Suburbs flush with homes for sale

[ckramer]

Inventory rises 54%, but effect on prices unclear

A decline in house sales last fall has left a January glut of unsold properties in suburban Boston as the big spring selling season approaches, according to data released yesterday.

The number of single-family homes for sale jumped 54 percent to 4,077 as of Friday, compared with a year earlier, said MLS Property Information Network of Shrewsbury. The data include all the suburbs surrounding Boston, extending out to Route 128; the city of Boston was excluded.

Some real estate agents expect this large supply of housing to be compounded by new sellers entering the market for the first time in February and March, which typically begins the busiest season for sales.

''We are going to be overstocked, because we have a lot more coming," said Gil Campos, an agent for Re/Max Real Estate Center in Foxborough.


link

[hatrack]

1. Yeah, I bet they are!

There was a really interesting thread on GD about houses for sale in/near Saginaw and/or Grand Rapids, MI. Properties out the ying-yang and no buyers.

[Stepup2]

5. Do you remember

when that discussion took place in GD? I live near the area and have been keeping tabs on this issue.

[NYC]

24. Probably within the last week.

I think the Michigan information appeared within a thread that was about Boston.

[hatrack]

30. It might have been just this weekend

Monday at the latest. :hi:

[Deja Q]

2. Looks like that little plan backfired...

Who's going to pay for the net losses, which are bound to be huge?

[VegasWolf]

15. Everyone historically. The banks will take a bath and dump the

properties at discounted prices, this will further impact existing home sales driving home values down, new home builders will have to drop their prices to compete. And the most screwed of all will be the people that bought at the price peak. Screwed backwards and forwards if they have an adjustable rate mortgage.

On the upside, if one has ready cash, like Bush's robber barron buddies, then they will scoop up the deals of a lifetime!

[formercia]

18. you found the secret

turning worthless paper into real property. In the end, the rich will have the resources to buy up the properties for pennies on the dollar, just like in the Depression.

It's like musical chairs with only one chair.

[VegasWolf]

20. yes, and in Texas in the 80's when oil prices fell. nt

[formercia]

3. What happens when the Baby Boom is over?

and nobody needs the houses any more?

[pretzel4gore]

7. the apocalypse?

i'm being silly...
the thing is, looking at all aspects of human affairs, the most striking thing about everything that has gone on since, well since WE let the bushviks murder John F Kennedy, is the absolute banality of the reasoning behind everything THE MAN does, and the stupidity of it in terms of generations/the future...can you imagine that someday the iraqis might demand, and the entire world agree, that the USA must pay Iraq reparation? Or that global warming unleash plagues that governments can't deal with beyond insisting to themselves via foxnews that everything is darn marvellous! or radioactive powerplants/waste storages began decaying so fast because governments haven't the will or the finance to manage them? or that entire generations grow up knowing that everything the MAN says was/is bullshit, even if it isn't....or that their (the piggy's) own descendants will be victims just as much as the poor in the slums of mexico or south africa etc? And all this happens just as technology breakthroughs makes life a fukking ball for potentially everybody...

[formercia]

10. The rich don't care

as they sip their mint juleps inside their climate controlled gated communities.

[Zynx]

22. Rich people aren't happy when they can't make money on investments.

[AngryAmish]

40. Rich won't be too happy if lots of mortgage defaults

When one gets a mortgage the majority of them are bundled together and sold as a security. Who buys securities? Many folks. Pension funds,hedge funds, institutional investors and the rich. If these securities default they are screwed too. Ha Ha.

[Thor_MN]

25. You are predicting population decline in the US?

Barring a pandemic, or a real war, I can't really see that happening. Do you know something I don't? Demand for managed properties will certainly increase as the boomers decide that they don't want to mow the lawn or fix the laeking pipes, but unless population in the US starts to decline, people will need more places to live.

[wtbymark]

4. Vermonters never thought act250 was a good thing- now they will n/t

[smirkymonkey]

6. How will these housing busts affect the rental market?

Anybody know?

[RC]

8. I would think it would help the renting situation.

If you can't sell it and are still making payments, you have to do something. Meeting two mortgages kinda cuts into the lunch money.

[formercia]

11. It reminded me all of those nice 5000+ sq foot houses

that the govt was forced to let Katrina victims live in. Can you afford the rent?

[wordpix2]

14. I predict the McMansions are going the way of the SUV

[formercia]

16. I can't wait to see the 20 Mule Team HUMMER.

[wordpix2]

37. McMansion owners will soon be renting out rooms b/c won't be able to

afford heating and maintenance costs

[justabob]

39. I saw a new house today that had taken 3 lots

It was the most enormous house I have ever seen without grounds like a country estate. I had to do a double-take because it looked like an apartment building being built in the middle of a single family neighborhod. I jokingly said that someday real soon it would be a boarding house, an upscale boarding house, but still.... It was shocking.

[Zynx]

23. When housing goes out of favor, the long term effect on rents is a rise in

rents.

[happyslug]

35. Renting should ALWAYS cost more than Owning

You have a Housing bubble when the opposite becomes the case (i.e when renting a house is cheaper then paying a mortgage on the same type of house). Thus look at the price for Rental housing. Except in very rare cases Rent almost never participates in a bubble (When people rent they are committing themselves for only a limited time period, unlike a Mortgage which is often for 20 years or more).

I give you some examples (I live in Johnstown Pa, which has LOW housing prices compared to the rest of the Nation so these values look low for the prices for Housing in Johnstown is low). A neighbor of mine purchased a house at $162 a month mortgage that he had been paying $250 a month for (Yes, it is a shack, but it is now his shack). It was a distressed sale (The previous owner had been found guilty of running a illegal gambling operation) so the Mortgage should be higher but renting should be about 10 to 20% higher than paying a Mortgage for the same property.

In most Bubbles this reverses and is one of the first signs of a bubble (When Renting is Cheaper than owning you have a severe problem). It takes months (and sometime up to a year) to foreclose on a house when the Mortgage is NOT paid, while most Tenants can be kicked out of their homes within weeks upon failure to pay rent. Thus Rental properties react to a drop in prices QUICKER than does housing being sold. Thus when a babble starts to break, rental property goes down first, and then housing prices up to a year later.

Thus Renting is what to look at to see where housing prices will go.

One last comment, do to Schooling, most people move between June 1 and September 1 in the US. You do NOT want to switch your Children mid-way though the School year so you move between those months (I know the South starts School in the Begging of August and ends in May, but that just reduces inter-state movement to and from the South to two months, June and July instead of the Three months in the Rest of the Country). I know people do move during the School year, but most families try to avoid doing so.

What this means is people buy homes starting in March to move into during the Summer. If the house is NOT sold by September 1 it may not sell till the following March. People in September and October tend to panic and drop prices drastically (This is what probably what triggered the Stock Market Crash of October 1929, people selling housing at a lost rather than hold it till March, notice I USe the term "Trigger" as opposed to "Caused", while the price of Housing may have been Triggered by the drop in the price of Housing, the Causation was deeper than just the Drop in Housing)).

Thus it will be interesting this summer on how Housing sells between April and September.

[northzax]

38. rents will go up

they've been fairly stagnant in DC lately, since everyone has been bailing to buy. For a while at least, while there are fewer properties to rent, the prices will increase, then stagnate as more and more units bought for investments go on the rental market. I think.

[Jacobin]

9. "Inventory rises 54%, but effect on prices unclear"

:rofl:

:rofl:

:rofl:

:rofl:

[wordpix2]

13. haha, this must be a * economist making that statement

[VegasWolf]

17. Only unclear to the realtors. Economists have seen this numerous

times. Realtors still desperately trying to get people to pay inflated prices.

[Eurobabe]

31. Looks like I picked a good time to get out of R.E. sales

leaving to go back overseas in June. Our sales are non-existent this month.

[wordpix2]

12. good news for home buyers-I predict rates will go down- but buyers also

are sellers

[VegasWolf]

19. With the staggering deficit, the hugest in history for any nation, and

increasing hourly due to the quagmire in Iraq and loss of the US manufacturing base, I predict interest rates will go through the roof. Pity any poor people with ARMs.

[wordpix2]

21. oh, you've got a point-the deficit is definitely worrisome

[Sadie5]

26. Tons of HUD homes for sale

Where I live. Bankruptcy's are up, people losing their houses. Wages are getting lower. Where does it end?

[MetaTrope]

27. There are certainly MILLIONS of buyers out there...

All those people who are having their homes foreclosed upon...

[Jamison]

28. Duh! The homes are still seriously overpriced.

I'm in the midwest where prices are a bit better, but still WAY overpriced.

I'm not gonna pay $350,000 for some 35-year old, 1,200sf home that needs repairs. These are about the cheapest homes in my area.

I'll just continue to rent my 1br. apartment for $540/month and let the landlord take care of my repairs and property taxes.

[f-bush]

29. Sounds like the bubble is about to burst!

[wordpix2]

34. bursting already-I complained to a realtor about a ridiculous price for

a house that needs a lot of work and she said, "Well, YOU name a price, then."

[dapper]

32. I heard about this...

I heard about this on the radio. It seems since housing prices are skyrocketing (overvalued) many people are selling into the strong market.

On the flip side, I have been researching foreclosures and they seem high as well.

I'm selling into this strong market and am actually buying in a market that really hasn't moved too much in the past few years. I'm hoping I end up buying low and selling high (in the future)

Dap

[leftofthedial]

33. with the economy in such incredible shape,

shouldn't there be more buyers than sellers? Shouldn't nearly everyone who is selling also be buying? Why the glut?

It couldn't be that more and more and more people are being forced *down* the economic ladder?

[wordpix2]

36. just checked my CT county's listings--still $350,000 for a shack on an ac.

of rocks and poison ivy