last month---the first in seven months.

existing home sales up

Do people still think we are heading into a another great depression, or is this blip the start of a housing recovery?

Have prices fallen enough to tempt people back into the market, or should we still be putting all our money into gold and stockpiling crates of top ramen and bottles of water in secret underground bunkers?

Anybody here looking to buy some real estate?

[emersonbiggins]

Month-to-month figures are meaningless. It's the beginning of SPRING, and sales traditionally go up during the season.

YoY's are better indicators of the health of the housing market, and they say that we are -23.8% in sales vs. a year ago.

[seahorse]

Plantagenet,

You may or may not know that I'm a lawyer who has been involved in a lot of housing gone bad issues. I personally don't think this is the bottom of the housing market primarily bc many banks continue to hold onto delinquent loans but not foreclose hoping that the market will recover. In my area, at least, several huge developers have defaulted on massive loans that are big enough to take the local banks down with them, thus, the banks cannot foreclose. The banks do not list these loans as non-performing yet, because they tinker with how these loans are carried on their books. I suspect this is occuring nationally, and thus the question about the book value of MBS.

All this is expected to come to a head in the 4th quarter of this year, bc under banking regulations, the banks will have to foreclose on these loans and can't keep carrying the loans. However, I also note that one of the proposals floated around in Congress would allow banks to basically carry these loans indefinitely.

At any rate, there is a huge number of bad properties out there that haven't even hit the market. If or when they do, this flood of new houses and delinquent unfinished subdivisions would wreak havoc on property prices in my area. I strongly suspect that what is happening in my area is also happening in larger markets like California, Florida, Nevada etc.

Further, the next waive of defaults will be commercial loans. We are only now seeing the first signs of commercial defaults. This could easily be as big a problem for the banks than the home loans, if not bigger.

[Plantagenet]

$this->bbcode_second_pass_quote('seahorse', 'P')lantagenet,

You may or may not know that I'm a lawyer who has been involved in a lot of housing gone bad issues. I personally don't think this is the bottom of the housing market primarily bc many banks continue to hold onto delinquent loans but not foreclose hoping that the market will recover.

[emersonbiggins]

$this->bbcode_second_pass_quote('Plantagenet', '
')Sounds like this isn't the light at the end of the tunnel....its just the roof collapsing into the tunnel.

[Tyler_JC]

But WHY did home sales go up?

Because prices fell by 8.7% compared to February of last year.

New home construction stalls as prices fall, inventories get bought up at bargain prices. It doesn't take a PhD in economics to predict that one.

[Plantagenet]

$this->bbcode_second_pass_quote('Tyler_JC', 'B')ut WHY did home sales go up?

Because prices fell by 8.7% compared to February of last year.

New home construction stalls as prices fall, inventories get bought up at bargain prices. It doesn't take a PhD in economics to predict that one.

[ColossalContrarian]

$this->bbcode_second_pass_quote('Tyler_JC', 'B')ut WHY did home sales go up?

[Plantagenet]

Big up move on Wall Street today---

"Housing Data Lift Stocks

Stocks climbed after J.P. Morgan increased its offer for Bear Stearns and new data on existing-home sales were stronger than expected. Builder stocks posted strong gains.

----

I guess the folks on Wall Street don't know its spring, and housing sales always go up in the spring.

[emersonbiggins]

$this->bbcode_second_pass_quote('Plantagenet', '
')I guess the folks on Wall Street don't know its spring, and housing sales always go up in the spring.

[PrairieMule]

Have you ever wondered if during the sinking of the Titanic, the revenue reciepts from the bar and inventory consumption were greater than forecasted by the home office?

I guess that was a good thing huh?

[emersonbiggins]

$this->bbcode_second_pass_quote('PrairieMule', 'H')ave you ever wondered if during the sinking of the Titanic, the revenue reciepts from the bar and inventory consumption were greater than forecasted by the home office?

I guess that would be a good thing eh?

[Tyler_JC]

$this->bbcode_second_pass_quote('ColossalContrarian', '')$this->bbcode_second_pass_quote('Tyler_JC', 'B')ut WHY did home sales go up?

[Plantagenet]

....economists said they still believed any sustained rebound was many months away.

"The hemorrhaging has stopped but the recovery will be long, slow and painful," said Bernard Baumohl, managing director of the Economic Outlook Group. "It's unlikely that we will see any sustained jump in home purchases, must less higher prices, until mid 2009 at the earliest."

Brian Bethune, an economist at Global Insight, said, "A quick bounce back in the housing markets is simply not in the cards."

White House press secretary Dana Perino said the increase in sales and a decline in the inventory of unsold homes was encouraging but "we can't put a lot of stock in just one report."

Lawrence Yun, chief economist for the Realtors, said that some formerly hot markets in California and Florida were seeing significant price declines now as sellers are cutting prices to attract buyers.

"We are not expecting a notable gain in existing-home sales until the second half of this year," he said.

--wsj


A notable gain in second half of the year wouldn't be bad....that's only 6 months away.....

[PrairieMule]

$this->bbcode_second_pass_quote('emersonbiggins', '')$this->bbcode_second_pass_quote('PrairieMule', 'H')ave you ever wondered if during the sinking of the Titanic, the revenue reciepts from the bar and inventory consumption were greater than forecasted by the home office?

I guess that would be a good thing eh?

[emersonbiggins]

$this->bbcode_second_pass_quote('Tyler_JC', '')$this->bbcode_second_pass_quote('ColossalContrarian', '')$this->bbcode_second_pass_quote('Tyler_JC', 'B')ut WHY did home sales go up?