MaxedOutMama
Saturday, March 25, 2006
La La La! Impeachment.
As the Dems try to both cater to and suppress the impeachment frenzy among the lunatic segment of their base, I feel the need to turn my attention to something that matters. Because, you know, the very, very last thing the Democratic leadership wants to have happen is an impeachment trial, at which actual evidence would be presented to show that Iraq did have WMDS and the Iraqi intelligence service was in contact with terrorists. This would mess up the storyline badly. I bet some Republicans in the house are praying for it, though.
But enough of the political fun. Let me point you to a very good resource on housing statistics. Hanley Wood carries a constantly updated set of indicators for people in the housing industry. This is free! Bookmark it.
And one, just one stat you need to watch if you are in the market somehow is the purchase money applications survey by the Mortgage Bankers Association. This is the March 17th week's survey (released March 22nd):
Condo prices are going to plummet in some of these places. Take a gander at this photo from Washington DC (in some DC areas, 50% of the housing was owned by "investors"). This is good advice if you are going to get in trouble with payments you can't afford in the next few years. The Fed has spoken, and you are on your own. Remember, interest rates are still very low by historical terms, but with lending criteria tightening (to what they should have been all along), the pool of available buyers is shrinking regardless. I leave you with this nice summary of risk factors. Don't be a sucker.
But enough of the political fun. Let me point you to a very good resource on housing statistics. Hanley Wood carries a constantly updated set of indicators for people in the housing industry. This is free! Bookmark it.
And one, just one stat you need to watch if you are in the market somehow is the purchase money applications survey by the Mortgage Bankers Association. This is the March 17th week's survey (released March 22nd):
The Market Composite Index — a measure of mortgage loan application volume was 565.0 – a decrease of 1.6 percent on a seasonally adjusted basis from 574.4 one week earlier. On an unadjusted basis, the Index decreased 1.6 percent compared with the previous week but was down 13.8 percent compared with the same week one year earlier.The previous week's was down 12.92% from a year earlier. These are leading indicators, whereas the sales report is a trailing indicator. A lot of "investors" operate on credit lines and don't get traditional mortgages, which is one reason the market was so surprised by the news that new-home sales in February had declined 10.5%. But it was not across the board:
The seasonally-adjusted Purchase Index decreased by 2.3 percent to 393.6 from 403.0 the previous week whereas the Refinance Index decreased by 0.6 percent to 1574.5 from 1583.6 one week earlier.
By sector of the country, sales fell by the largest amount last month in the West, a drop of 29.4 percent. Sales were also down in the South, dropping 6.4 percent. Sales rose in the Northeast by 12.7 percent, and sales in the Midwest were up by 5.2 percent.Hint: The south and the west has many concentrated hotbed areas of speculation. Prices are dropping in the areas from which the speculators are fleeing. Some sellers of their own homes are getting wise and starting to drop their prices, which probably accounts for the 5.2 increase in existing home sales in February. Many of the hot markets have a glut of housing compared to the number of people who can afford to buy. Forget that 6.3 month ratio. In Naples, Florida, there's a 28-month supply.
The slowdown in sales pushed the inventory of unsold homes up to a record of 548,000 at the end of February. At the February sales pace it would take 6.3 months to sell all of the homes on the market, up from 5.3 months in January.
Condo prices are going to plummet in some of these places. Take a gander at this photo from Washington DC (in some DC areas, 50% of the housing was owned by "investors"). This is good advice if you are going to get in trouble with payments you can't afford in the next few years. The Fed has spoken, and you are on your own. Remember, interest rates are still very low by historical terms, but with lending criteria tightening (to what they should have been all along), the pool of available buyers is shrinking regardless. I leave you with this nice summary of risk factors. Don't be a sucker.
