Seiders seems to be rather reasonable, he is looking for modest starts tomorrow.
click for video
Note that he actually is looking for starts to stay low to help eliminate supply — compare his level of honesty and suitable caution versus NAR . . .
Excerpt from Bloomberg:
Confidence among U.S. homebuilders was unchanged in August at a record low, signaling there is no relief in sight from the worst housing slump in a quarter century.
The National Association of Homebuilders/Wells Fargo sentiment index held at 16 for a second month, the Washington- based group said today. Readings under 50 mean most respondents view conditions as poor.
Builders are delaying projects as sales drop, foreclosures throw more houses on the market and prices tumble. Job losses, stricter lending rules and growing buyer pessimism indicate builders will need to cut prices further to stimulate demand.
Little Traffic
The NAHB index of buyer traffic was unchanged at a record low of 12 for a second month. The measure represents the number of prospective buyers visiting properties.
The increase in two of the three components "may be an indication that we are nearing the bottom of the long downswing in new-home sales,” said NAHB Chief Economist David Seiders in a statement. "Our current forecast shows stabilization of sales during the second half of this year, followed by solid recovery in 2009 and beyond.”
Sentiment improved in two of four regions. It rose to 16 from 14 in the Northeast, and to 14 from 10 in the Midwest. The index was unchanged at 20 in the South and fell to 11 from 14 in the West.
Other housing measures continue to show weakness. Total single-family home sales in June were down 37 percent from a peak reached in July 2005, the biggest drop since 1982. Home prices in 20 U.S. metropolitan areas fell 15.8 percent in May from a year earlier, the biggest decline since records began seven years ago.
Source:
US Builder Confidence Index Unchanged at Record Low
Bob Willis
Bloomberg Aug. 18 2008
http://www.bloomberg.com/apps/news?pid=20601103&sid=au3prho3Jrpw&
David Seiders said:
“The new home sales numbers are already down something like 62% from their peak in the middle of 2005, following an unsustainable boom, by the way. You know, so I think we’re probably approaching a low before long.
I must say that in terms of concrete, current market signals, you know, we don’t really have that much in hand at this point …”
The chief economist for the NAHB finally admits that they’re all sitting around and just hoping that the market for new home sales won’t get any worse.
As someone who has a front row seat to the carnage in the housing market from SW FL, let me tell you that it isn’t getting any better anytime soon. Supply is simply too great at this point.
“Since the number of prospective buyers has not fallen under their month-ago level (zero), we feel confident in calling a bottom to the housing market.”
“Since many prices houses have not fallen under their month-ago level (1$), we feel —-”
“Since no additional houses in California have been repossessed (which is all of them), we feel —”
Now I am hearing that the tax break for home buyers is actually a loan. Just what the American Consumer needs is another loan…
Somebody should just publicly challenge any of these bottom callers to a bet, say $1000 towards the United Way, on anything whether bottom in housing, stocks, etc.
I’d gladly take the other side of the dude above.
Look at the US M3 estimates, it’s collapsing. Hardly an environment in which builders are going to their friendly regional bank officer to a construction loan and get approved.
Somebody should just publicly challenge any of these bottom callers to a bet, say $1000 towards the United Way, on anything whether bottom in housing, stocks, etc.
I’d gladly take the other side of the dude above.
Look at the US M3 estimates, it’s collapsing. Hardly an environment in which builders are going to their friendly regional bank officer to a construction loan and get approved.
Builders in our area are still building spec houses to keep their crews working. Hope the crews can buy the specs because no
one else is.
Ironically, I’m seriously looking to buy a house since we sold our too large of a house and are renting. However, every house we look at is either too old, two story or too expensive. In our medium sized midwestern city, there are probably 5,000 houses for sale, and the existing home owners are beginning to drop prices. Builders are still holding their high wishing prices and some are going under.
Guess we will continue to rent and wait for the right house at the right price.
I’m reminded of the Rime of the Ancient Mariner by Samuel Taylor Coleridge:
“Water, water, every where,
And all the boards did shrink;
Water, water, every where,
Nor any drop to drink.”
Maybe I’ll become the Ancient Home Shopper:
“There are houses, houses everywhere, and I wonder why
There is nary a one for sale I see that I would wish to buy.”
As they say at the sausage factory, “The wurst is yet to come.”
Prices are still stupid in most markets. How does a kid out of college start a family and buy a home? Somthing had to give, stay a renter and ride it out until next fall at the soonest.
I think we have a way to go especially on the commercial side. 2008 is going to see mid-level retailers get slammed due to high gas and lack of consumer credit. It is a cycle going in the down motion probably for a couple more years.