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Who are the buyers ? From my experience, people whose patience has run out are buying. They also see that they are not paying more than what the would have an year ago.
House are selling, but house prices are NOT increasing. Nor are buyers in any hurry. So depends on what you mean by spring bounce ? Uptick in sales or in price ?
BA market is like a stock priced for perfection. Just because a stock is overpriced doesn't mean it will fall. It can stall and trade in a range. Only when something changes the price starts moving lower. That can be increasing foreclosures, or rates or the economy slowing down.
The subprime problems have started at the right time for any spring bounce to remain very short, even if it happens.
Until it becomes common knowledge that buying a house is a bad idea, people will continue to buy. All they know is, their friends just bought a house and they don't have one or that their friend's house is bigger than theirs or something like that.
The low wage girl in my office was gushing on Friday because she and her boyfriend were approved for some enormous mortgage. She is buying, and I suppose others like her are buying.
Someone bought the condo across the hall from me back in November. They have yet to move in. Bizarre.
A touch off topic and off geography but how funny to live in a 4 season region and see a listing as "just listed" with pictures from last or previous summers!
Peter P
2007 Feb 25, 10:00am
The subprime problems have started at the right time for any spring bounce to remain very short, even if it happens.
The average joe cannot link subprime problems to the housing market. As a result, the mortgage shakedown may not change the desire to buy homes. It takes a while for the effects to be felt and it takes a while for the prevailing view of the market to change.
Peter P
2007 Feb 25, 10:01am
A touch off topic and off geography but how funny to live in a 4 season region and see a listing as “just listed†with pictures from last or previous summers!
LOL! Perhaps it is "climate controlled" ?
HeadSet
2007 Feb 25, 10:08am
A quote from the AOL real estate page:
"The smart money this year is on undervalued foreclosure properties that have been oversold due to jittery emotions in the real estate world."
This is refering to cities with high forclosure rates, such as Denver.
Incredible. So it is the "smart money" who are those "willing buyers."
HeadSet
2007 Feb 25, 10:17am
This on LA, number 4 on the best buy list:
4. Los Angeles
Total Filings: 300 (2,700 pre-foreclosures)
Outlook: Housing has been a major component of the high cost of living, which makes 2007 a rare window of opportunity for homebuyers or investors.
Smart Money? Not likely. Just heard that one of the largest real estate typhoons put all his properties on sale.
Nigel,
Nice link to your blog; after all they aren't making any more land and there is certainly a shortage of housing! That is why rents are screaming higher!?! You're right, this time is different, it will be much more painful than previous downturns!
Paul
HeadSet
2007 Feb 25, 10:51am
"However, it is clear from the defensive posture that the realtwhores are a little less confident this year. Four months without a commission can do that to one’s psyche, I suppose."
Since no sale equals no commission, do you think that this hunger may cause realtors to actually scream at the clients to "lower the price NOW!"
wtf,
I think Real Estate Typhoon was a freudian slip. I think it's a perfect name for the perfect storm that could take down the bloated real estate market in the Bay Area.
SP,
I do think that it is the Realtors' interest to start asking people to lower their expectations/prices. Would they rather get $0 from their share of an unsellable /Marina style 3/2' in Bernal Heights priced at $1,000,000 or the $10,000 that they'll get (after splitting/brokers etc.) of the same house at $500,000?
That half million extra isn't going to them, they'd rather take the bird in hand. The Freakanomics book had a good article about why Realtors (TM) sell their own houses for significantly more money than they sell other people's houses for. A quick sale, a quick commission, then on to the next.
Peter P
2007 Feb 25, 11:33am
On record, I must protest the use of the term "realtwhore", which I consider too degrading. It is not right to blame any one profession for the current situation.
Little link to a bit of the Freakanomics stuff. The guy is entertaining. The real estate agent article is under "Articles' and has a house next to it.
FAB,
1800 Gough Street penthouse had ANOTHER open house again today. Honestly, that thing has been on and off the market for about four years.
Comments 1 - 16 of 122 Next » Last » Search these comments
It is clear that homes are still being purchased in the Bay Area. Many "For Sale" signs in my Sunnyvale Neighborhood have "Sale Pending" attached to them. Who are still buying? What are the motivations? Now that the fear of being priced out has waned, what is the driving emotion?
This also leads to the issue of a possible "spring bounce". Will there be one this year? If the local economy is strong, a soft leading is not completely out of the question.