The housing slump means different things to different people, depending upon where they live. In some U.S. markets, sales may have slowed but prices are still on the rise. In others, prices have slipped but the market is still orderly. And in still other markets -- particularly those where speculators helped fuel the boom of recent years -- prices are down sharply and there's a glut of unsold properties.
As Scott Cohn reports from South Florida, bad hurricane seasons in 2004 and 2005 and the national national slump have "knocked a little bit of sense into a real estate market that badly needed it."
Thus far, there has been no big downturn and no wave of foreclosures, but it is "a more rational market." The flippers are gone as are the days when one could buy a property, slap a coat of paint on it and resell it for a profit. Prices, however, are still appreciating, but sellers are a little bit more flexible and negotiable.
Northern California Dreaming
One of the nation's traditionally hottest markets is "ice cold", reports Jim Goldman. The number of homes on the market is up 39% from last March and it takes an average of eight months for a property to move. Nevertheless, as sales are slipping, prices are edging higher, creating a "financial paradox." Buyers think the market is softening and are looking for bargaiins while sellers are standing pat.
East Coast Coasting
In many areas, the suburban market is alive and well, especially in the more upscale towns, after what one realtor called a "dead market" in 2006. In municipalities such as Greenwich, Conn. and Chevy Chase, Md., prices for multi-million dollar homes have stabilized and may even be on the rise. Inventories are lower than in the mid-range homes. As Diana Olick reports, buyers looking to get a deal might be disappointed.
Big City Foreclosures
From New York To California, foreclosures are on the rise, as the subprime lending mess appears to be spilling over. In New York, foreclosures are up 24% in the first quarter. In Los Angeles, they are up 56%. But as Margaret Brennan reports, Miami tops them all.
Opportunity for some, misfortune for others.
Mortgage delinquency rates hit an all-time high in the first quarter of 2007, according to data compiled by Equifax and analyzed by Moody’s Economy.com.
The percentage of mortgages in default rose to 2.87%, surpassing the worst levels following the 2001 recession.
"I don’t think we’re near the bottom,” Mark Zandi, analyst at Moody’s Economy.com, told CNBC's Steve Liesman. “The correction is in full swing. I think we have at least a year to go.”
Rates rose in 44 of the 50 states.. The exceptions were Kansas, Kentucky, Montana, North Dakota, South Carolina and Utah.
The states with the highest delinquency rates are:
- Mississippi, 4.85%
- Texas, 4.09%
- Michigan, 4.06%
- Georgia, 3.89%
- West Virginia, 3.83%