Thursday, Aug 26, 2010
Guess how many new homes sold in the US this July at >$750k
12 Comments
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1. hpwatcher said...
That's absolutely incredible - if it's true.
2. cyril said...
The data is measured in thousands of houses. So zero means somewhere between 0 and 499.
3. mark wadsworth said...
Even more incredibly, according to US Census Bureau, in 2006, at the height of the boom, just over one million houses were sold.
The US population is five times the UK population, and the UK was (graciously) allowing about 200,000 new houses to be built (very low by historical comparison), in other words, to say that there was a new construction boom in the USA is an outright lie (there may have been localised constructions booms in some smaller defined areas, that much is true).
I wonder what excuses US NIMBYs use? "America is a crowded continent"? Doesn't have the same ring to it, does it?
4. mark wadsworth said...
Today is one of those days. The first line should read "one million NEW homes".
5. jack c said...
The data relates to new homes above $750K and as cyril points out is per thousand - nonetheless assuming it is accurate it's a pretty shocking result. I wonder if the UK will follow suit?
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7. Rental John said...
Land Registry HPI report, but does not give monthly breakdowns:
www.landreg.gov.uk/assets/library/documents/HPIreportmlrmd0710.pdf
8. icarus said...
Historically in the US outstanding residential mortgages equate to close to 40% of total housing stock value. Thus, in 2006 $23 trillion in housing value supported a mortgage 'load' of $10 trillion. In 2010 $16.5 trillion in housing value is supporting that same $10 trillion load (a rise from 40% to over 60%)
(Note - it's likely that those in positive equity have more than $6.5 trillion implied by those figures since some of the $10 trillon is in houses in nequity). That homeowner positive equity in 2010 is highly concentrated: those 'free and clear' of their mortgage probably own over $5 trillion and most of the rest is owned by the 12 million (24% of the number of all mortgages) with conventional mortgages (20% down and 30-year fixed mortgage, no second lien). Just about everybody else (low-downpayment, subprime, second mortgages, ARMs = 35 million mortgages) is underwater or not far from it.
Currently over 11 million (possibly more) of the 47 million or so mortgages are in nequity (there were over 50 million mortgages but 4 million were dissolved by foreclosure in 2008-9 and the 2010 number looks like being 2.4 million). Many more are a whisker away from nequity. Over 9 million of that 11+ million is >20% nequity. That 11+ million figure would of course be much higher if those foreclosures hadn't dissolved those millions of underwater mortgages.
Funnily enough the states with the worst nequity (Nevada, Arizona, Florida and Californis) were the ones with the fastest price rises during the bubble.
Thin ice indeed.
Data from http://www.dailyfinance.com/story/credit/real-estate-underwater-homeowners/19582685/
9. str 2007 said...
Wow, those are some figures Icarus.
No wonder they're trying to support the housing market.
10. andrew said...
I don't think this is rocket science anymore, the housing industry has just made everybody poorer by extracting large sums of money out of people and the real economy. The real winners got out a few years ago.
11. mrmickey said...
I was always a trap designed to ensare the middle classes in to debt servitude, drop interest rates, create a massive housing bubble, draw in all the suckers then pull the rug out from under them, job done and all this without even having to raise interest rates like the last time.
12. uncle tom said...
The trouble with these American articles is that they so often feel the need to put sensation before accuracy.
Not one new house (in a country that has over 100 million houses) - sold for more than $750k? - totally unbelievable.
Less than 500 (as Cyril points out..) - entirely credible
Less than 500 is a very different stat to none at all..