We're Coming Down the Other Side of the Mountain
Thanks to the reader who sent me the URL for this article:
"The latest report on third-quarter home prices, released Tuesday by the National Association of Realtors, showed continued strength. But increasingly there are signs that prices have plateaued."
""We're coming down the other side of the mountain," said DeKaser [chief economist for mortgage banker National City]."
"Builder pessimism - The builders DeKaser surveys are less optimistic than they were even a few months ago."
"New-home sales declining - DeKaser also notes that the number of new homes sold have fallen sharply since peaking in July at an annual rate of 1.3 million units."
"Inventories rising - Supplies of new homes are way up, to nearly 500,000 units, from 350,000 a few months ago. "That's an all-time high for new homes," says DeKaser. The higher the inventory, the more likely prices will fall."
"Sell times are up - Houses are sitting on the market longer."
"While DeKaser expects a slowdown, he predicts an "orderly transition" for the most part, with some exceptions. "There will be busts in some markets," he said. "Mostly, we'll come out of it unscathed.""
"But history shows that some over-valued markets could fare much worse."
"It may already be too late to cash out at the top, which some residents of hot markets have already done. About 500,000 California residents moved out of state since 2001, according to economy.com, many to take advantage of lower housing prices elsewhere."
"People looking to buy right now should shop carefully. Look at a number of homes, try not to fall in love, and be realistic about prices. Don't be afraid to bid low. The days of multiple bids may be over for a while."