Knife catchers jump in

[LA_Renter]

From what I am reading across the blogs, there is increased investor activity in certain segments of the market which is showing up as increased purchases in the data, albeit from volumes we have literally not seen since the 1970’s. I have no reason to doubt that, but it does make you think exactly how many all cash buyers are out there? It sounds to me that for people that really know what they are doing, there are profits to be had right now. I imagine at this stage of the correction much of this was to be anticipated. I don’t think that there has ever been this steep of a price decline in such a short period especially in the lower to mid tiered markets. I agree with Bugs when he pointed out that there were at least three mini rallies during the last downturn only to fizzle out. I guess you can call these bear market rallies. These rallies can be persuasive, not to compare the stock market to RE but Wall Street rallied to 13,000 off of the Jan lows, even I started to consider maybe the worst really is behind us. I am glad I didn’t put any money on that bet. I am on the sidelines because I think the credit crisis is going to be deeper and take longer to correct than what is being bandied about by the MSM and many pollyanna economists. Ground zero of that distress is Cal RE. I usually go with my gut on these things and my gut tells me this thing is far from over.

[gdcox]

biggoldbear

Please tell us whether the house you are buying is bank owned and where.

It would be useful if buyers tell us that for one gets the impression that REOs are on one level and non-Reos at another.

All the price indices miss that distinction.

Some REOs really being offloaded now may be at prices that voluntary sales get to say in a year’s time and hence make more sense.

It is at least feasible that over the next year (from Sept 08) the price of voluntary sales falls faster than the price of Reos.

A tale of two markets, in places like SD, is so important to describe; and contrasts with places like Texas where there is still one market (and a rising one at that).

(PS Remember that today’s Case Shiller data relates to deals on average committed to in March/April)

[gdcox]

biggoldbear

Please tell us whether the house you are buying is bank owned and where.

It would be useful if buyers tell us that for one gets the impression that REOs are on one level and non-Reos at another.

All the price indices miss that distinction.

Some REOs really being offloaded now may be at prices that voluntary sales get to say in a year’s time and hence make more sense.

It is at least feasible that over the next year (from Sept 08) the price of voluntary sales falls faster than the price of Reos.

A tale of two markets, in places like SD, is so important to describe; and contrasts with places like Texas where there is still one market (and a rising one at that).

(PS Remember that today’s Case Shiller data relates to deals on average committed to in March/April)

[gdcox]

biggoldbear

Please tell us whether the house you are buying is bank owned and where.

It would be useful if buyers tell us that for one gets the impression that REOs are on one level and non-Reos at another.

All the price indices miss that distinction.

Some REOs really being offloaded now may be at prices that voluntary sales get to say in a year’s time and hence make more sense.

It is at least feasible that over the next year (from Sept 08) the price of voluntary sales falls faster than the price of Reos.

A tale of two markets, in places like SD, is so important to describe; and contrasts with places like Texas where there is still one market (and a rising one at that).

(PS Remember that today’s Case Shiller data relates to deals on average committed to in March/April)

[gdcox]

biggoldbear

Please tell us whether the house you are buying is bank owned and where.

It would be useful if buyers tell us that for one gets the impression that REOs are on one level and non-Reos at another.

All the price indices miss that distinction.

Some REOs really being offloaded now may be at prices that voluntary sales get to say in a year’s time and hence make more sense.

It is at least feasible that over the next year (from Sept 08) the price of voluntary sales falls faster than the price of Reos.

A tale of two markets, in places like SD, is so important to describe; and contrasts with places like Texas where there is still one market (and a rising one at that).

(PS Remember that today’s Case Shiller data relates to deals on average committed to in March/April)

[gdcox]

biggoldbear

Please tell us whether the house you are buying is bank owned and where.

It would be useful if buyers tell us that for one gets the impression that REOs are on one level and non-Reos at another.

All the price indices miss that distinction.

Some REOs really being offloaded now may be at prices that voluntary sales get to say in a year’s time and hence make more sense.

It is at least feasible that over the next year (from Sept 08) the price of voluntary sales falls faster than the price of Reos.

A tale of two markets, in places like SD, is so important to describe; and contrasts with places like Texas where there is still one market (and a rising one at that).

(PS Remember that today’s Case Shiller data relates to deals on average committed to in March/April)

[hipmatt]

[quote=donaldduckmoore]The truth is there are lots of buyers (you may prefer knife catchers). Bottom or not depends on the performance of our economy. You know the Fed is trying everything to save the housing market. If inflation is no longer a threat, they will make interest rate stable and low for as long as possible and the bottom will be near. The current inflation is all driven by oil price. You know that oil price is not moving up recently and stronger dollar also suppresses rising oil price. If they have the trick to do all these, then the housing market should not be looking too glim. It is all psychological cycle. Just my personal opinion.[/quote]

A. The fed can not save housing.
B. Who says inflation isn’t a threat?
Just because a gallon of gas is now in the high $3s and not the low $4 doesn’t mean inflation isn’t a problem. BTW $115 per barrel of oil is still up about 100% from early 2007 prices… hardly a sign of moderating inflation. Food prices are still way up. Check it out http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-foodprices_25bus.ART.State.Edition1.3f90971.html
C. It is all psychological, I agree, but the economy isn’t doing so hot, and as you say if housing depends on the performance of the economy.. then housing won’t bottom anytime soon.

[hipmatt]

[quote=donaldduckmoore]The truth is there are lots of buyers (you may prefer knife catchers). Bottom or not depends on the performance of our economy. You know the Fed is trying everything to save the housing market. If inflation is no longer a threat, they will make interest rate stable and low for as long as possible and the bottom will be near. The current inflation is all driven by oil price. You know that oil price is not moving up recently and stronger dollar also suppresses rising oil price. If they have the trick to do all these, then the housing market should not be looking too glim. It is all psychological cycle. Just my personal opinion.[/quote]

A. The fed can not save housing.
B. Who says inflation isn’t a threat?
Just because a gallon of gas is now in the high $3s and not the low $4 doesn’t mean inflation isn’t a problem. BTW $115 per barrel of oil is still up about 100% from early 2007 prices… hardly a sign of moderating inflation. Food prices are still way up. Check it out http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-foodprices_25bus.ART.State.Edition1.3f90971.html
C. It is all psychological, I agree, but the economy isn’t doing so hot, and as you say if housing depends on the performance of the economy.. then housing won’t bottom anytime soon.

[hipmatt]

[quote=donaldduckmoore]The truth is there are lots of buyers (you may prefer knife catchers). Bottom or not depends on the performance of our economy. You know the Fed is trying everything to save the housing market. If inflation is no longer a threat, they will make interest rate stable and low for as long as possible and the bottom will be near. The current inflation is all driven by oil price. You know that oil price is not moving up recently and stronger dollar also suppresses rising oil price. If they have the trick to do all these, then the housing market should not be looking too glim. It is all psychological cycle. Just my personal opinion.[/quote]

A. The fed can not save housing.
B. Who says inflation isn’t a threat?
Just because a gallon of gas is now in the high $3s and not the low $4 doesn’t mean inflation isn’t a problem. BTW $115 per barrel of oil is still up about 100% from early 2007 prices… hardly a sign of moderating inflation. Food prices are still way up. Check it out http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-foodprices_25bus.ART.State.Edition1.3f90971.html
C. It is all psychological, I agree, but the economy isn’t doing so hot, and as you say if housing depends on the performance of the economy.. then housing won’t bottom anytime soon.

[hipmatt]

[quote=donaldduckmoore]The truth is there are lots of buyers (you may prefer knife catchers). Bottom or not depends on the performance of our economy. You know the Fed is trying everything to save the housing market. If inflation is no longer a threat, they will make interest rate stable and low for as long as possible and the bottom will be near. The current inflation is all driven by oil price. You know that oil price is not moving up recently and stronger dollar also suppresses rising oil price. If they have the trick to do all these, then the housing market should not be looking too glim. It is all psychological cycle. Just my personal opinion.[/quote]

A. The fed can not save housing.
B. Who says inflation isn’t a threat?
Just because a gallon of gas is now in the high $3s and not the low $4 doesn’t mean inflation isn’t a problem. BTW $115 per barrel of oil is still up about 100% from early 2007 prices… hardly a sign of moderating inflation. Food prices are still way up. Check it out http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-foodprices_25bus.ART.State.Edition1.3f90971.html
C. It is all psychological, I agree, but the economy isn’t doing so hot, and as you say if housing depends on the performance of the economy.. then housing won’t bottom anytime soon.

[hipmatt]

[quote=donaldduckmoore]The truth is there are lots of buyers (you may prefer knife catchers). Bottom or not depends on the performance of our economy. You know the Fed is trying everything to save the housing market. If inflation is no longer a threat, they will make interest rate stable and low for as long as possible and the bottom will be near. The current inflation is all driven by oil price. You know that oil price is not moving up recently and stronger dollar also suppresses rising oil price. If they have the trick to do all these, then the housing market should not be looking too glim. It is all psychological cycle. Just my personal opinion.[/quote]

A. The fed can not save housing.
B. Who says inflation isn’t a threat?
Just because a gallon of gas is now in the high $3s and not the low $4 doesn’t mean inflation isn’t a problem. BTW $115 per barrel of oil is still up about 100% from early 2007 prices… hardly a sign of moderating inflation. Food prices are still way up. Check it out http://www.dallasnews.com/sharedcontent/dws/bus/stories/DN-foodprices_25bus.ART.State.Edition1.3f90971.html
C. It is all psychological, I agree, but the economy isn’t doing so hot, and as you say if housing depends on the performance of the economy.. then housing won’t bottom anytime soon.

[hipmatt]

[quote=sdrealtor]”The BIGGEST driver of prices is supply and demand. Well the big news today is another record high supply.”

Thats national not local news. I have the news on in the background and just heard a statement that sales are up over 40% year over year this month (admittedly it is mostly low end bargain hunters). Inventory in the MLS is down from last year. Not saying prices are going up but supply/demand certainly is not on your side right now. I have about a dozen buyers, all well qualified, with substantial down payments ( afew are all cash) looking for decent proeprties at or just below today’s prices. It has been a HUGE challenge to find what they are looking for. When we do, there is competition.[/quote]

sdrealtor, your numerous powerful, rich, all cash buyers may be a nice exaggerated anomaly, and you should enjoy the fat commissions you will make when you find them the right homes, but I can assure you that the supply/demand certainly IS in my favor.

“As the article says.. Additional waves of foreclosures are likely, because thousands of alternative-documentation loans and other exotic mortgages are scheduled to reset to higher monthly payments in the coming months, he said. In addition, sales haven’t increased enough yet to substantially reduce the high inventory across the state.”

While the summer rally comes to and end, an additional wave of inventory will be presenting itself to us in the coming quarters. Rents (in Temecula) are falling in some places. In Temecula, nicely located apartments are offering rates about 25% off of past prices and are giving 2 months free. This will eventually make its way into home rental prices as well as renters default and spend their money of food and other necessities. Soon, investors will see that these prices aren’t that great and they will find more profitable investments.

Inventory may have dropped this summer, but is this a surprise? No, what do you expect when prices fall 40%.

[hipmatt]

[quote=sdrealtor]”The BIGGEST driver of prices is supply and demand. Well the big news today is another record high supply.”

Thats national not local news. I have the news on in the background and just heard a statement that sales are up over 40% year over year this month (admittedly it is mostly low end bargain hunters). Inventory in the MLS is down from last year. Not saying prices are going up but supply/demand certainly is not on your side right now. I have about a dozen buyers, all well qualified, with substantial down payments ( afew are all cash) looking for decent proeprties at or just below today’s prices. It has been a HUGE challenge to find what they are looking for. When we do, there is competition.[/quote]

sdrealtor, your numerous powerful, rich, all cash buyers may be a nice exaggerated anomaly, and you should enjoy the fat commissions you will make when you find them the right homes, but I can assure you that the supply/demand certainly IS in my favor.

“As the article says.. Additional waves of foreclosures are likely, because thousands of alternative-documentation loans and other exotic mortgages are scheduled to reset to higher monthly payments in the coming months, he said. In addition, sales haven’t increased enough yet to substantially reduce the high inventory across the state.”

While the summer rally comes to and end, an additional wave of inventory will be presenting itself to us in the coming quarters. Rents (in Temecula) are falling in some places. In Temecula, nicely located apartments are offering rates about 25% off of past prices and are giving 2 months free. This will eventually make its way into home rental prices as well as renters default and spend their money of food and other necessities. Soon, investors will see that these prices aren’t that great and they will find more profitable investments.

Inventory may have dropped this summer, but is this a surprise? No, what do you expect when prices fall 40%.

[hipmatt]

[quote=sdrealtor]”The BIGGEST driver of prices is supply and demand. Well the big news today is another record high supply.”

Thats national not local news. I have the news on in the background and just heard a statement that sales are up over 40% year over year this month (admittedly it is mostly low end bargain hunters). Inventory in the MLS is down from last year. Not saying prices are going up but supply/demand certainly is not on your side right now. I have about a dozen buyers, all well qualified, with substantial down payments ( afew are all cash) looking for decent proeprties at or just below today’s prices. It has been a HUGE challenge to find what they are looking for. When we do, there is competition.[/quote]

sdrealtor, your numerous powerful, rich, all cash buyers may be a nice exaggerated anomaly, and you should enjoy the fat commissions you will make when you find them the right homes, but I can assure you that the supply/demand certainly IS in my favor.

“As the article says.. Additional waves of foreclosures are likely, because thousands of alternative-documentation loans and other exotic mortgages are scheduled to reset to higher monthly payments in the coming months, he said. In addition, sales haven’t increased enough yet to substantially reduce the high inventory across the state.”

While the summer rally comes to and end, an additional wave of inventory will be presenting itself to us in the coming quarters. Rents (in Temecula) are falling in some places. In Temecula, nicely located apartments are offering rates about 25% off of past prices and are giving 2 months free. This will eventually make its way into home rental prices as well as renters default and spend their money of food and other necessities. Soon, investors will see that these prices aren’t that great and they will find more profitable investments.

Inventory may have dropped this summer, but is this a surprise? No, what do you expect when prices fall 40%.

[hipmatt]

[quote=sdrealtor]”The BIGGEST driver of prices is supply and demand. Well the big news today is another record high supply.”

Thats national not local news. I have the news on in the background and just heard a statement that sales are up over 40% year over year this month (admittedly it is mostly low end bargain hunters). Inventory in the MLS is down from last year. Not saying prices are going up but supply/demand certainly is not on your side right now. I have about a dozen buyers, all well qualified, with substantial down payments ( afew are all cash) looking for decent proeprties at or just below today’s prices. It has been a HUGE challenge to find what they are looking for. When we do, there is competition.[/quote]

sdrealtor, your numerous powerful, rich, all cash buyers may be a nice exaggerated anomaly, and you should enjoy the fat commissions you will make when you find them the right homes, but I can assure you that the supply/demand certainly IS in my favor.

“As the article says.. Additional waves of foreclosures are likely, because thousands of alternative-documentation loans and other exotic mortgages are scheduled to reset to higher monthly payments in the coming months, he said. In addition, sales haven’t increased enough yet to substantially reduce the high inventory across the state.”

While the summer rally comes to and end, an additional wave of inventory will be presenting itself to us in the coming quarters. Rents (in Temecula) are falling in some places. In Temecula, nicely located apartments are offering rates about 25% off of past prices and are giving 2 months free. This will eventually make its way into home rental prices as well as renters default and spend their money of food and other necessities. Soon, investors will see that these prices aren’t that great and they will find more profitable investments.

Inventory may have dropped this summer, but is this a surprise? No, what do you expect when prices fall 40%.

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