AMAZING, ARE YOU STUPID ENOUGH TO BELIEVE THIS HYPE…….AGAIN?
Business Week Writes:
The housing site Redfin measures what it calls “selling velocity,” or how briskly homes are finding buyers. The faster homes go under contract, the higher the selling velocity. In the 19 major markets in February, more than a third of houses sold within two weeks of being listed. In California, the velocity is even higher. In San Jose, 63.1 percent of homes sell within two weeks; in San Francisco, 56.8 percent do. Further south, in Los Angeles, Ventura, the Inland Empire, and San Diego, about half of homes went under contract within two weeks. This is the housing equivalent of “flying off the shelves.”
Part of the frenzy comes from a lack of inventory. Buyers have returned to the market while sellers sit on the sidelines, and Redfin says inventory is down 32 percent from last year in those top markets. But there are forces that may increase inventory. Chief among them are rising prices. Bank of America estimates that prices will increase 8 percent this year, stimulating a “positive feedback loop” to help the market pick up even more. “Someone say house party?” the bank’s analysts wrote earlier this month.
Wall Street Journal Writes:
More than half of all homes sold last year and so far in 2013 have been financed without a mortgage, according to an analysis by economists at Goldman Sachs Group.
The analysis estimates that around 20% of all homes sold before the housing crash were “all-cash” sales (or around 30% of sales by dollar volume). But over the past seven years, the all-cash share of sales has more than doubled, increasing by more than 30 percentage points, according to economists Hui Shan, Marty Young and Charlie Himmelberg.
OK, fair enough. So we have one fact straight. As of right now there is an insane amount of speculation in the real estate sector. Anyone who has studied finance and markets knows that cash buyers, foreign investors, begging people to sell you a house is the LAST stage of any mania.
No market goes straight up and down. The first stage of the bear market in the housing market has started in 2007. What you seeing now is the second leg up (rebound) that sucks people back in by making it look like the worst is over and the time to get in is now.
Of course, it is not. What’s next, might you ask?
A massive 3rd leg down in the real estate market. It will take everyone by surprise and will put a final nail in the coffin that is the real estate market. No one will be able to do anything about it. Not the Fed and not this time. When will it start? Based on the market sentiment above, it should start fairly soon.
“Someone say house party?” Wait a second, where did I hear that before? Oh yeah, 2001-2007. Good laugh.