Home Prices Near A Double Dip

[ASH]

I'm interested in comments about this article from CNN Money today. There has been a fair uptick in new homes lately. Is it based on concrete money, or speculation? Can it be sustained? How?

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Home prices near a double dip

By Les Christie, staff writerMarch 29, 2011: 10:51 AM ET




NEW YORK (CNNMoney) -- January home prices fell for the sixth month in a row, edging closer to a double dip.
The S&P/Case-Shiller home price index covering 20 major markets fell 3.1% year-over-year, hovering near the market's bottom set in April 2009.
"January brings us weakening home prices with no real hope in sight for the near future," says David M. Blitzer, a spokesman for S&P.
The dismal report followed other negative housing market indicators recently. Sales of existing homes were off nearly 10% in February and new homes sales were at a record low.
"The housing market recession is not yet over," said Blitzer, "and none of the statistics are indicating any form of sustained recovery. At most, we have seen all statistics bounce along their troughs; at worst, the feared double-dip recession may be materializing."
Pat Newport, a housing market analyst for IHS Global Insight sees little prospect of a turnaround.
"There's just a lot of inventory glut out there," he said, "and that's why housing prices are dropping. The low prices help clear out the glut."
Anthony Sanders, director of Real Estate Entrepreneurship at George Mason University, pointed out that home prices have fallen despite extremely low interest rates, which have dramatically reduced monthly mortgage costs for buyers.
"If interest rates climb, that could be the tipping point into the double dip," he said.
Eighteen of the 20 markets covered by the survey recorded year-over-year price declines. Washington, D.C., reported the only substantial increase, up 3.6%, while San Diego edged 0.1% higher.
Prices fell 9.1% in Phoenix, compared with January, 2010, more than any of the other markets covered. Detroit dropped 8.1% and Minneapolis fell 7.6%.
Newport expects the price drops to continue most of the year, and says that it's only a matter of time before the market enters a double dip.
"I think prices will drop another 5% to 10%," he said. "The double dip will hit in the next couple of months."

 

[scooterbug44]

It's hard to tell, as Sowal is unique and realtors are rarely 100% truthful about the state of the market.

What I am hearing is:
1) High end/new stuff is selling and the buyers are using cash.
2) The inventory is shrinking as foreclosures/short sales are being purchased because anyone who can do so is not putting non-distressed up for sale (because the competition from f/ss drive prices down).
3) There has been an uptick in selling.
4) The banks suck.

 

[GoodWitch58]

It's hard to tell, as Sowal is unique and realtors are rarely 100% truthful about the state of the market.

What I am hearing is:
1) High end/new stuff is selling and the buyers are using cash.
2) The inventory is shrinking as foreclosures/short sales are being purchased because anyone who can do so is not putting non-distressed up for sale (because the competition from f/ss drive prices down).
3) There has been an uptick in selling.
4) The banks suck.

Agree. There is a definite uptick--had two closings last week.
I am seeing a lot of inquiries/showings; particularly for primary homes in the $200-250,000 range; and the high end investment property seems to be taking off too.
Vacant land is still slow in my experience and condos are slow, mostly due to high maintenance fees scaring people off...
I am looking forward to a really good summer season--and praying that we do not have another disaster of any kind.

 

[30ashopper]

I wonder how inventory is doing for the area. It all comes down to supply.

I too can confirm sales of reasonably priced, primarily bank owned property have taken off in just the last ten months or so.

 

[30ashopper]

Quarter over quarter price change for all of Walton County. We're still headed down on price at this point. (The spike last spring was the sandestin sale.)

 

[Smiling JOe]

from dreambigproperties.com:

"People are often asking about inventory of homes on the market. We?ve seen a continued down trend in the number of homes listed and Feb 2011 inventory of 1188 homes, is the lowest inventory level since July 2005. Inventory levels peaked at 2118 homes in September of 2007. Inventory of homes has dropped 44% since the peak." ...(continue reading)

 

[Bobby J]

It's hard to tell, as Sowal is unique and realtors are rarely 100% truthful about the state of the market.

.

Realtors tend to believe their personal business is the state of the market and the general public tends to believe whatever the media is telling them.
Somewhere in the middle is the reality.

I personally feel locally we are on the bottom with ups and downs still to come. When you hit a bottom, you often bounce a little before you can get back up.