November home sales: 'About as god-awful as they can get'

U.S. home sales and prices continued their rapid descent in November, according to reports out today on resale and new homes. Sales declines were more than anticipated, and the price drop was the steepest monthly decline in four decades. From the New York Times:

“They’re about as god-awful as they can get,” said Robert Barbera, chief economist at ITG. “This is pretty breathtaking stuff.”

On the numbers:

Sales of existing homes declined 8.6% last month, to a seasonally adjusted rate of 4.49 million, according to the National Assn. of Realtors. The median price of a home plunged 13% from October to November, to $181,300 from $208,000 a year ago. That was the lowest price since February 2004 ...

The Commerce Department also reported that new home sales dropped to a seasonally adjusted annual rate of 407,000 in November, from a downwardly revised rate of 419,000 in October.

Housing values have plummeted since the peak of the market in July 2006, when the median home price in America was $230,200.

The Commerce Department said that the median price of a new home sold in November was $220,400, down 11.5% from the period a year ago. It was the biggest year-over-year price decline since a 12.7% drop in March.

The capper on those existing home sales figures: 45% of all were distressed or foreclosure related. And it isn't nearly over yet. 

-- Lauren Beale

Comments? Thoughts?

Comments

[matthew]

Peter Viles used to run a piece that followed HousingTracker.net's median listing prices; of course they have been going down, and for a while they leveled off and there was a lot of talk of a bottom, but this month they actually ticked upwards. The did this a little bit in early 2007, but I think it's the first time this has happened since. Worth noting, I think, even though the uptick is pretty small.

[latesummer2009]

Can it get any worse? Yes, the Westside is next in the sights... Hold on, 2009 is going to be wild.

[OverIt]

I'm sure glad the banks are using all that TARP money to not give us loans, especially home loans.

Someday homes might be affordable again but it might not be for another 3-4 years if the morons in Congress actually succeed in manipulating prices. Oh, who am I kidding - I just used "succeed" and "Congress" in the same sentence....

[John]

And yet it must be reiterated over and over: THESE ARE NOT SALE PRICES. NOW IS NOT A GOOD TIME TO BUY. "Prices haven't been this low since 2004." Guess what? 2004 was 3 years into the bubble with its ridiculous price appreciations.

[MyLessThanPrimeBeef]

November numbers are 'about as god-awful as they can get.' - but that was what they said in October and September and August and...

[E.R.]

I found this interesting. It's from the knowledge@w.p.carey website: http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1727

Thoughts?

[Benjamin Pirih]

Another 70K and we will get close to true value.. Everything in california was so so over priced that a generation was pushed out of the market. Now with the day-labor and low paying jobs drying up, residents who supported mortages through multiple incomes are suffering and losing the house which they couldn't afford by themselves. I'm saving my money, the time is coming..

[Tre]

Seems like it's time for people to start walking away from homes purchased in 2004 - 2007 en masse.

[Tim K.]

Once again, it's only "god-awful" if you're a realtor. If you're actually going to buy a home, this is fantastic news - it means maybe you won't have to wait as long before you can possibly afford a decent home.

This is great news for most of the population, who is not in the business of selling homes!

[bigunit]

Matthew - A significant number of realtors have been engaging in "baiting": listing homes at prices significantly lower than the amount owed or likely to be accepted by the bank (short sale). The goal is to drive traffic to the listing and/or attract multiple offers to bid up the sales price.

Regional MLSs are only now beginning to discourage and address this problem, starting with fining those participating in this practice. In short, listing prices don't mean squat.

[Laker]

matthew,
The composition of houses selling is changing.
In the last 12 months, the low end houses were getting hammered by the subprime loans and were dumped to the market by the banks. Many many houses in the $750,000-$1.2M say in the SFV were simply not selling. So the median prices were going down and fast. Now, we are starting to see the ALTA and OPTION Arm together with prime mortgages default, so you are now seeing many of those $1 million homes actaully decreasing to $700,000. You see a $700,000 home listed 6 months ago going down to $500,000 and sells for $480,000. Althought the prices are falling and fast, the composition is changing and you get many more sales especially in in the $400,000-630,000 range. That will increase the median price or at least provide some support. However, look at the case shiller index to see true price changes.
When CS index will show prices are increasing even Month over Month, WAKE ME UP.

[Laker]

E.R Your article says:
"who'd have ever thought they'd be going down 20 to 30 percent"
and
"Foreclosure, in other words, is a fool's game; everybody loses."...

This guys is completely wrong. either he is lying or just have a big mistake.
1) Many thought and envisioned 50% declines. Thornburg, Cash Shiller, Roubini, Savage, and even myself...
2)In Foreclosures, BUYERS WIN - BIG TIME !!! so not everybody loses.... Unless of course you are invested heavily in RE....like that specuvestor.
(He want us to reduce his loan balances so he could continue making money on his rentals....)

[Nelcisco]

I don't know why this continues to shock people especially the NY times or anyone with common sense, we commentors here at LA Land have been saying this for a yr. now. Look, not in enough income or down payment = no house, we're headed toward a depression, why are economist and media people so shocked that home sales are in the toilet? DO THE MATH!!!!!!!!!!

[lampman]

There's a reason why I didnt buy in 2004 and there's a reason why I'm not buying now.

[In-the-know]

My phone was ringing off the hook in November, 4 closings and no they were not suckers they all got great deals compared to any pricing.

Prices will go down until 09/01/08 and remain flat unitl 2010.

[1]

It may be quite awful now, but it will surely get a lot more awful and be that way a long, long, long time before it gets better.

[shockg]

Homes sales in OB were up 59% in November. "U.S." home sales don't mean a whole lot when real estate is all local.