This guy gets quoted in the media a lot because he is the only bear left – read his full report here:
http://mhanson.com/archives/1467
In summary, the past two-years of massive Fed, Gov’t, and bank intrusion into the housing market went way too far. Houses are mis-allocated, there is no shortage of houses “in which to live”, and in ALL the popular “mega-recovery” regions are at least 50% expensive on a monthly payment basis than they were at the peak of the housing bubble in 2006.
And all it will take is the wave of “cash-money” buyers ‘easing off” a bit; “some” of the organic first-time and repeat buyer cohort stepping away due to the sudden lack of “affordability”; and/or a wave of supply from “panic sellers” hitting the market to send sales volume and prices down sharply, over a very short period of time. And I think the rate “surge” catalyst has caused all three to occur at the same time.
Note that he is just guessing that the market will dive due to demand being pulled forward.
Granted, the Y-O-Y comparisons should start looking grim in the coming months, when measured against the boisterous gains we’ve had on the run up. But there are plenty of buyers – it will just be a question of whether they will be willing to pay the same (or more) than those who got the lower rates.
The UNDER-$1,200,000 Market:
| Date | ||||
| April 29 | ||||
| May 5 | ||||
| May 9 | ||||
| May 18 | ||||
| May 23 | ||||
| May 30 | ||||
| June 5 | ||||
| June 11 | ||||
| June 17 | ||||
| June 24 | ||||
| July 1 | ||||
| July 8 | ||||
| July 15 | ||||
| July 22 | ||||
| July 29 | ||||
| Aug 5 | ||||
| Aug 12 | ||||
| Aug 19 | ||||
| Aug 26 | ||||
| Sep 2 | ||||
| Sep 9 |
The OVER-$1,200,000 Market:
| Date | ||||
| April 29 | ||||
| May 5 | ||||
| May 9 | ||||
| May 18 | ||||
| May 23 | ||||
| May 30 | ||||
| June 5 | ||||
| June 11 | ||||
| June 17 | ||||
| June 24 | ||||
| July 1 | ||||
| July 8 | ||||
| July 15 | ||||
| July 22 | ||||
| July 29 | ||||
| Aug 5 | ||||
| Aug 12 | ||||
| Aug 19 | ||||
| Aug 26 | ||||
| Sep 2 | ||||
| Sep 9 |
These are probably the numbers we’ll be seeing for the next 1-2 months:
Weekly NSDCC New Listings and New Pendings
| Week | ||
| May 30 | ||
| June 5 | ||
| June 11 | ||
| June 17 | ||
| June 24 | ||
| July 1 | ||
| July 8 | ||
| July 15 | ||
| July 22 | ||
| July 29 | ||
| Aug 5 | ||
| Aug 12 | ||
| Aug 19 | ||
| Aug 26 | ||
| Sep 2 | ||
| Sep 9 |
NSDCC Average $/sf of 2013 Monthly Sales:
Jan: $379/sf
Feb: $400
Mar: $404
Apr: $420
May: $416
Jun: $453
Jul: $418
Aug: $437
Sep: $502
September’s average is based on only 42 sales so far, instead of the 200-300 sales each full month. But no evidence of a dive so far.
I agree Jim, there seem to be plenty of buyers. I question not only whether they are willing but able to fund the steep premiums of the current market and also whether sellers are going to be willing to downshift due to rising rates. Game on. I read Hanson to say that we have not seen the full effect of rising rates yet because the effect will lag the deals that have recently closed and been reported as those deals were cut a month or two ago. We’ll see.