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John Burns Real Estate Consulting CEO John Burns on the great opportunities for investors in the housing market with the declining prices.
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Good news in the housing market today shocker.
Pending home sales are up to their highest level in a year now this comes after yesterday's negative news from S&P case Shiller.
That home prices have fallen to levels not seen since 2003.
So who's got -- right.
Here to break it down for as John Burns to CEO on his own real estate.
-- company John -- of the show great to have you here.
Who let's start with the idea that there are these two numbers out there and they seem to be conflicting.
We have the forward looking number that's very positive in the we have the SB case Shiller number that says hey things are terrible.
They believe that prices are down some three point 6% for -- year ago what do you say.
-- say they're both right but you -- know it's gone on in the data I've learned got copper price proprietary index we use the markets slid all during the second quarter was flat during the third quarter we saw big spike in October.
Case Shiller data is actually talking about sales contract -- were entered into way back in June.
So it's really lagging -- -- the pending home sales data is right and the new home sales data came out earlier this week is right October was a boost.
Citi you know pending -- -- that's forward looking that's not the rear view mirror does that mean -- the housing market is recovering.
It did in October or not we're gonna -- next week count November turned out but the anecdotal information I've got -- at a cooled a bit in November solve.
You know I'm not gonna get all excited until I see three or four months in a row -- -- gonna -- I'll -- it.
Arrested married John I understand that's -- we're not there will included another short term barometer and that's home builder stocks.
Aren't -- a day take a look at the is that Beazer Homes KB -- -- take.
MI -- skyline these stocks on fire -- they just benefiting from an overall stock market rally today the push all stocks up about.
400 points the -- yeah.
You know that the builders seem to move twice as much as the market every day so when -- up five there attendant and vice -- Versa but clearly that pending home sales number was that it was a very early indicator early in the morning and out of stock really -- I don't know but most of those guys are my clients their businesses have not gotten a lot better in the last month trust me on that.
Hot well that's interesting to hear.
Let me try theory out on you here.
Here's my view.
The housing market seems to be in Atlanta.
Prices definitely in the toilet down 33%.
On average across the country 50% in some markets.
Interest rates I think we have an interest rates full screen I can show you your brief CNC -- mortgage rates are there but.
Bargain basement thirty year fixed 4%.
This is the opportunity of a life time for individual investors for real people out -- not fancy pants hedge fund managers.
Who have millions of dollars at their fingertips.
But for people who want to make money and are tired of waiting for the stock market turnaround although we thought and great play today.
-- you hit the nail on the -- prices have dropped dramatically mortgage rates really low the economy is growing.
And consumers are sitting on their hands not buying homes and you know what they're doing -- watching investors come -- scoop them up there about a third of the market right now on the letting investors make all the money.
This is ridiculous where is the opportunity -- in your mind.
But the opportunities right now are really for -- to get into homeownership particularly in the first time neighborhoods -- that's where I think if I can generalize prices have really hit bottom or close to bottom.
And some of the higher end neighborhoods that haven't had all the distress -- all those hedge fund managers live should have hit bottom yes that's a different story.
I didn't mean to make fun of them but I guess my dad are -- -- thank you for coming on tonight and great stuff and really good information we appreciate your help.
Thanks --
