Major Collapse in High End Properties Underway

March 12, 2009 · Posted in General Economics · Comment

Bloomberg writes Greenwich Home Sales Fell Most on Record Last Month:

Greenwich, Connecticut, home sales dropped 77 percent in February, the most on record, as Wall Street firms cut jobs and buyers retreated from multimillion- dollar purchases, Prudential Connecticut Realty said.

Seventeen homes sold last month, down from 75 a year earlier, the biggest annual decline for any month since 1976, when broker John Cooke of Prudential Connecticut began collecting the data. Sales of houses priced $2 million to $3 million fell 80 percent, with two properties selling last month, the broker said. The median sales price declined 2 percent to $1.76 million.

“Greenwich, despite its imputed affluence, is still a part of the world, and like every place else, it suffers from buyers and sellers not agreeing on the value of illiquid assets — one of those being real estate,” said Roger Pearson, a Greenwich real estate lawyer and former mayor of the town.

Banks, insurance companies and securities firms have cut more than 180,000 jobs in the Americas in the past year in the recession, data compiled by Bloomberg show. Greenwich, a town of about 61,000 about an hour’s drive northeast of Manhattan, is a bedroom community for Wall Street and known as the U.S. hedge fund capital since more than 100 such companies are based there.

In Greenwich, there’s a long-held conviction that prices never fall.

People who still think that there will be some high-end properties in some areas that won’t be affected from the housing crash should erase that thought from their minds quickly. In fact, it is rather likely that high end properties will see a slump that is much more severe than that of less expenisve ones.

Tags: home prices, housing market

Home Prices at 5 Year Low

February 24, 2009 · Posted in General Economics · Comment

Click on image to enlarge.

The Case-Shiller Composite Home Price Index has dropped to 162.12 from 166.05 last month and 200.67 a year ago (-2.34% and -19% respectively). It is now below the level from January 2004.

Top 3 annual declines by cities:

1. Phoenix, AZ: 34%
2. Las Vegas, NV: 33%
3. San Francisco, CA: 31%

Top 3 monthly declines by cities:

1. Phoenix, AZ: 5.06%
2. Las Vegas, NV: 4.81%
3. Minneapolis, MN: 4.67%

Tags: case shiller, december 2008, home prices

Home Prices – November 2008

January 28, 2009 · Posted in General Economics · Comment

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The composite index for home prices fell by 18% from November 07 through November 08.

Largest annual declines:

1. Phoenix: 33%
2. Las Vegas: 32%
3. San Francisco: 31%

Largest monthly drops:

1. Phoenix: 3.43%
2. Las Vegas: 3.18%
3. Detroit: 3.11%

Home prices are now approximately at February 2004 levels. The way toward 1999 levels is wide open and prices are in free fall with absolutely no end in sight in the near future.

Tags: case shiller, home prices, november 2008

Home Prices Drop Further in October 2008

December 30, 2008 · Posted in General Economics · Comment

Today the new Case Shiller home price index values were published:

Top 3 annual declines:

1. Phoenix 33%
2. Las Vegas 32%
3. San Francisco 31%

Top 3 monthly declines:

1. San Francisco 4.18%
2. Minneapolis 3.42%
3. Tampa 3.39%

On average home prices are still around 2004 levels. The way toward 1999 levels is wide open and there can’t be any doubt that home prices will keep falling throughout 2009 until they reach pre-bubble levels, before the most recent business cycle was started by excessive credit expansion.

Tags: case shiller, home prices

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