Housing Bubble and Real Estate Market Tracker

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day- "From the House's Mouth"

"The next cycle (of home building) will be driven more by move-down buyers than move-up families. Within the next three years, the majority of what enters the market will be more affordable and, in a lot of cases, smaller." - Mark Boud, principal and founder of Real Estate Economics, a residential real estate research company based in Irvine, California. (Press Enterprise, Oct. 27th)

Real Estate Sales and House Prices

• County's Ailing Housing Market: How Low Will It Go? (San Luis Obispo.com, Oct. 28th): "San Luis Obispo County: DataQuick: sales of all homes — single- family detached, condominiums and new houses — declined nearly 28% from September 2006, the lowest in 18 years. Single- family home sales plummeted 37.3% from the previous year and condominium sales declined 13.3%. Sales of new homes increased 14% in September. The median price of all homes declined last month to $495,000, an 8.2% dip from the previous year when the median... stood at $539,500. The median for new home sales decreased 16.3% from the previous September, while single-family detached houses dropped 7% from the prior year."

• Home Sales Are Down, But Home Prices Are Up (Duluth News Tribune, Oct. 28th) Minnesota: "From July-September, median prices were up 8% but the number of homes sold fell 12% compared with July-Sept. 2006.... Duluth Area Association of Realtors: There have been quite a few larger-ticket homes being sold... in the $600,000-$700,000 range... In a comparatively small market, a few high-priced houses can bring up the median price... The median selling price as calculated by the DAAR, was $155,587, compared with $143,500 during the summer of 2006, up 8%. Homes that sold were for sale an average of 60 days, which is about the same as summer 2006."

• Permits Dip Helps Balance Supply (AZ Central, Oct. 28th): "Last month's dramatic drop in building permits for homes across metropolitan Phoenix [is] actually a good sign... New-home sales are holding steady... There were 1,391 single-family permits issued from Casa Grande to north Peoria in September, while new-home sales or closings were more than double permits for the month at 2,991. The two market indicators should mean fewer speculative-built houses languishing on the market unsold. The Phoenix Housing Market Letter estimates there are 6,000-8,000 spec homes in the Valley now [vs.] an estimated 15,000-20,000 spec homes... earlier this year... Existing homes for sale are still hovering in the mid-50,000s."

• Portrait of a Slowdown (Philadelphia Inquirer, Oct. 28th): "Prudential Fox & Roach's HomExpert Market Report: Sales of existing homes in the eight-county Philadelphia region were down about 10% in Q3 from Q3'06. Median sale prices... in the five Pennsylvania counties were 1.9% higher in Q3'07 over Q3'06, 6% [higher] in the South Jersey counties. Philadelphia... saw a median price gain of 0.3% in the period. Center City prices were up 6.3%. Montgomery and Burlington Counties saw no median-price gain. Camden County sale prices dropped 2.0% from Q3'06... In the four other counties, price increases ranged from 1.8% in Chester to 6.2% in Gloucester."

• Local Home Auctions Offer Quick Way To Sell Houses (ABC4, Oct. 28th) Utah: "The real estate market around the country and here in Utah is slowing down... The slowing housing market convinced Mike Medina and his partner Will Velazquez to start a new company called myREauction.com. On Saturday night, the two men unloaded a house in 45 minutes. Medina and Velazquez are investors and developers out of Layton... The Plain City house was four bedrooms, 3 baths with more than 3,000-sf. It was recently appraised at $370,000 and that’s what the guys wanted... The winner called in his winning bid at $290,000."

• Local Experts Say Supply Of Homes For Sale Needs To Even Out (Charleston Post and Courier) South Carolina: "Though sales began slowing in February 2006, buyers continued to list their homes, creating a massive buildup in available properties. Locally, that number has climbed to more than 10,000 homes, giving the region an 11.6-month supply of inventory based on the number of sales made last year through the Charleston Trident Association of Realtors' Multiple Listing Service. The process of absorbing all the available inventory is expected to take a while, some local agents say it could take until 2009."

• Home Sales Continue Falling While Jobless Rate Rises (Las Vegas Business Press, Oct. 27th): "Las Vegas home sales hit their lowest level in nearly seven years in September, local housing analysts reported. Home Builders Reasearch recorded 1,399 new home sales in September, and SalesTraq showed 1,328 sales. Those are lowest numbers since January 2000, the two companies said. For the year so far, homebuilders said home sales are down 44.3% to 15,475 from a year ago. Median home prices were also down from a year. SalesTraq said median home prices were down 3.3% to $312,639."

• As Housing in Florida Plummets, the Top Tier of the Market Just Dips (NY Times, Oct. 27th) Florida: "Houses and condominiums with price tags of $1 million or more are still changing hands robustly in... exclusive areas, though at a pace less brisk than a year ago... Miami and other parts of Florida are continuing to attract interest among the wealthy. S&P/Case-Shiller index: In greater Miami, over all, home prices have fallen 7.3% from their peak in December 2006... But the median price for condos sold so far this year for over $1 million is up slightly at $1.51 million, according to the Realtor Association of Greater Miami and the Beaches."

Affordability Problems

• Buyers Play Waiting Game For Best Deals (Charleston Post & Courier, Oct. 28th) South Carolina: "Hundreds, if not thousands, of potential buyers are waiting on the sidelines to see whether real estate values in Charleston will drop... [Where] more than 10,000 sellers are courting an increasingly limited pool of buyers... Year-to-date, the median sales price for the Charleston region actually has risen by nearly 2% to $210,000, while home sales tracked by the local real estate industry's main trade group are off 20% through September compared with the same period of 2006... Sellers of existing homes are being forced to compete with deep discounts and incentives offered in brand-new nearby developments."

• Ariz.'S Choice: Lead Or Follow (AZ Central, Oct. 28th): "Inexpensive housing has long been Phoenix's key to steady growth. But in the past two years the median home price has soared from $169,400 in 2004 to $268,200 in 2006. Even with the current housing crunch, experts tend to agree that the median price won't fall back to the level of three years ago."

Mortgates and Real Estate Lending

• Mortgage Lenders Taking Big Risk in Michigan (WLNS TV, Oct. 28th): "A First American Core Logic study finds that mortgage lenders are taking a big risk in Michigan. Eight of the ten riskiest markets are located in the Midwest. Michigan has three of those markets for residential mortgages. The findings are based on tendency for fraud, house prices and the economy. Groupings of the Detroit area communities took the number one and number two slots. The Grand Rapids area ranked seventh. Foreclosure rate estimates for the national residential mortgage market are still well below 2%."

• Countrywide Surges on Expected Return to Profitability in Q4 (Eli Hoffmann in Seeking Alpha, Oct. 28th): "Shares of number-one U.S. mortgage lender Countrywide Financial surged Friday after posting a worse-than-expected quarterly loss, but surprising the Street by saying it expects to return to profitability by next quarter. A net loss of $1.2 billion (-$2.85/share) was the company's first quarterly loss in 25 years. Last year, the company earned $647.6 million ($1.03/share) in Q3. Analysts, on average, had expected a $1.65/share loss. The company said the situation will be short-lived: "We view Q3'07 as an earnings trough, and anticipate that the company will be profitable in Q4 and in 2008."

• Genworth, Radian Rise as Countrywide Boosts Hopes (Bloomberg, Oct. 26th): "Countrywide is a bellwether for the industry,'' said Kathleen Shanley, a bond analyst with Gimme Credit LLC in Chicago who covers the insurers. "If you believe what they said about Q3 being the trough quarter and profitability coming back, that bodes well for the entire industry...'' Genworth, the fifth-largest U.S. mortgage insurer, said Thursday that the [mortgage] business contributed $39 million to Q3 earnings, down 26% from a year earlier. The company also sells life insurance, long-term care coverage and variable annuities and covers mortgages in Australia and Canada. Its stock is down 19% this year."

• MGIC Investment Announces Quarterly Dividend of $0.025 Per Share (CNN Money, Oct. 25th): "MGIC Investment Corporation's (MTG)Board of Directors today declared a quarterly cash dividend of $0.025/share. The dividend is a decrease of $0.225/share from the prior quarterly dividend of $0.25/share which was declared in July 2007. The dividend is payable December 3, 2007, to shareholders of record on November 9, 2007."

Global Subprime Fallout

• US Giant GMAC To Back Bid For Northern Rock: Report (India Economic Times, Oct. 28th) :"Sunday Times: US financial services group GMAC (GM) will lead a rescue bid for stricken British bank Northern Rock... The Times reported that GMAC would play a key role in a bid being assembled by US private equity group Cerberus. Cerberus -- which owns 51% of GMAC -- is one of three suitors that are conducting due diligence on Northern Rock's accounts... Northern Rock also faces takeover interest from US private equity firm JC Flowers, while Richard Branson's Virgin Group wants to lead a separate consortium rescue plan."

• Mexicans Miss Money From Relatives Up North (NY Times, Oct. 26th): "From 2000-2006, [migrant remittances to Mexico] grew to nearly $24 billion a year from $6.6B, rising more than 20% some years. In 2007, the increase so far has been less than 2%... Until last year, the American housing trades absorbed hundreds of thousands of migrants, and the hardships of the trip north... paled beside the near certainty of finding work. Now, the construction slump... a year-old crackdown on illegal immigration at the border and in the workplace, and mounting anti-immigrant sentiment in places — has made it even harder for Mexican migrants to reach the U.S. and land well-paying jobs."

• Property Broker Sees A Dive In Global Real Estate Investment (International Herald Tribune, Oct. 25th): " Jones Lang LaSalle, one of the world's largest commercial real estate brokerage firms: Global direct real estate investment could fall this year as concerns about defaults on U.S. mortgages prompt lenders to tighten credit. Asia may be the only market to experience an increase in investment in H2'07 said Jane Murray, the Asia Pacific head of research at Jones Lang LaSalle. Global direct property investment rose 41% in 2006 to $699 billion, advancing for a third straight year."

Subprime Fallout

• Banks Rethink Relationships With Mortgage Brokers (OC Register, Oct. 28th): "As loan defaults and foreclosures rise, politicians and consumer groups [blame] mortgage brokers... Congress ha[s] introduced [two] bills expanding broker regulation... Bank of America (BAC) will close its lending division that works with brokers... This summer, Wells Fargo (WFC) stopped making subprime loans via brokers... In October, Washington Mutual (WM) said brokers will have to prove they disclosed key loan terms to borrowers... First American LoanPerformance: In Orange County in July, 2.47% of outstanding loans made by brokers were delinquent or in foreclosure vs. 1.21% of retail loans. Statewide... 5.88% of broker loans [have] gone sour vs. 2.2% of retail loans."

• Merrill is Not Alone – Barron's (Seeking Alpha, Oct. 28th): "Barron's says investors thinking Merrill Lynch's $8.4 billion Q3 writedown constituted a bottom for brokerages should beware: The industry's $20B mortgage securities writeoff—to date—is not done. Merrill alone could erase another $2B-$4B. Analyst Richard Bove of Punk Ziegel: Earnings will trend 5-10% lower industry-wide as mortgage originations and securitizations decline alongside M&A activity. Shares, however, reflect high projected earnings growth rates. Bove thinks financials' book values will be further revised downward and sees the bottom only when shares will trade for less than book and offer higher dividend yields. Barron's thinks no brokerage will be spared."

• Bofa Job Cuts Hit Wholesale Mortgage Business (Charlotte Observer, Oct. 26th): "Bank of America Corp. (BAC) on Thursday detailed its 3,000 planned job cuts: It will eliminate 700 of the positions in the wholesale mortgage business... BAC issued loans through a network of 7,000 independent mortgage brokers. The company will exit that business and instead focus on making loans directly to customers through branches, call centers and over the Internet. The bank's consumer real estate division has a total of about 13,000 employees... BAC said many of the 3,000 jobs cut are related to corporate and investment banking, which suffered during this summer's global credit crunch."

• Norlarco to be Sold (Coloradoan, Oct. 28th): "Norlarco Credit Union, beset by financial trouble caused by faulty construction loans in a flimsy Florida real estate market, will be sold to one of three Colorado credit unions by the end of the year. The National Credit Union Administration took over Norlarco in July after mounting construction loans in Lee County, Fla., went sour for Larimer County's largest credit union... Since late August, Norlarco has lost nearly $52 million in deposits and about 1,500 members... Norlarco still faces lawsuits alleging unfair business practices and still has $66.8M in delinquent loans on the books, including $36.7M that are between 6-12 months delinquent."

• Connecticut Subpoenas Rating Agencies (Akron Farm News Report, Oct. 27th): "Connecticut‘s attorney general said Friday that he has subpoenaed the nation‘s three largest debt-rating agencies [S&P, Moody's, Fitch] as part of an investigation into possible anticompetitive practices. The investigation focuses on whether the credit-rating agencies are using their dominant position to unfairly raise prices or exclude competitors in violation of Connecticut‘s antitrust laws... The attorney general] is also reviewing whether some credit-rating agencies pressured issuers into exclusive contracts under threat of a downgrade, and whether contracts that offer a discount in return for exclusivity violate Connecticut‘s antitrust laws by locking out other debt raters."

Foreclosure Data

• Housing Crisis Hits Home (Connecticut Post, Oct. 28th): "RealtyTrac: During H1'07, the number of foreclosures in the Bridgeport/Norwalk/Stamford region spiked by 522% compared to H1'06. RealtyTrac found a similar pattern in the New Haven/Milford area, where foreclosures jumped 547% in 2007. The Hartford region experienced a 446% increase compared to H1'06. The Association of Community Organizations for Reform Now, or ACORN, estimates foreclosures in the Bridgeport region will cost the economy $80 million. ACORN projects losses as high as $85 million in the Hartford region. ACORN's study predicts that foreclosures in Fairfield County will mostly occur in Bridgeport, Norwalk, Stamford and Danbury."

• California Sets Record for Home Foreclosures (San Francisco Sentinel, Oct. 28th): "DataQuick Information Systems: Californians lost their homes to foreclosure in record numbers for a second straight quarter, and the trend is creeping into affluent communities. Foreclosures statewide hit a new high of 24,209, besting the previous record by 39%. Default notices - the first step toward foreclosure - rose to 72,571 for the three months ended Sept. 30, breaking a record set in 1996. Census Bureau: The nation’s homeownership rate fell for a fourth straight quarter, the longest decline since 1981. The agency said foreclosures helped push the number of vacant homes to a record 17.9 million."

Global Opportunities

• Strong Loonie Not Affecting Real Estate Market In Booming B.C. (Canada East Online, Oct. 28th): "With a muscular Loonie and a B.C. housing market that shows no sign of slowing down, especially in Vancouver, logic suggests foreign investors might find the real estate market here a little chilly. U.S.-dollar purchasers face a double whammy of weakened currency and soaring real estate prices... [But] the average selling price of a house in Vancouver and its immediate suburbs reached $819,794 last month, with townhouse condos nudging $600,000 and apartments $400,000. For British Columbia as a whole, average residential prices climbed 12% in September to $436,000, compared with a year ago."

Macro Impact, And Will The Housing Slump Cause A Recession?

• Housing Bust Takes Big Toll On Realtors (Detroit News, Oct. 29th): "Thousands of Michigan real estate agents -- some with decades of experience -- are getting squeezed out of the business, casualties of one of the worst housing slumps in state history... Michigan agents say a lack of home buyers for the glut of houses on the market is driving them from the business. Those who do manage to move a property are realizing lower commissions as a result of dampened real estate prices... In the last year alone, the Michigan Association of Realtors has lost 10% of its membership, or about 3,500 agents."

• California's Economy May Get Post-Fire Boost - Barron's (Susan Lerner in Seeking Alpha, Oct. 28th): "California's wildfires have wreaked more than $1B in damages... yet Barron's says the destruction could boost the state's economy... Some 3,000 homes destroyed will need to be rebuilt, which Barron's speculates will result in lots of work for contractors and carpenters. One economist said homebuilding would stimulate the economy for the next 6-12 months. Among those with a major presence in the state, Barron's notes, are Standard Pacific and KB Homes. Meanwhile, Lehman Brothers has said individual insurers should find costs manageable, even if they reach $3B. Allstate, with a 13.4% share, is the most highly-exposed publicly-held insurer."

• Housing Slump May Reduce Payrolls, Growth: U.S. Economy Preview (Bloomberg, Oct. 28th): "Economists: Smaller employment gains and slower growth signal the two-year U.S. housing slump is reverberating through the economy... Employers [are expected to have] added 80,000 workers to payrolls this month following an increase of 110,000 in September, based on the median economist forecast... Manufacturers fired workers for a 16th consecutive month in October, while declines in subprime-mortgage lending and homebuilding led to job losses at construction companies and financial institutions."

• With The Market Slowing, Going Up's Status Changes (Sarasota Herald Tribune, Oct. 28th): "The [housing slump] has claimed one more casualty: this feature. It has become occasional, rather than weekly. The Sarasota Herald-Tribune developed the Going Up feature two decades ago to give equal treatment in the Sunday Real Estate section to upcoming residential developments. But that was when it was difficult to keep up with the number of new developments. Now, builders and developers brag about "traffic" through their sales centers, instead of growing stacks of sales contracts. And so the residential building industry must wait... until inventories of already-built housing is low enough... wait until there's enough money to budget for marketing."

• Ariz.'S Choice: Lead Or Follow (AZ Central, Oct. 28th): "Arizona Republic analysis: Metropolitan Phoenix has settled into a trajectory of rising costs and reduced opportunity, riding an economy singularly dependent on the ability to build and sell homes. At risk is the region's ability to compete in the global economy, which in turn threatens... growth... Housing accounts for at least $1 in every $3 that is generated in metropolitan Phoenix. If real estate begins to pick up as predicted by mid-to-late next year, the Valley's future may again appear secure. But in the larger world economy, Phoenix is essentially running in place, falling behind cities such as San Diego, Austin and Philadelphia."

• The Recessionary Macro Effect of the Worst U.S. Housing Bust Ever (Nouriel Roubini in RGE Monitor, Oct. 28th): "We're entering phase 2 [of the] housing bust: Home-builders’ bankruptcies, housing starts and permits crash, substantial layoffs in construction and real estate-related fields (mortgage brokers, mortgage lenders, etc.)... Home prices will have to fall by 20% to bring back home affordability to semi-normal levels; or mortgage rates would have to fall by 200bps... [Fat] chance... Long rates went up after the Fed eased on September 18th. So the adjustment will occur via a painful and deflationary 20% fall in home prices that will trigger an economy wide recession as any mainstream macro-econometric model shocked with a 20% fall in home prices shows."

• The Impact of the Housing Crisis on Main Street (Markham Lee in Seeking Alpha, Oct. 25th): "Scores of baby boomers abandoned the stock market to speculate on real estate after seeing the values of their 401ks declines during the tech crash... Prior to the real estate boom (and even during) we had a generation of Americans who were ill-prepared for retirement, and [now] the housing downturn/mortgage crisis likely set them back in even further. Social Security, Medicare and other public services could face more strain in coming years [because] of the current housing/credit/mortgage mess. Whilst the “investor class” will recall Black Monday... and the Tech Crash as their waterloos, Main Street will remember the housing downturn."

Homebuilders And Housing Stocks

• Beware of the Housing Fallout (NY Times, Oct. 28th): "Companies in sectors with less obvious connections to housing — like appliance manufacturers, carpet and furniture makers, and even chemical companies — are starting to [hurt]... Appliance-maker Whirlpool (WHR) met profit projections but announced that weaker-than-expected sales... Steven Wieting, Citigroup economist: “There’s a nine-month lag between building permits and housing-related durables, so we’re seeing that now.” P. J. Juvekar, a Citigroup chemical industry analyst, is cautious about paint companies like Sherwin-Williams (SHW) [as] "88% of Sherwin’s sales are in the U.S.... Furniture companies like Ethan Allen (ETH) and Herman Miller (MLHR) are near 52-week lows, yet it still looks way too early to go bottom-fishing in even those sectors."

• Inland Buyers Shunning Mega-Homes, Experts Say (Press Enterprise, Oct. 27th): "Smaller and more efficient houses that middle-income buyers can afford are needed to revive the stalled home-building industry and lure back buyers, marketing experts say. Alan Nevin, chief economist for the California Building Industry Association: "The next round of development will absolutely be smaller homes." Steve Ruffner, president of KB Home's (KBH) Inland Empire division: "The No. 1 issue on everyone's mind right now is affordability... the way to get that is to get smaller." KB homes in the past two years built homes sized between 1,800-4,000-sf, the homes in its newest communities range between 1,300-2,800-sf."

• WCI Communities: Totally Risky - But Icahn's in Control (SmallCap Investor in Seeking Alpha, Oct. 26th): "Morningstar: The $937 million of land and land improvements on WCI Communities' books are probably understated because about 60% of the company's land was put under contract before prices rocketed in 2004. Also, (WCI) owns 18 golf courses and several marinas, which can be liquidated to shore up the capital structure. Goldman Sachs recently re-initiated coverage with a “neutral” rating and a target price of $8/share [because] "the weak fundamentals of building towers and selling homes in Florida are seemingly priced into the shares (WCI is trading at 32% of book value) and new leadership at the company may support investor interest in the shares near term.”

• Black & Decker Power Surge: Earnings Fall But Beat Street (Baltimore Business Journal, Oct. 25th): "Black & Decker (BDK) earned $105 million in Q3, or $1.59/share. BDK lowered its earnings outlook in April, and analysts... expected earnings of $1.44/share for Q3. A year ago, Black & Decker had earned $125M, or $1.74/share. But Q3 sales came in better than predicted... The tool and hardware giant grew third-quarter sales by 1% to $1.6 billion. In a year when U.S. housing starts will likely fall more than 20%, BDK expects sales growth and roughly flat earnings, officials pointed out. They said BDK has done it by diversifying -- across business lines and across global lines."

Commercial Real Estate and Real Estate Investment Trusts (REITs)

• Tulsa Sees Boost In Commercial Real Estate (The Journal Record, Oct. 29th) Oklahoma: "The Tulsa CoStar survey of multi-tenant office buildings larger than 25,000-sf found the occupancy at 82.4% at Aug. 31. Factoring in the still-incomplete Eastgate Metroplex lowered that to 79%, the same rate as the central business district. The suburban occupancy rate without Eastgate stood at 83.3%, but with it sank to 78%– marking one of the first times in years [or] decades that the suburban numbers trailed downtown... Although the pace of sales has slowed from 2006... prices have remained below replacement cost, keeping the deals attractive... The industrial market at June 30 recorded a vacancy rate of 7.08%."

• CGM Eases Up On Real Estate In Top Realty Fund (Seattle Times, Oct. 28th): "Kenneth Heebner, manager of the top-ranked U.S. real-estate mutual fund... the $1.7 billion CGM Realty Fund, [has] divested SL Green Realty, Manhattan's biggest office landlord... Heebner, whose fund has annually returned 40% a year since September 2002, cut stakes in REITs to 25% of assets from 75% in December. "You're seeing a retrenchment in the private-equity, hedge-fund and brokerage businesses, and there could be a lot of layoffs. That could have a devastating impact on high-end residential real estate in New York. Appetite for office space will also decline." CGM Realty had 4.5% of its assets in SL Green as of June 30."

• Highly Leveraged Commercial Real Estate Deals Are Dead, But Capital Is Ready To Jump At Low-Debt Deals (Financial Week, Oct. 26th): "Commercial real estate Lenders have shifted from participating in highly leveraged CMBS-backed deals to doing old-fashioned “balance-sheet lending"... based on financial fundamentals such as earnings and cash flow projections in the near term... The floating-rate commercial mortgage backed securities market is dead right now due to lack of investor demand... The fixed-rate CMBS market will have to work off a hefty backlog before it begins to show signs of renewed growth, [forecasted] from six months to two years... [However,] the Bank of Ireland has earmarked about $1 billion to lend in the U.S. over the next 12 months."

• Webster Shopping Center Sells For $17.7M (Conde Nast Portfolio, Oct. 26th): "A 102,000-square-foot Webster, Mass., shopping center is being sold for $17.7 million. An affiliate of of Plaza Properties LLC of Worcester sold the Price Chopper Plaza, which serves three states, to Cedar Shopping Centers REIT (CDR)... Cedar VP Michael Winters: The purchase adds to the New York REIT's growing portfolio in southern New England... The deal gives Cedar 14 retail assets and more than 2 million-sf in Connecticut and Massachusetts combined; the REIT has seven Massachusetts properties, the largest being Franklin Village Plaza in Franklin, which has 289,000-sf anchored by Stop & Shop."

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Comments

[Lee Carlson]

Most of the article is old news. What we are all hoping to see is some hard facts about what will get the housing market moving again.
In Florida, where I am an Active Realtor, 26th year,..there is no sign of a recovery, and in fact, sales are taking longer than ever in spite of ever lower prices ! On Clearwater Beach alone, there are approx. 1,000 homes /condos, for sale and last months sales were 30 units ! It will take forever to absorb that much inventory ! In spite of that, some builders are still building,..( doesn't make much sense, does it ? ), but then again, who ever said that builders or Banks were smart ..? In the Tampa Bay area, even Don Trump is having a hard time getting a development off the ground,.. for lack of financing. He likes to put his name on buildings, but not any cash.
Lower interest rates will definitely not solve the problem as R.E,Taxes kill most sales ! Politians love to tax people but hate to reduce taxes, thus a tremendous glut of homes in the entire state of Florida ! No one, I repeat, NO ONE can predict with any degree of acuracy, when there will be a recovery, even though prices on resales are getting lower every day ! Those who put money down on new condos, before they were even finished, are now walking away from them ! Think a half point drop in interest rates is going to cure this situation ? I think not ! LC