Author Topic: Housing Analysis  (Read 70983 times)

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Offline eyephone

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Re: Housing Analysis
« Reply #960 on: May 23, 2019, 12:37:19 PM »
Not surprised by the big home improvement stocks. Lets look at the results.

Lowe’s LOWERS forecast for the year, Lowe’s adjusted earnings per share $1.22  vs estimate $1.33, revenue came lower than expected. However, same stores sales up.

Home Depot with $2.27 per share vs. estimate $2.18, however same stores sales lower than expected

https://www.google.com/amp/s/finance.yahoo.com/amphtml/news/home-depot-reports-first-quarter-2019-earnings-100446443.html

Lowe’s
https://www.cnbc.com/2019/05/22/lowes-shares-down-after-posting-mixed-first-quarter-earnings.html


Offline Loco_local

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Re: Housing Analysis
« Reply #961 on: May 23, 2019, 12:56:10 PM »
will this have any impact in Irvine

Quote
H-1B visa: Government says work ban for H-4 spouses coming this month
After a series of delays, the federal government is now saying it will this month publish a long-promised rule to strip spouses of H-1B visa holders of their right to work.

The news came via an update to the federal government’s “unified agenda.” The page dedicated to the planned work-ban has been changed to provide a new time-frame for the draft rule to be published, saying it will happen this month.

The prohibition would affect wives and husbands of H-1B visa holders on track for a green card. University of Tennessee researchers have estimated that 93 percent of the approximately 100,000 spouses, who are on the H-4 visa, are women from India.



https://www.ocregister.com/2019/05/23/h1b-visa-h4-spouses-work-ban/

Offline eyephone

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Re: Housing Analysis
« Reply #962 on: May 23, 2019, 01:13:31 PM »
will this have any impact in Irvine

Quote
H-1B visa: Government says work ban for H-4 spouses coming this month
After a series of delays, the federal government is now saying it will this month publish a long-promised rule to strip spouses of H-1B visa holders of their right to work.

The news came via an update to the federal government’s “unified agenda.” The page dedicated to the planned work-ban has been changed to provide a new time-frame for the draft rule to be published, saying it will happen this month.

The prohibition would affect wives and husbands of H-1B visa holders on track for a green card. University of Tennessee researchers have estimated that 93 percent of the approximately 100,000 spouses, who are on the H-4 visa, are women from India.



https://www.ocregister.com/2019/05/23/h1b-visa-h4-spouses-work-ban/

Maybe

Offline irvinehomeowner

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Re: Housing Analysis
« Reply #963 on: June 06, 2019, 12:34:12 PM »
So summer is around the corner and prices are... going back up.

Seasonal?
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Offline irvinehomeowner

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Re: Housing Analysis
« Reply #964 on: June 06, 2019, 01:58:31 PM »
Here, since some prefer data anb news from other sites:

Amid housing slowdown, Southern California prices rise slightly in April
https://www.latimes.com/business/la-fi-southern-california-home-prices-20190529-story.html

Quote
In a report released Wednesday, real estate firm CoreLogic said the six-county median sales price climbed 1.4% from a year earlier to $527,500. Sales, meanwhile, were up nearly 12% from March — far more than the average 2.2% month-to-month increase seen in April as the home-selling season heats up.

"Home-selling season"? What is that?

But sure, there was some "slowdown":

Quote
However, the annual gain in prices was far smaller than in recent years and the median — the point where half the homes sold for more and half for less — remains $7,500 below the all-time high reached in June.

$7500 difference so far. Is that large? So who wants to bet if it will be higher or lower than last year once June is over?

Overall, numbers say slightly increased or flat (similar to TI's poll: https://www.talkirvine.com/index.php/topic,16587.0.html):

Quote
Last month, the median increased or stayed flat in each corner of the Southland, with recorded gains smaller than in years past.

In Los Angeles County, the median rose 3% from a year earlier to $607,750, while sales fell 0.9%.
In Orange County, the median rose 2.8% to $735,000, while sales fell 8%.
In Riverside County, the median rose 3.6% to $390,000, while sales fell 3.3%.
In San Bernardino County, the median rose 1.5% to $335,000, while sales fell 4.7%.
In Ventura County, the median was flat at $585,000, while sales fell 0.2%.
In San Diego County, the median was flat at $570,000, while sales fell 3.4%.

But what does MLS data know? How about that Case-Shiller Index?

Quote
Other housing measures also show a slowdown. The S&P CoreLogic Case-Shiller index is considered the gold standard of price measurements, though it provides a delayed snapshot. On Tuesday, the latest data were released, showing prices in Los Angeles and Orange counties rose 1.3% in March from a year earlier.

Don't look at me... just reporting the data.
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Offline irvinehomeowner

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Re: Housing Analysis
« Reply #965 on: July 08, 2019, 07:43:41 AM »
So who is going to explain that even though volume was lower this last year than previous years, prices still went back up to where they were last year in Irvine (and SoCal actually)?

I believe the median high in Irvine last year was $850k in Sept 18 (not July 18 as some people called) and it has hit that high this year in May and again in July. Will it continue to go up or are we looking at another "slowdown"?

Number of sales is over 25% less than it was a year ago (506 vs 700), yet prices are still high... why? Let's say price lags volume, volume was at its lowest in Feb/Mar of this year (361), the lowest it's been in 10 years, but prices went back up.

Fundamentals say that prices should be going lower because of the lower volume, but as I've said in the past, my time in Irvine has shown me that Irvine has too many non-fundamental factors that make it hard to figure out what is going to happen.

I've stated why i think Irvine is so stubborn, but people feel I'm biased so maybe someone else who isn't an Irvine proponent can give their opinions on what is going on here.
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Offline zubs

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Re: Housing Analysis
« Reply #966 on: July 08, 2019, 10:29:29 AM »
Housing volume goes up...prices remain flat. why?
Because lending standards became really tight after the last downturn and the owners don't have to sell.

Also, the dow has been around 26,000 since the end of 2017.  If we end the year 2019 at 26,000 then the stock market would have gone no where for the last 2 years.  Perhaps that will relieve the pressure of everyone thinking the market will drop.  If we can hold it flat I think it'll be a win.

Offline fortune11

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Re: Housing Analysis
« Reply #967 on: July 08, 2019, 10:45:31 AM »
I have been saying on this forum like a broken record for quite some time - there is no recession and wont be a recession , in the conventional terms as we have historically known it. 

but that doesn't mean asset prices (whatever - stocks, bonds , homes) - cannot correct and move up or down. hence prudent risk management in line with your own personal needs is first and foremost importance

problems happens when we tie a "recessionary angle" to every analysis centered around any given asset price.  in this case say, "homes" . 

people have missed massive gains in equities in the last 10 years trying to protect against the next 5 percent down and based on misplaced fears of "fed pushing on a string" ..

think of it this way - we know a vast majority of stocks under perform the broad index , right ?

but there are superstar stocks which outperform by a wide margin to make up for the vast majority of laggards.   similar principle, but on a different scale , applies to real estate locations. I haven't lived here long enough to claim Irvine is a "superstar" , but certainly has non-replicable attributes compared to a vast majority of other suburban areas in CA. 

when it doubt, always think about "liquidity" in the system (availability of capital).   is it going up or down ? when supply floods the market but liquidity stretched , market has nowhere to go but down. 

when supply is increasing, but system liquidity is also increasing at the same time, then it is much tougher call and things can break either way, but unlikely to break in a big way .
   

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Offline USCTrojanCPA

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Re: Housing Analysis
« Reply #968 on: July 10, 2019, 01:30:18 AM »
My take is that the lower rates have stabilized prices for both the lower end and middle of the market (ever now and again I see multiple offer situations in these price segments).  I've had over half a dozen come off the sidelines this year because of the lower rates along with signs of price stabilization.  The higher end is a completely a different story with a lot of inventory, including substantial quick move-in builder inventory.  That being said, builders are beginning to slow down their construction pace so if sales volume continue to stay flat we'll begin clearing both the builder and resale inventory.  I just can't see how we can have big price declines if the job market is strong, rates stay low, and/or inventory levels don't significantly increase.
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Offline irvinehomeowner

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Re: Housing Analysis
« Reply #969 on: July 10, 2019, 07:00:34 AM »
I just can't see how we can have big price declines if the job market is strong, rates stay low, and/or inventory levels don't significantly increase.

But what about the Great Slowdown? :)

Other than volume, I have yet to see an overall marked drop in prices that is outside the range of seasonal drops. I've been told that a low volume/high prices environment is not sustainable so does that mean we will see prices go lower in the next year (as opposed to this past year like others were saying)?

Who is making the call for this year? Slowdown again? Are we at the top? Analysis time!!!
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Offline irvinehomeowner

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Re: Housing Analysis
« Reply #970 on: July 11, 2019, 07:10:52 AM »
Here, since some prefer data and news from other sites:

Amid housing slowdown, Southern California prices rise slightly in April
https://www.latimes.com/business/la-fi-southern-california-home-prices-20190529-story.html



Since I can't get past the OCReg paywall, here is the same article from LA Times for May (published June 26):

Southern California home prices are flat in May as sales fall
https://www.latimes.com/business/la-fi-southern-california-home-prices-20190626-story.html

Quote
The Southern California median home price barely budged in May, a sign that the housing market remains soft despite a sustained drop in borrowing costs.

The six-county median — the point where half the homes sold for more and half for less — rose just 0.2% from May 2018 to reach $530,000, according to a report released Wednesday by CoreLogic.

Sales, meanwhile, dropped 2.7% from a year earlier.

So as I've said on the Housing Bottom thread, while volume is down, prices are almost the same or higher than last year.

But, the article does mention a prediction of future drops:

Quote
John Burns Real Estate Consulting predicts declines ahead, in part because it’s forecasting a slowdown in the economy, with slight job losses nationally in 2021. The Irvine researchers said prices this year in Los Angeles County should be essentially flat, while they’ll drop 2% in Orange County. In 2020, it said, prices are likely to fall 1% in Los Angeles County and 3% in Orange County.

So a combined 5% drop in the next year or so in Orange County? So again, I wouldn't wait for a 5% drop... but others might. And if you waited until now from when this slowdown call was first made, there was almost zero movement in prices, even if you timed the "bottom" right and bought in February 2019, the drop was just over 4%.

Sure, rates are lower now, so you can factor that in as cheaper to buy, but then again, you could also refinance now to capture that savings.

But maybe people should wait until December, when prices are usually lower. That's also a hedge because in December 2018, Irvine prices ticked slightly up, so if prices do their usual "seasonal" drop in December, the YOY comparison could show prices are down more than it normally does.

The remarkable thing about this is volume numbers are definitely down, it's just not having the effect on prices that it should... and that's my question. Is it really a lag (especially because volume has gone up recently) or is it Unicorn magic that's keeping these prices expensive?

Irvine is too expensive, so I do think we should see drops in prices, but unless some big event happens (which we seem to be due for), a sustained slowdown in volume just doesn't seem to have the effect on prices that it should.
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Offline lnc

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Re: Housing Analysis
« Reply #971 on: July 11, 2019, 10:27:05 AM »
The housing shortage in OC will keep Irvine price high for a long long time. 


https://www.ocregister.com/2019/07/10/orange-county-housing-shortfall-projected-to-reach-114000-units-by-2045/

Quote
Orange County housing shortfall projected to reach 114,000 units by 2045

Orange County needs to build 58,000 new homes to meet the needs of its current residents and stem rising home prices, skyrocketing rents and growing homelessness, a new report says.

And if the pace of construction doesn’t pick up, that deficit will virtually double over the next quarter century.

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Offline zubs

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Re: Housing Analysis
« Reply #972 on: July 11, 2019, 10:34:23 AM »
What about rents?  Are rents going up, flat, or down?
From talking to renters, it feels like rents are going up.


How will real estate drop if rents are rising?


Anecdotally, back in 2016, I raised my rent from $2100 to $2700...and there were still 4 people interested, and that was only after 2 days on the rental market.

Offline irvinehomeowner

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Re: Housing Analysis
« Reply #973 on: July 11, 2019, 11:25:03 AM »
On one of those sites I look at, it shows rents were rising.

That jives with less people buying.
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Offline USCTrojanCPA

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Re: Housing Analysis
« Reply #974 on: July 11, 2019, 12:00:08 PM »
On one of those sites I look at, it shows rents were rising.

That jives with less people buying.

Rents are flat to slightly up from what I see.
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