Mohave.net

I’m going to try posting in the forum on this site once more.  The link is on the left side of the page and anyone can register and reply to posts or start new posts.  Since topix has become a play ground for an obnoxious aol poster, I would like somewhere to talk about Kingman/Golden Valley and what’s important to its residents. You do have to register and we will delete any improper posts and/or posters. Thanks.  This should be the link…    http://www.mohave.net/blog/sf-forum

Commentary: Figure at least another 20% before families can afford to buy

By Dr. Irwin Kellner, MarketWatch
Last update: 11:23 p.m. EST Dec. 3, 2007

PORT WASHINGTON, N.Y. (MarketWatch) — Housing will revive when prices come down to the point where demand rises enough to reduce the huge supply of unsold homes now overhanging the market. That said, this point is a long way off.

Today, median home prices are 3.5 times the size of median annual family incomes. This may be down from the recent peak of 4.2 times incomes reached last year, but it’s way above the 2.8 times that home prices averaged during 1984-2000, when lots of homes were bought, sold and built.

And if you think 2.8 is low, check out the early 1970s. That was when home prices were only 2.3 times median family incomes, and housing was selling like gangbusters.

To get prices back to 2.8 times family incomes would require a drop of 20% from today’s levels - and this does not take into account interest rates and lending standards.

To equal the affordability of the early 1970s, prices would have to fall a whopping 38%.

Those who say such declines can’t happen are ignoring how fast home prices rose in the first half of this decade. In most parts of the country, housing prices doubled during this five-year period while incomes went up only a fraction as much.

Sellers could always hold the line and wait for family incomes to rise. But this clearly won’t happen overnight - and, besides, it’s a buyer’s market and no one wants to buy today knowing that prices might well be lower tomorrow.

After all, when it comes to housing prices, what matters most is not the cost of construction, nor what surrounding homes might be selling for.
Simply put, it’s affordability.

And until they are more affordable, houses won’t sell.

http://www.marketwatch.com/news/story/irwin-kellner-how-low-must/story.aspx?guid=%7B501755BA-5015-43E7-B2A3-E2A3536ADF71%7D&dist=hplatest

by Geoff Dornan, R-C Capitol Bureau December 4, 2007

The head of an independent Southern Nevada research firm told lawmakers Monday nearly 60 percent of homes in foreclosure there are not occupied by their owners.

That means they are either rentals or homes purchased by speculators during the housing boom of the past couple of years.

Jeremy Aguero, of Applied Analysis in Las Vegas, said of the nearly 30,000 unsold homes on the market, 42 percent are vacant and another 11 percent occupied by renters.

Duncan said Nevada, California, Arizona and Florida are in the same situation and the cause is a mix of over-development and speculative investment.

http://www.recordcourier.com/article/20071204/NEWS/71204004

After years of robust growth, the housing market in Las Vegas has been beset with the highest foreclosure rate in the nation, as well as a drop in prices and declining sales. (Adam Tanner/Reuters)

By Susan Milligan
Globe Staff / December 2, 2007

HENDERSON, Nev. - In America’s ultimate boomtown, the signs of economic trouble literally show up in the streets, with “for sale” sign after “for sale” sign stuck in the front yards of homeowners who lost their houses because they couldn’t afford to pay their mortgages.

Las Vegas, a national symbol of growth and opportunity, now suffers the highest foreclosure rate in the country. Nearby Henderson - full of gated communities as well as moderately priced housing - now has more than 300 properties in foreclosure or preforeclosure and some streets have as many as six houses in the process of being sold because the owners couldn’t keep up the payments.

The subprime mortgage crisis was caused when lenders gave often-risky loans to buyers who would not be approved for mortgages under normal standards, either because they had bad credit or lacked the financial records - such as proof of income - to get a standard mortgage.

http://www.boston.com/news/nation/articles/2007/12/02/mortgage_crisis_tarnishes_las_vegas_boomtown_image/?page=1

Misty Williams, Tribune

While the real estate downturn has devastated many households, it has also opened up opportunities for first-time home buyers and others to take advantage of more affordable prices and low interest rates.

Builders have knocked tens of thousands of dollars off the prices of new homes, especially in outlying areas, such as Maricopa and Queen Creek. A rising number of foreclosures and bank-repossessed properties also offer large discounts.

Mesa real estate agent Steffanie Countryman said she recently listed a bank-owned property in south Chandler for $469,000 — almost $200,000 less than what the former owner paid for it in 2006.

“(Prices) jumped up so quickly,” Countryman said. “It’s like anything else. You swing way up, you’re going to swing way down.”

http://www.tribunehomefinder.com/story/103187

Housing woes have domino effect

By Kathy Chu with Sharon Silke Carty, Greg Farrell, Barbara Hagenbaugh, Edward Iwata, Noelle Knox and Adam Shell

If you haven’t yet felt the impact of the nation’s credit crisis, just wait. Chances are, you won’t have to wait long.

So far, the turmoil may feel a bit remote for average people: Failed mortgage lenders. Gargantuan write-downs by banks. Foreclosures for people who couldn’t really afford the mortgages they got.

What about the rest of us? Are we in danger? No one knows for sure, but quite likely, yes.

http://www.usatoday.com/money/economy/2007-11-25-credit-crunch_N.htm

A good article from USA Today with lots of charts.

Here is an interesting YouTube video, there are several more by the same people listed on the right side of the page.

http://www.youtube.com/watch?v=I5kNJgLwD3Y&feature=related

Current U.S. housing decline will be worst since Depression, says Ken Rosen.

Video……

http://www.marketwatch.com/tvradio/player.asp?guid={44C53817-F5F3-403A-9262-7D907DE58687}

By Christie Smythe
Arizona Daily Star
Tucson, Arizona Published: 11.15.2007

Home builders are working to roll back or delay some Tucson-area impact fees to help the new-home industry weather its slump.

The Southern Arizona Home Builders Association has been asking local governments to allow builders to postpone paying impact fees until after houses are sold rather than when construction permits are issued. The organization also is working to delay and temporarily reduce a new impact fee in Marana.

http://www.azstarnet.com/allheadlines/211719

This is from the UK, but the article is about the US commercial real estate market.

By Daniel Pimlott in New York
Published: November 13 2007 02:00 Last updated: November 13 2007 02:00

“In the US we’ve spent 15 years building the concept of securitisation into real estate,” said Eric Schwartz, joint head of Deutsche Bank’s commercial property arm. “I don’t think anybody is prepared to believe that the events of the last three months have changed everything.”

In spite of Wall Street’s hopes, the signs at the moment are not good in commercial real estate, as fears rise that a flight from commercial mortgage backed securities could be pushing commercial real estate prices lower.

Investors are increasingly betting that the booming commercial real estate market is heading for a downturn. Yields on CMBS have soared to levels not seen since the late 1990s, indicating that they are seen as riskier.

In the third quarter, the average loan was 118 per cent of the property value, according to Moody’s, which includes expectations of properties incomes over several years in their calculations. That level of leverage is “really kind of creepy” says Sally Gordon head of commercial property research at Moody’s.

http://www.ft.com/cms/s/0/ab0c89ca-918e-11dc-9590-0000779fd2ac.html?nclick_check=1