Friday, May 15, 2009

House Price Puzzle: Mid-to-High End

by Calculated Risk on 5/15/2009 12:33:00 PM

House Price Puzzle Click on puzzle for larger image in new window.

I've linked to a few pieces of the puzzle below.

But this adds up to more supply (in the mid-to-high end) because of rising foreclosures - and limited demand because sellers at the low end are mostly banks or short sales (so there are no move up buyers), and tight financing.

To me, this suggests prices will fall much further in many mid-to-high end areas.

  • Surging prime delinquencies.

    See: OCC: More Seriously Delinquent Prime Loans than Subprime

    and Fannie, Freddie Report Surge in Prime Delinquencies

    and S&P: Delinquencies Surge for HELOCs and Jumbo Prime Loans

  • Option ARM Loan Recasts are coming.

    See: Loan Reset / Recast Schedule

  • Limited Jumbo Financing

    See: More Jumbo Financing Coming

  • Few Move up buyers

    See: Home Sales: One and Done

    And even more shadow supply, see: High Percentage of Homeowners Waiting for a Market Turnaround