US housing market as a rollercoaster
Spark posted this link in an earlier thread. If you havent seen this yet its worth watching: the US housing market from 1890 to the present rendered as a rollercoaster ride. You really get a visceral feel from the peaks and dips.
This video was created by the fine folks at speculativebubble.com
.. so who wants to make one of these for the GVRD? I bet the 1980-82 section would be particularly exciting.
(No Ratings Yet)
Loading ...
April 4th, 2007 at 10:21 pm
April 5th, 2007 at 6:53 am
A lot of these homes have been sitting on the market since last year or early this year unsold. Remember when 30 very expensive homes in southern California came sliding down the hillside due to heavy rains? Maybe, these homes will be sliding down the hill due to heavy prices.
I created this handle Million Pit Fall, as I still believe that this is where the slide will begin. A few rocks are starting to give way, price reductions of 150k to 400k now.
April 5th, 2007 at 7:03 am
April 5th, 2007 at 8:19 am
Burnaby 74
Coquitlam 49
Ladner 18
Maple Ridge 34
North Van 59
New West 5
Port Coquitlam 5
Pitt Meadows 10
Port Moody 30
Tsawwassen 15
Richmond 130
Van East 15
Van West 481
West Van 262
Abbotsford 72
Cloverdale 33
Langley 151
Mission 15
N. Delta 1
N. Surrey 28
Surrey 48
White Rock/South Surrey 158
Quite the inventory piling up. Even if 13 of these million dollar plus babies sold per day, it would still take over 4 months to clear out the current inventory levels.
April 5th, 2007 at 8:42 am
I’m also watching the million+ homes, but I expect the slide to begin in the suburbs and in the downtown condo market.
The million dollar plus homes are:
1. in relatively strong hands (except for the few which are dedicated developer/flips).
2. a very small market, so it’s only taking a small handful of crazed buyers to keep that ball in the air.
3. not showing much in the way of inventory increases. Some sfh westside markets are still low inventory.
They’ll come down eventually, but they won’t start the cascade this time round.
April 5th, 2007 at 8:55 am
Thanks for the inventory summary.
April 5th, 2007 at 10:26 am
April 5th, 2007 at 10:32 am
If it ran at a constant rate it wouldn’t emulate what a roller coaster does.
April 5th, 2007 at 11:03 am
I laughed…
I cried…
didn’t try the Kool-Aid
or buy the T-shirt…
great popcorn though!
April 5th, 2007 at 12:25 pm
http://spring.finance.sympatic.....id=4595487
April 5th, 2007 at 12:49 pm
Not bad for this sleepy little town.
April 5th, 2007 at 3:02 pm
The URL you posted got cut off, try http://www.tinyurl.com to convert it into something that you can cut and paste here.
April 5th, 2007 at 3:37 pm
Here’s a clickable version of MK-Kids zero down mortgages link.
April 5th, 2007 at 5:49 pm
April 5th, 2007 at 6:22 pm
The 46% jump in inventory for the Fraser Valley is interesting. The burbs could be the place to watch this spring and summer.
April 5th, 2007 at 7:02 pm
Problem is that a lot of these houses being priced past the 750K mark would in substance not really worth the value, but priced at that level due to the speculative rise.
The burst will be seen in the condo market first. Once this areas dips, that’ll will be the beginning of the end of this upturn.
Ahkenaten
April 5th, 2007 at 8:46 pm
We don’t have sub prime lending in Canada, we call it something else.
Tick Tock, Tick Tock
April 6th, 2007 at 6:16 am
I see your point, but it is actually all the little guys supporting all the sales in the housing market right now, not the million dollar plus buyers.
If lower priced properties continue to sell and increase in price and higher priced million dollar properties stagnate in sales because no one can qualify for mortgages that large, this type of situation creates a collision course too.
Unless there is a glut of condos on the market and people bail out of assignments, then things can possibily give way at the bottom first. I guess that depends on how many speculators are in the market at that price point.
One thing to consider, if the lower end gives way in price, the bottom feeders will be out buying too. If the 2 million dollar home is falling in price, where do the bottom feeders buy in at? But, then again, if everything starts falling in price, will the fear of the prices falling further make people stop buying period? Your guess is as good as mine.
April 6th, 2007 at 11:46 am
If things behave in a linear fashion you may have to reassess. But there is more than meets the eye when it comes to inventory and pricing. Being speculators market, demand can become supply in a heartbeat. Second, this supply will be weak hands in terms of hanging on.
Therefore, downtown may or may not cave crack first, but it will likely be first to reach the intermediate milestons such as double digit peak to trough decline.
The first “cracks” could appear anywhere. I already consider price compression a crack (caused by fundamentals, not psychology). FTB and lower end tradeup is not up against a fundamentals wall just yet. Investor owned condos may never run up against a wall as long as banks keep lending. While fundamental demand is limited by how much demand we can borrow from the future (homeownership rate can’s surpass 100%, and will peak long before that), speculative greater fool demand can go on and on. This is where we really mirror the states. We need a decline for the investor psychology to change, and we don’t seem to get a decline until the psychology changes.
Investor psychology could crack just because. It is a chaotic system after all. Or it could crack fundamentally with waning ownership demand, and then spread into investor condos. The walls are definitely closing in. The price compression is proof of that. Keep an eye on it.