housing-market

Zillow: Home Values Lose Another $2 Trillion

Filed in BP, economy, EPS, Gold, GOld juniors, Gold Market, housing-market, Lear, o, revenue by on February 9, 2011 0 Comments
Zillow: Home Values Lose Another $2 Trillion

Anybody that thinks housing has reached a bottom needs to have their head examined. If you doubt that just ask the fine folks at Beazer Homes (NYSE:BZH) who reported a loss of $48.8 million, or 66 cents a share, down more than 200% from a $48 million, or $1.17 per share, income a year earlier. That dismal effort came on revenue that plummeted 48% to $110.3 million from $213.1 million just a year earlier. Meanwhile the spring is really not looking that much better. Beazer reported a total of 527 home closings and 540 new orders during the period, down 43.6% and down 23.9% respectively. Of course, that what happens Uncle Sam steps out of the mix with tax goodies and rebates—the market falls apart. Because the truth is despite historically low interest rates, the demand for homes of all types remains at exceptionally low levels. That’s true no matter what Lawrence Yun says. The end result is falling prices and more borrowers left underwater…. From Bloomberg by John Gittleson entitled: Home-Price Drop Leaves 27% of U.S. Owners Underwater on Loans “ The number of U.S. homes worth less than their outstanding mortgage jumped in the fourth quarter as prices fell and lenders seized fewer properties from delinquent borrowers, according to Zillow Inc. About 15.7 million homeowners had negative equity, also known as being underwater, at the end of the year, up from 13.9 million in the previous three months, the Seattle-based real estate information company said in a report today. The total represented 27 percent of mortgaged single-family homes, the highest in Zillow data dating to the first quarter of 2009. Home prices are declining as foreclosed properties sell at discounts and unemployment at 9 percent limits buyer demand. Values will fall as much as 5 percent this year, putting more homeowners underwater, before finding a floor as the economy improves, said Stan Humphries, Zillow’s chief economist. “ These seem like fairly grim numbers,” Humphries said in a telephone interview. “We’re still expecting a bottom in home values later this year. And this, if anything, makes me a bit more confident because I’m seeing very large corrections now, which means the market can start to repair itself.” The median value for a U.S. single-family home was $175,200 in the fourth quarter, down 2.6 percent from the end of September and 5.9 percent from a year earlier, according to Zillow. Values have fallen 27 percent from the June 2006 peak. Las Vegas led the nation in …

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Millionaires More Likely to Strategic Default

Filed in BP, CBS, Gold, GOld juniors, Gold Market, housing-market, Lear, o by on February 8, 2011 0 Comments
Millionaires More Likely to Strategic Default

Not surprisingly, the bursting of the housing bubble has moved up to the final rung on the ladder. Far from the days of the subprime debacle, now even the “good” people are getting squeezed. The difference is the rich are smart enough to walk away from it all. In fact, homeowners with loans of more than $1 million default at a much higher rate than “the little people” do. From CBS News entitled: Even More Millionaires Defaulting on Mortgage “ For Darren Thomas that ocean view was quickly losing its value. He says, “I bought it for [$1.385 million]. It is worth less than [$800,000], maybe less.” Thomas bought his townhome in 2006 but after seeing its value drop steadily he stopped paying. “I haven’t made a payment in two years,” he says. “It was business decision. It was an easy decision. I have a property worth six or 700,000 less than when I bought it. I was making payments of 10,000 a month.” Thomas has gone into strategic default. He could make payments but is refusing to put more money into a home that is worth less than his mortgage. Among luxury homeowners he is not alone. One in seven homeowners with loans over $1 million are seriously delinquent compared to one in 12 with mortgages below $1 million. The more you owe, it seems, the better off you may be. Darren Thomas continues to live in his home because banks are often slower to foreclose on million-dollar homes. For those who have stopped paying their million-dollar mortgages it’s just an investment that didn’t work out. “As negative equity took place and drove the value down it became an investment not worth holding onto,” says Corelogic’s Mark Flemming. “Not much different than a regular stock you would sell.” “People like myself, business people, are going it is silly to throw good money after bad,” says Thomas “The loss is not mine. The loss is the banks.” When it comes to real estate, the rich are different. They can be just as ruthless as the bankers.” I guess Nick Carraway was wrong after all. In some ways the rich really are just like the rest of us….suckers for a good bubble. The difference is they understand the money/business part of the game better than most. For them its just a business decision. By the way, according to CoreLogic, home price have fallen for the fifth straight month. Overall, house prices delined 1.8% for the month of December. Related Articles: Case-Shiller Index Shows Renewed Home Price Declines 2011 Housing Market Forecast Case-Shiller Index Screams Housing Double Dip Meredith Whitney Predicts a Housing Double-Dip Zandi: Expect 8% Home Price Declines To learn more about Wealth Daily click here Millionaires More Likely to Strategic Default originally appeared in Wealth Daily . Wealth Daily is a free daily newsletter featuring contrarian investment insights and commentary.

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China’s Housing Bubble Begins to Top

Filed in BP, citigroup, economy, Gold, GOld juniors, Gold Market, housing-market, Lear, o, target by on February 1, 2011 0 Comments
China’s Housing Bubble Begins to Top

Round and round she goes, where she stops nobody knows…. From Bloomberg entitled: China’s Housing Market Nears U.S., Japan Bubble Levels: Chart of the Day “ China’s property market may be heading into a bubble as the economy’s reliance on real estate reaches a level close to the housing peaks in the U.S. and Japan, according to Citigroup Inc. The CHART OF THE DAY shows investment in residential property accounted for 6.1 percent of China’s gross domestic product last year, the same level as the record in the U.S. in 2005 that was followed by the subprime crisis, said Shen Minggao, Citigroup’s China research head. It’s also about 2 percentage points away from Japan’s 1970s housing boom, he said. “ China’s property market is entering into a bubble stage,” Shen said in a phone interview. “It’s evident that property prices are no longer sustainable once the residential investments achieve above 8 percent of nominal GDP, and China may not be an exception.” A 10 percent drop in China’s property investment translates to a 1 percentage point decline in nominal GDP, Shen said. Adding investments indirectly related to the real estate industry, nominal GDP will fall 2 percentage points to 2.5 percentage points, he said China’s property prices rose for 19th month in December, climbing 6.4 percent from a year earlier. The government last week increased the minimum down-payment for second

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Case-Shiller Index Shows Renewed Home Price Declines

Filed in BP, Gold, Gold Market, housing-market, Lear, o by on January 25, 2011 0 Comments
Case-Shiller Index Shows Renewed Home Price Declines

This one is no real surprise since the double dip in home prices is accelerating…. From Bloomberg by Shobhana Chandra entitled: Home Prices in Us. Declined 1.6% From Year Earlie “ Residential real-estate prices dropped in November by the most in a year, signaling housing has yet to join the U.S. rebound. The S&P/Case-Shiller index of home values in 20 cities fell 1.6 percent from November the prior year, the biggest 12-month decrease since December 2009, the group said today in New York. The decline matched the median forecast of economists surveyed by Bloomberg News. “ The housing market is in a state of hibernation,” said Zach Pandl , an economist at Nomura Securities International Inc. in New York. “We have a very severe foreclosure problem. Prices are going to keep weakening this year. Weakness in the housing market is likely to keep the Fed relatively cautious in its statement tomorrow.” The Case-Shiller gauge is based on a three-month average, which means the November data was influenced by transactions in October and September. Sixteen of the 20 cities in the index showed a year-over- year decline, led by a 7.9 percent drop in Atlanta. In November, prices in eight markets dropped to fresh lows from their 2006, 2007 peaks. “ With these numbers more analysts will be calling for a double-dip in home prices ,” David Blitzer , chairman of the index committee at S&P, said in a statement. A double-dip would be reached when the 20-city index sets a new post-peak low, which may happen in the first half of this year, said Blitzer. Industry projections reinforce the concern about housing. The number of homes receiving a foreclosure filing will climb about 20 percent in 2011, reaching a peak for the housing crisis, said RealtyTrac Inc., an Irvine, California-based data seller. Home values may drop as much as 11 percent through the first quarter of 2012, which would put them 36 percent below their 2006 peak, according to a Dec. 8 Morgan Stanley report.” From the looks of this report, it is shaping up to be another tough Spring. Related Articles: 2011 Housing Market Forecast Case-Shiller Index Screams Housing Double Dip Meredith Whitney Predicts a Housing Double-Dip Zandi: Expect 8% Home Price Declines To learn more about Wealth Daily click here Advertisement “R-4 Trigger” Predicts Which Options Will Jump 68% or More After three full years of beta testing (and cumulative returns of 10,805%), the “R-4 Trigger” is ready for public release… Which means, just 27 days from now, you could be sitting on easy 68% gains. Click here to learn more. Case-Shiller Index Shows Renewed Home Price Declines originally appeared in Wealth Daily . Wealth Daily is a free daily newsletter featuring contrarian investment insights and commentary.

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The 2011 Foreclosure Flood

Filed in BP, depression, Gold, GOld juniors, housing-market, Lear, o by on January 13, 2011 0 Comments
The 2011 Foreclosure Flood

It’s hardly news these days, but the latest numbers on foreclosures speak for themselves. Again, it proves that the bottom in housing is nowhere in sight. Here’s the latest… From the AP by Janna Herron entitled: 2011 to top 2010 record of 1 million foreclosures The bleakest year in the foreclosure crisis has only just begun. Lenders are poised to take back more homes this year than any other since the U.S. housing meltdown began in 2006. About 5 million borrowers are at least two months behind on their mortgages and industry experts say more people will miss payments because of job losses and also loans that exceed the value of the homes they are living in. “2011 is going to be the peak,” said Rick Sharga, a senior vice president at foreclosure tracker RealtyTrac Inc. The firm predicts 1.2 million homes will be repossessed this year. The blistering pace of foreclosures this year will top 2010, when a record 1 million homes were lost, RealtyTrac said Thursday. One in every 45 U.S. households received a foreclosure filing last year, a record 2.9 million of them. That’s up 1.67 percent from 2009. Foreclosures are expected to remain elevated throughout the year, pushing home prices down another 5 percent nationally before finally bottoming out. More than half of the country’s foreclosure activity came out of five states in 2010: California, Florida, Arizona, Illinois and Michigan. Together, these states recorded almost 1.5 million households receiving a filing, despite year-over-year decreases in California, Florida and Arizona. The toxic stew grows… By the way, The Zillow Home Value Index has now fallen 26% since its peak in June 2006. That’s more than the 25.9% decline in the Depression-era years between 1928 and 1933. Related Articles: 2011 Housing Market Forecast Case-Shiller Index Screams Housing Double Dip Meredith Whitney Predicts a Housing Double-Dip Zandi: Expect 8% Home Price Declines To learn more about Wealth Daily click here Advertisement American OPEC We’re about to buck the peak oil trend. It’s all about shale oil these days, and if you play the right stock, you could easily see your investment double in a matter of weeks. I’ve found one little-known company that is able to double the amount of oil we get from shale reserves… Here’s how to get your share of these underground profits. The 2011 Foreclosure Flood originally appeared in Wealth Daily . Wealth Daily is a free daily newsletter featuring contrarian investment insights and commentary.

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ADP Surprises to the Upside

Filed in BP, economy, Gold, Gold Market, Gold Prices, housing-market, o, RBC Capital by on January 5, 2011 0 Comments
ADP Surprises to the Upside

Here’s one for the bulls. ADP has surprised to the upside this morning. Are happy days here again? Only time will tell. Either way, more jobs beats fewer jobs any day of the week. From Reuters by Jonathan Spicer entitled: Surprise Jobs surge boost economic outlook “A surprise surge in private-sector employment last month to its highest level on record provided the most bullish signal in months that the economy is slowly mending. Private employers added 297,000 jobs in December, triple the median estimate by economists and up from the gain of 92,000 in November, an ADP Employer Services report showed on Wednesday. “You cannot ignore the strength of this report,” Tom Porcelli, a U.S. economist at RBC Capital Markets. “With small business now beginning to start to ramp up hiring, it’s safe to feel better about the labor backdrop.” Adding to the rosy picture, the number of planned layoffs at U.S. firms fell last month to the lowest level in 10 years, according to a report by consultants Challenger, Gray & Christmas Inc. The ADP figures came ahead of the government’s much more comprehensive labor market report due on Friday, which will include both public and private sector employment. That report is expected to show a rise in overall nonfarm payrolls of 140,000 in December, based on a recent Reuters poll of analysts, but a rise in private payrolls of 145,000. Economists often use the ADP report to fine-tune their forecasts for the payrolls numbers, though it is not always accurate in predicting the outcome.” All eyes have now shifted to the Friday BLS number…. Related Articles: The Top 25 Financial Stories of 2010 2011 Housing Market Forecast Case-Shiller Index Screams Housing Double Dip Zandi: Expect 8% Home Price Declines To learn more about Wealth Daily click here Advertisement This Metal Humiliates Gold It took gold prices an entire decade to make investors 387%. … But experts believe that this little-known metal could hand you more than four times your money in the next couple of months! Click here to find out how. ADP Surprises to the Upside originally appeared in Wealth Daily . Wealth Daily is a free daily newsletter featuring contrarian investment insights and commentary.

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Zillow: Another $1.7 Trillion to the Downside in Housing

Zillow: Another $1.7 Trillion to the Downside in Housing

My pal Charlie is as persistent as the sunrise. So when he called me last week to give me a hard time about my 2011 Housing Market Forecast the only surprise was it that took him so long. Twenty-four hours after it hit the web I saw Charlie’s number go up on line one. You see, a real estate agent by trade, he never misses a chance to call me an idiot when in his eyes I “bad mouth the American Dream” The result has been five-year running dialog in which I have bested him every single time. The guy is a glutton for punishment. So like a good pal I answer the phone anyway even though I know I’m in store for the rerun of my nightmares. “Steve,” he says, “you can’t be serious.” “As a heart attack,” I answer, “Like it or not dude there is still another 8-10% downside.” This obviously drove him to distraction since he must have forgotten the 100 or so conversations we already had that were exactly like this one. “Not a chance this time son. There has never been a better time a house”, he told me with what I can only guess was straight face. From that point on I knew I was just wasting my time again. The dude may have been great scrum-half but he didn’t know jack about the laws of supply and demand. In fact, I don’t think they actually teach that real estate school but I hear the Kool-aid is top notch. Meanwhile, the mountain of evidence against my friend continues to mount. From Bloomberg by By Hui-yong Yu entitled: U.S. Home Values May Drop by $1.7 Trillion This Year: Zillow “ U.S. home values are poised to drop by more than $1.7 trillion this year amid rising foreclosures and the expiration of homebuyer tax credits, said Zillow Inc., a closely held provider of home price data. This year’s estimated decline, more than the $1.05 trillion drop in 2009, brings the loss since the June 2006 home-price peak to $9 trillion, the Seattle-based company said today in a statement. The drop in home values pushed more buyers underwater, meaning they owe more on their mortgages than their homes are worth, Zillow said. The percentage of homeowners with so-called negative equity reached 23.2 percent in the third quarter, up from 21.8 percent at the end of 2009. “ With foreclosures near an all-time high in late 2010 and high rates of negative equity persisting, it does not appear that the first part of 2011 will bring much relief,” Stan Humphries, Zillow’s chief economist, said in the …

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Home Depot’s Profit Rises 21%, Beating Estimates

Filed in earnings, housing-market, o, revenue, Spot Gold by on November 16, 2010 0 Comments
Home Depot’s Profit Rises 21%, Beating Estimates

Filed under: Earnings Reports , Forecasts , Home Depot (HD) , Housing Home Depot’s ( HD ) third-quarter earnings came in 21% higher than the same period last year, beating analysts’ estimates. For the quarter ended Oct. 31, the company reported a profit of $834 million or 61 cents a share, up from $689 million or 44 cents a share last year. Revenue rose 1.4% to $16.6 billion. Same-store sales increased 1.4% These results mark the fourth straight gain after three years of decline. Chairman and Chief Executive Frank Blake said: “As the business stabilizes, we continue to improve our operational performance … We are exercising good control over our expenses.” Continue reading Home Depot’s Profit Rises 21%, Beating Estimates Home Depot’s Profit Rises 21%, Beating Estimates originally appeared on BloggingStocks on Tue, 16 Nov 2010 09:00:00 EST. Please see our terms for use of feeds . Read | Read | Permalink | Email this | Comments

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The American Housing Market Is Headed for Total Destruction

Filed in Debt, deflation, earnings, housing-market, obama, Spot Gold, ubs by on October 13, 2010 0 Comments

The issue with the recent robo-signing scandal is that clear title could disappear in the American mortgage market. Part of the outrage is that U.S. banks have been foreclosing on mortgages which they don’t even own. Part of the reality is that the convoluted process of securitisation means banks may not be able to prove at all they actually do own the mortgages. Already large unions in the U.S are encouraging borrowers to challenge banks to prove they won your mortgage. They’ve set up a website asking the question, “Where’s your note?” You can see where this is headed. No one in America wants to own a failure. The banks want to foreclose on homes and sell them and avoid taking losses. Borrowers (some of them, and some of them rightly) want to avoid paying a debt for an asset that’s worth less. No one wants to be responsible anymore because the most lucrative and least painful route is to abandon responsibility and your word. This is a serious breakdown in one of the most basic elements of a functioning market: contract (doing what you said you’d do). People at every level appear to have cheated and lied during the housing boom. The borrowers who lied on their loan applications…the mortgage originators who made the loan without any documentation of work or income…the securitiser who packaged it up and sold it to investors…the ratings agency that rated the debt investment-grade…the insurance companies who sold default insurance …

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Little Hope for the Housing Market

Filed in housing-market, silver by on August 31, 2010 0 Comments

Just when you thought the housing market couldn’t get worse, it did. New single-family home sales slumped 12.4% in July to a record-low annual rate of 276,000 units, as homebuyers shunned their realtors in the absence of government support. The consensus expectation was for a slight up-tick to a 333,000 unit annual rate, so I suppose it’s time to throw out the models. Sales over the prior three months were also revised lower by 9,000 units. No section of the country was spared, though the West led the parade with a 25.4% plunge. On a year-over-year basis, sales were down 32.4%, the fastest decline since April 2009. New home inventories held steady at 210,000 units, the lowest level in 42 years, according to Ned Davis Research analysts. Low-to-medium-priced homes were in the most demand. Only properties in the $150,000 – $300,000 price range rose as a share of total sales. So median prices fell to the lowest level since 2003.

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The Case-Shiller Index Rises But Confidence Wanes

Filed in economy, Gold, GOld juniors, housing-market by on July 27, 2010 0 Comments
The Case-Shiller Index Rises But Confidence Wanes

Charlie the Realtor called me again this morning to give me another load of grief. Ecstatic beyond words, he was all warm and fuzzy in the wake of the Case-Shiller Home Price Index data released this morning. Not surprisingly, home prices were up for the month instead of down. According to Standard & Poor’s, the 20-city index was up for the third month in a row and was 4.6% higher than a year ago, as all but one of the 20 cities recorded increases in April. So seduced by the headline number, Charlie dropped me line. However, since he didn’t bother to read the whole report , he missed out on this bit of analysis. According to the report: “While May’s report on its own looks somewhat positive, a broader look at home price levels over the past year still do not indicate that the housing market is in any form of sustained recovery,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “Since reaching its recent trough in April 2009, the housing market has really only stabilized at this lower level. The two Composites have improved between 5 and 6% since then, but this is no better than the improvement they had registered as of October 2009. The last seven months have basically been flat.” Meanwhile, we also learned today that consumers are still down in the dumps making for an even tougher environment this fall… From the AP by Anne D’Innocenziao entitled: Consumer confidence retreats further in July “Americans’ confidence in the economy eroded further in July amid worries about a job market that has proven stubbornly stagnant. The report raised concerns about the overall economy and the back-to-school season. The Conference Board, a private research group, said Tuesday that its Consumer Confidence Index slipped to 50.4 in July, down from the revised 54.3 in June. Economists surveyed by Thomson Reuters expected 51.0. The decline follows last month’s nearly 10-point drop, from 62.7 in May, which marked the biggest since February, when the measure also fell 10 points. The second straight month of declining confidence follows three months of increases. With unemployment stuck near 10 percent and the stock market having wiped out gains made early this year, Americans are skittish about spending. A continuing stream of sobering economic data — from disappointing job figures in May and June to weak housing numbers — is increasing worries that the economic recovery is stalling just as government stimulus programs are disappearing. One component of the Consumer Confidence Index, which measures how people feel now about the economy now, declined to 26.1, from 26.8. The other barometer, which measures respondent’s outlook over the next six months, declined to 66.6, from 72.7 last month. The index — which measures how shoppers feel about business conditions, …

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Iamgold (NYSE:IAG), Goldcorp (NYSE:GG), AngloGold (NYSE:AU) Up on Weak Economy

As we gradually sift through the economic data and news, confirmation we are far from any type of recovery continues to emerge, as the latest data in new housing starts confirm once government props are removed it falls apart. Gold companies like Iamgold (NYSE:IAG), Goldcorp (NYSE:GG) and AngloGold Ashanti (NYSE:AU) will continually be the beneficiaries of the weak economy, as gold prices resume

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