Cut, borrow, or tax to bridge the gap?

Posted on April 7, 2009 by grim

From the Philly Inquirer:

New Jersey faces “historic” tax-revenue drop

New Jersey is facing a “historic tax-revenue collapse” that could leave the state with a $100 million deficit by the end of the next fiscal year.

That was the assessment of Budget and Finance Officer David Rosen of the nonpartisan Office of Legislative Services, who presented his findings to the Senate budget committee yesterday.

“New Jersey finds itself in the most significant revenue downturn in its modern history,” Rosen said.

Rosen projected that New Jersey would bring in $606 million less in revenue than previously anticipated by the Corzine administration from the current fiscal year through the end of the next on June 30, 2010.

If that estimate holds true, the state would be forced to make more spending cuts or increase revenue to balance the budget, as required by the state constitution.

Rosen said that only twice in the last four decades did the state’s revenue decline from one year to the next. Revenue declined 2.1 percent in fiscal 1975 and 1.9 percent in 2002, he said.

The Office of Legislative Services estimates that revenue for the current fiscal year, which ends June 30, will drop 11 percent from the previous year. For fiscal 2010, OLS projects a decrease of 3.7 percent.

Declining income, sales, and corporate tax revenues helped fuel the projections.
…
State Treasurer David Rousseau, who addressed the Senate budget committee yesterday afternoon, noted that a difference of $600 million over two years of state revenues amounted to less than 1 percent. But he acknowledged that the difference, if accurate, would affect the budget.

Rousseau said the administration would adjust revenue estimates downward if warranted.

“This administration continues to work to find every dollar of savings we can, and we will not shirk our responsibility to provide additional recommendations to balance the [fiscal 2009 and 2010] budgets if further revenue reductions are warranted,” Rousseau said.

Rousseau is slated to present new revenue figures in late May, which will include critical April tax collections.

Posted in New Jersey Real Estate, Politics, Property Taxes | 183 Comments

March 2009 Warn Notices, 2000+ Jobs Lost

Posted on April 6, 2009 by grim

From the NJ Department of Labor and Workforce Development:

2009- March WARN Notice

Company | City | Date | Workforce Affected

ALUMINUM SHAPES LLC DELAIR 9/9/09 182
AMERICAN DISTRIBUTION SERVICE RIDGEFIELD 5/12/09 101
ASCO FLORHAM PARK 5/31/09 350
CATALENT PHARMA SOLUTIONS LLC PENNSAUKEN 5/18/09 132
CENVEO CARLSTADT 5/18/09 46
COLORITE SPECIALTY RESINS BURLINGTON 5/6/09 53
DRUG FAIR SOMERSET 5/16/09 129
ELECTROCHEM TETERBORO 5/31/09 97
FLUOR MT LAUREL 5/18/09 128
GOLDMAN SACHS JERSEY CITY 3/6/09 70
KV PHARMACEUTICAL STATEWIDE 3/6/09 30
PROPAK CORPORATION BARRINGTON 4/17/09 59
STATE STREET BANK & TRUST PRINCETON 6/26/09 80
THE CHILDREN’S PLACE SERVICES CO. LLC SECAUCUS 6/13/09 341
THE HOME DEPOT PARAMUS 4/26/09 106
THE HOME DEPOT BRIDGEWATER 4/26/09 99
WOLFBLOCK LLP STATEWIDE 5/23/09 121
Posted in General | 47 Comments

Affordable housing? Sure doesn’t feel like it.

Posted on April 6, 2009 by grim

From the NY Times:

Housing Affordability Improves

TRADITIONALLY, there is happy news about the residential market in springtime — always its busiest season. Here is this year’s bulletin: Home prices have declined so much in the state that average buyers can actually afford to buy houses (if they can get a mortgages, of course).

Also, as of the latest statewide report from the Otteau Valuation Group, there were six towns with less than six months’ worth of unsold inventory. (But there were also six others with enough houses on the market that it would take 99 months — more than eight years — to sell them all at the current pace.)

These tidings may seem underwhelming in their gladness, but they are the most salutary available as prices continue to slide and the inventory of houses for sale blips upward this season, according to the market trend analyst Jeffrey G. Otteau.

House prices right now are descending at the rate of about a percentage point a month, according to Mr. Otteau, whose company is based in New Brunswick. At seminars that he conducted for brokers in March, Mr. Otteau predicted an additional nine point drop in prices by the end of the year, and no likely upturn until 2010.
…
Back in 2000, the index was pegged at 122 percent, meaning a buyer with the median income earned 22 percent more than needed to own and maintain the median-priced home. This assumes that housing costs 30 percent of income, which is a standard assumption, Mr. Otteau explained in a recent telephone interview.

By 2005, when housing prices were reaching their peak, the median buyer could afford only 92 percent of the cost of owning the median home, he said, and by 2006, it was only 81 percent.

In 2007, when prices fell, “affordability” was back up to 87 percent, and by June 2008, housing was again 100 percent “affordable,” under the formula.

Now, Mr. Otteau said, the market has “overcorrected,” and this will continue. The index is 107 percent and rising.

He also suggested that towns that have commuter rail stations — Montclair, for instance, has three — continue to be in the best position to attract buyers, once the economy improves and the New York metropolitan area stops “leaking jobs.”
…
ased on the most recent Otteau market report, the six communities in the state with the shortest time frames to sell their inventories — and therefore the healthiest markets — were Midland Park, Fanwood, Dumont, Boonton, Hanover and New Providence. Of those towns, all but Dumont and Hanover have train stations.

The six communities with the 99-month inventories are Alpine, Garfield, Oradell, Avalon, Lavalette and Seaside Heights. They are among the most affluent communities in New Jersey, the nation’s second-wealthiest state, Mr. Otteau noted. “This is understandable,” he added, “because homes that are less affordable, those priced above $1 million, are the ones sitting on the market the longest.”

Statewide, there is a 42-month inventory of homes priced above $1 million; for listings at $2 million or more, there is an 84-month (seven-year) supply, he said.

Posted in Economics, Housing Bubble, New Jersey Real Estate | 235 Comments

March Comp Killer 2!

Posted on April 5, 2009 by grim

Morris Comp Killer!

(in progress, keep checking back. Price descending order, so scroll through to see updates)

MLS# 2609747 132 Ormont Rd, Chatham NJ
Purchased: 9/13/2005
Purchase Price: $890,000

Sold: 3/12/2009
Sale Price: $726,000
18.4% below 2005 purchase price

MLS# 2629546 15 Wychwood Rd, Morris Twp NJ
Purchased: 9/12/2006
Purchase Price: $790,000

Sold: 2/26/2009
Sale Price: $690,000
12.7% below 2006 purchase price

MLS# 2564064 16 Ridgeline Dr, Washington Twp NJ
Purchased: 10/30/2006
Purchase Price: $1,026,015

Sold: 3/12/2009
Sale Price: $660,000
35.7% below 2006 purchase price (REO)

MLS# 2624430 44 Buckley Hill Rd, Morris Twp NJ
Purchased: 9/17/2003
Purchase Price: $679,900

Sold: 3/12/2009
Sale Price: $659,500
4% below 2003 purchase price

MLS# 2634721 8 Montgomery Ave, Montville NJ
Purchased: 10/31/2006
Purchase Price: $855,000

Sold: 3/06/2009
Sale Price: $615,000
28.1% below 2006 purchase price

MLS# 2601044 3 Indian Trail Rd, Randolph NJ
Purchased: 6/30/2005
Purchase Price: $675,000

Sold: 2/20/2009
Sale Price: $610,000
9.6% below 2005 purchase price

MLS# 2562052 5 Sky Top Dr, Denville NJ
Purchased: 11/12/2007
Purchase Price: $725,000

Sold: 3/30/2009
Sale Price: $595,000
17.9% below 2007 purchase price

MLS# 2626867 2 Oakwood Ct, Morris Plains NJ
Purchased: 9/25/2007
Purchase Price: $599,000

Sold: 3/19/2009
Sale Price: $572,000
4.5% below 2007 purchase price

MLS# 2615717 13 Chestnut Way, Mount Olive NJ
Purchased: 9/17/2004
Purchase Price: $675,222

Sold: 3/15/2009
Sale Price: $550,000
18.5% below 2004 purchase price (REO)

MLS# 2630946 51 Taft Ln, Morristown NJ
Purchased: 1/12/2005
Purchase Price: $475,000

Sold: 3/27/2009
Sale Price: $415,000
12.6% below 2005 purchase price

MLS# 2608487 1505 Riveredge Ln, Whippany NJ
Purchased: 8/28/2005
Purchase Price: $485,000

Sold: 3/11/2009
Sale Price: $390,000
19.6% below 2005 purchase price

MLS# 2628389 14 Noelle Ct, Lincoln Park NJ
Purchased: 5/20/2005
Purchase Price: $409,000

Sold: 3/30/2009
Sale Price: $375,000
8.3% below 2005 purchase price

MLS# 2570106 11 Tulane Rd, Flanders NJ
Purchased: 12/20/2006
Purchase Price: $360,000

Sold: 3/30/2009
Sale Price: $355,000
1.4% below 2006 purchase price

MLS# 2624525 287 Gettysburg Way, Lincoln Park NJ
Purchased: 5/22/2006
Purchase Price: $389,900

Sold: 3/27/2009
Sale Price: $343,000
12% below 2006 purchase price

MLS# 2628229 3203 Appleton Way, Whippany NJ
Purchased: 9/8/2006
Purchase Price: $401,000

Sold: 3/20/2009
Sale Price: $360,000
10.2% below 2006 purchase price

MLS# 2634669 26 Hillery Dr, Flanders NJ
Purchased: 6/28/2005
Purchase Price: $400,000

Sold: 3/20/2009
Sale Price: $335,000
16.3% below 2005 purchase price

MLS# 2617936 347 Cambridge Dr, Butler NJ
Purchased: 2/28/2006
Purchase Price: $320,000

Sold: 3/17/2009
Sale Price: $301,500
5.8% below 2006 purchase price

MLS# 2617670 17 Arch St, Butler NJ
Purchased: 3/31/2005
Purchase Price: $355,000

Sold: 3/10/2009
Sale Price: $299,900
15.5% below 2005 purchase price

MLS# 2563430 31 Pine Tree Ln, Morris Twp NJ
Purchased: 10/20/2000
Purchase Price: $296,999

Sold: 3/30/2009
Sale Price: $248,000
16.5% below 2000 purchase price! (REO)

MLS# 2647702 13 Petersburg Ct, Oak Ridge NJ
Purchased: 5/10/2005
Purchase Price: $265,000

Sold: 3/30/2009
Sale Price: $238,500
10% below 2005 purchase price

MLS# 2621369 75 Randolph Ave, Mine Hill NJ
Purchased: 3/9/2006
Purchase Price: $390,000

Sold: 3/3/2009
Sale Price: $237,500
39.1% below 2006 purchase price!

MLS# 2595283 68 Wildwood Rd, Oak Ridge NJ
Purchased: 12/1/2007
Purchase Price: $242,000

Sold: 3/3/2009
Sale Price: $225,000
7% below 2007 purchase price!

MLS# 2609166 14 Brookside Ln, Mt Arlington NJ
Purchased: 6/27/2005
Purchase Price: $240,000

Sold: 3/25/2009
Sale Price: $220,000
8.3% below 2005 purchase price!

MLS# 2617944 38 Overlook Ave, Dover NJ
Purchased: 8/30/2002
Purchase Price: $246,000

Sold: 3/30/2009
Sale Price: $195,000
20.7% below 2002 purchase price!

Posted in Comp Killer | 148 Comments

March Comp Killer!

Posted on April 4, 2009 by grim

Bergen Comp Killer!

MLS# 2845722 15 Terhune Ct, Upper Saddle River NJ
Purchased: 6/1/2006
Purchase Price: $1,600,000

Original List Price: $1,699,000
Sold: 3/6/2009
Sale Price: $1,250,000
21.9% below 2006 purchase price

MLS# 2829680 123 Woodland Ave, Ridgewood NJ
Purchased: 8/29/2006
Purchase Price: $1,350,000

Original List Price: $1,449,000
Sold: 3/12/2009
Sale Price: $1,175,000
13% below 2006 purchase price

MLS# 2901544 293 S. Central Ave, Ramsey NJ
Purchased: 9/18/2007
Purchase Price: $985,000

Original List Price: $979,900
Sold: 4/3/2009
Sale Price: $859,000
12.8% below 2006 purchase price

MLS# 2904948 405 Burlington Rd, Paramus NJ
Purchased: 8/11/2006
Purchase Price: $505,000

Original List Price: $495,900
Sold: 3/10/2009
Sale Price: $398,000
21.2% below 2006 purchase price

MLS# 2835150 23 River Dell, Oakland NJ
Purchased: 5/18/2006
Purchase Price: $799,900

Original List Price: $769,900
Sold: 3/23/2009
Sale Price: $610,000
23.7% below 2006 purchase price

MLS# 2850322 52 Walton Ave, Oakland NJ
Purchased: 2/6/2004
Purchase Price: $412,000

Original List Price: $639,000
Sold: 3/18/2009
Sale Price: $355,000
13.8% below 2004 purchase price

MLS# 2900082 48 Fairway Terr, Norwood NJ
Purchased: 7/28/2004
Purchase Price: $1,400,000

Original List Price: $1,599,000
Sold: 3/17/2009
Sale Price: $1,200,000
14.3% below 2004 purchase price

MLS# 2807120 833 Blanch Ave, Norwood NJ
Purchased: 4/2/2004
Purchase Price: $490,000

Original List Price: $639,000
Sold: 3/6/2009
Sale Price: $385,000
21.4% below 2004 purchase price

MLS# 2900219 639 Trenton St, New Milford NJ
Purchased: 2/9/2007
Purchase Price: $362,500

Original List Price: $399,900
Sold: 3/27/2009
Sale Price: $340,000
6.4% below 2007 purchase price

MLS# 2854372 68 Alcott Rd, Mahwah NJ
Purchased: 12/18/2007
Purchase Price: $830,000

Original List Price: $839,000
Sold: 3/10/2009
Sale Price: $750,000
9.6% below 2007 purchase price

MLS# 2821708 344 Watson Ave, Lyndhurst NJ
Purchased: 11/15/2007
Purchase Price: $412,000

Original List Price: $355,000
Sold: 3/5/2009
Sale Price: $290,000
13.8% below 2007 purchase price

MLS# 2840721 19 Long Valley Rd, Lodi NJ
Purchased: 11/15/2006
Purchase Price: $410,000

Original List Price: $299,900
Sold: 3/23/2009
Sale Price: $290,000
29.3% below 2006 purchase price

MLS# 2906999 156 Euclid Ave, Hackensack NJ
Purchased: 8/9/2006
Purchase Price: $509,000

Original List Price: $393,750
Sold: 3/26/2009
Sale Price: $322,500
36.6% below 2006 purchase price

MLS# 2827625 54 Catalpa Ave, Hackensack NJ
Purchased: 9/1/2005
Purchase Price: $370,000

Original List Price: $359,000
Sold: 3/16/2009
Sale Price: $280,000
24.3% below 2005 purchase price

MLS# 2829909 8 Buckingham Rd, Fort Lee NJ
Purchased: 12/29/2003
Purchase Price: $1,475,000

Original List Price: $1,750,000
Sold: 3/6/2009
Sale Price: $1,450,000
1.7% below 2003 purchase price!

MLS# 2902836 365 Kennedy Dr, Fairview NJ
Purchased: 12/26/2004
Purchase Price: $349,000

Original List Price: $250,000
Sold: 4/2/2009
Sale Price: $250,000
28.4% below 2004 purchase price

MLS# 2822648 43 Albert Ave, Fair Lawn NJ
Purchased: 2/14/2007
Purchase Price: $491,500

Original List Price: $539,000
Sold: 3/20/2009
Sale Price: $465,000
5.4% below 2007 purchase price

MLS# 2848465 12-42 Roosevelt Pl, Fair Lawn NJ
Purchased: 12/1/2005
Purchase Price: $417,500

Original List Price: $475,000
Sold: 3/3/2009
Sale Price: $294,000
29.6% below 2005 purchase price

MLS# 2854352 128 Rockwood Pl, Englewood NJ
Purchased: 6/8/2006
Purchase Price: $438,000

Original List Price: $505,000
Sold: 4/3/2009
Sale Price: $325,000
25.8% below 2006 purchase price

MLS# 2825654 398 Liberty Rd, Englewood NJ
Purchased: 9/18/2006
Purchase Price: $385,000

Original List Price: $400,000
Sold: 3/31/2009
Sale Price: $260,000
32.5% below 2006 purchase price

MLS# 2851253 78 Park Ave, Englewood NJ
Purchased: 6/18/2004
Purchase Price: $335,000

Original List Price: $299,900
Sold: 3/10/2009
Sale Price: $175,000
51% below 2004 purchase price

MLS# 2908405 148 Jefferson Ave, Emerson NJ
Purchased: 3/13/2008
Purchase Price: $535,000

Original List Price: $524,777
Sold: 3/27/2009
Sale Price: $505,500
5.5% below 2008 purchase price

MLS# 2849426 39 Godwin Ave, Elmwood Park NJ
Purchased: 1/18/2006
Purchase Price: $398,000

Original List Price: $433,000
Sold: 4/2/2009
Sale Price: $350,000
12% below 2006 purchase price

MLS# 2817503 40 Williamson Road, Bergenfield NJ
Purchased: 12/10/2004
Purchase Price: $349,000

Original List Price: $380,000
Sold: 3/19/2009
Sale Price: $300,000
14% below 2004 purchase price

MLS# 2851387 49 Murray Hill Terrace, Bergenfield NJ
Purchased: 9/9/2004
Purchase Price: $395,000

Original List Price: $475,000
Sold: 3/4/2009
Sale Price: $385,000
2.5% below 2004 purchase price

MLS# 2853248 160 Bergenline Ave, Closter NJ
Purchased: 8/2/2006
Purchase Price: $765,000

Original List Price: $755,000
Sold: 3/2/2009
Sale Price: $650,000
15% below 2006 purchase price

MLS# 2843463 139 E 53rd Street, Elmwood Park NJ
Purchased: 3/3/2006
Purchase Price: $412,000

Original List Price: $470,000
Sold: 3/23/2009
Sale Price: $285,000
31% below 2006 purchase price

Posted in Comp Killer | 164 Comments

Fashionably late, Manhattan joins the party

Posted on April 3, 2009 by grim

From the NY Times:

Apartments Sell for Less if They Are Sold at All

Hard times have come to the Manhattan real estate market, according to a series of quarterly sales reports to be issued on Thursday.

Relatively few apartments are selling, and when they do, prices are down 20 percent or more from a year ago. Large, luxurious apartments on Fifth Avenue, Park Avenue and Central Park West, and new condominiums with many unsold apartments, have been particularly hard hit.

One report, prepared by two brokerage firms, Brown Harris Stevens and Halstead Property, showed the number of closings of condos and co-ops down by 58 percent in the first quarter of 2009, compared with the same period a year earlier, as buyers were scared off by worries over the economy, portfolio losses and fears that apartment prices would continue to fall in the months ahead.
…
The report showed that average condo and co-op apartment prices were down 11 percent from the first quarter of last year, to $1.5 million. Co-op prices were off 27 percent, to $975,000, and condominium prices down by 4 percent. but were up from the last quarter, as buyers continued to close on new condominiums for which contracts were signed many months ago.

The number of sales of apartments over $10 million plummeted, by 87 percent, compared with a year ago, when sales of apartments at some of the city’s most expensive condominiums, at 15 Central Park West and at the Plaza Hotel, were completed, the report said.
…
Although details in the various reports differed — one put the decline in sales at 52 percent and another at 48 percent — they suggested a market still traumatized by a collapse in confidence last fall after the bankruptcy of Lehman Brothers, even as sales have begun to stabilize in far more troubled real estate markets in the West.
…
Jonathan Miller, an appraiser who prepares the market report for Prudential Douglas Elliman, said he has tracked a series of statistics on inventory over the last decade that show the market declining more steeply than ever before.

The number of apartments on the market, 10,445, was 34 percent above the inventory level a year ago, he said, and 15 percent above the inventory last quarter.

The average number of days that apartments stayed on the market had increased to a record 170, nearly half a year, up 16.5 percent from the first quarter last year and 7 percent from the last quarter. And when buyers did sign contracts, they got a discount of 12 percent from the most recent listed asking price, up from 7.3 percent from the fourth quarter of 2008.

Posted in Foreclosures, Housing Bubble, National Real Estate | 267 Comments

Countrywide settlement to aid NJ borrowers

Posted on April 2, 2009 by grim

From the Record:

Countrywide to provide foreclosure-relief fund in N.J.

Countrywide Financial Corp. will set up a $3.7 million foreclosure-relief fund in New Jersey to settle allegations that it wrote high-priced and unaffordable subprime mortgages, Governor Jon S. Corzine announced today.

Corzine said Countrywide, which is now a subsidiary of Bank of America, engaged in “aggressive sales and marketing of inappropriate or bad loans.”

The agreement is expected to help an estimated 8,200 New Jersey borrowers. Under the agreement, the state will receive half of the $3.7 million to fund mortgage modification programs sponsored by state agencies, including the statewide mortgage foreclosure mediation program administered by the state judiciary. The remaining half will be available to sub-prime borrowers who have lost their homes to foreclosure after making six or fewer payments.

The $3.7 million is New Jersey’s share of a $150-million nationwide settlement, which Countrywide agreed to Tuesday, without admitting any wrongdoing.

Under the agreement, Countrywide will offer loan modifications or relocation assistance to borrowers who are delinquent on their mortgages. Countrywide will not begin foreclosure proceedings until it can be determined whether a borrower’s loan can be modified.

Loans eligible for the program are Countrywide sub-prime adjustable rate mortgages (ARMs), pay-option ARMS or other sub-prime residential mortgages for owner-occupied properties serviced by Countrywide and which began between Jan. 1, 2004 and Dec. 31, 2007.

Loan modifications would be designed to bring monthly housing payments, including property taxes and insurance, to between 34 percent and 42 percent of a borrower’s monthly income. If homeowners cannot afford loans even after they are modified, they may receive relocation help, which Countrywide estimates will average around $2,000.

Posted in New Jersey Real Estate | 53 Comments

New Jersey Home Price Tracker

Posted on April 1, 2009 by grim

The New Jersey Home Price Index Tracker has been updated to include:

January S&P Case Shiller (Aggregate, Tiered, Condo)
Q4 OFHEO HPI and Purchase-Only Index
Q4 New Jersey Association of Realtors (NJAR) Median Price


(click to enlarge)

S&P Case Shiller NY Metro Commutable Area Home Price Index

Low Tier (Under $308k) – Peaked in October 2006 and is down 18.07% from peak

Mid Tier ($308k-$457k) – Peaked in September 2006 and is down 16.80% from peak

High Tier (Over $457k) – Peaked in June 2006 and is down 12.92% from peak

Aggregate (Overall Market) – Peaked in June 2006 and is down 16.01% from peak

Condo-Only Index – Peaked in February 2006 and is down 7.92% from peak

Q4 OFHEO Home Price Index & Purchase-Only Index

HPI – Peaked in Q1 2007 and is down 6.26% from peak (Includes Refi)

Purchase Only – Peaked in Q2 2006 and is down 9.26% from peak

Q4 NJAR Median Price

Median Sale Price – Peaked in Q2 2006 and is down 13.72% from peak

Posted in Economics, New Jersey Real Estate | 864 Comments

No bottom for home prices – PMI

Posted on April 1, 2009 by grim

From Bloomberg:

Home Prices in U.S. to Decline Through 2010, PMI Says

Home prices will fall in more than half of the largest U.S. cities through 2010 as the recession slashes jobs and reduces buying power, according to PMI Mortgage Insurance Co.

PMI, the second largest U.S. mortgage insurer, said 21 of the 50 biggest U.S. metropolitan areas have more than a 75 percent chance of lower home prices in two years. Six others have more than a 50 percent chance, the Walnut Creek, California-based insurer said in a report today.

“We’ll see sales start to recover before the job market,” David Berson, chief economist at PMI, said in an interview. “Prices will lag because of the large number of homes for sale and those that are vacant but not yet on the market.”
…
In New Jersey, the Edison-New Brunswick area and Newark have an 89 percent and 84 percent probability, respectively, of lower prices in two years. Nassau-Suffolk in New York has a 78 percent chance; Washington has an 88 percent chance; and Baltimore has an 84 percent chance, according to PMI.

“The suburbs of New York and D.C. are high-cost areas that had substantial run-ups in prices,” Berson said. “They are the next group down from the sand states.”

Posted in Economics, Housing Bubble, New Jersey Real Estate | 53 Comments

NY metro area home prices fell 9.6% in the past year

Posted on April 1, 2009 by grim

From the Record:

Home prices slide record 9.6 percent

Home prices in the New York metropolitan area, which includes North Jersey, slid a record 9.6 percent in the 12 months ending in January, the Standard & Poor’s Case-Shiller index reported this morning.

Nationally, prices of existing single-family homes plummeted 19 percent, also a record.

“Home prices, which peaked in mid-2006, continued their decline in 2009,” said David M. Blitzer, chairman of the index committee at Standard & Poor’s. “Most of the nation appears to remain on a downward path.”
…
The Case-Shiller index is considered a more reliable index than some other housing measures because it attempts to track the prices of typical single-family homes.

From the WSJ:

Drop in Home Prices Picked Up Speed in January

Home-price declines in many of the largest U.S. cities accelerated in January, according to a closely watched index, offering a grim reminder that the housing market remains in a deep contraction despite recent glimmers of stability.

The S&P Case Shiller Index, which tracks prices in 20 metropolitan areas, fell 19% for the three-month period ended in January, compared with the year-earlier period. The decline, which follows a 18.5% decline for the three-month period ended in December, sent the index to a record low.
…
When will home prices stop sliding? “When the share of home sales that are distressed starts to decline is the day that house prices will hit bottom,” says Mark Zandi, chief economist at Moody’s Economy.com.

That day could be a ways off. Home lenders, many of which had halted foreclosures temporarily in anticipation of the government’s housing plan, appear to be increasing efforts to foreclose. That could produce a new supply of distressed properties. In February, the number of new foreclosure starts rose to 243,000 from 217,000 in January, according to Hope Now, a coalition of mortgage companies, investors and housing counselors, on Monday.

From MarketWatch:

Home values sink at record pace in January

Home values in 20 major U.S. cities fell at the fastest rate on record in January and are now down a record 19% in the 12 months ending in January, Standard & Poor’s reported Tuesday.

The Case-Shiller 20-city home price index fell a record 2.8% in January, with home values in all 20 cities falling at least 1%. Prices in the original 10-city index fell a record 19.4% over the year. Prices fell 2.5% in January in the 10 cities.
…
“There are very few bright spots that one can see in the data,” said David Blitzer, chairman of the index committee at S&P.

“Looking ahead, depressed demand, tight credit, rising default rates and excess inventories will continue to lead prices lower,” wrote economists for Bank of America’s Merrill Lynch. “We estimate that an additional 10%-15% in downside is still in store.”

Home prices are getting closer to “fair” value, argued Stephen Stanley, chief economist for RBS Greenwich Capital. But prices are likely to “overshoot” by a significant margin, he warned. Still, he looks for a bottom in home prices later this year.

From Bloomberg:

Home Prices in 20 U.S. Cities Fell by a Record 19%

ome prices in 20 U.S. cities fell 19 percent in January from a year earlier, the fastest drop on record, as demand plummeted and foreclosures rose.

The S&P/Case-Shiller index’s decrease was more than forecast and compares with an 18.6 percent decrease in December. The gauge has fallen every month since January 2007, and year- over-year records began in 2001.

A glut of unsold properties may keep prices low, shrinking household wealth and damping spending. Still, sales of new and previously owned homes rose in February, indicating the housing slump, now in its fourth year, may ease as policy efforts to unclog credit and aid borrowers begin to take hold.

“There is still a lot of downward momentum,” said Michelle Meyer, an economist at Barclays Capital Inc. in New York. “We don’t think we’ll see a bottom in home prices until the second half of next year. The decline in home prices will continue to depress household balance sheets.”

The home price index was projected to decline 18.6 percent from a year earlier, according to the median forecast of 29 economists in a Bloomberg News survey, after an originally reported drop of 18.5 percent in December. Estimates ranged from declines of 17.2 percent to 19 percent.

From a month earlier, home prices fell 2.8 percent in January, after a 2.6 percent drop in December, the report showed. The figures aren’t adjusted for seasonal effects, so economists prefer to focus on year-over-year changes instead of month-to-month.
…
All 20 cities in the index showed a year-over-year price decrease in January, led by a 35 percent drop in Phoenix and 32.5 percent drop in Las Vegas. The index in January was at its lowest level since late 2003.

All of the 20 areas covered also showed declining home prices from the prior month.

Posted in Economics, National Real Estate, New Jersey Real Estate | 268 Comments

January Case Shiller HPI

Posted on March 31, 2009 by grim

The January S&P/Case Shiller Home Price Index is due out at 9am this morning. I’ll be on the road this morning, so check the comments for more details.

From Bloomberg:

Housing Prices in 20 U.S. Cities Probably Dropped in January

Home prices in 20 U.S. cities probably fell at the fastest year-over-year pace on record in January as demand plummeted and foreclosures rose, economists said ahead of a private report today.

The S&P/Case-Shiller index dropped 18.6 percent, according to the median forecast of 29 economists surveyed by Bloomberg News. A separate report will likely indicate consumers this month were still pessimistic about the economic outlook.

A glut of unsold properties may keep prices low even as policy efforts to unclog credit and aid borrowers begin to take hold and ease the housing slump, now in its fourth year. Shrinking wealth and a persistent lack of confidence in the economy may also temper a turnaround in consumer spending.

“It’ll be some time before we reach the nadir in home prices,” said Joseph Brusuelas, a director at Moody’s Economy.com in West Chester, Pennsylvania. “We’re starting to see some signs of stability in housing sales, but there’s a significant oversupply.”

S&P/Case-Shiller will report the 20-city home-price index at 9 a.m. Washington time. Estimates in the Bloomberg survey ranged from declines of 17.2 percent to 19 percent, after a drop of 18.5 percent in December. The gauge has fallen every month since January 2007. Year-over-year records started in 2001.

From Forbes:

Home Price Index On The Horizon

On Tuesday, investors will be bracing for the latest report on the January S&P/Case-Shiller Home Price Index. Analysts expect the decline in prices to slow somewhat, falling 18.3% in the latest report after dropping 18.5% in December.

Posted in Economics, National Real Estate | 289 Comments

Trenton Unemployment – 17.5%

Posted on March 30, 2009 by grim

From the Times of Trenton:

Trenton jobless numbers climbing

When Mayor Douglas Palmer saw the city’s latest unemployment figure, he literally couldn’t believe his eyes.

The unemployment rate hit 17.5 percent in January, soaring from 12 percent a year earlier. More than 3,000 residents entered the unemployment rolls in a city of 83,000, Palmer said.

“How could 3,000 people in Trenton lose their jobs?” he said. “The city only laid off 29 people. The state didn’t lay off anybody, the county didn’t lay off anybody, the schools haven’t laid anybody off yet.”

Trenton’s unemployment rate was the highest among New Jersey’s cities, ahead of Camden at 15.7 percent, Paterson at 15 percent and Newark at 12.5 percent.

Statewide, unemployment was at 7.3 percent in January and then jumped to 8.2 percent in February, just above the U.S. rate. The federal Bureau of Labor Statistics will release February figures for cities next week.
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The figures also show county job losses in a range of private industries. The shrinking of fields like construction, retail and domestic work are likely having a disproportionate impact on lower-skilled Trenton residents, said James Hughes, dean of the Edward J. Bloustein School of Planning and Policy at Rutgers University.

“The demographic sectors hit hardest so far tend to be younger workers, particularly teenagers and those with lower skill levels and education levels,” he said.

“So as the economy contracts, a lot of the job losses could be impacting really more unskilled jobs,” he said.

Posted in Economics, New Jersey Real Estate | 341 Comments

Weekend Open Discussion

Posted on March 27, 2009 by grim

This is the time and place to post observations about your local areas, comments on news stories or the New Jersey housing market, open house reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let’s have them. Also a good place to post suggestions, requests for information, criticism, and praise.

For readers that have never commented, there is a link at the top of each message that is typically labelled “[#] Comments“. Go ahead and give that a click, you might be missing out on a world of information you didn’t know about. While you are there, introduce yourselves to everyone.

For new readers that have only read the messages displayed on the main page, take a look through the archives, a substantial amount of information has been put online in the past year. The archives can be accessed by using the links found in the menus on the right hand side of the page.

Posted in General | 253 Comments

NYC jobless rate as bad as NJ

Posted on March 27, 2009 by grim

Are you really sure New York City jobs are going to save New Jersey real estate?

From the Ledger:

N.Y.C. jobless rate hit 8.1 percent in February

New York’s unemployment rate jumped in February to its highest level since June 1993, rising to 7.8 percent from 7 percent in January, the state labor department said Thursday.

That compares with 4.6 percent in February 2008.

In New York City, the February rate was 8.1 percent –up from 6.9 percent in January and 4.4 percent a year earlier. Those are the highest numbers in the city since 2003.

Outside New York City, the rate stands at 7.6 percent, up from 4.8 percent last year and a 25-year high, said Peter Neenan, director of the Division of Research and Statistics.

“In the past six months, the state has lost almost 150,000 private sector jobs,” Neenan said.

The losses are fairly widespread and “the pace has definitely picked up in the last month,” said James Brown, the department’s New York City labor market analyst.

In addition to Wall Street and commercial banking job losses, “we’re also taking significant losses in what we call the ‘business and professional sector,’ which includes lawyers, accountants, architects, and temp work agencies,” said Brown.

Posted in Economics, New Jersey Real Estate | 169 Comments

NJ Home Prices Down 9.31% In January – LoanPerformance

Posted on March 26, 2009 by grim

From First American CoreLogic:

Double-Digit, Year-over-year Home Price Declines Continued in January

National resale housing prices fell 11.6 percent in January from a year ago. Home prices have declined by at least 10 percent on a year-over-year basis for 11 consecutive months and February preview data indicates the trend will continue.

The number of metropolitan markets experiencing price declines was, by far, the highest level tracked by the LoanPerformance HPI. As of January 2009, more than 700, or nearly three-quarters, of all metropolitan markets were experiencing home price depreciation, up from 254 markets experiencing depreciation in December 2007 and 394 in June 2008.
…
LoanPerformance HPI Largest CBSAs Ranking:
CBSA 12 Month HPI Change %
Edison-New Brunswick NJ -9.34%
New York-White Plains-Wayne NY-NJ -8.46%
…
LoanPerformance HPI State and National Ranking:
STATE 12 Month HPI Change %
National -11.61%
New Jersey -9.31%

Posted in Economics, National Real Estate, New Jersey Real Estate | 325 Comments