June numbers are in. My thoughts:
- The free fall appears to have ended in March 2009 when pending sales were about half of March 2008. Since then (April, May, and June 2009), we've seen pending sales within 10% of the same month previous year.
- While we're seeing glimmers of hope, we're still not beating last year's numbers. It's getting close but still softer than 2008 across all major metrics.
- If I were a betting person, I'd say we'll see continued improvements over time but it will probably be a long, hard slog for the next 6-12 months. The good news is that painful period late last year and early this year where each month was worse than the last seems to have passed.
May Seattle Condo Market Update
April Seattle Condo Market Update
March Seattle Condo Market Update
What? No doomsayers taking over this thread?
They’re busy hoping the Dow hits 6500 again. Either that or looking for evidence the lunar landing was a hoax.
I think even the biggest bubble heads will agree the economy is recovering. Virtually all the experts, economists, banks, and fed officials agree so I don’t think some doom-gloom comments from trollers is really gonna change much. Quite happy they’ve learned to keep their mouths shut. Tired of listening to their half-baked arguments for why prices will fall another 1,000% before the white helicopters come and Seattle falls into the sea.
Facts are a stubborn thing for the haters. Here’s some new national data from CNN. New home sales “soar” 11% over previous month.
“Virtually all the experts, economists, banks, and fed officials agree…”
Boy, if there was ever a reason not to believe in this supposed recovery, that quote right there would be reason #1. Where exactly were all these “experts” before the collapse in Sep. 2008? Probably feeding us the same lines.
This is not to say that a recovery won’t eventually happen. Of course it will. It’s more a question of whether that recovery is happening now and whether we’ll see a “double dip” recession.
My money is on the pessimistic side of the argument (or, more aptly, on the opposite side of where the “experts” are).
Agree the experts missed the crash but if all you do is the opposite of what professional economists do for a living, how is that any better? In fact, I think the experts are right more often than they are wrong. Bubbles and crashes are hard to predict and don’t happen that often so missing one doesn’t mean you should ignore everything they say.
How do you explain this?
Or do you believe the stock market does not reflect economic activity or that economic activity is unrelated to real estate demand?
The stock market is a leading indicator. Real estate demand is a lagging indicator. Both react to economic activity but not in timing or necessarily direction.
Have we ever we seen stock market go up and real estate prices go down?
Yes, this year.
the stock market only started to recover in march and really recover this month. i think you’ll see real estate prices stabilize this summer and show some slight appreciation by the winter.
i’m curious, if you don’t like GDP or stock market performance as drivers of real estate prices, what exactly are you looking at?
Um, what if you had said the same thing to me in October 2008? No need to worry, the Dow is at 14K!
Looking at the current stock market level, or even its recent trend, is simply looking for surety in a world that doesn’t have any.
If the stock market can be at its highest when the very fundamentals of the economy are rotten, then I think that’s a good reason to completely ignore the market as any kind of surefire economic indicator.
I am not so dumb as to automatically put myself in opposition to what the majority of economic experts profess. As you say, that would be just as dumb as swallowing what they say, head-to-tail.
In fact, I do put faith in one particular economist, Nuriel Rabbini, who just happened to have predicted the economic collapse of 2008. He is now predicting a “double dip” recession.
Better to put my “faith” in someone who actually predicted what happened then these kool-aid dispensing experts who are telling us everything’s okay.
The problem here is that the rules of the game have changed. If this were a “normal” recession, then I would agree with you: we’d be out of it by the end of this year.
But this is NOT a normal recession. This is something of an entirely different order. This is the consequence of having economic growth based almost entirely on increasing debt, both national and personal.
With this collapse, truly the greatest economic contraction for the American economy since the Great Depression, people’s behavior has actually changed. People are retrenching, altering their spending habits, paying down debt, coming to a better appreciation of what they “need” and what they “want”.
Because of this, and because we’ve just about maxed out the national credit card, economic growth, when it does return, will be anemic. The stock market hasn’t adjusted yet to this “new reality”. It will soon enough.
By the way, I completely butchered his name. It’s “Nouriel Roubini”. Geez, way to make yourself look smart, Joe! 🙂
It looks like even Roubini thinks the recession will be over by end of the year. Considering he’s doctor doom, that’s gotta be a good sign…