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oldandslow
04-11-2007, 10:34 AM
...whomever gets the presidency in 08, they are apt to have some economic messes to deal with...

Home prices to fall for first time in 2007
Real estate group sees 0.7% drop in prices this year, the first annual decline in nearly 40 years of tracking.
By Chris Isidore, CNNMoney.com senior writer
April 11 2007: 12:00 PM EDT


NEW YORK (CNNMoney.com) -- The National Association of Realtors said Wednesday it expects its measure of home prices to fall this year for the first time since the group began tracking sales nearly 40 years ago.

In its latest monthly forecast, the group said it expects a 0.7 percent decline in the median price of an existing home sold in 2007. A month ago it had been projecting a 1.2 percent increase. Half of all homes sell for more than the median and half for less.


The subprime mortgage mess led the group to cut its sales forecast as well. It said problems some buyers may have getting financing reduced its forecast for sales of existing homes this year by 100,000 homes to 6.34 million. That sales pace would be 2 percent below the 6.48 million sold in 2006.

Fastest and slowest growing housing markets
The subprime mortgage sector, which handles loans to people with less than top credit, has seen a number of top lenders stop making loans while others have gone bankrupt in recent months as delinquencies and mortgage default rates rise. That has led remaining lenders to tighten underwriting standards and raise rates for those borrowers.

The Realtors said the problems in subprime could actually lead to a stronger housing market over time if tighter lending helps prevent buyers from getting in too deep with low "teaser-rate" mortgage loans before being hit with much higher payments a year or two later.

"Simply stated, a loan with the lowest monthly payment probably isn't in your best interests - borrowers need to understand worst-case scenarios," David Lereah, the Realtors' chief economist, said in a statement.

He also tried to put the best picture on the housing price decline, saying much of it was caused by a sharper slowdown in sales in higher-priced markets along the East and West Coasts.

Home prices: Don't expect a quick rebound

The group estimates that about three-quarters of the markets nationwide could still see a narrow increase in median sales prices during 2007, but that those gains will be outweighed by the declines in the markets that saw big gains in sales and prices during the record sales years of 2004 and 2005.

Slower sales have already produced year-over-year decline in prices in eight of the last nine months through February, according to the group's numbers. The median price in February was 1.3 percent below year-earlier levels, and was 7.6 percent below the record high price set last July.

The group's forecast sees an even bigger slowdown in the new home market, as it is forecasting new-home sales will come in at 904,000 this year, down 13 percent from the 1.05 million sold last year. It sees new-home sales picking up slightly in 2008, to 935,000.

Housing starts are forecast to fall 18 percent to 1.47 million in 2007 before rebounding slightly in 2008, which would still be well below the 1.8 million starts seen in 2006.

The group sees median new home prices edging up 0.4 percent this year to $246,200. But while the Realtors didn't mention it, that increase could be a false gain, as about three-quarters of builders have reported having to offer incentives such as paying closing costs or offering buyers extra features for free to maintain sales.

Weakness in sales has also cut into the revenue and earnings of the nation's leading builders.

Subprime risk: Most vulnerable markets
On Tuesday No. 2 home builder D.R. Horton (Charts) reported a 37 percent drop in the number of new homes it sold in the latest quarter, citing continued weakness in prices and saying the typical start to the spring home buying season hasn't begun.

While Horton is expected to still report a profit for the period when it reports results, No. 3 builder Pulte Homes (Charts) reported a loss in its most recent period, as did No. 4 Centex (Charts) and New Jersey-based Hovnanian Enterprises (Charts).

No. 1 home builder Lennar (Charts) and No. 5 KB Home (Charts) both reported losses in their quarters ending in November, although both returned to an operating profit in their most recent period. The CEO of KB Home said Tuesday that he expects the housing slump to get worse.

recxjake
04-11-2007, 10:37 AM
.7 decrease... ROFL

pikesome
04-11-2007, 10:41 AM
Real estate speculation + lax lending requirements = bubble bursting

I'm thinking it might just be best to take the pain of this "correction" rather than try to cushion it. Some lessons are best learned the hard way.

Eleazar
04-11-2007, 10:47 AM
Faux growth eventually => correction

jAZ
04-11-2007, 11:06 AM
The "faux growth" in the housing market accompanied by the surge in refiancing and resulting spending... plays a huge part in the economy that Bush supporters tried to trumpet over the last 2-3 years.

You don't get to have it both ways... sorry.

Unless you are a lender who made billions and billions of dollars in loans during that period, then lobbied the Republican Congress to change the Bankruptcy laws so that you will experience windfall profits as a result of lending at interest rates assuming one set of bankruptcy rates, and then changing the rules to lower that bankruptcy rate.

Eleazar
04-11-2007, 11:24 AM
Yeah, I know Bush = de debbil and he's to blame for all the world's problems. But I wasn't making any kind of political statement. I was just saying that the market corrects itself when things get out of control. The real estate bubble falsely inflated our impression of this economy just like the tech bubble falsely inflated our impression of the 90s economy.

patteeu
04-11-2007, 11:26 AM
The "faux growth" in the housing market accompanied by the surge in refiancing and resulting spending... plays a huge part in the economy that Bush supporters tried to trumpet over the last 2-3 years.

You don't get to have it both ways... sorry.


You mean like the both ways you'd like to have it when you discredit the Bush economy on the basis of the so-called housing bubble but don't level the same kinds of criticisms at the Clinton economy which was bouyed by the tech bubble? After trying so hard over the past few days, you've finally said something that I find funny. ROFL

tiptap
04-11-2007, 11:29 AM
And to add to the problem this administration drove up government debt as opposed to the Democratic administration that moved aggressively to put spending in line with tax revenues. As such they help contribute to rising rates for loans by taking out such big loans themselves.

Eleazar
04-11-2007, 11:30 AM
You mean like the both ways you'd like it when you discredit the Bush economy on the basis of the so-called housing bubble but don't level the same kinds of criticisms at the Clinton economy which was bouyed by the tech bubble? After trying so hard over the past few days, you've finally said something that I find funny. ROFL

Why don't you ask the spokesman for the Clinton boom?

tiptap
04-11-2007, 11:31 AM
The criticism is over how they managed the monies they were responsible for more deficit less deficit.

StcChief
04-11-2007, 11:31 AM
You mean like the both ways you'd like to have it when you discredit the Bush economy on the basis of the so-called housing bubble but don't level the same kinds of criticisms at the Clinton economy which was bouyed by the tech bubble? After trying so hard over the past few days, you've finally said something that I find funny. ROFL

The great over valued Internet companies with piss poor business plans and wild speculation of ideas. Fueled salary, bonuses for IT guys. Created shortages of workers, spurned the Off-shore IT crap...

We knew it was a bust, it wasn't if but when.

Still pissed at how all that got out of hand and we in IT are still cleaning it up and dealing with the aftermath.

pikesome
04-11-2007, 11:31 AM
And to add to the problem this administration drove up government debt as opposed to the Democratic administration that moved aggressively to put spending in line with tax revenues. As such they help contribute to rising rates for loans by taking out such big loans themselves.

WTF!?!?! I must have missed a few years, don't remember this happening.

tiptap
04-11-2007, 11:33 AM
They added to the false growth by using Keynesian spending to inflate the economy. And for a freaking war not something like infrastructure or OUR people and they couldn't even get the war prosecuted well.

patteeu
04-11-2007, 11:38 AM
WTF!?!?! I must have missed a few years, don't remember this happening.

My handy tiptap to English dictionary says that that phrase means "Democratic administration that moved aggressively to raise taxes."

tiptap
04-11-2007, 11:47 AM
As opposed to Republican method of raising spending by the government so besides paying the equity for a wasteful war we also get the interest payments for that rat hole.

tiptap
04-11-2007, 11:49 AM
WTF!?!?! I must have missed a few years, don't remember this happening.

Look up.

http://www.u-s-history.com/pages/h1982.html

Note the blue area during the Clinton Adm. He remained disciplined to controlling spending vs revenue.

pikesome
04-11-2007, 11:54 AM
Look up.

http://www.u-s-history.com/pages/h1982.html

Note the blue area during the Clinton Adm. He remained disciplined to controlling spending vs revenue.

Or revenue increased faster than it could be spent. I'd also argue that the Pres has very little control over spending, I'm not sure either Bill or George can effectively be credited with the spending/revenue levels. Congress still controls the checkbook entirely.

Pitt Gorilla
04-11-2007, 11:56 AM
And to add to the problem this administration drove up government debt as opposed to the Democratic administration that moved aggressively to put spending in line with tax revenues. As such they help contribute to rising rates for loans by taking out such big loans themselves.It's hard to blame the administration for this mess. I mean, who wouldn't want to spend as much money as you like without worrying about actually having to pay for it? It reminds me of some college kids when they get their first credit cards.

Eleazar
04-11-2007, 12:06 PM
It's hard to blame the administration for this mess. I mean, who wouldn't want to spend as much money as you like without worrying about actually having to pay for it? It reminds me of some college kids when they get their first credit cards.

I'm not pleased either, but the root of the problem is that the voting public refuses to hold the government responsible for rampant spending.

What was the Bush vs Gore campaign essentially about? How to spend the projected budget surplus. What is one of the main topics the next time around? Free health care for everyone.

All voters care about is goodies. Who is going to promise me the most stuff?

tiptap
04-11-2007, 12:12 PM
At least there was a surplus to consider at the end of Clinton's Administration. The discipline was there. It didn't exist at all for a Republican Controlled Congress and Whitehouse. BIG DIFFERENCE THERE. The Democrats are looking for budget neutral ways to get things done as opposed to free spending Republicans.

pikesome
04-11-2007, 12:31 PM
Our out-of-control budget also erodes personal freedom. When government grows, as Thomas Jefferson once famously put it, "liberty yields." Dollar by trillion dollar we are voluntarily giving up our liberties for a government that promises us, in return, a blanket of protection from cradle to coffin. Republicans are steering us in the direction of the "workers' paradise" of a European socialist welfare state. The reply from the Democrats is faster, faster.

The emphasis is mine.

Link (http://www.nationalreview.com/moore/moore200402020906.asp)

This is a shit pie both sides are feeding us equally. It's not just "those guys", it's every, single, god-forsaken politician.

Eleazar
04-11-2007, 12:35 PM
Republicans are steering us in the direction of the "workers' paradise" of a European socialist welfare state. The reply from the Democrats is faster, faster.


Couldn't have said it any better.

tiptap
04-11-2007, 12:42 PM
Let's see a lot of industry is looking to get out of under their obligations as far as providing medical insurance. Add to that the 40 million who are not insured. And that sounds like someone needs to take on the odious prospects both for the health of individuals and competitiveness of industry. But it isn't deficit spending to move the monies circulating through health industry presently and put them under governmental supervision. The administrative costs (even if you include fraud) is small compared to the expenditures and smaller in percentage to overhead from a diverse hospital and insurance expenditure as present.

You may not want government taking care of medical insurance. OK But that is quite different then running deficits over the monies you are managing. That has been the face of Republicans for 20 years of administration vs the 8 years of Democratic adm. that moved toward a balanced government spending.

patteeu
04-11-2007, 12:53 PM
You may not want government taking care of medical insurance. OK But that is quite different then running deficits over the monies you are managing. That has been the face of Republicans for 20 years of administration vs the 8 years of Democratic adm. that moved toward a balanced government spending.

I think you're wasting your breath (figuratively speaking). No one is going to buy the idea that Clinton, left to his own devices, would have held spending to the levels that the Republican Congress did during that period. It took three tries to get him to back off his protection of the status quo welfare programs previous democrats had given us.

pikesome
04-11-2007, 01:04 PM
Let's see a lot of industry is looking to get out of under their obligations as far as providing medical insurance.

Business, by default, have no such obligation. None. Many have been paying it over the years because they told their employees they would but this idea that business have an obligation is horseshit.

Add to that the 40 million who are not insured. And that sounds like someone needs to take on the odious prospects both for the health of individuals and competitiveness of industry.

What level of insurance is required for these people? Emergency service? They got it. Do I have to pay for sex-change operations like the Brits do? The government already provides a minimum level of coverage, doctors and EMTs don't let people die because they can't pay. How much farther do you want? Where's the limit?

Also you mention "competitiveness". While that's an awful vague term, I think you're going to have to work real hard to convince me that Gov control can, in any way, shape, or fashion, improve "competitiveness".

But it isn't deficit spending to move the monies circulating through health industry presently and put them under governmental supervision. The administrative costs (even if you include fraud) is small compared to the expenditures and smaller in percentage to overhead from a diverse hospital and insurance expenditure as present.


Administrative costs of a government-run program will be lower? Besides being counter-intuitive I think you're over looking the removal of the profit motive to control costs. When you don't have to turn a profit you don't bother controlling income/cost. Which, by the way, is exactly the problem with our government has with the overall budget. They have no reason to control spending regardless of income levels. If they run a profit, cool, if not who cares. The way to fix this problem is to quit spending money on things. That means reducing spending on existing things and quit finding new ways to waste my money.

BucEyedPea
04-11-2007, 01:11 PM
How are falling house prices bad news?
It means MORE people can afford the American dream.
For those stuck with overpriced houses well blame the govt for that phenomena.

Seems the options are lower prices sometimes with a higher interest rate or higher prices with lower interest rate. Wonder what it all adds up to at the end of a 15 or 30 years?

I suspect different regions will be affected differently. Afterall, it's location, location, location.

You can always move to Iraq too if things don't work out. Cheap housing there.

BucEyedPea
04-11-2007, 01:16 PM
Let's see a lot of industry is looking to get out of under their obligations as far as providing medical insurance.
Can you cite where the US Constitution stipulates such obligations on behalf of the private sector?

And, they should just automatically absorb higher and higher expenses on hc even if it threatens their ability to stay in business? Who would want to start up a business venture with those odds?

Eleazar
04-11-2007, 01:18 PM
How are falling house prices bad news?
It means MORE people can afford the American dream.
For those stuck with overpriced houses well blame the govt for that phenomena.


That's what I was thinking: this is a great market for buyers. It benefits half the groups of people in the housing market. It's not like everyone in America is getting screwed. Screwed were mortgage companies with poor business models and their investors, sure. My heart bleeds for them.

Nobody feels bad for a stockbroker when he buys at the top of the market. To take advantage of this, he could buy more, or hold what he's got until the market goes back up, right? Seems common sense to me. :shrug:

Eleazar
04-11-2007, 01:20 PM
Can you cite where the US Constitution stipulates such obligations on behalf of the private sector?

And, they should just automatically absorb higher and higher expenses on hc even if it threatens their ability to stay in business? Who would want to start up a business venture with those odds?

We don't need to government to go Poland 1939 on the health care sector of the economy. We just need reform to keep costs down and for businesses to eliminate the insurance (profit) layer by becoming self-insured.

jAZ
04-11-2007, 01:23 PM
But I wasn't making any kind of political statement. I was just saying that the market corrects itself when things get out of control.
Unless you are a financial services company who can lend, lend, lend (at rates calculated based upon the risk associated with the bubble marketplace and existing bankruptcy laws) and you can pay Republicans to change the rules of the marketplace to enable a windfall profit for you when the bubble bursts.

jAZ
04-11-2007, 01:36 PM
You mean like the both ways you'd like to have it when you discredit the Bush economy on the basis of the so-called housing bubble but don't level the same kinds of criticisms at the Clinton economy which was bouyed by the tech bubble?
The Economy in the 90s was genuinely more stable and sound than it has been this decade. The tech bubble bouyed things in the stock market, no doubt, but the underlying growth was a result of massive innovation and very real growth. And in fact helped by Clinton's (and the previous incarnation of Republicans') fiscal responsibilty.

This administration (and the Repubilcans party of today) drove this nation into massive debt, and then gave a handout to the lenders as a reward. Set aside the respective bubbles and the two economies were vastly different fundamentally.

Eleazar
04-11-2007, 01:59 PM
The Economy in the 90s was genuinely more stable and sound than it has been this decade. The tech bubble bouyed things in the stock market, no doubt, but the underlying growth was a result of massive innovation and very real growth.


Who could have ever expected that you would see it that way?

BucEyedPea
04-11-2007, 02:05 PM
This is a shit pie both sides are feeding us equally. It's not just "those guys", it's every, single, god-forsaken politician.
Yup! Even Newt's gone green....Newt Greengrich! He believes UN science now.
But not to worry, he'll be pragmatic about it. He'll make big govt work with a mix of the right incentives.

Logical
04-11-2007, 05:33 PM
Can you cite where the US Constitution stipulates such obligations on behalf of the private sector?

And, they should just automatically absorb higher and higher expenses on hc even if it threatens their ability to stay in business? Who would want to start up a business venture with those odds?

I think he meant a pre existing commitment that they are now trying to back out of. If a person takes a job with a company that has health insurance, that person has possibly selected to work there because they have health insurane, thus an obligation was implicit in the job offer.

StcChief
04-12-2007, 05:31 AM
I think he meant a pre existing commitment that they are now trying to back out of. If a person takes a job with a company that has health insurance, that person has possibly selected to work there because they have health insurance, thus an obligation was implicit in the job offer.

The company can pass on costs of HC premium changes to employees.

We are going thru this now, another bait and switch deal pulled by the Insurance companies to lure small companies to sign up.

Get you in for a year or two raise the premiums and force company to look around.

Even pooling with other companies. All it takes is a few people or or their dependants with bad health problems and your screwed.

jiveturkey
04-12-2007, 07:12 AM
Can I expect a decrease in property taxes now?

SBK
04-12-2007, 02:27 PM
All markets are cyclical. We had a huge real estate boom, home prices aren't going to increase by double digit %'s each year.

This is hardly news. If you want to know which president to feel sorry for, feel sorry for the one that's in office when baby boomers start turning 70 and BY LAW must withdraw from their retirement accounts. Then the market will have more sellers than buyers, and a massive sell off will lead to a massive crash. And it won't be the Presidents fault, it will be the fault of the idiots that wrote the laws decades before.......

SBK
04-12-2007, 02:43 PM
Can I expect a decrease in property taxes now?

ROFL

I'm waiting for the dems to jump on the property tax increase rollback the same way they are on the GWBush tax cut rollback. :)