Get Your Boots On Baby....
...It is getting thick and deep!
(Press Democrat)
"April home sales in Sonoma County sank to their lowest level for a month in five years while prices remained flat, further evidence the housing market is settling down."
"The market is coming into balance between buyers, who have plenty of homes to select from, and sellers, who must price homes more competitively."
The market is not coming into balance. The listings have spiked upwards with no end in sight. Buyers DO have plenty of homes to choose from, if they were only inclined to buy. There are many more homes than buyers.
Supply and Demand are NOT in balance. Prices are not in balance with incomes. And the cost of ownership is still double if not three times the cost of renting.
The only balance I see here is the BS being juggled between the real estate agents, mortgage lenders and the newspapers. Seems they are playing a mean game of "hot potato" with the truth and none of them can bring themselves to hold onto it let alone speak it.
"The April median resale price was $596,925, the second consecutive month with little change compared with prices a year ago."
In Sonoma the median is: $618,000
Glen Ellen: $714,000
Sebastopol: $618,500
Petaluma: $649,500
Healdsburg: $655,000
Penngrove: $942,500
Cotati: $672,000
Windsor: $594,475
Rohnert Park: $580,000
Santa Rosa: $570,000
'"It is a great buyer's market. It's just a little more challenging for sellers," said KC Garrett, an agent with Frank Howard Allen Realtors."
No... it is not a buyer's market. With prices like these so out of touch with the reality of the incomes, and budgets of buyers and so inflated from rent prices this is what is called a sucker's market. Only suckers would buy now. Stupid ones.
By the way...(courtesy of Ben Jones from the Housing Bubble Blog)
“Misrepresentation claims continue to be the largest source of legal troubles for real estate brokers, said Laurie Janik, general counsel for the NAR trade group. Agents and brokers should not make any statements about future market conditions, Janik also said. ‘Don’t say anything like, ‘This well will never run dry.’ It’s a sure recipe for disaster,’ she said.”
Back to the Press Democrat programming already in progress:
"The number of homes listed for sale at the end of April has doubled from the past year, reaching 1,571."
WRONG!!!!
From Norcal mls: 3310
SFH's only: 2828
Ziprealty SFH only: 2549
803 on the price reduced list
Looks like the REAL number is DOUBLE what the Press Democrat is claiming ...
Sonoma County listings progression
3/20/06 = 1742
3/26/06 = 1766
4/03/06 = 1888
4/19/06 = 2828
4/25/06 = 2868
4/30/06 = 2898
5/07/06 = 3052
5/13/06 = 3187
5/18/06 = 3310
Sonoma Valley listing progression
2/14/06 = 172
2/14/06 = 183
2/24/06 = 193
2/25/06 = 200
2/27/06 = 214
3/01/06 = 219
3/04/06 = 220
3/12/06 = 230
3/20/06 = 236
3/26/06 = 238
4/03/06 = 268
4/19/06 = 291
4/25/06 = 305
4/30/06 = 315
5/07/06 = 328
5/13/06 = 346
5/18/06 = 363
"And it now takes more than twice as long to sell the typical home. A home took 38 days to sell on average in April, compared with 15 days a year ago."
Come now honey, let's tell the truth now.
According to rereport.com's April Data for Sonoma County the average count for Days on the Market is: 85. In April of 2005 it was 59
In Sonoma: 100
Glen Ellen: 217
Santa Rosa: 90
Rohnert Park: 69
Petaluma: 55
Sebastopol: 87
Penngrove: 98
Healdsburg: 90
Cotati: 132
Windsor: 75
"Increasingly, sellers must reduce their prices to attract buyers, agents and brokers said."Last year people got more than their asking price. This year it doesn't look like that and people need to price accordingly," said Rick Laws, Santa Rosa manager for Coldwell Banker, which prepares the monthly Press Democrat home sales report."
Right... according to Ziprealty the number of houses with recent price reductions is: 803
'"Buyers are expecting some concessions and some bargaining. This is what we would expect to see in a normal marketplace," Laws said."
Actually, I don't know about you, but I expect to see more normal pricing in a normal marketplace. You know, one where the average person in the area can actually afford to buy a house?
"Sellers are finding it increasingly difficult to make their homes stand out in the crowded marketplace. Coldwell Banker agents Jeanne and John Delario offered $100 as a business card raffle prize just to get agents to stop by the northwest Santa Rosa home they listed this week. The raffle attracted a number of agents to walk through the freshly remodeled home, one of 60 on Tuesday's weekly tour of new listings in Santa Rosa."
'"In a market like this, you want to bring the agents in to see the house so they remember it. An agent can't see 60 houses in one tour," she said. Agents rarely needed such promotions a year ago. But today, agents rely on such tours to take the market's pulse, determining if a listing is priced to sell and what buyers might expect to pay."
"The Delarios also went by a handful of homes on the tour. "It's not a poor market. It's just balancing now," she said."
"After a sluggish winter, sales picked up this spring, as they often do when more buyers and sellers enter the market. But over the first four months of 2006, sales were running nearly 18 percent below the pace from a year ago. The 382 sales in April were the fewest for the month in five years."
380 homes were sold in April of 2006 compared with 504 for April 2005.
"Back then, the economy was headed into a recession. But home sales rebounded as mortgage rates dropped to historic lows, fueling record price increases that peaked at $619,000 in August. By last fall, however, buyers became increasingly cautious about the market's direction and sales slowed."
"Buyers were waiting for prices to ease or were pushed out of the market by rising interest rates that made homes even less affordable.The average interest rate for a 30-year, fixed-rate loan was 6.58 percent last week, up from 5.77 percent a year ago, according to Freddie Mac, the national mortgage company."
"The rate hike has added $252 to the monthly mortgage payment on a $600,000 home, pushing it up to $3,059 a month."
This is quite a bit more than what one would pay to rent the same property. Considering 900sq. ft. chit boxes are priced at $600k how many of you would really rent a 2bd/1ba 900sq.ft converted chicken coop for $3,059 a month?
"That assumes the buyer took out a 30-year loan with a 20 percent down payment."
BWAHAHAHAHAHHAHAHAHA!!!!! Here is what the REAL loan breakdown looks like for Sonoma County....again...
Percentage of home buyers choosing adjustable-rate mortgages
Sonoma County
2003 - 36.8%
2004 - 59.4%
2005 - 69%
Accoording to a local Countrywide representative he said nearly 80% of his customers are choosing Interest Only Negative Amortization Loans. Not good Sonoma County.
"The market slowdown has resulted in prices' leveling. (we call that stagnating, since so few are actually selling) The March and April median prices were unchanged from a year ago. Homes might sell for $5,000 to $10,000 under what the same homes would have gone for a year ago, agents and brokers said."
(unless you are smart enough to hit the internet and do a little research in Ziprealty and calculate the price reductions and the listing history and see that many actually have reduced titanic prices to merely ridiculously overpriced now. Check it out for yourself price reduced lists on the side bar)
"What I'm telling my sellers is, 'Be patient, it's going to happen. We just need to get people in the houses. Once we have people that are very interested, they should sell,'" Garrett said.
"Buyers have more homes to select from than at any time in the past nine years.Inventories have built back to a more than four-month supply in April, which is a measurement of how long the supply would last at the current sales pace."
WRONG!!!
MLS Listings: 3310
At the current rate of sales: 380 this translates into an 8.7 month supply of homes on the market.
"A market is considered in balance when inventories are in the four- to six-month range."
'"I explain to people the market's not bad, it's just kind of leveling off. Sellers are starting to get it," said Pat Avila, an agent with Windermere Wine Country Properties who has sold homes in the county for three decades."
Considering buyers still think they are entitled to the speculation fueled imaginary 20% gains for the past 4 years, I would say no... no the sellers arent' starting to get it. When housing prices revert to the mean of what is realistic, then they will get it.
The Wall Street Journal Real Estate Q&A (courtesy of Ben again)
“Question: Why is it so hard to get good data on housing-market prices, especially in major metro areas like Washington, D.C.? Are there no reliable indexes? I disagree that Realtors will help much, even for information on price cuts in your target neighborhood. Most Realtors just want to sell houses, and ‘now’ is always the best time to buy.”
“Answer: Wouldn’t it be great if you could get all of the information you need to buy and sell your home on one free Web site? Don’t get me wrong, there’s a lot more useful real-estate-listing information floating around in cyberspace than there was even two years ago. But much of it is controlled by Realtors, who, as you have pointed out, seemingly don’t want anything but ‘happy news’ getting out, and don’t really want consumers to be empowered.”
12 Comments:
the press democrat is less honest than the average real estate salesman,they print a monthly "real estate report" which is prepared by the flacks at coldwell banker,never check the accuracy or truthfulness of this so called report and print it as news!it is only off by about 50% for inventory #'s and month's supply so i guess it is in line with their ethical standards.this $hit should be listed as what it is,a paid advertisement,and coldwell banker should be sued for fraud and get its licence revoked! mother of god can you think what would happen to any other regulated business that made this kind of material misrepresentation of the facts!ah well,i guess this is what the first amendment is all about now,lying to please your biggest advertisers.FAUGH!
well now I think there is starting to be a little bit of a backlash against the industry for misrepresenting facts. I think as long as people are viewing houses as something other than a place to live and instead as an investment... we are going to start to see some misrepresentation claims.
i wonder if it amounts to a conspiracy whencoldwell banker writes a press release containing material misrepresentations of the facts,the pd publishes it as "news" and coldwell banker and others use this "news" to induce people to buy property...does it amount to a criminal conspiracy,legally speaking? perhaps one of your visitors from doj could comment on this? i am going to have lunch with a real estate attorney next week,and will be sure to ask for an opinion...rico or class action?
LOL... Did you see that law that Georgia passed? From the article there are some real estate fraud specialist attorneys there in Santa Rosa... perhaps they have some thoughts on this?
Did you notice that the PD recently started putting its RE data in the business section instead of the RE section where it was for years? I'm guessing they did this because they knew it would begin to go negative and didn't want it with the open homes listings. They wouldn't want to discourage buyers from buying.
That is a good observation Anon. I didn't even notice the change. I don't subscribe to the PD so it slipped right past me.
But that would make perfect sense that it is intentional, especially given them being in bed with the real estate industry in the area. They run their regular infomercials in the paper, falsify the data and attempt to paint a much different picture of the risks of our housing market to potential customers.
I'm with Tom on this one... I would interpret that as conspiracy, conspiracy to commit fraud, and plain and simple fraud.
It is NOT a buyer's market, it is a SUCKER'S market. Prices are so far beyond fundamentals it only makes sense to buy if one or both of the following are true:
1. You have more money than God so what do you care?
2. You think house prices will continue to appreciate at above inflation rates.
It will be a buyer's market when house prices return to pre-bubble levels.
another special report in today's pd by michael coit...sos..so i tried calling the pd to at least leave a msg on his voicemail...and you can't do it! the only depatment you can reach is circulation where you can use an autoprompt to complain if your paper didn't arrive...i guess the advertisers will let them know on monday if anything important happened.so i'll call monday to find out if michael coit is a lazy incompetent or a craven liar...although these are certainly not mutually exclusive categories.
I live in Marin (happily renting after selling my house in 2004) and noticed that the Pacific Sun has eliminated their separate "Real Estate" section. It's now a small section called "Home".
The local press gets lots of advertising dollars from the real estate industry, so they will be the last ones to want to turn over the apple cart.
Sales here in Marin are down 33% versus YAG, so buyers are starting to wake up (hopefully).
Hey guys! Sorry for being gone all weekend. youngest sister is getting married and had to be up with the family taking care of details.
Tom... do you have a link for that story? I didn't see it when I looked online... but will check again to see if they were just late uploading it.
i get a paper copy,and i'm at the office.it was in saturdy's biz section and it is on my desk next to a rodale book,at home.dang.
One thing I noticed is the PD did post online their claim of houses sold. However, I have already seen some of those houses listed as sold previously. I used to really like the SFGATE listings of recent home sales, but I take those with a pound of salt as well since seeing the same houses listed multiple times.
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