The big news in the NAR Existing Home Sales Report is the condominium and cooperative sales.
Nationally, condo & coop inventory increased to 494,000 in March 06 from 425,000 in February 06 which represents a 16.2% increase in inventory in one month. Year over Year the inventory increased from 267,000 units to 494,000 which represents a dramatic 85% increase.
There is now a 6.9 month supply of condo /coop inventory. Sales fell 2% from March 2005.
The median sales price for condos in the West actually fell 3.7% (not seasonally adjusted) from March 2005. In March 2005 it was 290.4K which has since fallen to 279.6K.
Overall, the condo & coop market is much more vulnerable then the single family housing market. Much more inventory is coming. Median sales price will decline. The construction crane is now the unofficial bird in many states.
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Cluck-cluck (you huge chicken). So it seems that maybe this is more complicated than just running around and yelling "the sky is falling!"
ReplyDeleteI hope you get the joke that at the first sign of information that says "no housing bubble thank you very much", you've just changed it to "there's a condo/coop bubble!" and you can explain sotto voce that's what you meant all along.
It would have been a lot better if you had stuck to your guns and said "this is a temporary blip and I stand by my predictions." But instead we see the waver and the flip-flop. Your blog is toast pal.
What on earth are you talking about?
ReplyDeleteThis trend is definitely noticeable in DC. Click below to see evidence:
ReplyDeletehttp://dcbubble.blogspot.com/2006/04/incredible-bifurcating-market-condo.html
"It would have been a lot better if you had stuck to your guns and said "this is a temporary blip and I stand by my predictions." But instead we see the waver and the flip-flop."
ReplyDeleteI stand by my original predictions. All I am pointing out is that the condo market is more vulnerable and declining faster the single family housing.
"Your blog is toast pal."
H*ll no. It is more popular then ever.
Anonymous
ReplyDeleteCluck-cluck (you huge chicken). So it seems that maybe this is more complicated than just running around and yelling "the sky is falling!"
Maybe nationwide the sky is not falling but certain areas like DC metro are in a world of hurt when it comes to selling a house.
Several posts on this blogsite have shown price declines and increases in inventory (both new and otherwise). I can't come to any other conclusion than the bubble is either bursting or deflating. I know it's better in Raleigh, NC and I'm sure it's better in many other places.
Several years ago we had the "dot.com" bust but other industries like biomedical were chugging along just fine.
Also I'm sure that Mr. Bubblemeter is not stating the sky is falling on the entire planet.
David- this is good work. We dont generally track condos. Maybe we should.
ReplyDelete-X
Keep up the great work David. You have an excellent blog.
ReplyDeleteA Redskins fan
Thanks for all the words of support the readers when some anon poster attacks my blog. I am not thin skinned. I can take the attack.
ReplyDeleteNevertheless, I truly appreciate all the words of encouragement.
New to the blog, but thanks for the great information!!!
ReplyDeleteDavid,
ReplyDeleteReally like your blog and I'm happy you got a mention in the Post last week.
That anon poster doesn't seem to realize that condos/coops are housing too.
I am new to this blog too and appreciate the data on condos etc. However, if as your troll(?) suggests you have been in "the housing market is going to crash therefore there will be a recession" school then, with respect, you ARE almost certainly wrong. In the same way that the dot com bubble did not affect the wider market - the unweighted S&P ROSE 10% in 2000 and 4% in 2001 - the bursting of the condo bubble will hit certain sectors very hard and others barely at all. Do not confuse cause and effect. In the UK, Australia or even 1989 Japan, sharp increases in short rates brought down leveraged bubbles and at the same time seriously hit the disposable income of the whole home owning population on floating rate mortgages. Despite the hype from the "US consumer is going to collapse THIS year (dammit)" school of bond economists, in excess of 80% of US household debt is fixed rate.
ReplyDeleteNot only is this a housing a bubble. There is a credit bubble.
ReplyDeleteFirst, MarkT: Please continue to disagree and argue. Frank discussion is the good stuff. :-)
ReplyDeleteNext, Tidbit: Most car loans are fixed. They're usually 3-5 years anyway.
Next, MarkT: You're right that this is housing thing, but with all these people having risky loans, AND their values falling under them, AND supply going through the roof, you're going to get a lot more loan defaults. It's possible that could really hurt the financial institutions involved, and that'd be bad for everyone.
To first poster ANON: It sounds like you are sitting in some RE office with nothing better to do then blame the messenger? Why don't you quit wasting your time on blogs and start dialing for dollars?
ReplyDeleteWhy are you all suprised that your blog, which openly hopes that homeowners (people with jobs and families) will lose their shirts in an unprecedented market crash, gets comments from people who point out how foolish you are acting?
ReplyDeleteI hope your landlord steals your security deposit, your building goes condo, and you have to move to Prince George's County because you waited too long to buy someplace nice.
Does anyone know what the average condo/coop inventory has been, say over the last 10 years? It's been my understanding that inventories have been very low for the last few years. This might be more of a return to normal than a glut.
ReplyDeleteRebar
God, does anyone read anything that long written in a blog comment? I bought my condo in G'town for 360K in May 1999 for $200 sqft. A large one but not as nice sold in January for a million. I have a 30 year, 6.125 fixed rate mortgage on it, it rents now for a nice cashflow profit, and I get a nice tax loss each year to save me even more money. Now, if property values are going to sit still for five years then I might sell it if I decide I would rather be all in equities, but I like being diversified. The BH philosophy misses the point that few people will have to sell, despite suggestions to the contrary. What any property owner looks at is a longer term. I can't really complain that if I didn't get a million dollars this summer, six months after someone else did get it, that I "lost" that money. I didn't want to sell then and still don't, so what bubble? Multiply this by many millions who aren't selling, and so much for the end of the world. But it is more fun to read those who think the end is nigh.
ReplyDeleteSon, stop playing in the basement and get out and get a job. I'm sorry you never got around to buying your own place during the housing boom. Please stop complaining about it because it is tiresome. And start doing your own laundry!
ReplyDelete"Son, stop playing in the basement and get out and get a job. I'm sorry you never got around to buying your own place during the housing boom. Please stop complaining about it because it is tiresome. And start doing your own laundry! "
ReplyDeletepwn3d
Bothering to register and log in is even more exceptionally boring than people complaining about anonymous postings. I mean, does logging in as crackerjoe or PO'drenter or cantkeepajob really provide transparency?
ReplyDelete