Taper: game on

[spdrun]

And by leaving, I meant that the pace of buying has slowed down, not that they’re not holding their current properties. No contradiction here.

[kev374]

[quote=spdrun]If you read about what’s happening in Phoenix and Las Vegas, property is already correcting. Investors are leaving like rats, very little organic demand to replace them.[/quote]

I am not seeing any reports in the press about a housing correction in Phoenix. Infact, I found info that housing is still soaring there.

http://www.phoenixnewtimes.com/2013-11-07/news/the-sky-s-the-limit-for-home-prices-in-phoenix-but-for-how-long/

Looks like Phoenix is still surging. Locally, here in OC, inventory that is competitively priced is still ultra-tight and people are still trampling over each other to buy homes that are priced below $400,000 and are move in ready since there are just so few of them.

[spdrun]

A more recent article, saying that prices and demand have at least flattened.

http://ktar.com/155/1680053/Subdued-holiday-shopping-season-for-Phoenix-home-buyers

… …
“It’s pretty quiet,” said Arizona State University Director of Real Estate Michael Orr on his weekly appearance on That Real Estate Show. “‘Subdued’ is the word I’d probably use for the current market.”

“Subdued” is not what many current home sellers want to hear, especially after witnessing a sudden shift in market conditions during the summer.

“Phoenix [real estate] is very volatile, and this just proves it again,” said Orr. “I’d say as late as (this past) June we were still in a very strong sellers’ market.”

[spdrun]

Interestingly, you should also read about HELOCs. A lot of 10-year HELOCs are coming up on their reset date (either become amortizing vs interest-only, or come due in full). If this increases distress levels, it may not have a dramatic effect on pushing down home prices, but it won’t be pretty either.

[SK in CV]

Just a reminder spdrun, we must have heard a dozen times after 2005 that “huge number of resets” are happening on variable rate loans at some point in the not too distant future. Not HELOCS, but first loans. And it would result in big things happening. It never did. HELOCs are even less likely to cause a blip. For one, hundreds of thousands of them were called due during the crash, solely because of the lenders’ perception of disappearing collateral. And second, HELOCs issued in the last 4 or 5 years are mostly good, irrespective of the interest rates.

[spdrun]

Afaik, the warnings are about 2004-5 HELOCs coming up on ten years, not loans from 2009 or 2010.

[kev374]

Most of the HELOCs from 2004 can refi as they probably have positive equity here in Southern California. In Orange County, CA we are just 12% off the bubble peak and it’s more than likely that they have built 15-20% equity in the home since 2004 through their payments so they will more than likely be ok. This is a non-issue.

I think housing is going further up and is not going to come down anytime soon. This is a shame for first time buyers here but I am pretty sure many of them are forever priced out.

This is common in other countries, for instance in Barcelona, Spain a small home near the city can cost 1 million Euro but hardly anyone can afford it because the salaries there are so tiny and the taxes are so high, in addition the unemployment is pretty staggering, yet home prices have not come down at all.

[spdrun]

Population density in urban Spain vs SoCal is a whole different ball game. I don’t see housing shooting up much further, not straight up at least.

Remember — that’s what everyone was saying in 2005. Blah, blah, yap, yap, buy now because homes will never be cheaper.

You’re also assuming that the LTV on the homes was sane in the first place. I’ve recently seen units where the total LTV of all loans was 20% ABOVE peak bubble value, so even if values exceeded bubble pricing, they’d still need a short sale.

[Coronita]

.

[Coronita]

[quote=flu][quote=AN][quote=flu][quote=AN]DOW’s up 1.14%, NASDAQ’s up 0.43%, and S&P’s up 0.99%. I’ll take that. Now, lets see if it can continue through the rest of the year at this rate :-D.[/quote]

You mean Dow up 1.84% and Nasdaq up 1.15% and S&P500 up 1.46%….

:)[/quote]Or better yet, UDOW up 4.91%, UPRO up 5.19%, and TQQQ up 3.45%. :-D[/quote]

You are a brave soul my friend… I’m done with the “ultra-XXX ETF’s”[/quote]

You win AN… Good move on your part….

[Author]

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