Friday, September 14, 2007

'Sales are Slower Than a Tortoise on NyQuil'

From the Sacramento Bee:

It's come to this: For roughly every two homes sold in August in the capital region, one house went into foreclosure, according to the newest sales statistics released Thursday. Last month, 2,978 new owners picked up keys to homes they purchased in Amador, El Dorado, Nevada, Placer, Sacramento, Sutter, Yolo and Yuba counties, La Jolla-based DataQuick Information Systems reported Thursday. But in those same counties during August, 1,367 homeowners in foreclosure handed their keys back to the bank, according to Fair Oaks-based Foreclosures.com, a Web site for real estate investors.

That grim ratio may worsen as fall and winter sales traditionally slow and foreclosures keep rising, analysts say. Already, in Sacramento County in August, there were more defaults -- the first indicator of payment problems that can trigger foreclosure -- than sales, DataQuick reported...The county...tallied more defaults during the month -- 1,869 -- than sales, statistics show..."Sacramento (County) was positioned almost perfectly to take the brunt of this housing storm," said DataQuick analyst Andrew LePage.
...
The number of sales, meanwhile, fell to a 12-year August low in Sacramento County and an 11-year low in Placer County...Clearly, such numbers are fuel for still more for-sale signs -- now at a record 16,262 in El Dorado, Placer, Sacramento and Yolo counties -- and further declines in sales prices...The county's $332,000 median sales price for new homes alone is the lowest since October 2003, the firm reported.
Prices by zip
Prices by county

Also from The Bee:
In a tough market of hesitant homebuyers, builders are trying every incentive and attention-grabbing idea they can to encourage a purchase. This weekend, New Jersey-based Hovnanian Enterprises Inc. is launching a national three-day sales blitz, which includes its nine projects in the Sacramento region.

In a local market where Dallas-based Centex Homes is running radio ads promising free swimming pools, and Texas-based D.R. Horton just held a multimillion-dollar "giveaway," K. Hovnanian Homes is throwing in free furniture for every house it sells from Sacramento to Suisun City on Friday, Saturday and Sunday. The company's model home designers have furnished six new houses -- in Galt, Natomas and Suisun City -- to show buyers what they'll get.

"The idea behind it was to come out with a big blast. The economic data is still fairly strong, jobs and incomes are still good, home prices are low, and interest rates are still low," said the builder's Sacramento spokesman Ian Cornell. "Anybody who's been considering it ought to be hopping off the fence. This is one of those mechanisms, to get them to take advantage of it."
From The Union:
Median house prices in Nevada County fell nearly 12 percent for August to $417,000, compared to $472,500 a year earlier, a real-estate tracking firm said Thursday.

"It's a fabulous time for buyers to buy," said Diane DiLeo of Network Real Estate in Grass Valley.
From the Stockton Record:
Dismal home sales have thrown Gorilla Glue into downtown Stockton's comeback, forcing postponement of a key plan to build waterfront homes. To root for a city center's redevelopment, it seems, is to wish for the 969-year life span of Methuselah. And that still may not assure you'll be there at the ribbon-cutting.

Still, you cannot blame The Grupe Co. for delaying construction of 150 condominiums on the south bank. There have been 8,000 foreclosures this year in Stockton. About 3,000 homes are for sale. In this lame market, sales are slower than a tortoise on NyQuil...Rate increases on 80 percent of adjustable-rate mortgages nationwide have not kicked in. The housing carnage is going to get worse.

14 comments:

rocklin renter said...

"Anybody who's been considering it ought to be hopping off the fence. This is one of those mechanisms, to get them to take advantage of it."

AHAHAHHAHAHHAHAHAH ROFLMAO!

Yes, I will buy a home now that it comes furnished and with a pool. I will certainly overlook the fact that (after discounts & freebies) it is still overpriced by 20+%.

"It's a fabulous time for buyers to buy," said Diane DiLeo of Network Real Estate in Grass Valley.

Spoken like a true stealtor.

smf said...

Hilarious, the first signs that this is a real problem are taken by cheerleader to assume the bottom has been reached.

It's like the train has just left the station on this bubble deflation, but some believe that the station we are at is the destination, not the beginning of the trip.

Slick50 said...

I'll tell you what will sell homes... LOWER THE PRICE!!!

Give me the money you would have spent on the pool, give me the money you're spending on all the furniture and give me an additional 20% off the home price!

Want me to buy, really? Not until you LOWER THE PRICE!!! Hello, any home sellers out there listening!?

David said...

"Hello, any home sellers out there listening!?"

No, they stopped reading or watching TV about 2005.

Sippn said...

Very slooooow.... we won'tsee a bottom until after order is restored in the mortgage markets.

buying time said...

The DQ data is missing Yolo county zips...but has the totals for the county. They must be in denial =)

Gwynster said...

Yolo is small and it gets overlooked for all kinds of stuff, namely my USC housing and econ estimates. Makes me nuts.

Sittin' Out This One said...

Gwynster:

Here is one for you. I was working with an agent 2 months ago and wanted to write an offer for $432,000 on an REO. She refused saying the lender would never accept it. I shrugged O.K., but told her that was my price, since it equaled the after tax equivilent of rent for me (28% fed, 7% state effective rates).

The house just sold for $418,000! The Realtor just lost lender $14,000. I keep lucking out. The lesson for me is to wait another year or so, until prices drop below reproduction cost! Wow, it just keeps getting more interesting each day.

dvobell said...

"Already, in Sacramento County in August, there were more defaults -- the first indicator of payment problems that can trigger foreclosure -- than sales."

Oh Lordy. Stop and reread that. More. Defaults. Than. Sales.

And here comes another $1+ trillion in ARM resets to close out 2007 in style...

I don't think any of us can fully grok how bad this could end up. It's staggering. Terrifying, even.

SCREW my planned Xmas 2010 lowball play. I'm thinking 2015? Maybe a full Decade of Carnage?

"Hopping off the fence"?
You betcha.
Onto the 'no lowball is low enough' side, though...

waiting_for_the_fall said...

Sittin' Out This One, if the realtor refused to submit your offer, they can get their license revoked. The realtor is supposed to, by law, submit every offer, even if it's for $1.
Next time a realtor refuses to submit your offer, tell them you want that in writing.

Patient Renter said...

Sittin, man, what's your hurry? Patience patience patience. Hopefully your luckouts are teaching you that this thing still has a ways to go down. :)

Sippn said...

waitn' - no written offer is no offer.

Sittin' Out This One said...

Waitn', Sippn is right. She would have written the offer if I had pressed, but why bother. As Patient Renter says, there is a long way to go in this correction.

I was just listening to Brent Gove on KFBK and he concurs it may very well get worse. He cited a bunch of listings on the MLS: 2200 SF house in Roseville for $299,000. That is 2003-2004 pricing. It is definitely accelerating lower and should drop more this winter.

So I continue to be patient as I look at the market come down.

norcaljeff said...

Homes in Roseville are not that low yet. Not sure where you guys got that data.