Housing Bubble and Real Estate Market Tracker

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can get this sent to your blackberry or desktop email by signing up for our no-spam free email subscription service.

Real Estate Sales and House Prices

• Slump Forces Builders To Adapt (Mainetoday.com, Nov. 26th): "One local builder turned his "move up" homes subdivision into a first time homebuyers subdivision... The strategy is working. Five of the 20 homes in the first phase went under contract quickly... Maine, with its low population growth, rarely sees overbuilding and speculation... To move inventory, the National Association of Home Builders found 55 percent of builders were offering incentives; 42 percent paid closing costs, and 26 percent were picking up points on mortgages. Similar practices also are in play in Maine."

• As Nation's Residential Sales Go Flat, NWI May Be Bucking Trend -- Slightly (Post Tribune, Nov. 26th) Northwest Indiana: "Synergy Homes LLC of Valparaiso builds homes in Porter County... In the last year, Synergy has seen a 20 percent drop in business and sales. Higher building costs may be deterring new buyers according to Synergy. "Copper hit an all-time high, oil $75, gold a five-year high, and interest rates did move up. These are real increases in the cost of new homes."

Real Estate Investing and Sentiment

• Deutsche Bank's DB Real Estate To Sell German Properties For 2 Bln Eur (Forbes.com, Nov. 28th): "Deutsche Bank AG's DB Real Estate plans to sell nearly all of the German properties in its property fund Grundbesitz-Invest for around 2 bln eur to the Fortress group. The price tag is around 200 mln eur higher than the last appraisal of the properties. Sources said that Fortress beat Goldman Sachs Group Inc's Whitehall Property Funds and Morgan Stanley's unit Morgan Stanley Real Estate Funds in bidding for the properties."

Mortgages and Real Estate Lending

• Mortgage Reset And Equity Strain” In California (Housingbubbleblog.com, Nov. 27th): “These days, [few] bid on auctioned foreclosed houses because lenders are owed more than the property is worth. That means the starting bid often is too high to attract buyers. Lenders then end up taking possession of the foreclosed homes and list them with real estate agents, increasingly, selling at a loss... Lenders may lose $1.8 billion because of foreclosures in the Northern San Joaquin Valley during the next five years.”

• ‘What Am I Bid?’ (Columbus Dispatch, Nov. 26th): Ohio’s high home foreclosure rates turn some ordinary people into real estate speculators... Bidding was fast and furious at an October property auction... Eighteen properties were disposed of in 45 minutes... Michigan, in particular, has been hard-hit by automotive industry layoffs, which has contributed to the high foreclosure rate, yielding plenty of available property. Ohio has the highest foreclosure rate in the country, according to the Mortgage Bankers Association. At the end of June, more than 3 percent of home loans in the state were in foreclosure. The national average is just less than 1 percent."

• Questionable Lending Pratices “Coming Home To Roost” (Thehousingbubbleblog.com, Nov. 26th): "The Denver Post from Colorado. “In Montbello and Green Valley Ranch, existing-home values are falling as foreclosures spread... Montbello homeseller: "Why should anyone buy this house for $175,000 when the bank will sell that one for $130,000?" 70 percent of pending house sales and 68 percent of all sales in the past six months were either short sales or foreclosures... Foreclosures now reaching middle-class neighborhoods in Arapahoe and Jefferson counties where homes were overvalued and buyers borrowed 100 percent of the purchase price.”

• Mortgage Troubles Are Rising (The Arizona Republic, Nov. 25th): "As mortgage payments rise, many homeowners fall deeper into debt. Household debt has climbed to 132 percent of disposable income. Some Valley homeowners piled on debt by taking out second mortgages to buy investment houses... some are now in foreclosure. In October, the Valley's notice of trustee sales... almost doubled from April's level. West Valley's [less affluent] neighborhoods typically have some of the highest rates of foreclosures... But also the poshest neighborhood's have high foreclosure rates. Some of the areas also have higher-than-average credit-card debt."

Will The Housing Slump Cause A Recession?

• A Local Crash Has Already Happened (Bend, Oregon Economy Blog, Nov. 25th): "Bend home sales in October are down 60% below last October's. Inventory is up >250% since the beginning of the year. And at the beginning of the year we were already seeing inventory shoot up from the fall... real estate construction and sales make up about 20% of the local economy. So when sales fall 60%, then we have, ballpark, about a 10% recession in the local economy."

Hedging Your House Price By Shorting Stocks

• Real Estate Sector Asserts Itself (Nick Perry in Seeking Alpha, Nov. 26th): "Last week we saw an upside bias with housing and semiconductors leading. This week we find another skew to the upside. (See chart) Despite the Thanksgiving holiday-shortened week, we still have some large movers. Realty funds, took the lead with moves in excess of five percent. The iShares DJ U.S. Real Estate Fund (IYR), Wilshire REIT Fund (RWR), and iShares C&S Realty Majors Fund (ICF) are all at new highs now."

Commercial Real Estate and REITs

• Real Estate Deal Would Put Silicon Valley Property in Private Realm (Mercury News, Nov. 27th): "About 5 million square feet of prime Silicon Valley real estate would pass from public ownership into private hands under the proposal from the Blackstone Group to acquire Equity Office Properties... Blackstone will control about 7 million square feet of South Bay property -- making it one of the valley's largest landlords. Commercial real estate brokers say that tenants could discover that making a deal with the the landlord of a privately held company is easier... With any publicly held company, there are a lot of checks and balances."

• WaPo On Non-Residential Construction (Calculated Risk, Nov. 26th): "Money spent on private non-residential construction nationally rose 19.2 percent in 12 months to September... State and local governments are building roads, schools and other public buildings... The increase in non-residential work more than offset the 6.7 percent decline in home building over the same period, so the value of all construction rose a net 2.9 percent... Builders of non-residential projects say they are simply playing catch-up. So many new neighborhoods filled up during the housing boom that they're still building the stores, offices, restaurants, bank branches, hotels and hospitals needed to serve the influx of residents... but if the bust follows the typical pattern, the non-residential boom will end soon (or is already ending)."

Web Site of the Day

Bubble Markets Inventory Tracking is a blog that provides housing inventory data about selected Western state real estate markets. The data tracks the number of houses available alongside the population ratio, and provides comparison data from previous years-- even foreclosure charts for a particular city. The data is comprehensive-- for those particular markets-- ranging from Austin to Sacramento, San Bernadino county to L.A.

Even more interesting is the individual house stories the author provides, by showing pictures of particular homes and then tracking it's sale history: What it was purchased for and when, house flippers and speculators, or homeowners in real trouble and how it all, in turn, affects the neighbors equity. Refi dates and sums are documented, along with defaults, price cuts and ultimately (more often than not) foreclosure proceedings.

The site offers detailed and invaluable information to the investor about the specific markets it covers.

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