HOUSING PRICES MAY FALL, BUT SLOWLY.Byline: GREGORY J. WILCOX Last week started on a sour note and ended the same way. First DataQuick Information Systems released its sales and price report for July that showed weakness in the residential market for the eighth consecutive month. On Thursday, the California Association of Realtors reported that affordability for first-time buyers first-time buyer n → persona que compra su primera vivienda first-time buyer n → personne achetant une maison ou un appartement pour la première fois first-time buyer is at record low levels in most of the state. And on Friday, Boeing Co. told its workers in Long Beach that production on the C-17 military cargo airplane is ending. Is this going to be an economic train wreck train wreck Medtalk A popular term for a multiproblem Pt in critical condition like the one that happened in the early 1990s? No, concludes economist Christopher Thornberg in a somewhat surprising assessment since he's been one of the biggest bears about the California real estate market. He recently left the UCLA UCLA University of California at Los Angeles UCLA University Center for Learning Assistance (Illinois State University) UCLA University of Carrollton, TX and Lower Addison, TX Anderson Forecast to start his own consulting firm Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee consulting company business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a , Beacon Economics, and was one of the first to conclude a bubble had formed in the residential real estate market. The market's in a free-fall as far as sales go. Prices have a longer event horizon, though. For example, if an equities market bubble pops, prices fall rapidly. ``The housing bubble pops (and) you don't get a rapid decline in prices,'' Thornberg said. ``Why? Stocks are very liquid, lots of trading, lots of money, lots of players. Housing is not a liquid market.'' It takes time to sell a house, and in a market like this, it takes longer than in one that's booming. Time on the market can tend to push down prices. The question is by how much. Here's Thornberg's take. ``I think there is ... potential to have a mild retraction In the law of Defamation, a formal recanting of the libelous or slanderous material. Retraction is not a defense to defamation, but under certain circumstances, it is admissible in Mitigation of Damages. Cross-references Libel and Slander. in prices, nothing dramatic. Housing prices are going to go down. The key is they are going to go down slowly, not rapidly.'' And when they bottom out in this current cycle, they will probably do so at a high level. When the last boom cycle ended, the median price fell 36.7 percent from a high of $245,000 in November 1989 to a low of $155,000. By last month, it had soared 291.6 percent to $607,000. He expects sales to retreat to the level of 1993 or 1994 and price declines totaling 10 percent or more. It's not a collapse, though. ``It had to run out of steam. All this appreciation was a function of irrational exuberance Irrational Exuberance An infamous phrase uttered by Alan Greenspan in 1996 to describe the overvalued market at the time. Notes: Although every word spoken by Mr. . And that's not how equity markets work.'' He also expects the economy to slow next year and some job losses. But nothing like what happened in the early 1990s. And while this market is now bringing pain to some, others are doing OK. Stephen Bock Noun 1. bock - a very strong lager traditionally brewed in the fall and aged through the winter for consumption in the spring bock beer lager beer, lager - a general term for beer made with bottom fermenting yeast (usually by decoction mashing); originally , a partner in infill in·fill n. 1. The use of vacant land and property within a built-up area for further construction or development, especially as part of a neighborhood preservation or limited growth program. 2. developer D and S Homes Inc., has had a pretty good summer. Their 14-unit detached condo project Roxford Village sold out in a couple of weeks. Bock said that there were no cancellations and prices were in the $500,000 range. Foothill Village, across the street near the intersection of Roxford Street and Foothill Boulevard The following streets are named Foothill Boulevard:
Of, relating to, or being a new security issue that is sold out before all the specifics of the issue have been announced. In the case of a bond issue, this term usually means that sufficient orders for the issue have been placed before announcement . They are priced in the upper $400,000 range. The company also completed a five-lot development in Arleta, and two homes have sold. They are priced between $729,000 to $749,000. They are among 60 homes the company has completed or are building in the area. The company's strategy is simple. ``We're not pushing the market. We bought the dirt a few weeks back when compared to today's standards it was a little more affordable. ``Sure we could push the prices and be over $500,000. But I don't think that would make sense for us. What we do is build and sell homes. We don't want to build and keep homes.'' greg.wilcox(at)dailynews.com (818) 713-3743 |
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