Dont Panic abut this latest housing statistics

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A report from CNBC. “A Federal Reserve economist says the current housing backdrop is similar to recent economic slumps, with several metrics ‘consistent with the possibility of a late 2019 or early 2020 recession. ‘Data on single-family home sales through May 2019 confirm that housing markets in all regions of the country are weakening,’ the St. Louis Fed’s William R. Emmons said. ‘The severity of the housing downturn appears comparable across regions—in all cases, it’s much less severe than the experience leading to the Great Recession but similar to the periods before the 1990-91 and 2001 recessions.’”

From Miami Agent Magazine. “Home price growth in some of the biggest markets in the U.S., including Miami, has increased at a continually slower annual rate. That has put the brakes on historic levels of price appreciation across the U.S. In a July 2 report, Kate Seabaugh, senior researcher at John Burns Real Estate Consulting, called this recent trend “The Great Price Deceleration.” That’s because year-over-year price appreciation had suddenly reversed in many metros where home prices had been skyrocketing only a year ago.”

“For example, between June 2018 and June 2019, price appreciation in San Jose went from a 20 percent average annual increase to a 6 percent average annual decrease — a 26 percent decrease in the rate of change, in other words.”

The Long Beach Business Journal in California. “Currently, the rent control solution has once again come to the forefront in California as protestors are staging demonstrations to force price controls on landlords. But if what has happened in a very similar situation on the other side of the country is any indication, it could lead to some very serious and unintended consequences that will cause a host of problems.”

“New York is much like California in that is has one of the largest populations in the country. New York’s rent reforms that are about to go into effect have already had a decided impact on lenders and banks, as three institutions have already reported a combined loss of $2.5 billion in market capitalization just since this spring, when the debate over rent control began to look bad for multi-family owners.”

“‘These stocks have really been hammered . . . in the last month and a half,’ Peter Winter, a stock analyst who covers New York Community Bank and Signature for Wedbush Securities, recently told ‘The Real Deal.’”

The Midland Reporter Telegram in Texas. “The value of construction projects started in the greater Houston area fell sharply across both the residential and nonresidential sectors in May, according to a new Dodge Data & Analytics report. Area construction totaled $1.1 billion in May, down 42 percent from the $1.8 billion the year earlier.”

“Residential construction fell 27 percent to $797.8 million, while nonresidential activity fell 61 percent to $305.7 million. Dodge did not provide an explanation for the drop.”

From D Magazine in Texas. “Mike and Tracy Voegtle are not getting back into the Dallas housing market anytime soon. It took months of constant searching for the couple to find their Far North Dallas home back in 2013. That year, the local residential property market was the hottest it had ever been. Cash offers were being made for homes all over the area. Prices soared higher by the day. Supply was limited. Demand seemed endless.”

“But something has changed in the Voegtles’ neighborhood. ‘For Sale’ signs are standing on lawns a lot longer than they used to. ‘The housing market around us feels like it is slowing down a bit,’ says Mike. We’re seeing houses sitting on the market for a long time now, for months, even. That didn’t happen a few years ago.’”

“Don’t panic. This is not a bust. It is not a crash. If you are a homeowner in the Dallas area, you will not have to start making your belt out of cardboard. Prices overall are still increasing. First-quarter home prices in North Texas increased 1.4 percent over their level in 2018, according to the National Association of Realtors.”

“That was the smallest price gain in the area since 2011. In 2011, the median home price in North Texas was $150,000. Today, it is $254,300. So if area price increases have slowed, does that mean that $254,300 is something like the top of what has been a huge upward sales market here?”

“For homeowners, it seems like good news that the demand is still out there and prices are still climbing. But, then, what’s the deal with those lingering ‘For Sale’ signs in Mike Voegtle’s neighborhood?”

“Jeff Duffey, who runs Jeff Duffey & Associates, a real estate firm that handles both existing and new home sales in Dallas, thinks that too many sellers believe Dallas is experiencing a boom market that gives them total control over pricing.”

“‘For example,’ he says, ‘two to three years ago, it was hard to find many homes in North Dallas that were listed between $400,000 and $600,000. Now I can show someone homes for five straight weekends and still not go through all of the active listings in that price range. Sellers who have overpriced their homes or who think they don’t need to go through the trouble to fix up their homes for sale are watching their properties sit on the market. Buyers don’t want those homes and they don’t need them.’”

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