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(MSNBC)   Housing starts jumped in June -- back to almost a third of their bubble peak   (msnbc.msn.com) divider line 36
    More: Followup, housing starts, building permits, RBC Capital Markets, long way to go, home construction, condos, structures, United States Department of Commerce  
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680 clicks; posted to Business » on 19 Jul 2011 at 1:25 PM (3 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



36 Comments   (+0 »)
   

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2011-07-19 01:02:16 PM
Look folks, I'm sorry for all of you who bought their house at the top of the peak, but the prices aren't going to get back to those levels for a loooooong time, nor should they. That's why it's called a "bubble," it's artificial inflation.
 
2011-07-19 01:36:42 PM
I'm still waiting for tulips to return to their bubble peak. Boy will I have the last laugh!
 
2011-07-19 01:51:23 PM

Snot Monster from Outer Space: I'm still waiting for tulips to return to their bubble peak. Boy will I have the last laugh!


Just you wait, now that there is no more pork belly futures, the bubble for bacon has begun!
 
2011-07-19 01:55:16 PM

poisonedpawn78: Snot Monster from Outer Space: I'm still waiting for tulips to return to their bubble peak. Boy will I have the last laugh!

Just you wait, now that there is no more pork belly futures, the bubble for bacon has begun!


Mmmmmmmmmmm, bacon bubbles.
 
2011-07-19 02:05:34 PM
Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.
 
2011-07-19 02:15:20 PM
With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?
 
2011-07-19 02:22:45 PM

IrateShadow: Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.


When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?
 
2011-07-19 02:27:35 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


The next house my wife and I get has a good chance at being a new home instead of an existing, because we're looking for some pretty specific requirements. While we COULD retrofit an existing house, it's of course going to come down to cost / benefit / time. Not looking forward to that whole debacle, since I'm going to have to do some crazy digging into any builders we might use to avoid using someone who cuts every corner possible...

If we weren't looking for a very specific set of criteria for our next house, I'd be more inclined to go with existing.
 
2011-07-19 02:34:04 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


Because you don't own that land over there, but you do own this land over here, with no house on it.
 
2011-07-19 02:34:47 PM

hurdboy: IrateShadow: Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.

When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?


No, you are wrong. The value of a house (for tax purposes or otherwise) has nothing to do with the price somebody paid on the house, or the amount of an outstanding loan on it. It is the price somebody is willing to pay for it.

As for idiots trying to sell their houses for more than they are worth, well, they are idiots. Idiots do idiotic things.
 
2011-07-19 02:35:27 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


New houses in exurbia are still cheaper than a lot of vacant houses in nice gentrified neighborhoods. And some of those vacant houses are so shiatty they should just be torn down.
 
2011-07-19 02:38:42 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


Because maybe I don't want to live in Detroit?
 
2011-07-19 02:47:49 PM

Geotpf: hurdboy: IrateShadow: Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.

When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?

No, you are wrong. The value of a house (for tax purposes or otherwise) has nothing to do with the price somebody paid on the house, or the amount of an outstanding loan on it. It is the price somebody is willing to pay for it.


I understand why a house is worth what it's wroth. Re-read what I wrote, with emphasis added.

A tax assessment is about the most concrete thing you can get short of a sale price.
 
2011-07-19 02:48:00 PM
Heh, TFA states it is predominately condos, which is wrong.

The accurate term is multi-family, which means apartments could be the driving force behind the numbers. Rentals, not purchased properties.
 
2011-07-19 02:49:08 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


Many of them around here cut corners during the bubble to get to market as quickly as possible. Others have lain (lied?) so neglected due to owners walking away from the mortgage that it would take significant repair. I was lucky and bought mine in '08 so it hadn't decayed much. But sadly, I have watched an entire neighboring subdivision that only had 10-15 houses built when the crash came slowly get reclaimed by vegetation.

//value still lower from when I bought it, but I'll be in it for 10 more years or so
 
2011-07-19 03:04:58 PM

Apeboy: Heh, TFA states it is predominately condos, which is wrong.

The accurate term is multi-family, which means apartments could be the driving force behind the numbers. Rentals, not purchased properties.


Not to mention the fact that the numbers will very, very likely be revised downward - again.

These reports are among the most BS market news. They are never accurate, yet they always seem to move the market.

We have a GLUT of new homes already on the market that have been sitting empty. This isn't going to change the trend.
 
2011-07-19 03:12:42 PM
While I'm always happy about improving economic indicators, I am extremely wary of this one. There is still shadow inventory. There are still massive amounts of homes sitting empty. There should not be much of an increase in new home construction.
 
2011-07-19 03:35:06 PM

hurdboy: When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?


I'm not sure when the last assessments were, so that's a possible explanation. But the couple of peoperties that I've been watching are already bank-owned, so I'm thinking that something else might be at play there.
 
2011-07-19 03:43:29 PM

IrateShadow: I'm not sure when the last assessments were, so that's a possible explanation. But the couple of peoperties that I've been watching are already bank-owned, so I'm thinking that something else might be at play there.


Question for Fark Accountants; if it was listed for sale for a certain period of time at a price it'll never sell for, it would seem.....something about capital depreciation, or something. It's been a long time since I took accounting, and it was never something terribly interesting.

Much like that three month-old computer that got stolen from your house is worth every penny you paid for it new, despite the crumbs in the keyboard when it got stolen....

/GAAP.....?
 
2011-07-19 04:30:53 PM
Once the government waived mark-to-market accounting, all bets were off. They had to do it, Citi was heading below a dollar and going down for the last time. But now we're paying the price, as anyone can say that an asset is worth whatever they feel like. Investors have no transparency anymore, it's all "take our word for it".
 
2011-07-19 04:59:52 PM

hurdboy: Geotpf: hurdboy: IrateShadow: Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.

When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?

No, you are wrong. The value of a house (for tax purposes or otherwise) has nothing to do with the price somebody paid on the house, or the amount of an outstanding loan on it. It is the price somebody is willing to pay for it.

I understand why a house is worth what it's wroth. Re-read what I wrote, with emphasis added.

A tax assessment is about the most concrete thing you can get short of a sale price.


Meh, I trust Redfin's price-based-on-nearby-sales thing over the some tax dude's numbers (or Zillow's, for that matter). Just adjust for condition and ultra-local defects (house is right next to the railroad tracks or freeway) and you are golden.
 
2011-07-19 05:01:35 PM

hurdboy: IrateShadow: I'm not sure when the last assessments were, so that's a possible explanation. But the couple of peoperties that I've been watching are already bank-owned, so I'm thinking that something else might be at play there.

Question for Fark Accountants; if it was listed for sale for a certain period of time at a price it'll never sell for, it would seem.....something about capital depreciation, or something. It's been a long time since I took accounting, and it was never something terribly interesting.

Much like that three month-old computer that got stolen from your house is worth every penny you paid for it new, despite the crumbs in the keyboard when it got stolen....

/GAAP.....?


That doesn't make any sense. Listing a $100k property for $1 million doesn't change anything for accounting purposes.
 
2011-07-19 05:03:28 PM

Geotpf: Meh, I trust Redfin's price-based-on-nearby-sales thing over the some tax dude's numbers (or Zillow's, for that matter). Just adjust for condition and ultra-local defects (house is right next to the railroad tracks or freeway) and you are golden.


You need to look at recent sales of similar square footage and use the price per square foot as your guide.
 
2011-07-19 05:05:56 PM

IrateShadow: hurdboy: When did they do local property assessments? If the bank is preparing to foreclose, or do a short-sale, they have to calculate what the loss is going to be. What better figure to use for the value than what the city/town/county/whatever says its worth...amirite?

I'm not sure when the last assessments were, so that's a possible explanation. But the couple of peoperties that I've been watching are already bank-owned, so I'm thinking that something else might be at play there.


Our local prices are starting the seasonal bump. Some of the places I'm looking to buy re-listed the first of June for 20 to 30 percent higher than the previous list. I'll just wait until September when they go the other way again.
 
2011-07-19 05:05:59 PM

hurdboy: Question for Fark Accountants


You paid some amount to purchase the property. You sell it for some amount. The difference between those amounts is what you end up paying taxes on- if you've lost money, you get to claim that loss as a deduction. Real estate cannot be depreciated; chattel can.
 
2011-07-19 05:19:41 PM

rnld: Geotpf: Meh, I trust Redfin's price-based-on-nearby-sales thing over the some tax dude's numbers (or Zillow's, for that matter). Just adjust for condition and ultra-local defects (house is right next to the railroad tracks or freeway) and you are golden.

You need to look at recent sales of similar square footage and use the price per square foot as your guide.


The number I mentioned does exactly that, automatically.
 
2011-07-19 08:42:40 PM

Geotpf: That doesn't make any sense. Listing a $100k property for $1 million doesn't change anything for accounting purposes.


It does if the local government is valuing it at a million, and you're responsible for taxes on a property worth a million......
 
2011-07-20 07:15:22 AM

Apeboy: Heh, TFA states it is predominately condos, which is wrong.

The accurate term is multi-family, which means apartments could be the driving force behind the numbers. Rentals, not purchased properties.


Winner.
 
2011-07-20 07:34:02 AM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


That and the millions of jobs associated with construction, they still need to feed their families. Does it make sense in a macro perspective for more houses to be built? Not really. Should every home builder lay off his entire work force and disassemble their capital infrastructure because supply outweighs demand? I don't think so.

And the issue with supply and demand is very simple. There aren't many people out there who want to or can buy a house right now.... at these prices. Price can fix everything. Lower prices will increase sales and get that industry back on track. Delaying the inevitable only spreads the pain.

Geotpf: As for idiots trying to sell their houses for more than they are worth, well, they are idiots. Idiots do idiotic things.


That's about 95% of the listings in my area... delusional, bubble-clinging sellers. The best thing is that when they give up, they say "well I'll just try next year", like prices are going to be higher. Hell, if they wait until rates creep back up, they'll likely die before selling for the price they expect.

Occam's Nailfile: These reports are among the most BS market news. They are never accurate, yet they always seem to move the market.


I don't trust a single report coming from NAHB or NAR. They actively pushed people into the bubble with their propaganda, are actively pushing our political leaders to recreate the bubble, and they (NAR) have been lying for years about their data. The only thing I question when their numbers are uncharacteristically bad is if they're trying to cause fear in political circles to push their case for more expensive and insidious programs to drive up their business by spurring demand.
 
2011-07-20 11:21:53 AM
Link (new window)

Remember that surprisingly strong home starts data from yesterday which drove the market by 100 DJIA points higher yesterday? Neither do we. According to the NAR, June existing home sales once again declined, this time to 4.77MM from 4.81MM, the lowest since November, and well below the expected rise to 4.90MM. This number was 8.8% below June 2010's 5.23MM. Total inventory increased by 3.3% to 3.77 million units, or 9.5 months of supply at the current sales rate up from 9.1 in May. The biggest question mark is the surge in order cancellations which soared from 4% in May to an unprecedented 16% in June. That's one in five home transactions being cancelled in the middle of the deal. Here is Larry Yun's explanation for this shocking development: "The underlying reason for elevated cancellations is unclear." So let's get this straight whenever the number is better than expected it is always due to the economic recovery. When it is worse, it is "unclear." Thanks Larry. Now go back to fudging data please.
 
2011-07-20 11:29:20 AM

IrateShadow: Something weird has been going on in my neighborhood. A bunch of properties that have been on the market for almost a year have suddenly been relisted at twice the price they weren't selling at before.


One of our farktarded city commissioners is a realtor who keeps bleating publicly that he hasn't "sold a house in a year". He has one listed that is a block from my house. It's a single family, one story house, about 1200 sq. ft., on a 1/4 lot with no alley access, no on-street parking, and room for one car (parked in the side yard in reach of the sidewalk). It's at the intersection of two very busy streets and across the street from a noisy elementary school. Last I knew, he wanted $168,000 for it two years ago. He wants to cram it full of students, but there's literally no place for them to park legally. I just checked his website to see what he wants for it now. There are NO houses listed on his site, yet I see his dumb name on real estate signs all over town.

Seriously, fark realtors.

This guy is also instrumental in trying to repeal our rental inspections law. He knows it will result (already has) in dumping ever more substandard houses onto the market.
 
2011-07-20 11:45:51 AM

betweenthenines: Here is Larry Yun's explanation for this shocking development: "The underlying reason for elevated cancellations is unclear." So let's get this straight whenever the number is better than expected it is always due to the economic recovery. When it is worse, it is "unclear." Thanks Larry. Now go back to fudging data please.


He's a professional liar, and a complete p.o.s. I'm surprised he didn't blame it on the lending industry, FHA, and govt GSE's. Go through some of NAR's press releases, most of them contain language which directly says or insinuates that "able and qualified" would-be buyers are being hindered by lending restrictions and unfair requirements. It is funny since being "able" is the opposite of being "unable", which is what they're basically crying about: "give more shoddy loans to people who are high risk factors, and stick the losses to the taxpayers."

Here's a letter they just sent to the Secretaries of HUD and Treasury, try to pretend while reading it that they aren't being 100% insidious and self-serving while playing the pathetic "American Dream" heart-string tug in a personal letter which they're releasing to the public:

Link (new window)

We believe and see evidence every day that the pendulum has swung too far already with regard to mortgage credit regulation.

Lending standards today are somewhere between the sane world of the 1990's and the batshiat insane world of the housing bubble. They're asking the govt, which has already done everything it can to prop up housing prices, to use its power and money to bring back the malaise of the housing bubble, just so 1m scumbag realtards can get their commission. These criminals need to be drawn and quartered.
 
2011-07-20 11:48:40 AM

atomic-age: Seriously, fark realtors.


Agreed. I read this story earlier and thought it is worth sharing:

Scumbag Realtor (new window)
 
2011-07-20 12:58:24 PM
* POP *
 
2011-07-20 02:25:39 PM

Pick: With all the vacant houses sitting out there, why are there any housing starts at all? I guess some folks that can buy want new?


Rebuilding from tornadoes and floods?
 
2011-07-20 02:25:49 PM

wolvernova: atomic-age: Seriously, fark realtors.

Agreed. I read this story earlier and thought it is worth sharing:

Scumbag Realtor (new window)


Except for this:

Bring your Imagination and Ideas, hey the kitchen has orange counters with aqua appliance from the 70s; the bathroom is pink and grey 50's tiles.

I have aqua appliances. They are 50's,not 70's. I'd shoot someone and hide the corpse for a pink and grey bathroom that was all original.
 
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