During Presidential Hopeful Senator John Edwards visit to northern Nevada, Erick Harpole with Keller Williams Realty discussed the extensive issues facing the state of Nevada but specifically the Reno/Sparks area in regards to the numerous foreclosures facing the area and the lack of education about the problem and possible solutions. As one of the top real estate professionals in the state of Nevada, Erick has spoken extensively to groups regarding foreclosure, short sales, and loan modification. For more information about John Edwards solutions to this issue and others please visit http://www.johnedwards.com
January 28th, 2008
NEW YORK (CNNMoney.com) — The worst housing financial crisis in decades is only going to get worse, a Merrill Lynch report said Wednesday.
The investment bank forecasted a 15 percent drop in housing prices in 2008 and a further 10 percent drop in 2009, with even more depreciation likely in 2010.
By contrast, the National Association of Realtors (NAR) expects housing prices to remain flat in 2008. NAR did cut its home price estimate for the current quarter, however, to a 5.3 percent year-over-year decline, which represents the steepest drop in that price measure on record. But NAR sees an uptick in home prices in the last two quarters of 2008.
“Merrill Lynch’s figures are way too pessimistic, and they are unprecedented,” Lawrence Yun, the National Association of Realtors chief economist told CNNMoney.com. “There is so much variation in local housing markets, and we see stable price conditions for 2008.”
The current housing crisis and the depreciation in home prices have pummeled the economy, with businesses and consumers cutting back on spending, raising the specter of a recession. “Lower sales and higher inventory for sales are lowering the velocity of transactions,” said Fritz Siebel, Director of US Property Derivatives for Tradition Financial Services. “That cannot be a sign of good health for the economy.”
But for those who think that the worst is over, Merrill Lynch said that housing prices still remain comparatively high. The brokerage believes that home prices are still far above historical norms when compared to other measures such as rent or GDP. “By our calculations, it will take about a 20 to 30 percent decline in home prices to correct this imbalance,” said the report.
Merrill Lynch believes that housing starts will most likely slide another 30 percent by the end of 2008 - a historic low.
The report says that the inventory situation only continues to worsen, as homebuilders are now looking at more than a nine months’ supply. “The current supply/demand environment does not favor a swift recovery in the housing market, in our view,” according to the report.
Yun agrees that the reduction in housing starts will not bode well for the economy, especially in the homebuilding industry, but he believes that the reduction will soothe the housing market by slowing the glut in inventory. “The reduction in housing starts is not stabilizing the economy, but it will stabilize the market,” said Yun.
January 28th, 2008
The median price for a homes dropped 1.3 percent to $219,000 in 2007, while total home sales plunged by 13 percent for the year.
NEW YORK (CNNMoney.com) — Prices of homes sold in December registered the biggest year-over-year decline on record, according to a report from an industry trade group, and 2007 is the first year on record that has seen a drop.
The National Association of Realtors (NAR) said on Thursday that the median price of homes sold in December fell nearly 6 percent from a year earlier to $208,400. The three biggest declines in prices ever recorded have now come in the last four months.
In addition to the December price decline, NAR reported the median price for all homes sold in 2007 fell 1.3 percent to $218,900, the first time that the annual price reading has shown a decline since the group started tracking that measure in 1968.
“What we saw in December was a rough month to cap off a rough year,” said Mike Larson, real estate analyst with Weiss Research. “There wasn’t much holiday cheer.”
The news comes one day after Merrill Lynch released a study that forecasted a 15 percent decline in home sale prices for 2008.
Though NAR’s chief economist Lawrence Yun called Merrill’s figures “way too pessimistic,” the group estimates that home prices for the current quarter will see a 5.3 percent year-over-year decline. That will represent the steepest quarterly drop on record.
Existing-home sales also declined in December, slipping 2.2 percent from November to an annual rate of 4.89 million units. The December rate is 22 percent below the year-ago pace.
The pace of total home sales plunged 12.8 percent for the year - the biggest drop on record. Single family home sales fell by 13 percent in 2007, which was the largest drop in 25 years.
The Realtors have only tracked total home sales, which includes condos and other multifamily units, since 1989, while single family home sales have only been logged since 1982.
Housing bailout: winners and losers
The existing-home sales pace represents a seasonally adjusted annual rate of home sales. The pace in December was below the forecast of 4.95 million forecast by economists surveyed by Briefing.com.
“Home sales remain weak despite improved affordability conditions in many parts of the country,” said Yun. “Home prices are lower, mortgage interest rates continue to decline and incomes are higher, but many potential buyers are delaying a purchase.”
The downturn in home sales has hammered the results of the nation’s leading homebuilders. On Thursday Lennar, the nation’s biggest homebuilder, reported a $1.25 billion fourth-quarter loss, the largest in the company’s history.
Earlier this month, KB Home (KBH, Fortune 500), the nation’s number five builder by sales, reported a fiscal fourth quarter loss that was nearly 10 times worse than forecasts. CEO Jeff Mezger told investors during an earnings call that “As we enter 2008, we see no indication markets are stabilizing.”
Analysts are also forecasting that number two homebuilder Centex (CTX, Fortune 500), number three D.R. Horton (DHI, Fortune 500) and number four Pulte Homes (PHM, Fortune 500) will all report continuing losses until at least their final quarters of this calendar year. Hovnanian Enterprises (HOV, Fortune 500), the sixth-largest homebuilder, is expected to post losses in both fiscal 2008 and 2009.
The outfit forecast to see the quickest return to profitability is luxury home builder Toll Brothers (TOL, Fortune 500), which is expected to post a narrow gain in the quarter ending in July. It reported its first loss as a public company in its most recent period, which ended in October.
The outlook for the rest of 2008 remains gloomy, said Weiss Research’s Mike Larson.
“We’re looking at a battle royale in the market looking forward: 30-year mortgage rates have come down under 6 percent,” he said. “But on the other hand, more borrowers are going to need jumbo financing to purchase a home due to the bad economy.”
“Hopefully by the end of 2008 or beginning of 2009,” he added, “supply levels will come down and we’ll see some stabilization.”
January 28th, 2008
Don’t Get Stuck Owning TWO Homes!
Your biggest dilemma when considering purchasing another home is deciding whether to buy first or sell first.
Either way is risky.
You don’t want to get stuck owning two homes or no home at all.
When you list your home with me, you receive my better than risk-free offer. In fact, you are doubly protected, and here’s how.
- You receive my upfront guaranteed price in writing that I will sell your present home before you take possession of your next one.
- If you receive an offer that is higher than the guaranteed price from an outside buyer, you get the higher offer, not me.
This means that when you see a home that you like, you can react immediately and negotiate the lowest price possible with a firm, cash offer (with no conditions).
Contact Erick Harpole for more information about “Your Home Sold Guaranteed in 120 Days or I’ll Buy It” Campaign or call (775) 826-7653.
www.HarpoleHomes.com
July 10th, 2007
