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HUD Gave a Questionable Gift to the Rich Economics Written by Jonathan Smoke    03.07.2008 Before I began reviewing the new conforming loan limits from HUD and FHA, I didn’t expect to find anything interesting. After all, the legislation passed in February clearly stated that the new limits would be based on median home prices in each county. That seemed simple enough. I previously reviewed the likely changes using NAR’s median home prices at the end of 2007. We concluded that only 31 markets would be impacted. No comments for this item Read more...

Atlanta Housing Demand Remains Sidelined Economics Written by Jonathan Smoke    03.06.2008 As I reported from Orlando during the builder show, a theme I heard oft repeated by attendees and presenters was that the media was a major source of the fear apparently sidelining home buyers at the end of 2007. I could easily jump on the bandwagon and blame the current lack of demand on the media, but to be fair, the media are simply reporting what few metrics they can easily get their hands on. No comments for this item Read more...   A Tale of 939 Cities Market Research Written by Jonathan Smoke    03.04.2008 Despite what may happen year to year, quarter to quarter or month to month, an accepted truism in housing is that “all real estate is local.” Local supply and demand, driven by trends in jobs, incomes, household growth, permits, and home prices determine the conditions for local markets. I’ve heard from many housing professionals—from realtors to lenders to developers to builders—that they are having a tough time getting the public to understand that markets are different. Topeka doesn’t like being described like Miami. Little Rock isn’t like Detroit. Oklahoma City isn’t quite like Los Angeles. Albemarle shouldn’t be compared to Phoenix. No comments for this item Read more...   Scale Can Be Good and Bad for Big Builders Builders Written by Jonathan Smoke    02.29.2008 Yesterday at the Wachovia Homebuilding and Building Products Conference, several big builders presented their current performance and strategies. As I listened in on several presentations, an ironic theme jumped out at me regarding the benefits and downsides of scale. In Centex’s presentation, Tim Eller, Centex’s Chairman, President and CEO stated that a key part of their strategy is to concentrate investment in markets with greatest long-term profit potential that reward high relative market share. He later walked through internal analysis of how Centex’s operating margins and returns on assets were positively correlated with strong relative market share. No comments for this item Read more...   Housing Futures Also Reflect Shifting Expectations Housing Derivatives Written by Jonathan Smoke    02.28.2008 The relatively thinly traded Housing Futures on the Chicago Mercantile Exchange have been decidedly bearish about the future. As extended multiyear contracts began trading, the view out for each of the 10 cities and the 10-city composite has been negative. At the beginning of 2008, that negative view was apparent. For example, each of the west cities, as illustrated on this January 8, 2008 price curve chart from TFS Derivatives Corp, showed declines at least for another two years but most declining three full years. No comments for this item Read more...   Initial January New Home Sales Down but Shifts Are Occurring Economics Written by Jonathan Smoke    02.27.2008 I guess it’s time to eat crow over my call on Monday that January new home sales would be higher than the average economist’s expectation for a 1.2% decline. This morning the Commerce Department reported that the initial national new home sales number for January was a seasonally adjusted annual rate of 588,000 homes. That was a 2.8% decline over the upwardly revised December rate of 605,000 homes. No comments for this item Read more...   Home Price Indices Close Out 2007 Decidedly Negative Economics Written by Jonathan Smoke    02.26.2008 The housing news today was dominated by the release of the S&P/Case-Shiller price indices and the OFHEO price indices. Both were reporting the index values for December 2007. Did anyone involved in housing need affirmation that December would close out housing for 2007 on a decidedly negative note? S&P/Case Shiller reported that 4Q 2007 home prices measured in their national index were down 8.9% from the 4Q of 2006. The national index reflects existing home prices in all nine U.S. census divisions. No comments for this item Read more...

More... Existing Single Family Home Sales Up in January Demand for Small Homes? You Bet! Declining Starts Set the Stage for Gradual Recovery Sentiment Backs Up Comments at IBS Builders Encouraged Not to Discount Energy Efficiency on the Minds of Home Buyers and More Signs of Hope Builder Show 2008—Day One Observations Keep Track of Housing Companies Temporary Loan Limits Will Help Few Markets Houston, You Don’t Have a Problem

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