From CNN:
US home prices fall by largest amount annually since December 2011
US home prices fell in May at the largest annual rate in more than a decade, according to a National Association of Realtors report released Thursday.
The median existing home price was $396,100 last month, down 3.1% from a year ago, marking the largest year-over-year price reduction since December 2011.
Sales of existing homes — which include single-family homes, townhomes, condominiums and co-ops — rose 0.2% from April to May. Annually, sales were down 20.4% from a year ago, and the seasonally adjusted annualized sales pace dropped from 5.4 million units a year ago to 4.3 million in May.
Mortgage rates remain volatile — so far this year, average rates have ranged from 6.09% to 6.79%, but were fairly steady in April when some of the homes closed in May would have gone under contract.
“Mortgage rates heavily influence the direction of home sales,” said Lawrence Yun, NAR chief economist. “Relatively steady rates have led to several consecutive months of consistent home sales.”
There are marked regional variations in prices, however. From last year, prices dropped most in the West (down 5.7%), followed by the South (down 2.7%). But prices were still climbing from last year in the Northeast (up 2.5%) and the Midwest (up 1.1%).
Nearly one-third of the homes sold in May sold for above list price, Yun said.
“That is due simply to lack of inventory,” he noted.
Total housing inventory at the end of May was 1.08 million units, which is down 6.1% from a year ago, according to the NAR. Prior to the pandemic, there were nearly twice as many homes on the market, Yun said.
Unsold inventory sits at a three-month supply at the current sales pace, up from 2.9 months in April and 2.6 months in May 2022.
No. 1
Dina Manzo of The Real Housewives Of New Jersey alum, 51 – who didn’t attend longtime pal Teresa Giudice’s wedding to Luis Ruelas – and the executive, 43, dropped $16 million on a nearly 6,000 square foot, five bedroom, five and a half bathroom, Tuscan-style villa.
Does not apply to New Jersey. Every house I’ve bid on this year I have lost out to someone paying 200K+ over list. Fuck me for not being born 5 years earlier right?
My options:
Buy a house and take on $7K/mo PITI payment with a 500K down payment
Keep renting an equivalent house for $3.5K/mo, get 5% on my 500K in treasuries
Broken market, something has to give right? Right…?
You could also move. My place in DFW are is around 525k and is nicer than any house that was 800k 10 years ago in blue ribbon towns in Jersey. Those house are probably 1.3-1.5 million by now.
US home prices fell in May at the largest annual rate in more than a decade, according to a National Association of Realtors report released Thursday.
Not here. See Vince’s story above. Four walls and a roof, yellowed wallpaper from a 3-pack per day Pall Mall smoker, original kitchen, one blue and pink bathroom, curling, tiled basement that smells like a neighborhood tavern, old AC units in walls results in multiple bids within 48 hours. Take the highest offer, doesn’t matter if their financing falls through, 15 others are waiting in line.
New Jersey houses under 1 million are almost all depressing pos. Was just looking at some listings . tiny capes, colonials, and splits under 800k.
Broken market, something has to give right? Right…?
Buy now or be priced out forever. The house tour guides have finally won.
$630,000… Little Ferry, refrigerator in the living room. Pay up!
https://www.trulia.com/p/nj/little-ferry/34-mehrhof-rd-little-ferry-nj-07643–2006684964
Something does have to give. In 2008, I felt the same way. Everyone wanted $100k more than their trashy pad was worth. We held out. Buy vs. rent calculations meant nothing to me as we chose to rent a 1 BR apartment while waiting. Basically allowed us to pocket $50k a year when neither or us were making bank. Bought in 2011 when they came down to something I was more comfortable with. Refinanced last year. It was definitely worth waiting.
Nationwide, home prices have turned. I think the surrounding areas in our area are still the beneficiaries of people fleeing NYC.
$650,000… Teaneck, closet kitchen, window AC units, same as above. Only $4,500 per month with $130,000 down. Can’t afford it? Look in the Altoona, PA area.
https://www.trulia.com/p/nj/teaneck/652-linden-ave-teaneck-nj-07666–2006743246
Got the roof replaced yesterday. They replaced a few boards and put down synthetic felt and ice and roof shields first. The new shingles make the brick
And masonry pop. Looks nicer than the roof the builder put on.
Fast
Check out this house at 689k. It’s in a great neighbors about 20 minutes from
Where the rangers and cowboys play and 30 minutes from
Downtown Dallas.
https://www.trulia.com/p/tx/grand-prairie/6954-westlake-dr-grand-prairie-tx-75054–2590810352
Fast: I don’t understand the listing that states the basement is part of the first floor. Do t know much about Little Ferry accept for driving through it a few times, it looks pretty sad and depressing, but it is Bergen Co!
3b
Maybe it’s a walkout basement or built into a hill or slope?
An unfinished basement with junky furniture always makes me suspicious about water.
How about this one about a mile from the first one I posted at 740k.
https://www.trulia.com/p/tx/grand-prairie/2823-mariposa-dr-grand-prairie-tx-75054–2283894472
HMB Could be, just never saw a listing described like that before.
Article goes over what I said yesterday….stop raising the rates based on the job market. It’s not going to work. Raising rates further will hold a heavy cost. You will put us in a worse off position than we are in now. Inflation is contained. It’s over. Now patiently wait, without raising rates, for the economy to show pain. Then lower the rates and play another cycle. Raising rates is OVER.
“Where’s the Recession We Were Promised?
The economy and the jobs market turned out to be far less sensitive to interest rates than economists thought, at least so far”
https://www.wsj.com/articles/wheres-the-recession-we-were-promised-cd68a992?mod=hp_lead_pos2
Article goes over what I said yesterday….stop raising the rates based on the job market. It’s not going to work. Raising rates further will hold a heavy cost.
It’s going to work. You seem to believe that this is not the intent.
If you are not aware, the whole idea behind all this is to create a large shift to the uber wealthy.
None of this is an accident. Everything is working as planned.
The best thing you can hope for is an external country to displace the dollar as the main currency of trade. Then watch the sparks fly.
Beer,
That Little Ferry house is a mess. The living room is in the basement… yes. Good luck. People are insane.
Fast: I have seen houses in the past, where the master bedroom is in the basement.
Two best comments
1 this Walgreens is located on the corner of Grand and Larceny
2 doesn’t he know that a blowtorch releases greenhouse gases?
https://m.youtube.com/watch?v=XjPqA-0Clbc&pp=ygUTd2FsZ3JlZW5zIGJsb3d0b3JjaA%3D%3D
In a commutable distance to NYC, decent 4 BR house, in a ‘good’ town you are looking at 1.25m budget is my analysis after looking around the last few years… expect $20-25k in taxes as well. There is just not enough supply, we need unemployment to go up for prices to go down, until then, forget it.
I do see second house location prices no longer going up like crazy (i.e. beach houses) you can probably get a deal there at some point in the future.
What about cabbage?
Fast Eddie says:
June 23, 2023 at 8:52 am
US home prices fell in May at the largest annual rate in more than a decade, according to a National Association of Realtors report released Thursday.
Not here. See Vince’s story above. Four walls and a roof, yellowed wallpaper from a 3-pack per day Pall Mall smoker, original kitchen, one blue and pink bathroom, curling, tiled basement that smells like a neighborhood tavern, old AC units in walls results in multiple bids within 48 hours. Take the highest offer, doesn’t matter if their financing falls through, 15 others are waiting in line.
Hah, Ed..went to school in PA and briefly dated a girl from Altoona. Very pretty but also owned a gun and hunted in her youth (found out later). She could skin a deer, no problem. I did not stick around to find out about Skoal usage.
Sounds like boomer is getting the last laugh.
Chicago says:
June 23, 2023 at 10:50 am
What about cabbage?
Fast Eddie says:
June 23, 2023 at 8:52 am
US home prices fell in May at the largest annual rate in more than a decade, according to a National Association of Realtors report released Thursday.
Not here. See Vince’s story above. Four walls and a roof, yellowed wallpaper from a 3-pack per day Pall Mall smoker, original kitchen, one blue and pink bathroom, curling, tiled basement that smells like a neighborhood tavern, old AC units in walls results in multiple bids within 48 hours. Take the highest offer, doesn’t matter if their financing falls through, 15 others are waiting in line.
Altoona.
If you can find a girl there that is attractive with straight teeth that is a win.
Take a WFH job there and kick your feet back.
I am on the same page, esp with beach market.
Mike S says:
June 23, 2023 at 10:44 am
In a commutable distance to NYC, decent 4 BR house, in a ‘good’ town you are looking at 1.25m budget is my analysis after looking around the last few years… expect $20-25k in taxes as well. There is just not enough supply, we need unemployment to go up for prices to go down, until then, forget it.
I do see second house location prices no longer going up like crazy (i.e. beach houses) you can probably get a deal there at some point in the future.
What about cabbage?
The wet dog aroma has overpowered the cabbage stank.
The smell of a used Subaru
Fast Eddie says:
June 23, 2023 at 11:26 am
What about cabbage?
The wet dog aroma has overpowered the cabbage stank.
“The inverted curve could also help explain why the recession hasn’t—yet—hit. The combination of an inverted curve and falling stock prices put a lid on the postpandemic boom in corporate investment.
When the curve inverted before the 1990 and 2008-2009 recessions, corporate investment went up, as the economy went into a final growth phase. This time CEOs and CFOs with an eye on the curve might have exercised some caution, helping moderate the boom and so extending the period of growth. Rather than talk ourselves into recession, maybe we merely talked ourselves out of a boom.
The key lesson of the yield curve is that inversion doesn’t guarantee recession, but it is foolish to dismiss it.”
Still time to build a position. Maybe 2 years max, but prob less. Then collect 2030 or later.
https://seekingalpha.com/article/4613255-gingko-bioworks-tremendous-potential-but-strong-short-term-headwinds?utm_source=stck.pro&utm_medium=referral
“I’ve taught macro for decades, and I’ve long taught the definition of a recession used in this article (from the National Bureau of Economic Research). The textbook I use (Macroeconomics by Hubbard and O’Brien) uses that definition as well. The two-quarter decline in real GDP definition doesn’t do an awful job, but sometimes it produces head-scratching results so that’s why most economists have long used the NBER definition (sadly, this isn’t always taught). Real GDP did indeed drop for 2 quarters at the start of last year, but real Gross Domestic Income did not. In principle, GDP and GDI should be identical, but they sometimes vary. Further, in the first 6 months of last year the economy added more than 2 million jobs and in July 2022 the unemployment rate was 3.5%. These are hardly hallmarks of a recession. That’s why economists generally go with the NBER business cycle definition.”
Could get behind this. Everyone panicked and turned to gloom last year. Entire economy. So makes sense.
“One of my favorite quotes is by Humphrey B. Neill from The Art of Contrary Thinking. “When everyone thinks alike, everyone is likely to be wrong.”
There are a couple reasons why a recession hasn’t happened yet.
The first is that despite the inverted yield curve, real rates were deeply negative for last year. The market tanked last year not because of high interest rates but because of the speed of change in the rate. When you go from near zero rate to 4%+ in a year, that is a big shock to companies and investors.
And the market has rallied this year because the rate of change in interest rate has slowed and only now the real interest rate is near neutral level. The inverted yield curve worked well in predicting past recession because when it happened, real rates were positive. That is the one thing that a lot of strategists and pundits missed.
The other reason why a recession hasn’t happened yet is that after significant drumbeat from strategists and almost everyone last year, companies and consumers got the message and adjusted for the possible recession. Mr. Neill covered a similar situation in his wonderful book. Right before WWII ended, economists predicted a severe postwar depression. Everyone remembered the collapse in 1920-21. Businesses were frightened and played a conservative game. The public’s appetite for goods was intense and inflation set in and people spent money right and left. The result: a boom set in instead of the much advertised recession.”
“Still time to build a position. Maybe 2 years max, but prob less. Then collect 2030 or later.”
So now you can claim everything is going according to your plan for at least 7 years? Including losing money for the next 2 years?
I’ve worked in the investment management industry for over 30 years, and only charlatans use this sort of framing for an investment decision.
Buy my magical beans for a million dollars today. They won’t sprout until 2030 or maybe the next couple growing seasons after that, but when they do, you can ride on the magic beansprout up into the clouds where you will find huge golden eggs.
No one,
It’s acknowledging it takes time to build a money printing company. They are on the road. Who said I was losing money over next two years? Price should be higher, but still cheap if you believe in the potential growth of the company.
If you believe the biotech sector will finally mature….then DNA will be successful. It’s the picks and shovels play on the growing biotech sector. If the sector is successful, DNA will be successful as it will be one of the main ingredients in the growth of the entire industry. Making R&D cheap and efficient for these companies.
Throw your economics book away Blumpy. The recession won’t happen bc the Fed ensures it won’t happen. Bailout and QE lines for a few bank fails in March assured that one. Without any risks in system, everyone will continue on merry way. Zombie companies stay alive and employment moves sideways.
We are living in dot con bubble 2.0. I have never seen so many flim-flam organizations. I had call for position at CorpAxe? Some investor resource mgt tool for buy side. Looks like last funding round in Feb 2022 for 1.4m. 40 employees and 6 are “founders” sucking up profits. Their rev is 6m. How can they still be alive and why would I even think about jumping there?
Bystander,
Too many of your “fellow Americans” have outsourced your type of work. They profit, you lose.
Any job that can be shipped overseas, converted to AI, eliminated by a robot, etc will happen with the help of capitalism.
It’s really sad. I hope you find something that pays well.
You think house prices are expensive?
Gifts: $830k; gardeners: $542k; boat: $26k; spas $22k; Kevin Costner’s estranged wife Christine lays bare the couple’s extravagant spending as she demands $250k-a-MONTH in child support to ‘maintain accustomed lifestyle’
https://www.nj.com/monmouth/2023/06/nestle-to-close-last-us-coffee-plant-despite-protests-from-nj-workers.html
Phoenix says:
June 23, 2023 at 2:02 pm
Bystander,
Too many of your “fellow Americans” have outsourced your type of work. They profit, you lose.
Any job that can be shipped overseas, converted to AI, eliminated by a robot, etc will happen with the help of capitalism.
It’s really sad. I hope you find something that pays well.
Dead on.
Bystander says:
June 23, 2023 at 1:42 pm
Throw your economics book away Blumpy. The recession won’t happen bc the Fed ensures it won’t happen. Bailout and QE lines for a few bank fails in March assured that one. Without any risks in system, everyone will continue on merry way. Zombie companies stay alive and employment moves sideways.
Phoenix,
Capitalism and greed work hand in hand. There is no reason a company needs to seek labor outside of the markets they sell in unless they want more money. As you like to point out, it’s all gravy until it happens to them. When their company gets replaced by a Chinese company. Good job getting drunk off that greed! Cheers!
Phx,
Thanks. The honest truth is that the need for my services is still very much needed. It is just the rebranding of it all and skills expectations. As example, two years ago, the IB literally eliminated title tech PM and it business analyst. You were ugly, useless old hat as moving to hip
Agile ways with product owners, product manager, csm etc. I am starting to see new title “intiative manager” pop up with people. My boss says I should consider that title. I am asked him what they do and he said same as tech PM two years ago. Agile rollout has so many gaps and fails that just rebranding names. I’ve learned to adapt my job to hot title du jour. It has become such a shell game
Make better products and services more cheaply over time.
That’s what self interested free-market capitalism leads to.
Know where we don’t see this trend? State run schools.
Producers produce, losers complain about how they’re getting left behind. (Even while enjoying the bounties it produces – like increasingly powerful electronics devices that allow them to complain to more people than ever)
Why don’t you type something up on your TRS-80 about how capitalism only helps the rich?
Bystander: We shall see on the recession. I am not convinced the Fed can stop it. Powell was way behind the curve in tightening, and I just don’t see any way he can engineer a soft landing, however one defines that.
3b,
I was thinking about definition of soft landing. It means home prices stay 50% higher for boomers, Wall street QE flush so stocks rise for boomers, inflation at 2% for retired boomers..but labor market hammered sufficiently so non-boomer salary dependents need to grovel for lower wages and accept infinitely lower quality of life going forward in good ole USA…except for ones that inherit all boomer money. The Scarsdales, Ridgewoods, Short Hills, Greenwichs and Westports become Buckingham Palace like East. New generational royalty fiefdoms..untouchable. The rest are the serfs on the land.
Did Pumps get an early start on his typical Saturday seagull crapping on this board?
Bystander,
I agree with you except for several wildcards.
-Boomers are dropping like flies. In my neighborhood I’m astounded by how many old well off people are around me, very few kids.
-The Ukraine issue. Check news today. First the Wagner guy said that its all a lie, that the war was started for the benefit of russkie oligarchs. Follow by the russian troops shelling his people in Ukraine and TASS announcing the FSB is investigating him. It looks like this guy either flips to Ukraine, gets killed by Putin, or starts a coup and kills Putin – something wicked this way comes – and might settled this war sooner rather than later. Benefits or cost to be decided.
-Inflation is going to be around with us for longer because of demographics (no young people to abuse) and China (no one trust commie Xi + they ran out of young people to abuse too). Barrons today had articles about how the mistery of Bank of England forced to do a hard raise because of 8% inflation and how Germany looks to be in recession but with little unemployment. Again both easily explained by cheap labor is gone because there are no young people to abuse anymore. Finally add Saudi Arabia’s camel humping king that wants to build a futuristic totalitarian police state city for his parasitic people in check and need to keep oil prices high to funded as well as seeing the end of oil as primary propellant of personal vehicles.
-Finally, the populism that Trump unleashed. The GOP had “Talk this way (social issues that slowly moved farther and farther into lunaticville) + Walk this way (corporations and the 0.01% shall never shed a tear ) approach to politics. Trump killed that by jumping into the gigantic space and DeSantis will follow soon, left wide open by Clinton making the Democratic Party into the Democratic Corporate Party aka Republican Lite Party. Populism unleashed means their will always be someone that eventually will go corrupt as he’s bought up, but initially will use it to check corporate power. This might have the effect communism did within the corporate overlord world to lessen the worse corporate impulses because otherwise the pleabes might go commie. Or it may not, if we get AI to become our overlords. https://youtu.be/lOxE8EEBwjQ
Bystander: Your scenario just might be right. I have said for many years on this blog, that at some point the younger generations will come with torches and pitchforks, for the Boomers. I don’t blame them.
Wagner mercenaries headed to Moscow? Going to be an interesting weekend.
Juice: Well at least they won’t be attacking in Winter!!
There are ways to make products cheaper over time the right way (innovation), and then there is straight up exploitation.
No One says:
June 23, 2023 at 4:01 pm
Make better products and services more cheaply over time.
That’s what self interested free-market capitalism leads to.
Know where we don’t see this trend? State run schools.
Producers produce, losers complain about how they’re getting left behind. (Even while enjoying the bounties it produces – like increasingly powerful electronics devices that allow them to complain to more people than ever)
Why don’t you type something up on your TRS-80 about how capitalism only helps the rich?
Covid was the last straw.
Every young person sacrificed, down to a grade schooler, for the well being of Boomer and his/her close cohorts. Then what did Boomer do after getting the gift of life from those who sacrificed for them?
I’ll tell you. They doubled down. Greed consumed them. It’s why we are here.
This country does nothing about scandal after scandal. One after another you have a messed up disconnected from the youth President thanks to 90 year old goats getting in a bus and voting- but even before that, thanks to 70 year old goats in permanent Goverment positions they don’t even have hope there is someone worth voting for.
Why they don’t revolt? Too busy making memes of each other to organize. Or medicated with alcohol and now gummies. IDK. But eventually it will come to a head.
My guess is they will be quelled and controlled just like China does with it’s technology.
Black Mirror here we come.
3b says:
June 23, 2023 at 6:43 pm
Bystander: Your scenario just might be right. I have said for many years on this blog, that at some point the younger generations will come with torches and pitchforks, for the Boomers. I don’t blame them.
In its original forecast on the impact of the pandemic on the office sector, Capital Economics said that office occupancy would fall by 7% to 8% by 2025, with that, “vacancy would rise markedly and remain elevated” through 2030. And those lower occupancy levels and declining rents would result in a 20% decline in portfolio incomes by 2025, all the while net operating incomes would remain below pre-pandemic levels through the decade.
Now, the research firm suggests that the “35% plunge in office values we’re forecasting by end-2025 is unlikely to be recovered even by 2040,” in a new report published on Thursday. That means that offices are unlikely to regain their peak values in the foreseeable future, or in the next 17 years, per Capital Economics. That’s because of dramatically lower demand following the shift to remote work that emerged from the pandemic.
The report, written by Capital Economics’ deputy chief property economist, Kiran Raichura, likens the reduction in office demand to the experience of malls over the last six years as consumers have leaned into online shopping. There’s been no real recovery in the mall sector that’s been plagued by structural headwinds, Raichura said, and Capital Economics expects the office sector won’t prove to be much different.
“We expect office landlords to face a similar fate over the next few years, with the prospect of a rapid bounce-back in the sector’s relative performance looking slim despite its sharp falls to-date,” Raichura wrote.