In case you were hiding out from Wall Street’s housing market, you might not have heard that Bob Toll of homebuilder Toll Brothers issued an upbeat forecast on their Conference call yesterday December 5th for next year. This is in stark contrast to their most recent conference calls over the past few months. They believe the housing market has turned for their products.
It was so upbeat, Ivy Zellman, an analyst for Credit Suisse of Boston said,
You seemed like a very…I guess broken man last time. And here you are a new man, I’m wondering which Kool-Aid you’re drinking because I want some. No one else in the industry is willing to stick their neck out.
His Response?
I made the statement many moons ago that things stink and we’re getting chopped, but I don’t think I made a statement with respect to the future.
Which brings us to our point… will this be fodder for class-action lawyers in the coming quarter?
Only time will tell, but Toll had better really pull things around, or they may get sunk by angry shareholders. Coincidentally, offloading their shares at the near peak while happy talking the market may just not be convincing enough for some that they didn’t know what was going on. If it turns out that they made statements that were materially misleading to the future success of the company, good intentions won’t be enough. Sometimes it’s better just to not say anything at all. I would guess that they may just learn the value of safe harbor disclosures the very hard way… paying for it.
hi, my first time here. agree with u and glad to c this nice place. carry on the nice job:)
I’m personally seeing the market start to pick up with more buyers searching on my website and contacting me. But maybe thats my luck.
Richard M. Johnston, REMAX OTB ESTATES
http://www.estates.la
Hi Richard,
I’ll repost a post I made over at another blog about another agent, Dave, who said the same thing:
Since Dave is okay to post anecdotal support to his thesis, so will I.
While Dave seems that activity is increased, I would be more inclined to believe that there is a shrinking number of agents that buyers are going to… not that the number of buyers are increasing, but that the number of buyers PER AGENT are increasing. I have had several friends who picked up their license the past few years who finally threw in the towel this summer and handled their last clients in the past 2 months. I have also have regular contact with a number of realtors and brokers in the Southland that confirm that the number of full-time agents are dramatically decreasing and a strong decrease since September/October this year. So, while it is busier for Dave, it might just be that there are fewer pigs at the trough… no offense intended.
The data simply does not support Dave’s assertions. Dataquick says that October SoCal sales are off 22% from last year and 2.5% down from September. I am sure there are anomalies that create great realtor stories, but the facts don’t prove them out.
On the other hand, I also know of a number of people who I work with, go to church with, or have casual acquantances with who have told me that they plan to list their house as soon after Christmas as possible, “To get a jump on the spring”. Every one of them is worried about price. Several of them are trying to move out of state. Even more of them cannot afford their monthly payments after their ’07 reset. Just anecdotal information, though.
John Doe,
While it certainly can be an uptick, it may not have the staying power due to reduced affordability. However, the markets can remain irrational far longer than anyone can envision. That’s true for the upside as well as the downside. Noone 4 years ago could have predicted the back-to-back appreciation we have had, but when it crests and comes back down and how fast are still the questions that are open… I believe we’ve already crested and expect only to have some smaller sucker rallys on the way down. Most markets have this type of volume/price action when making a significant transition from bull to bear.
John Doe,
That may be the case as some real estate friends of mine are starting to look for regular 9-5 jobs.
I have also noticed top agents who were doing well in ’04 and ’05, pack up their stuff and go home.
Richard M. Johnston, REMAX OTB ESTATES
San Fernando Valley Real Estate
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Hey Richard,
When prices in So Cal hit 1997 levels let me know. I moved to the south but will be back in S.california in 07 no doubt renting til this insane market gets back to reality. You guys created your own monster and now the sellers actually believe their old mediocre homes are worth the fortune you said. Try to reverse their mindsets now. Goodluck! When you guys were raking in insane commissions you didn’t realize your short term gains would pollute the market long term. Nobody who’s been in your biz for many cycles believed those prices were resonable. But..you ran with it so now convince anyone with a brain why they should pay market price in a tumbling market.
Richard,
It’s over. You were in the business when a monkey could make home sales. Top agents in 04 and 05 does not mean a thing. It just means that they were able to live with themselves, putting hardworking americans in exploding option arms just to get that commission you bottom feeders can’t live without. That’s not skill. It’s the lack of morals. Go back to flipping burgers, and allow the system to filter out the crap of the last 5 years so we can back to a time when people bought homes that they could actually afford.