The Widening Mortgage Crisis and Economic Downturn

There is increasing bad news on the homefront. According to an interesting website The Mortgage Lender and its Impode-o-Meter, there has been 253 Mortgage companies have "imploded" since 2006. I stumbled across this website from a comment posted by John on the Tacoma News-Tribune Real Estate Blog .

Scarily enough, Yale University economist Robert Shiller, admittedly bearish and known for the S&P Case-Shiller home price index, said this week that U.S. housing prices could fall farther than they did during the Great Depression. At that time, prices decreased by 30 percent.

Can you even image a 30% percent plus price decrease? I think we are seeing a widening economic crisis, we have been watching a continue increase in food, crops, gas, and metal prices, you name it.

It will be interesting times, China is increasing it's reach in search for natural resources. They are heavily invested in countries such as Sudan, Myanmar, and Congo. China's steel imports have tripled since 2002 from places like Australia. Mr. Kevin Rudd, the new Aussie PM, is fluent in Chinese. With China holding on to over a trillion (yes a trillion) dollars in reserve, they hold an immense power over the U.S.

Described as China's "nuclear option" in the state media, such action could trigger a dollar crash at a time when the US currency is already breaking down through historic support levels.
It would also cause a spike in US bond yields, hammering the US housing market and perhaps tipping the economy into recession. It is estimated that China holds over $900bn in a mix of US bonds.

Xia Bin, finance chief at the Development Research Centre (which has cabinet rank), kicked off what now appears to be government policy with a comment last week that Beijing's foreign reserves should be used as a "bargaining chip" in talks with the US.

There is now a growing food crisis as well but that is for another day.

More Tacoma Condo Maps at King5.com

I ran across another Tacoma Condo Map at King5.com when I was analyzing the sites that are linking to Tacoma Real Estate Market. It is an interesting exercise in the way the web works, sites link to yours that you never even heard of, let alone visited. A large portion of them are spam sites, but even spam sites can have their uses, if you can get past all the pop-ups that is.

This particular site listing was sitting right below a link to my Tacoma Real Estate blog, and since it had a the magical words "Tacoma Condo Map." I decided to check it out.

It is very similar to the Tacoma Condo Map listed at Exit133.com , although highly out of date considering that defunct Tacoma Condo Projects are listed like Chelsea Heights, Hanna Heights, and Old City Hall Condos.

Looks like it was created by a site called Mapbuilder.net , I will have to check it out some day and maybe keep an updated Tacoma Condo Map.

Home Sales Drop and Current Real Estate Market Trends

In Pierce County and Tacoma, sales are showing a modest upward trend so far this year when compared to the winter months (which is cyclical and quite a normal trend). Pierce County reported a 30 percent drop compared to the year before. Not only are sales continuing to drop, Pierce county registered a 5.5 percent Home Price dip as compared to March a year ago.

Real Estate Market Trends made both Seattle Newspapers today:

See the Seattle Times article here: Home prices declining, inventory building around Puget Sound

Seattle PI: Seattle single-family homes prices stay steady in March

Check out the vastly differing titles and article content.

Real Estate experts still are claiming the end is near: The local market "has reached bottom -- or pretty darn close" and although inventory continues to grow, so does optimism among buyers, Northwest MLS director Dick Beeson said in a statement.

I think that this is hopeful at best. Add in the difficulty of getting a mortgage plus the recent economic development, you get a bleak outlook for a quick turnaround.

"It's no longer a question of recession or not. Now it's how deep and how long. Workers' pink slips stacked ever higher in March as jittery employers slashed 80,000 jobs, the most in five years, and the national unemployment rate climbed to 5.1 percent. Job losses are nearing the staggering level of a quarter-million this year in just three months. "

Check out the rest of the news in this recent AP Economics article: Huge job losses set off recession alarms.