"The Housing Market is Weakening by the Minute"

From Globe and Mail:

Mark Zandi of Moody's Economy.com in West Chester, Penn., predicted that “well over” a million Americans will eventually lose their homes after defaulting on their mortgages next year. “The housing market is choking on unsold inventory that continues to rise as homes sales plunge and foreclosures surge,” he said.
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There are 2.5 million homes sitting vacant across the United States. The only way to work off the inventory is for prices to come down enough to make homes affordable again, Mr. Zandi said. He said the worst-hit parts of the country are the markets where home prices rose most in recent years – California's central valley, South Florida, the industrial Midwest, New York and Boston.

From the Visalia-Times Delta:

Central Valley residents have the most pessimistic outlook in the state about current economic conditions, according to a survey released Tuesday. Central Valley residents posted a rating of 80.0 on an index created and tracked by the Survey and Policy Research Institute at San Jose State University.

From TheStreet.com:

The bad news for the housing market just keeps piling up. About 44% of the U.S. population lives in metropolitan areas where home prices are falling, according to the latest report on the dismal state of the real estate market...by the structured finance group at DBRS, an independent credit agency. DBRS based the report on figures from the Office of Federal Housing Enterprise Oversight that track housing price data through June of this year, the latest period available.

The region of Sacramento, which saw the first innings of the housing boom, will see an 8% drop in prices this year, the report says. San Diego, home to the condo boom, will see prices drop about 6%, while Oakland is expected to record a 5% decline. Parts of the central valley region of the state -- cities like Stockton and Modesto -- will see declines greater than 10%, according to the report.

From Inman News:

A forecast compiled by Santa Ana, Calif.-based Veros Real Estate Solutions...applies more than 50 metrics in the calculations, including interest rates, current inventory, unemployment rates, inflation, population and buildable land, among other metrics.

The markets expected to see the most rapid depreciation in home values through...[the second quarter of 2008] are: Palm Bay-Melbourne-Titusville, Fla., with a 9 percent expected decline in values; Sacramento-Arden-Arcade-Roseville, Calif., with an 8 percent expected drop; Sarasota-Bradenton-Venice, Fla., with a 7 percent decline; Cape Coral-Fort Myers, Fla., down 7 percent; and Riverside-San Bernardino-Ontario, Calif., down 7 percent.

KCRA: Bank Refuses Buyers Bids On Town Homes

From the Tri-Valley Herald:

While the housing market is weakening by the minute, city leaders are strengthening the tools they have to secure homes abandoned by foreclosure. The Manteca City Council unanimously decided Monday night in favor of a series of ordinances that would secure vacant properties, primarily at the expense of the owner. Slumping housing prices and bad lending practices have turned Stanislaus and San Joaquin counties into one of the nation's leading areas for foreclosures. Manteca, a city that coins itself the "Heart of California" because of its location, is in the center of the crisis.

"This is a nationwide problem," Councilman John Harris said. "I think we are just entering the tunnel and I don't see any light at the end of it. We have to take some action; this gives us some teeth as far as prevention." "We haven't seen the tip of the iceberg yet," added Councilman Steve DeBrum in reference to the number of foreclosure properties.

From the Manteca Bulletin:

New home builders over the past few months have indicated they believe the ultimate market adjustment will be from 20 to 28 percent of what the peak selling prices were 18 months ago. The Anderson Homes auction prices generally fall in line with such market assessments.

Although several other new home builders declined to comment on the Anderson Homes auction, at least one was interested in information on what homes had the most bids and subsequently commanded the highest price in terms of percentage of the original selling price. McMansions: The real big losers? The implications for the Manteca market for the next two or so years is simple. It verifies that the 3,000-square-foot homes dubbed McMansions are losing favor either because of size or affordability.

From the Manteca Bulletin:

Right now we are faced with the bear of all bears in our current situation. I have heard over and over how this is the worst it has ever been and how this is going to run all of us Realtors out of town. CBS did us a mis-service by reporting how bad they think it is here. I disagree.

As you know, unless you have been hiding under a rock lately, the market in our city as far as real estate is concerned, is what I call "unbelievable!" It is so unbelievable for that matter that CBS News came here recently and did a story for their news program. They were reporting an abnormally high number of foreclosures here. This is just part of the cycle of real estate that happens about every 10 years. Oh yes, this one seems worse than others, but just like the downturn of 1989, this too shall pass. When the bottom of the market starts to rise and the home values start to increase again (and trust me, they will) the market will turn. I think we are starting to see that turn. The average price of pending sales in Manteca is starting to level off at around $350,000 ($352,637) and the average sold and closed price is approaching that price then stability will occur. We are at $377,340 right now.

With this happening already that is why I say the market is "unbelievable!" I didn't look to see that until first quarter next year.

I will probably get plenty of arguments from the naysayers on this but I am tracking it weekly and I do see a slowdown in the falling prices and the gap between listing price and sold price is narrowing. Too bad CBS didn't contact me. I could have shown them the figures for the last 10 years as I keep them. I predict that when the average listing price gets near $360,000 we will see a big surge in sales. That is quickly approaching. Right now our average listing price in Manteca is around $410,000. That's down from $501,276 on 9-11-06. How's that for the market self-adjusting?