Wednesday, October 22, 2008

Calling Market Bottom (Again)

From the Sacramento Bee:

"Sacramento is well into the first phase of the housing stabilization process, which starts with sales recovering on a year-over-year basis," [DataQuick's Andrew LePage] said.
Discounted foreclosures were 65.8 percent of September sales in Sacramento County, according to MDA DataQuick. Foreclosures were half of sales in the Los Angeles region and 42 percent of those in the Bay Area during September, the firm said.
DataQuick sales/price stats by county
ADDED: by zip [pdf]

From the Appeal Democrat:
Local median prices were down last month compared with September 2007, declining 31.5 percent in Sutter County, and 36.8 percent in Yuba County. Both counties were well under the $200,000 mark — the only counties in the Sacramento region in that range — coming in at $190,000 in Sutter County and $175,000 in Yuba County.
From the Modesto Bee:
The clearance sale in real estate continued last month, with another jump in the number of homes sold and a continuing drop in prices. Stanislaus County's median sale price was $179,000 in September, down 40 percent from a year earlier, MDA DataQuick reported Tuesday...In Merced and San Joaquin counties, the number of sales also soared last month compared with a year earlier. Each had a 47 percent drop in the median price, to $140,000 in Merced and $191,500 in San Joaquin.
Craig Lewis, president and chief executive officer at Prudential California Realty in Modesto, said the foreclosure wave appears to be waning. He said prices could bottom out in three or four months. "The next 90 days is the best time to buy in the last 10 years," he said.
Bottom out in three of four months? How can that be when prices bottomed out back in June 2007?
Craig Lewis, president of Prudential California Realty...said [Stanislaus County] median home prices have fallen from $414,000 in 2005 to $359,000 now, and it takes nearly three months to sell the typical home. "First-time home buyers have the ability to buy now, but … they're sitting back and waiting because they think the price will go down more," Lewis said. He doesn't agree. "I certainly feel we're at the bottom of the market."
From CNBC:
[What] strikes me is the positively bewildered expressions on the faces of the chief economists of both associations. These poor guys are tasked with telling everyone when its all going to get better, and the fact of the matter is they just don't know. Don't get me wrong, these are supersmart guys, number crunchers with decades in the business, but as NAHBs David Seiders said, the risk in housing right now is just so high that it makes forecasting extremely difficult.
From the Wall Street Journal:
[Bill] Knoff's house has traveled the arc of the local market. Built on vacant land in 2002, it sold for $280,000. Its original owner unsuccessfully tried to sell it in 2006 for $450,000. Mr. Knoff bought it out of foreclosure in March of this year for $320,000. Today, based on local sales, he figures the house is worth about $220,000. Mr. Knoff paid nearly half of the purchase price in cash, so most of his equity has been wiped out. But he said he believes in taking responsibility for such choices. "The government can buy up troubled mortgages. But it should kick the people out of their houses," said the 61-year-old information technology manager. "Why should I pay for someone to buy their house?"
[T]he bottom still may not be in sight. Home prices in California could end down as much as 60% from peak values, according to recent research from both Barclay's PLC and J.P. Morgan Chase & Co. Towns like Los Banos may have further to fall. According to the city and a local title office, roughly 2,000 of 10,000 homes in the town are in the foreclosure process. The city expects that number could grow before the crisis passes.
Interactive map thingy

From the Sacramento Bee:
Ward Smith of J. Smith & Sons Inc., a home-entertainment business in Natomas, said business already was slow because of the soft housing market. Then, when the stock market faltered, things came to a near complete halt. "The phones became eerily quiet for no good reason," he said. "Well, maybe there is a good reason. Everyone's (saying), 'We'll wait and see until we know what's really going on.' "
Prominent real estate broker Mike Lyon also knows what it's like when the phones stop ringing. The president of Lyon & Associates said things got very quiet when the stock market went into its downward spiral. "It was kind of like 9/11, to be honest with you," he said.
From the Sacramento Bee:
[CEO Gary] Pruitt said skeptics wrongly assume the vast majority of McClatchy's decline in revenue is due to a permanent migration of business to the Internet. Instead, he said, most of the problem is due to the economic downturn. McClatchy will "return to revenue growth when the economy resumes growing," he said. As evidence, he noted that McClatchy's biggest problems in the past two years have emerged in California and Florida, where the real estate market has crashed the loudest. But now McClatchy's papers in the Carolinas are experiencing somewhat similar declines as economic woes have spread to those states, he said.


Jacob said...

Sacramento is well into the first phase of the housing stabilization process, which starts with sales recovering on a year-over-year basis

Would a better sign of stabailization be when new forclosures are down yoy? What are the sales from peak? The sales dropped off a cliff last year so they really had nowhere to go but up, but if new foreclosures are increasing faster than sales, then there is no improvement coming.

Bottom in 90 days? I thought most of these guys gave up on 08 and were calling bottoms for second half 09 at the earliest.

We'll see where we are after the elections, when congress doesnt have to worry about their own jobs.

Patient Renter said...

These bottom calling idiots are starting to wear on me lately. On one hand, it's really not my concern if someone wants to make a fool of themself in print. On the other hand though, it's frustrating to see that the "who could have known" class still represents the bulk of "experts" cited in reports.

I keep thinking I'm going to wake up one day and turn on the TV to find a journalist standing outdoors reporting on how the sky has turned red while in the background it can clearly be seen to be blue. That's what watching an endless stream of bottom callers feels like.

Cow_tipping said...

Another day another starving realtor wishing it were the bottom ... so what else is news ... Oh, pigs are stinking, again ... man that is everyday this year ...

norcaljeff said...

Sippin's been MIA for months now, maybe a sign of the bottom. LOL Or maybe he's putting money on a different money pit, the US stock market :)