Pragmatism In American Press

[bungy]

http://money.cnn.com/2005/11/07/pf/succeed...rhome/index.htm

It's increasingly a sucker's bet to buy more house than you can afford and assume that cheap financing and rising home equity will bail you out. Why? Housing affordability is the lowest it's been in 14 years.

[Guest]

With respect to "Pragmatism In American Press, Bit of a contrast to the BBC"

Does anyone remember (from last time around) whether the BBC were like this?

Edited November 28, 2005 by megaflop

[Mushroom]

With respect to "Pragmatism In American Press, Bit of a contrast to the BBC"

Does anyone remember (from last time around) whether the BBC were like this?

Can't really remember on way down but can remember programmes on negative equity once it got bad.

These days though I suspect that, at the upper levels of influence, the words "licence fee" and "hmm, BBC breakup" are whispered in Auntie's ears.

[Guest Riser]

U.S. Oct. existing home sales fall 2.7%

WASHINGTON (AFX) - Sales of existing U.S. homes dropped 2.7% in October to a

seasonally adjusted annualized rate of 7.09 million from 7.29 million in

September, the National Association of Realtors said Monday.

The number of unsold homes on the market rose 3.5% to 2.87 million, the most

in nearly 20 years. The inventory represents a 4.9-month supply at the current

sales rate, the most in more than two years.

The median sales price has risen 16.6% in the past year to $218,000. It's

the fastest price appreciation since July 1979, when inflation was raging at

double-digit rates.

The drop in sales and rise in inventories in October "signals that the

housing sector has likely passed its peak," said David Lereah, chief economist

for the real estate group.

"Make no mistake, slowing has occurred," he said.

"We expect further cooling in coming months," he said. Hot housing markets

are transitioning to a buyers' market. Nevertheless, activity remains healthy.

Economists were expecting a smaller decline to about 7.20 million, according

to a survey conducted by MarketWatch.

Sales peaked at a annual pace of 7.35 million in June.

Lereah now expects record sales of 7.11 million in 2005, with a slowing to

6.86 million in 2006.

Sales fell in all four regions in October, led by a 7.4% decline in the

Northeast.

Hurricane Katrina has had a net positive impact on existing home sales,

Lereah said, citing huge gains in Baton Rouge, La., Mobile, Ala., and Houston.

Excluding Katrina, sales would have fallen 3.2%, Lereah said.

[Yankee]

http://money.cnn.com/2005/11/07/pf/succeed...rhome/index.htm

As I've said here several times before, the American press and the American public seem accepting of the idea that there's a housing bubble and that it's begun to burst. In England, however, I've noticed a lot of denial.

I'm wondering if the broader acceptance of a housing crash in the US will cause our crash to happen quicker than yours.

[Casual Observer]

With respect to "Pragmatism In American Press, Bit of a contrast to the BBC"

Does anyone remember (from last time around) whether the BBC were like this?

My recollection is that it was very similar. In late 1988/89 I remember reading an article in one of the heavyweights (Times, I think) suggesting that prices were about to fall. I remember emphasising entirely with it, and became converted to the idea of a price crash.

Like this time round, everyone I voiced this opinion to thought I was crackers. My brother in law bought a second home in Poole at about this time - 3 years later he had to sell it at about 75% of the purchase price.

Nothing changes really - the market always corrects, because it's a market. You can't sell to someone at a price that's beyond them. Simple really, but the housing market relies on fresh mugs every generation.