October 4, 2006
-- by Dave Johnson
It hasn't even started yet, and they use the 'D'-word: Housing Prices to Drop, Report Says,
Housing prices, slumping after a five-year boom, are projected to decline in more than 100 of the nation's metropolitan areas...This forecast is widely reported, which means that it will be seen by buyers and sellers, and will cause them to adjust their expectations.
... The ... firm projects that the median sales price for an existing home will decline in 2007 by 3.6%, which would be the first nationwide decline for an entire year in home prices since the Great Depression of the 1930s. [emphasis added]
Along those lines, a warning to UK investors: US housing market 'in danger zone',
British investors who own property in the United States should take a long-term view on the market and focus on maximising rental income as the US teeters on the brink of a housing market price reversal, says Assetz.Think UK investors will be showing up to pick up some of that excess inventory and bail us out? Me, neither.
... Stuart Law, managing director of Assetz, said: "The U.S. is definitely in the danger zone but we are not currently certain how severe the downturn will be. Holiday home buyers who are getting regular use out of their property are unlikely to be affected in the long term, but investors who were hoping to sell their property on quickly are no longer set to gain and are likely to face losses if they sell now.
t's not just homeowners and homebuilders that have a lot to lose if tremors roiling the real estate market turn into a full-scale quake.Arkansas: Housing market slowdown has ripple effect on economy
Manufacturers of everything from drywall to the kitchen sink are also vulnerable to stagnant or declining sales as fewer houses change hands.
"Do a mental walk around your house and look at appliances and fixtures," to see what companies are exposed to the housing market, said Sam Stovall, chief investment strategist for Standard & Poor's.
Florida: Housing permits down 61 percent
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On the local NYC news this morning; average prices for apartment sales have dropped 4%. Most New Yorkers, especially in Manhattan, live in apartments, not single homes. The average sale price is still over 1 million. However, this is somewhat misleading because the "average" sales were for smaller apartments than sold previously, and the cost per square foot has gone up 6% during the same period. NYC still has a very long way to go before any meaningful drop in price; prices were up by 79% over the past few years.
There is, however, beginning to be a real glut of apartments for sale on the local market. Prices will have to begin to fall here to a meaningful extent sooner or later. Meanwhile, however, two of the largest apartment complexes in the country, built in 1847 to provide housing for middle class servicemen returning from WW II and rent stabilized, for a total of 11,000 apartments, are being dumped on the market by Met Life, with bidding to be held for them today. Met Life refused to allow the renters to form a group to bid on them. Rent stabilization will end once they're sold, there are elderly tenants living there who have been there since 1947, and the city could soon have over 11,000 newly homeless people.
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