Weekly Roundup: Upcoming auction, Hamptons rentals, U.S. prices, trending rates, much more

Queens public administrator schedules auction of three co-ops, 12 houses from $64,000 to $1.054 million

Co-op boards have broad latitude in making, amending, rescinding house rules, however wiggy

Suburbs, particularly in Connecticut and New Jersey, see rising prices

And in the Hamptons, number of $1 million rentals — for the summer alone — approaches record

Homeowners hurt by Sandy to receive property tax reductions totaling $90 million

Uh, those folks using balconies for storage or dead house plants can opt for highest, best use

When it comes to living here, actor Richard Kind knows what he loves

Again to be newly wed, actress turned fashion mogul lists Beverly Hills estate for $8 million

Discount taken in purchase of singer’s Central Park West apartment hardly immaterial

Rap mogul

Buyers ask, ‘Who needs brokers anyway?”

More and more folks searching for a new home are bypassing real estate brokers.

According to research (shown in the table above) by the National Association of Realtors, 38 percent of buyers found the home they ultimately purchased from a sales agent last year.  Contrast that statistic with

With thinking come murmurs of my mind

Housing recovery will depend on bitter medicine. (Flickr photo by aussiegall)

Experts cannot agree on how long housing’s crisis will continue or how to fix the problem.

You may have noticed  my characterization of the situation as a “crisis,” and certainly everything that has happened in housing in the last three years has been tragically dislocating to millions of families and profoundly harmful to the economy. No one knows when it all will end or even how bad things will be when it’s finally over.

The effects of the bursting bubble have thrown lives into chaos and helped make a shamble of the economy, and that’s where the word “crisis” comes in. Whether ameliorating the crisis means that the nation will–or should–return to 68-69 percent home ownership is another matter on which I have written and will consider again below

Meantime, allow me to quote some of the sources in the Bloomberg piece that I mentioned in my post yesterday. For example:

Morgan Stanley housing strategist Oliver Chang:

Whether it’s the sidelined, shadow or current inventory, the issue is 

Wall Street bonus impact leaves many guessing

Photo by epicharmus.

It is hardly surprising that there has been a flurry of stories in the last few days about the impact that heady bonuses will have on Wall Street.  Will they goose real estate sales, especially at the higher end?

Kicking him when he’s down and up is just fun

Robert Shiller now is warning that house prices in some areas of the U.S. could be approaching bubble territory, Global Edge reports.

Home prices in San Francisco and elsewhere have risen by double-digits over four months and look they as if they are in “bubble territory,” Shiller contended, adding:

“It is entirely possible that even with the bad news we are getting, home prices could start a major increase. . . What happens from here will depend on people’s animal spirits and speculative impulses.”

He also predicted rising unemployment would not stop prices from ncreasing:

“Even in the Great Depression real home prices were rising with the unemployment rate above 12 percent. . . Just because we have high unemployment does not mean the stock market cannot boom and the housing market cannot boom.”

Shiller, of course, is that Yale economist who correctly predicted that the recent housing bubble would burst and gave his name to half of the flawed index that he shares with Karl E. Case.

Shiller made the bubble forecast for years.  He was right, eventually.  Even a clock is right twice a day.

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Malcolm Carter
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Charles Rutenberg Realty
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Most price declines are ‘behind us,’ say analysts

Analyzing trend data from First American CoreLogic and the Federal Housing Finance Administration, PMI Mortgage Insurance reports in its latest Housing Market Mortgage Review “that the bulk of the home price declines are behind us.”  It continues:

“. . . Both also suggest that house prices have still not reached their long-term trend levels.”

As with other goods and services, house prices depend on demand and supply.  Over a long period of time, however, the growth rate in home prices should conform to income growth – otherwise houses would become either increasingly unaffordable or more affordable, PMI observes, adding that over long periods, home price growth and income growth tend to be similar.

The data are shown in the charts below.  The first one shows CoreLogic’s Home Price Index (HPI), while the second graphs  actual levels of the HPI through July 2009, as well as the long-term trend based on the 1983-2001 house price data.  And the third charts the same relationships for the FHFA purchase-only HPI.

This stuff ain’t easily digestible, but it’s good for you.  Like carrots and leafy vegetables.  The explanation that follows the charts is worth reading and can well make clear what you’re seeing.

FHA commissioner defends 3.5% downpayment

In response to congressional noise, the head of the Federal Housing Administration contended the other day that raising downpayment requirements or taking similar steps to limit the pool of eligible buyers for FHA-backed loans would hamstring a fragile housing recovery.

And, you know what, he’s right.

Moody’s is depressingly consistent. And wrong.

Moody’s Investors Service has thrown cold water on optimistic projections of a V-shaped recovery in the battered U.S. housing market, predicting it could take more than 10 years to get back to boom-level prices, according to MarketWatch.com.

“For many reasons, the rebound will be disproportionately small compared to the decline,” Moody’s said last week in its latest outlook on the residential market. “It will take more than a decade to completely recover from the 40% peak-to-trough decline in national home prices.”

What’s depressing is that Moody’s – which helped get us into a recession by incorrectly (and self-servingly) grading mortgage-backed securities – has been wrong all along.

The company is wrong again.

Case-Shiller posts gain for second straight month

In a conference call, even Robert Shiller sounded a note of optimism before backpedaling.  At first saying that perhaps the bottom had arrived nationally, he then said that maybe it was too soon to know.

This latest report of the Case-Shiller indices showed an impressive 1.4 percent gain from May to June after an increase of 0.5 percent from April to May.  Eighteen of the 20 metro areas surveyed went up in prices, but bear in mind that apartments are excluded.

The bottom is coming, the bottom is coming!

Economists and headlines are having a field day with the latest reports on existing-home sales, new-home sales and, from Case-Shiller and the federal government, prices.  (See the posts below, as well as my latest newsletter.)

3-YEAR DESCENT

IN HOME PRICES

APPEARS AT END

So trumpets the New York Times in the lead story on Page 1 today.  But whoa, fellas!  Let’s not rush to judgment.