Posted by: Prashant Gopal on May 16
The Donald gets what The Donald wants. Well, at least when it came to his 80,000-square-foot Palm Beach mansion on County Road, which it looks like Donald Trump will be able to sell for his $100 million asking price.
The Palm Beach Post reported this week that the oceanfront mansion is under contract for sale to an unnamed foreign buyer. Despite the real estate downturn, luxury home prices continue to hit records even in the beaten-down South Florida market.
Posted by: Prashant Gopal on May 16
Let me quickly dispel any notion that the 8.2% surge in housing starts in April reported by the Commerce Department on May 16 was a positive sign for real estate, or that it has much significance at all.
The rise was fueled by a 40.5% leap in construction starts on multifamily homes of five or more units – a monthly statistic that is notoriously volatile (April’s increase followed a 35% decrease in March and a 24% increase in February).
So let’s focus on the important number. Single-family home starts dropped 1.7% to a seasonally adjusted 692,000 annual rate, another sign that builders are holding back on new projects while they unload unsold homes and wait for a rebound.
Still, the April drop in single-family home starts was the smallest decline since June 2007 when starts fell 0.9%. Single-family home starts decreased 7.7% in November and the rate of decline has been falling ever since. The last time single-family starts increased was in April 2007.
Posted by: Chris Palmeri on May 14
On the same day the RealtyTrac reports that the nation’s foreclosure filings surged 65% in April to 243,353, Reuters has this wild tale of one man responsible for nine of those foreclosures.
Shawn Forgaad, software product manager from Santa Cruz, Calif., says he speculated in a major way during the boom, buying nine houses with Pay Option or negative amortizion loans. Now his house of cards is crashing down.
One out of every 519 homes nationally received a foreclosure filing in April, RealtyTrac figures. Some 53,000 were repossessed. The country, meanwhile, marches on to what could be one million foreclosures for the entire year. Washington debates what to do to fix the mess.
California cities account for six of the ten U.S. markets with the highest foreclosure rates. Forgaad, the speculator, says he’s learned his lesson and is moving his family to lower-cost North Carolina where they can start fresh.
"On the surface it looks like total devastation but it's just the opposite,” Forgaad told Reuters. “I'm confident our lives will be much, much richer as a result."
Posted by: Chris Palmeri on May 13
Well even with the housing market’s collapse and the stock market’s tumble at least some people are still rich. That’s according to the latest data from the market research firm TNS.
The number of households with over $1 million in net worth outside of their primary residence increased 5.9% last year to an estimated 9.9 million nationwide. The mean age of these millionaires is 66. Their average net worth is $4.6 million.
Some 75% of them owned stocks. About 60% said their approach to investing hasn’t changed much. As the book The Millionaire Next Door pointed out a few years ago, most people get rich not by speculating, just by earning decent money, spending less than they earn, and socking away the difference.
New York is the metro area with the highest number of millionaires. There are 661,000 in the New York metro area, almost 10% of the population. Here’s the full top ten city list:
New York, 661,000 millionaires
Los Angeles 376,000
Chicago 343,000
Washington 264,000
Philadelphia, 232,000
Dallas 190,000
Boston 185,000
Miami 180,000
Detroit 178,000
San Francisco 178,000
We'll see what happens this year.
Posted by: Prashant Gopal on May 13
It must be be getting tough for the National Association of Realtors to put a positive spin on the real estate market when prices in most of the more than 150 metro areas that it monitors are down and, in many cases, way, way down.
But the group and its optimistic chief economist Lawrence Yun appear to be up for the challenge, judging from the May 13 first quarter home price press release with the title: “Mixed Home Price Performance Continues in Metro Areas, One-Third Show Gains.”
A better title might have been: "Two-Thirds of Metro Areas See Price Drops as the NAR Reports the Largest Quarterly Home Price Decline Since it Began Releasing Price Data in 1982."
The median home price for single-family homes fell 7.7% in the first quarter compared to a year earlier. The Sacramento metro area first-quarter median home price dropped a startling 29%. The median home price in Lansing, Mich. fell 27%. And in Sarasota, Fla. the median price declined 22%. Eight metro areas saw price drops of more than 20%. Only three metros saw increases of more than 10%.
But the press release skips over the big declines in California, Nevada, Florida, Arizona and Tennessee metros and notes, instead, that Binghamton, N.Y. median prices rose 11.8% from a year ago, prices in Peoria, Ill. jumped 10.4% and Spartanburg, S.C. home values leaped 10.1%.
Yun says that slowing sales in high-price areas is dragging down the national median home price and “the numbers don’t tell the whole story.”
