Home Sweet Home, Insider-Tips on Minnesota real estate.

Don't expect home prices to rise this year

A growing number of economists are less optimistic an annual gain is likely in 2010, or even 2011.

It looks like the waiting is far from over for sellers-to-be who have put their plans to sell their homes on hold until the market picks up.

• It's now up to home sellers to offer incentives

According to The Wall Street Journal, a growing number of economists aren't expecting home prices to increase this year, or even in 2011.

To read the rest of the story go toMSN Real Estate

 

Fannie Mae Sees Housing Activity Flat in 2H

Fannie Mae expects second-half housing activity to remain flat with the year ago, as a tax credit pulled a number of sales into the second quarter.

The agency expects the low, 30-year, fixed-rate mortgages to boost refinance activity but not result in any sort of refinance boom. The current average rate of 4.5% is expected to . . . .click the link to read Fannie Mae Sees Housing Activity Flat in 2H by JASON PHILYAW or go to HousingWire.com

Negative News Flow

Although not unexpected, the news flow is about to take a more negative tone starting with the existing home sales report on August 23rd. We've been discussing this for some time ... and I'd like to highlight just a few pieces of forthcoming data:

The existing home sales report will show that sales collapsed in July (this is showing up in all the regional reports).

The existing home months-of-supply will jump to double digits.

House prices are probably falling again, although this might not show up in the repeat sales indexes until September or October (this data is released with a lag).

On August 27th, the second estimate of Q2 GDP will be released. This will probably show a significant downward revision from the preliminary estimate of 2.4% annualized growth. The downward revision is due to lower construction spending than the BEA initially estimated, less contribution from inventory adjustments, and the June surge in exports.

The unemployment rate will probably start ticking up again soon (or the participation rate will fall further).

Just something to be aware of ... by CalculatedRisk

Home Sales and Prices Not Yet at Rock Bottom

Home sales have yet to hit the trough of the recession, according the US Housing Market Monthly report by Capital Economics released Monday. Further, the economics firm states that pending home sales will do little to push home sale numbers higher. In fact, the number of pending home sales is so diminished, down 32% in the wake of the tax credit expiration, that existing sales will only dip in the coming months as these mortgage agreements are finalized.

Analysts at Moody's Investors Service agree, stating that the odds of . . .

Read the full article by CHRISTINE RICCIARDI published in HousingWire.com

Related article in Housingwire.com Zillow Sees 3.6% Dip in US Home Prices by AUSTIN KILGORE

Falling home prices

We already know existing home sales collapsed from May to June. The number of sales are reported but specific prices aren't known until closing typically months later.

June and July home sales typically don't close before August or even September and reports may lag until October or November.

Home sellers may feel the financial pinch when selling but if you're buying "up" this is a great opportunity as typically the higher the price the bigger the price reduction. 

And remember today's great interest rates.

Housing Recovery Stalls, But Are there Signs Of Hope?

Is housing in a double-dip?

Spencer and his colleagues at Zillow.com say housing values slipped in the first five months of the year. Michael and his number-crunchers disagreed slightly, but endorsed the view that they'd be lower in a few months. What's going on? Is this just the market skipping along at a bottom, or is this the beginning of a second, serious slide?

Read the experts' answers at Forbes.com

Economist Reports the Housing Market Double Dip is Beginning

Toronto-based Capital Economics, an independent macroeconomic research firm, said Tuesday that a double dip in the United States housing market is now materializing.

Furthermore, the report finds that for every home currently on the market, there are two homes waiting to be sold.

There are conflicting opinions on whether or not a double dip will occur, and warnings abound, but

Read more by JACOB GAFFNEY and published in HousingWire.com

Housing Double Dip Appears To Be Underway

Home values slide again in 2010, with few exceptions.

The final figures for the U.S. housing market's performance thus far in 2010 won't be officially released for several weeks. But a review of the best preliminary data available indicates that the recovery in home values that began in early 2009 has stalled. A second dip is clearly under way in some places, if not across the entire U.S.

Read the entire article by Stephane Fitch, and published in Forbes.com

 

Housing Expert: 'The Suburban Century Is Over'

At a recent meeting of the Urban Land Institute of Minnesota, Senior Fellow John McIlwain said "a new normal" will be created in the housing market over the next 10 years, and he marked the end of "the suburban century."

He noted that markets offering "a vibrant 24/7 lifestyle" will see the most robust activity, "net-zero-energy" units will become the norm, and the rental market will expand as homeownership rates fall to more historic levels.

Suburban town centers will gain popularity among those wanting an urban lifestyle without living in a big city.

Over the next decade, McIlwain said four demographic groups will fuel the housing market. He said older baby boomers increasingly are moving back to the central city, while younger baby boomers are finding it more difficult to relocate for jobs because they cannot sell their suburban houses. Meanwhile, millennials are more environmentally aware and will seek urban lifestyles, and immigrants who cannot afford large suburban houses to shelter multiple generations will increase demand for rentals.

With 1.5 million housing units per year needed to accommodate the shift to normal levels of household formation, McIlwain said zoning, financing, and regulations need to be rethought to meet housing demand.

Source: minnpost.com, Brad Allen (06/21/2010)

How high will Existing Home Months-of-Supply increase this summer?

Earlier I posted a graph showing the relationship of existing home months-of-supply to house prices. When months-of-supply is below 6 months, house prices are typically rising - and above 6 months-of-supply, house prices are usually falling (this isn't perfect, but it is a general guide).

So how high will months-of-supply rise this summer?

Here are some estimates of sales . . .  Read the full article published in the CalculatedRisk blog