NJAR 2006 Q4 Data

Posted on March 15, 2007 by grim

NJAR has released the 2006.Q4 data, it can be found on the NJAR website:

New Jersey Home Sales Report (PDF)


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32 Responses to NJAR 2006 Q4 Data

  1. SG says:
    March 14, 2007 at 7:03 pm

    Great data JB.

    Well, so it is evident that there is significant slowdown in some counties compared to others. In North & Central, only 5 counties were positive, and 9 were negative. Most of the positives ones are so called premier counties, e.g. Hudson, Morris, Passaic, Mercer.

    I am little surprised with Hunterdon though. The argument closer to NYC definitely does not apply to Hunterdon. I think this may be due to very small number of transactions, skewing the percentages, after all there were only 45 houses sold in the whole 4th quarter.

  2. James Bednar says:
    March 14, 2007 at 7:33 pm

    From MarketWatch:

    In subprime mess, another dumb theory falls

    It seemed so obvious at the time, back at the peak of the Internet bubble seven years ago this month. Profits no longer mattered.

    You see, it was different this time. It was a new paradigm. Internet companies were changing the world and old measurements of success, such as profitability, didn’t apply anymore.

    Until of course, they did. And we’re still living with the fallout from the resulting collapse in Internet stocks and tech stocks in general, seven years later.

    The parallel with what’s happening in the mortgage market seems eerily familiar. In the media, the general rule of thumb is that the next big crisis in the financial markets will come from something totally unexpected. An earthquake in Japan (Barings collapse); a plunge in Asian and Russian currencies and debt (Long-Term Capital Management); a shell game in the executive suite at one of America’s most respected new economy companies (Enron).

    The thing about the brewing mortgage scandal, however, is that everyone saw it coming. They just refused to believe it.

  3. Clotpoll says:
    March 14, 2007 at 7:55 pm

    SG (1)-

    Unh unh. Getting something sold in Hunterdon is a damned march thru mud these days. Lots of sellers in total denial…lots of “look at our beautiful neighborhoood, look at our award-winning school, everyone here is rich and has a PhD, that buyer works at Merck…look at how much their stock has risen…he has money…”

    Getting a bad price is something that happens to your neighbor, not you.

  4. SG says:
    March 14, 2007 at 8:29 pm

    Actually, my numbers were wrong. The total sales volume is 266. Still very small to show reality. Not sure how much inventory is up though.

    Clot – Yeah, I find such opinion a lot whenever I talk to folks living in Huterdon. I guess some Kool-Aid is coming in Water tap !!!

    Anyway, This was very interesting, coming from LATimes Editorial, which generally is considered Left sided.

    No bailouts for sub-prime borrowers

    Trouble in the mortgage market would be bad for the economy. But there’s no reason for a federal bailout.

    But providing forbearance is a job for lenders, not taxpayers. Lenders got very creative when they learned they could profit by unleashing a flood of easy credit. If they want to remain solvent and keep Wall Street happy, they’ll have to be equally creative when it comes to refinancing sub-prime mortgages.

    The federal government is already playing a role. On March 2, five regulatory agencies called on lenders to assess borrowers’ ability to pay and to explain loan terms clearly, making sure customers understand all costs, terms, features and risks. Such changes could help prevent future borrowers from falling into the easy-money trap.

    In the meantime, lenders have every incentive to cut struggling borrowers some slack. Ambitious presidential candidates shouldn’t be suggesting that the government might want to too.

    http://www.latimes.com/news/opinion/editorials/la-ed-subprime14mar14,0,3486385.story?coll=la-news-comment-editorials

  5. afe says:
    March 14, 2007 at 9:21 pm

    what is so great about hunterdon co?

  6. BC Bob says:
    March 14, 2007 at 9:26 pm

    Has Schiff been reading Clot’s[weimar] posts??

    “The bursting of the technology stock bubble of the 1990’s was simply the opening act. What we are about to experience with the real estate bubble is the main event. In that respect, though it may be March of 2007 it sure feels a lot like March of 2000. However, instead of a mild recession, this collapse will be followed by the most severe recession since the Great Depression. The main risk is that Ben Bernanke and his buddies at the Fed panic, producing something far worse; a hyper-inflationary bust similar to the one experienced by the Weimar Republic in Germany. Let’s hope that cooler heads prevail, but get your wheelbarrow ready just in case.”

    http://www.financialsense.com/fsu/editorials/schiff/2007/0314.html

  7. SG says:
    March 14, 2007 at 9:49 pm

    afe: what is so great about hunterdon co?

    Well, I think it is polar opposite of counties near NYC, but the folks living there are very similar. IMO Hunterdon somehow became play ground for Rich & Famous of NJ (mainly Pharma industry), like Bergen/Essex has become for FSI.

  8. Lindsey says:
    March 14, 2007 at 9:50 pm

    I realize it’s definitely on the edge of this blogs radar, but the Ocean County sales numbers are unreal.

    Inventory in Ocean County on November 13 (the last date the MLS site I use had complete info) was about 1.1K less than Monmouth County
    (8,500 to 7,400). If sales in OC are that low, the RE people have to be pulling their hair out.

  9. syncmaster says:
    March 14, 2007 at 9:53 pm

    Hunterdon County is very picturesque. And if you work in Morris or Somerset counties, not a bad commute.

  10. rhymingrealtor says:
    March 14, 2007 at 10:18 pm

    I would think that we would see something along the lines of a CIS Consumer information sheet. Realtors are required to have clients they are working with sign them. I don’t think it is explained well by most agents or understood, I have run into so many people who think they have signed some kind of buyer’s agent contract when they sign it, when in fact they are signing to attest to the fact they the understand the capacity to which the realtor is working with them. Either as a buyers agent, seller’s agent or dual agent if applicable. So lenders would probaly require this type CYA forms also. They do to an extent it is a Truth in lending form, but they are very lax in getting them signed until closing, when people are not generally paying attention to what they are signing.
    I go to all my closings and explain ad naseum what is being signed, but I can tell you from my experience most people glaze over and don’t care. Same with CIS.
    KL

  11. njrebear says:
    March 14, 2007 at 10:26 pm

    Carry Trade Might Hasten Subprime Woes

    http://online.wsj.com/article/SB117391637408137535.html?mod=yahoo_hs

    Two issues topping Wall Street’s worry list — the mortgage mess and the unwinding of “carry trades” — might be perilously connected.

    It’s possible to construct two different narratives for the recent bouts of selling that have hit the stock market. In one, investors are fretting about trouble in subprime mortgages, which cater to borrowers with checkered credit records. A sharp rise in mortgage defaults could lead to problems for Wall Street banks, in the housing sector and for the economy more broadly.

    The other worry — half a world away — is that traders are paying back yen they’ve borrowed to make investments. Many observers think the yen carry trade — where cash borrowed at low rates in Japan is used to fund purchases elsewhere — has buoyed prices of risky assets around the globe. The yen’s recent strength makes it harder to pay off such loans, so carry traders are exiting their positions. One sign this is happening: Stocks and corporate bonds have been trading in step with the dollar against the yen.

    Maybe the two narratives are part of the same story. Securities backed by subprime mortgages were probably on the shopping lists of many investors using borrowed yen to fund higher-yielding purchases. Subprime-mortgage woes led them to sell those securities and pay back the money they borrowed, says ITG economist Bob Barbera. To do that, they converted dollars into yen, pushing the yen’s value higher.

    He says the yen has been the tail that might start wagging the dog.

    Mortgages haven’t been the only asset class acquired by investors using borrowed yen. They have also been buying emerging-market debt, stocks and high-yield corporate debt. If mortgage troubles deepen and the yen strengthens, investors might be forced to unwind these other carry trades, prompting a wider-ranging selloff.

  12. RentL0rd says:
    March 14, 2007 at 10:36 pm

    BC #6,

    I just got my book from amazon –
    ” Crash Proof – How to profit from the coming economic collapse” by Peter Schiff…

    and my 4yo scribbled all over it.

  13. njrebear says:
    March 14, 2007 at 11:10 pm

    experts –

    Is there a career to be made in settling foreclosures? Are there any certifications that can help you get a jumpstart in the foreclosure business? I’m serious. Any help is appreciated.

  14. sas says:
    March 14, 2007 at 11:24 pm

    Why the N/A on Bergen?

    SAS

  15. sas says:
    March 14, 2007 at 11:33 pm

    BTW:
    Come out of the woods Mr. Otteau…

    and let us sort fact from fiction.

    or has General Motors Acceptance Corp got you by the goat?

    SAS

  16. James Bednar says:
    March 15, 2007 at 6:21 am

    From Bloomberg:

    Housing Price Declines May Set Off U.S. Recession, Merrill Says

    Tighter credit standards among mortgage lenders might lower U.S. home prices by 10 percent this year and push the economy into recession, a Merrill Lynch & Co. analyst said in a report.

    New Century Financial Corp., the second-biggest subprime lender and other mortgage companies may fail as the number of customers falling behind on payments rose to a four-year high. More than 20 subprime lenders have closed or sought buyers since the start of 2006 and bank regulators are pushing lenders to raise credit standards.

    “Even if the pullback is only aimed at the subprime market, there could well be potentially significant further drags on home prices, construction activity and of course consumer spending growth,” Merrill’s David Rosenberg said in a note to investors.

    Declines in home prices would have an effect on everything from furniture and appliance sales to landscaping and the price of copper. That would drive unemployment above 5 percent by the end of the year and the probability of a recession to “very close to 100 percent” unless the Federal Reserve cut benchmark interest rates by a full percentage point, Rosenberg said.

    “What we are concerned about most are the knock-on effects from the pullback,” Rosenberg said.

  17. James Bednar says:
    March 15, 2007 at 6:37 am

    From the Record today:

    New Century is one of the top five mortgage lenders in New Jersey in dollar volume, along with H&R Block, Countrywide Financial Corp., Ameriquest Mortgage Co. and GMAC Mortgage Corp., Gardner said.

  18. James Bednar says:
    March 15, 2007 at 6:43 am

    Some great detective work by bloggers and blog readers.

    This story appeared in the LA Times on March 10th:

    Loan turmoil closes doors for buyers

    ShaRon Lewis is facing a 50% hike in the payment on her adjustable-rate mortgage next month.

    This week, she discovered she can’t qualify for a new loan with payments that she could afford.

    And although she’s willing to sell the West Hills home she’s owned for two years, she has been told it won’t fetch what she paid for it. “I have to laugh to keep from bawling,” the 30-something Lewis said.

    Her situation is becoming increasingly common across the country amid the implosion of the business of sub-prime mortgages — loans for people with less-than-perfect credit or no credit histories.

    Many would-be home buyers, and homeowners who want to refinance, are finding that virtually overnight their status has changed: They no longer are eligible for the kind of easy-credit loans that helped millions of people join the ranks of property owners during the housing boom.

    It turns out Sharon’s story isn’t as it seems..

    Thank You, Los Angeles Times

  19. Clotpoll says:
    March 15, 2007 at 7:18 am

    bear (13)-

    Google “NJ Real Estate Investment Clubs”. You can join one of these (nominal cost), and get a pretty good education on how to proceed. I don’t know of any school-based programs.

    Be forewarned: I’m getting 3-4 inquiries a day on how to get into this game. Everyone smells chum on the water, but it’s hard to reel in the prize. Residential foreclosure- as you might imagine- is a shark pool, with hardened pros and even Wall Street being the major players.

  20. Pat says:
    March 15, 2007 at 7:21 am

    Was I the only one who felt sorry for her when her story was printed?

    I’m such a s*cker. Slap me.

  21. njrebear says:
    March 15, 2007 at 7:32 am

    thanks clot!

  22. Clotpoll says:
    March 15, 2007 at 7:32 am

    Pat (20)-

    Sad to say, there will be winners and losers in this whole shakeout. The losers this time will be all those subprime borrowers who get clobbered by the ARM reset/negative equity 1-2 punch. There will be no bailout. Poor, dumb people are essentially non-citizens in the US; household pets have more political stroke.

    IMO, I’ve come to the conclusion that the “American dream” of homeownership is not only not feasible, it is downright dangerous. The sad fact is that an acceptable rate of homeownership is probably around 50% of the adult population…not the close to 75% we currently have. There are just too many stupid people out there who will either be duped out of their equity or simply run themselves into the ground.

  23. James Bednar says:
    March 15, 2007 at 7:33 am

    Google “NJ Real Estate Investment Clubs”. You can join one of these (nominal cost), and get a pretty good education on how to proceed. I don’t know of any school-based programs.

    Your milage may vary.

    Personally, I think these are mostly fronts for RE, Mortgage, and 1031 brokers, those that aren’t are referral machines (they profit when you use one of their sponsors), and the handful that are left just sit around and worship Kiyosaki while playing “Cashflow 101”.

    jb

  24. Sassy says:
    March 15, 2007 at 8:07 am

    Sharon Lewis, Casey Serin, and countless others coming forward…..Brings the saying to mind “There are only cheaters and the cheated.”

    I will certainly be sending my e-mail to Dodd (and a few others!)…And, one to LA Times, I am so tired of journalists not checking their resources and facts, that frankly would have taken about an hour.

    The spewing of misinformation!

  25. twice shy says:
    March 15, 2007 at 8:11 am

    “I’ve come to the conclusion that the “American dream” of homeownership is not only not feasible, it is downright dangerous. The sad fact is that an acceptable rate of homeownership is probably around 50% of the adult population…not the close to 75% we currently have.”

    Clot:

    I could not agree more. Never dreamed I’d hear this from a realtor. Time to turn in your license and NAR membership?

  26. Ron says:
    March 15, 2007 at 9:30 am

    Clot:

    Home ownership can easily make or break you. It depends on how well informed you are.

  27. lisoosh says:
    March 15, 2007 at 9:58 am

    If everyone and his mother is looking to get into buying foreclosures, then now probably isn’t the time.

  28. James Bednar says:
    March 15, 2007 at 10:04 am

    I still think REO will present the best opportunities for those who are not interested in learning about, or bearing the risk associated with foreclosures.

    Just take a look at the Countrywide REO portfolio over the past 3 months:

    http://spreadsheets.google.com/pub?key=pOSu8I1YrtgD6YqtUVBaINg

    jb

  29. Justin says:
    March 15, 2007 at 4:39 pm

    Can anyone explain why Souther NJ had a huge percent (20.4) of sales in Q4 (3rd page of PDF). Seems like Q4 was very busy in the 200k+ category for SNJ.

  30. James Massa says:
    March 17, 2007 at 9:18 am

    I bought two townhouses in the Bull’s Ferry complex on 505 River Road. They are both Fulton models with direct river views. They seem to have dropped 20%-30% in value over the last year. Meanwhile Manhattan is holding its own. What do my fellow contributors think are the biggest factors in this downturn? Overbuilding on River Road? Overbuilding in surrounding areas such as Hoboken and Jersey City? Speculation in my complex? I think over the next few years they will run out of room to build directly on the water front, but I am concerned that there is plenty of room to grow Jersey city for decades. Any comments? What do people think of my investment long term?

  31. Tom Sherlock says:
    March 17, 2007 at 1:40 pm

    Do you know the significance of the series of ‘N/A’s on Table 10 for the Bergen Area? I could post this question to NAR, but I thought you might have a clue since you placed the stats on your blog. Thanks.

  32. ac says:
    March 17, 2007 at 10:50 pm

    #30 James,

    I personally like those developments myself. But at the end of the day, I think families with kids will place more priority on the importance of a good school district over an excellent view of Manhattan. It’s probably more likely that is something that DINKs working in the city would like given the high taxes. I would guess that families with kids on the same budget would gravitate towards Summit, Short Hills and Chatham etc.

    It is probably a good investment long term. But I hope for your sake that you have sufficient liquidity to pull you through. I don’t think we’ve hit rock bottom just yet.

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