OFHEO House Price Index Shows Declines in Five States,
Continued Deceleration in Others
U.S. home prices rose in the third quarter of this year, but the rate of
increase continued to slow and some areas experienced actual pricedeclines. Nationally, home prices were 7.73 percent higher in the third quarter of 2006 than they were one year earlier. Appreciation for the most recent quarter was 0.86 percent, or an annualized rate of 3.45 percent. This reflects a further slowdown from that reported for the second quarter when the quarterly appreciation rate was 1.3 percent and the annualized rate was 5.1 percent. The quarterly increase is the lowest since the second quarter of 1998.
“Our newest data confirm last quarter’s data that the housing market is in a decidedly different stage,” said OFHEO Director James B. Lockhart. “With U.S. house prices growing less than one percent during the third quarter, it provides more evidence that the longforecasted national deceleration in house prices is occurring. Given the five-year appreciation prior to this quarter of 56.8 percent, the slowdown is not unexpected. There are still some areas where appreciation rates remain very high but now they are the exception rather than the norm,” Lockhart said.
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Oct New Home Sales
Posted: November 29, 2006 at 8:34 am by Somesh
The October New Home Sales Data is out.
The New Home Median jumped by a 30K, from 218K in Sept to 248K in Oct. It is now at its third highest level ever.
Never has this median made a jump of 30K in a single month. That too, at this stage in the downturn.
Also the GDP was revised up to 2.2% from an initial 1.6% for Q3.
Both the numbers look suspect to me.
What GDP growth is to the Dollar, Home Building is to the Economy.
All five metros in Michigan show year-over-year decline. Detroit with -10%.
All eight metros in Ohio show decline .
All four metros in Indiana show decline.
Three out of four in Wisconsin show decline.
Minneapolis was -ve in Q2, is at 0.2% in Q3.
Eight of the nine Illinois metros are still positive. Chicago is down to 1.7% from 11% in 2005-Q4.
Loss of manufacturing jobs in the Mid West appears to be the primary reason for this early bust. And also for the same reason, home appreciation was tame compared to the the Coasts.
The National Median is down by -1.2%, and also the medians for all the four regions have declined as well.
From the NAR Report :
“Total state existing-home sales, including single-family and condo, were at a seasonally adjusted annual rate1 of 6.27 million units in the third quarter, down 12.7 percent from a 7.18 million-unit pace in the third quarter of 2005 – the second highest level on record, after a peak of 7.19 million in the second quarter of last year. Even with the overall decline, 10 states showed increases in sales activity from a year ago.
Third-quarter metro area single-family home prices, examining changes in 148 metropolitan statistical areas, 2 show 102 areas had price gains, including 21 metros with double-digit annual increases, and 45 areas experiencing price declines; one was unchanged.”
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Home Building Weakens Further in October
Posted: November 17, 2006 at 8:57 am by Somesh
Housing starts fell 27.5% to 1,486K from 2,051K of Oct 2005.
Since Jan 2000, the only time starts were lower than Oct 2006 was in July 2000 at 1,463K.
Permits fell 28% to 1,535K from 2,131K of Oct 2005.
And are at their lowest point in the period starting Jan 2000.
It is sad he did not live to see the downside of the economic cycle brought on by inflating the fiat money supply and the bust of a boom created by limitless credit expansion.
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NAR’s 40 Million Ad Campaign.
Posted: November 14, 2006 at 8:21 am by Somesh
“It’s a great time to buy or sell a home.”
Really?
How can it be a good time to buy and sell the same thing?
Unless you are the realtor who depends on the transaction to extract his commission.
This ad campaign is aimed at generating cash for realtors.
Buyers and Sellers need to look out for themselves.