Housing Slump Eventually Affects All

The housing slump may have proven a disaster to the east and west coasts, but there are some markets that haven’t been affected by the meltdown. A Wall Street Journal survey of housing data in 28 major metropolitan areas found that local markets still vary hugely across the country. Areas like Florida, Phoenix and Las Vegas were hit particularly hard by the slowdown while others like Boston and Denver actually saw a decline in the number of homes listed for sale. Meanwhile, areas such as the Pacific Northwest and North Carolina that had defied the housing slump are also starting to cool down.

One of the more interesting segments of the market is Manhattan, which has remained immune from the housing troubles thus far. However, problems on Wall Street could put a damper on the market for housing in the financial capital of the world. Falling housing prices and soaring defaults across the country have yielded more than $100 billion in losses on mortgage-backed securities at Wall Street firms, putting many of the employees out of business. More, the number of homes listed for sale in Long Island and Queens at the end of 2007 was enough to last 18 months at the current sales rate, up from 12 months a year earlier.

Another interesting location is California, which saw the steepest decline in housing prices. A quarter of the listings in Orange County are either foreclosed properties owned by lenders or homes owned by people trying to do short sales – or selling for less than the amount they owe the bank. Meanwhile, San Francisco Bay and Southern California were the slowest markets in at least two decades, according to experts.

In the end, it may take awhile for people to pull themselves out of the housing slump. Unfortunately, there are few areas that will be immune to tighter lending standards and other national problems forever – even markets like Manhattan. Until a turnaround, real estate owners may have to rely on foreign investment and a cheap dollar to drive their sales.

Popularity: 18% [?]