One month ago, we said that "it is not looking good for the US housing market", when in the latest red flag for the US luxury real estate market, we reported that sales in the Hamptons plunged by half and home prices fell sharply in the second quarter in the ultra-wealthy enclave, New York's favorite weekend haunt for the 1%-ers.
Reuters blamed this on "stock market jitters earlier in the year" which damped the appetite to buy, however one can also blame the halt of offshore money laundering, a slowing global economy, the collapse of the petrodollar, and the drastic drop in Wall Street bonuses. In short: a sudden loss of confidence that a greater fool may emerge just around the corner, which in turn has frozen buyer interest.
We concluded this is just the beginning, and sure enough, several weeks later a similar collapse in the luxury housing segment was reported in a different part of the country. As the Denver Post reported recently, high-end sales that fuel Aspen’s $2 billion-a-year real estate market are evaporating, pushing Pitkin County’s sales volume down more than 42 percent to $546.45 million for the first half of the year from $939.91 million in the same period of 2015.
The collapse in transactions means that Aspen’s high-end real estate market "one of the most robust in the country, with dozens of options for buyers ready to spend more than $10 million" finds itself in its first-ever sustained nosedive, despite "dense summer crowds, soaring sales tax revenues and high lodging occupancy."
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Its 1:06pm on the last Monday in August, prior to Labor Day weekend and the OC inlet parking lot is 90% empty.
ReplyDeleteMonday-Thurs all season has been that way, lots of vacancies downtown with hotel/motel row, lots of condo's EMPTY uptown - THAT in a nutshell tells you confidence is nowhere near normal!
Sad!
Check back next Monday. There are still plenty of suckers willing to pay the over the top prices of an OC mimi vacation. Schools are back in session in most fo the country, all they are worried about are backpacks and laptops right now.
DeleteWhy are schools going back the second week in aug ?.
DeleteBecause there used to be 10,000 millionaires and now there are only 10 billionaires and they already own enough houses.
ReplyDeleteI was in OC yesterday and also noticed how empty the place was.
ReplyDeleteAin't it nice?
DeleteFunny how us serf's have been saying this along and when it hits the 1%, then it is talked about.
ReplyDeleteMost people and small businesses are struggling to make ends meet.
ReplyDeleteGlad to hear OC is having problems.
ReplyDelete1:52 that is true in sby area but not everywhere. I travel all over the US and many places are booming.
ReplyDeleteJust drive around Salisbury and the Suburbs. There are abandoned homes with foreclosure notices in the doors and overgrown grass. I went to visit a friend who lives off old ocean city road and was shocked to see how many homes were abandoned around Atlantic and Pacific avenue. These are middle class neighborhoods! And the Democrats are saying the economy is getting better?
ReplyDelete