Thursday, February 14, 2008

Wasn't it supposed to be a great time to buy last year?

Maybe not.

Home prices continued their plunge during the last three months of 2007, setting a real estate trade group's record for the biggest-ever quarterly drop. The national median price drop of 5.8%, to $206,200 from $219,300, was the steepest ever recorded by the National Association of Realtors (NAR), which has been compiling the report since 1979.

Each of the four U.S. regions recorded losses compared with the fourth quarter of 2006. The West took the worst hit, at 8.7%. Prices dropped 4.8% in the Northeast, 5.4% in the South and 3.2% in the Midwest.

Cape Coral, Fla., condo prices were down 26% compared with the last three months of 2006 to $202,300, and Tucson, Ariz., prices dropped 19.8% to $128,000. Atlanta prices fell 12% to $141,100, and Las Vegas was off 10.3% to $178,500.

In Lansing, Mich., square in the Midwest Rust Belt, prices plunged 18.8% to 109,600. In Sacramento, Calif., prices fell 18.5% to $197,600, and in both Jackson, Miss and Riverside, Calif. prices dropped 16.8%.

But but but there is no national housing bubble so said the so-called experts. And if there was a national bubble it was only really California and Las Vegas. Atlanta was immune. And the midwest was immune.

How's all that working out for everyone?

Hey but wait maybe all is not lost after all:

Bismarck, N.D., condo prices recorded the largest gain at 20.8% to $125,000, with New Orleans second at a 17.8% gain to $173,300.

OK I'm sold. The housing crash is over. I have $1200 coming from Jorge W. and he told me the terrorists will have won if I don't go out and spend it. So as soon as that bad boy shows up in the mail I'm putting downpayment on my dream home which is sure to appreciate 40% by the end of the year.


Anonymous said...

There is not one house in my town that is worth what is being asked.

Some of the most overpriced places are the two bedroom condos that are everywhere. Quite a few of the nicer ones are still pushing the 300-400k price range.

Prices have been dropping like a rock on some though. But it makes me wonder why some communities are still holding onto their ridiculous prices (and nobody is buying) while other communities have prices that are tanking.

BTW ... the link isn't/wasn't working.

Ed said...

"But it makes me wonder why some communities are still holding onto their ridiculous prices (and nobody is buying) while other communities have prices that are tanking."

I've noticed the same with older, established areas holding up better than newer areas. My theory is that there are fewer suicide loans and so less desperation to sell at any price.

I'm renting in such an area. Houses are 35-45 years old. My neighbors have lived in their house for 38 years, which just blows my mind.

There are 8 or 9 houses that have been for sale since I moved in a year ago. Prices range from $550K to $1.2M. No price drops on any of them. Stubborn owners, but obviously not desperate to sell.

There has been one home sold that I know of in the area and that was a foreclosure auction. So looking at the sales data you could make the argument that prices today are what they were a year ago. But in reality nobody knows what a house is worth since nothing has sold for a year.