Archive for the ‘houses’ Category
August 19th, 2009 | 
Author: And Home Prices Drop By Record Amount
According to the National Association of Realtors, whose records go back to 1979, the median U.S. price for an existing single-family home dropped a record 15.6% to $174,100 in the second quarter of this year.
But Home Sales Increased
Meanwhile, sales of new homes increased by 11% for new homes and 3.6% for existing homes, which suggests that it’s a buyer’s market, and that buyers are taking advantage of the falling prices.
The total dollar reduction was $27.8 billion, and the states that were hardest hit were Nevada (15%) and Florida (13%) and a quarter of would-be sellers lowered prices by around 10%.
Which States Reduced Had The Most Reductions?
Connecticut, Massachusetts, Rhode Island and Illinois had the highest share of homes with price reductions of around 33%.
Then came,
Oregon 29%, followed by,
Washington
New Jersey
Minnesota
New Hampshire
Maryland.
Which Cities Were Worst Hit?
Jacksonville, Florida 38%
Portland, Oregon 35%
Milwaukee, Minneapolis, Boston and Seattle 34%
Albuquerque, New Mexico, and Chicago 33%
Detroit; 16%
Las Vegas 15%
Miami 13%
New York City and Phoenix 12%
San Francisco and Los Angeles 10%
* Undeveloped land and foreclosed properties were excluded from the above estimates.
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I couldn’t help but wonder if journalists were clutching at straws when I read stories today that said things similar to, “Orders for durable goods and home sales probably rose in April as the worst U.S. recession in at least half a century started to loosen its grip”.
What do they mean “probably rose”?
Surely, they did or they didn’t.
Sifting through the reports the good news was;
Orders for goods meant to last several years increased 0.4% making it the second gain in three months.
Combined sales of new and existing homes probably advanced to a 5.02 million annual rate from a 4.93 million pace in March, but again the reports say “probably”.
If true, and not “probable” then the above is good new but a stabilization in housing and manufacturing would help the present economic slump since they are the two areas suffering the biggest contractions. It won’t be possible to maintain these gains however unless banks loosen their purse strings, if unemployment continues to rise.
Surveys suggest that the sales of existing houses, which account for more than 90% of the market, rose 2% in April to a 4.66 million annual rate from a 4.57 million rate and Commerce Department figures are expected to show that new-home sales increased 1.1% to a 360,000 annual rate.
David Resler, who is the chief economist at Nomura Securities International Inc. in New York added to the “probables” and “expecteds” by saying “Evidence that the 16-month recession is coming to an end continues to build. Home sales and building activity seem to be stabilizing and manufacturing surveys point to smaller production cuts and smaller job losses”.
A spokesperson for Toll Brothers Inc., the largest U.S. builder of luxury homes, said last week, “That signs were beginning to emerge that the worst was over”, and “We believe the U.S. government’s forceful intervention in the capital markets has begun to restore some confidence that the financial system is on the road to stabilization”.
So the pundits are now telling us that the recovery is, “probable”, “expected” and “suggested”, and I hope that what they see is their glass balls is correct and that it will all happen soon, but I’d have liked to have seen more definitives.
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