Real Estate Bust

Manhattan (REB's home city, by the way) has been throwing many buyers, sellers and brokers for a loop.  Are prices going up or down? Is the market really softening?  Can I bid under the asking price or is that still taboo?

This week, several reports were released with conflicting data about the state of the New York City market.  I'll break down some of the highlights:

• A report by broker Prudential Douglas Elliman's showed a mean price gain from the first quarter to the second quarter of 6.6 percent, to $1.37 million. The median price gained 6.7 percent, to $880,000.
• A second report, by The Corcoran Group, showed that the mean sales price declined 3 percent in the quarter, to $1.247 million. The median fell 3 percent to $775,000. The Corcoran Group also showed 3 percent declines for the year.
• There were an average of 7,640 apartments listed for sale in the second quarter, from 6,904 the prior quarter and 4,965 a year ago, according to Prudential Douglas Elliman. Time on the market also lengthened, to 144 days - that's six days more than the prior quarter. Corcoran found a similar trend.
• The Mean negotiated discount was 3.5%. 

Rising interest rates are causing would-be homebuyers to take a second look at many are opting for rentals.  This is causing rents to rise:

• The mean rent reached a whopping $3,970 for leases signed last quarter, up 15 percent in a year. Median rent was $2,900, up 9 percent.
  

Continue reading "Are Manhattan Prices Going Up or Down? Mixed Messages Released This Week" »

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According to a report chronicled on Matrix, the Miller Samuel blog, the New Jersey real estate market looks to be in dire straights. 

 The New Jersey housing market took a sharp turn for the worse in April as contract-sales activity declined 11% from the prior month and ran 20% below the April 2005 level. At the same time, the inventory of unsold homes on the market increased by nearly 6,000 homes in April and now stands 71% higher than a year ago. That this deterioration comes in the midst of the prime spring selling season when home sales would normally be accelerating provides solid confirmation that the transition to a buyer-controlled market is now complete.

Full Report 

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An interesting article from the Boston Globe today paints a picture of how some buyers are desperate to sell in the Boston area.  The situation is especially precarious for sellers in a subdivision, where multiple, almost identical homes are now competing with each other for buyers... definitely a buyer's market. 

Across Massachusetts, the average number of single-family homes for sale each month during the first quarter of 2006 rose by 16,467, to a record 55,338 homes, the Massachusetts Association of Realtors said.

Homes are piling up on the market because sales have slowed dramatically in the past year. Sales of single-family homes fell to their lowest April level since 1995, according to a monthly housing report issued yesterday by the Warren Group, a Boston firm that collects real estate data.

Single-family home sales fell 16.5 percent last month, to 4,142 statewide, compared to the same month last year.

The condominium market, which until recently had better withstood the housing slowdown, experienced a 15.3 percent decline in sales last month, to 2,420 units.

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The word from Long Island this morning is that price appreciation in some counties has slowed dramatically while others have actually declined year over year. 

"The latest data from the Long Island Multiple Listing Service showed annual median price increases of 4.3 percent in April for [Suffolk and Nassau counties], with Nassau at $470,000 and Suffolk at $385,000. Nassau's price remained stable since March, but Suffolk's declined by 3 percent. Residential inventory, meanwhile, rose by 65 percent over the year in Suffolk County and 76 percent in Nassau County - each reaching levels not recorded as far back as the MLS records go, to 1980."

Many are suggesting that this has been the slowest spring in the last six years for local real estate, with the slowdown expected to continue into the summer.  One local agent also noted that of 60 updated listings in her region yesterday, 34 had lowered their listed prices.

Full Article

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In a appreciating housing market, builders often don't have to worry about customers walking away from contracts.  In the Washington market, though, buyers are beginning to see the writing on the wall and are backing out of these agreements, losing many thousands in the process. 

From The Washington Post:

"Despite the pain of giving up that much money, some buyers are canceling to cut their losses because builders are pricing the same houses for so much less, Alexandria lawyer James C. "Beau" Brincefield Jr. said.

"I have seen people literally walk away from $125,000 deposits rather than go forward with the closing because the value of a house identical to their own was being sold by the builder for $100,000 less," said Brincefield, who is preparing litigation for buyers who want to sue builders to get their deposits back."

 The Full Article

Continue reading "Buyers walking away from contracts, down payments" »

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