August 27, 2005

WAITING FOR AN OFFER THEY CAN'T REFUSE:

Number of unsold homes surges: Economist sees 'tiny declines' or flat prices ahead (Kimberly Blanton, August 27, 2005, Boston Globe)

''It's a sign that the market is weakening," said economist David Stiff, of Fiserv CWS Inc., a Boston real estate research firm. ''The growth in supply is outpacing the growth of demand."

Reports of higher Massachusetts inventories come as many home buyers and sellers fear that the spectacular rise in real estate values and prices may be ending.

Stiff predicted ''tiny declines" or prices going ''flat for three or four years," perhaps starting nine to 12 months from now.

This week, the Massachusetts Association of Realtors reported single-family home sales in the state decreased 7.4 percent in July from a year earlier, though the median price -- the midpoint price of all the houses on the market -- rose about 7 percent, to $375,000.

Real estate agents say prices haven't fallen yet in response to more supply because owners unable to sell for as much as they want simply hold out, leaving their properties on the market longer -- or they may not sell them at all.
The reason prices aren't coming down is because -- as we've seen in other stories on the phenomenon -- many of these listings are for folks who aren't interested in moving but would sell if they could realize an absurdly high gain.

Posted by Orrin Judd at August 27, 2005 12:01 AM
Comments

It would be wise to recall that Mass. is the only state that has recently LOST population.

Posted by: obc at August 27, 2005 11:42 AM

I've decided that I'm not worried about a housing bubble - even if there actually is one - but I am worried that Alan Greenspan will decide to do something to 'fix' a housing bubble.

Posted by: carter at August 27, 2005 2:04 PM

Wow, they should send a reported to my neighborhood in the far NorthWest Chicago suburbs. A year & 1/2 ago there was a huge weed grown field a couple of blocks away.

Today, 3/4 of it is covered with houses & townhouses, and the remaining 1/4 is being worked over with bulldozers.

http://maps.google.com/maps?ll=42.202820,-88.382735&spn=0.007188,0.012210&t=k&hl=en

And none of them are rentals, they are owner-occupied. And the people move in as soon as each unit is completed.

Posted by: ray at August 27, 2005 3:18 PM

carter:

that's the much greater worry--he caused the 2000-01 slowdown for no good reason.

Posted by: oj at August 27, 2005 3:43 PM

I agree, OJ, it sure looks like that now. Cherchez le Fed.

Posted by: carter at August 27, 2005 4:35 PM

Greenspan found out he didn't like being on receiving end of media wrath, so he's on board now.

I hope Rove is ready for him this time.

Posted by: erp [TypeKey Profile Page] at August 27, 2005 7:12 PM
« OR IF AN ASTEROID HITS: | Main | THE BUSH/SHARON LESSON--UNILATERALISM WORKS: »