St. Maarten Private Eye

...or intentionally misleading?

In today's (Jul 23) free online DH I find these 2 articles:

"Real estate prices remain stable but sales are low"
http://www.thedailyherald.com/tdhonline/index.php?option=com_content&view=article&id=336:real-estate-prices-remain-stable-but-sales-are-low-&catid=56:today"

and " Long overdue"
http://www.thedailyherald.com/tdhonline/index.php?option=com_content&view=article&id=337:long-overdue&catid=56:today

Both seem to argue that while real estate sales are slowing, there's no crisis, no panic, and everything is stable, the market will adapt, yada yada yada.

Is DH totally clueless, dumb, and incompetent? Or simply trying to mislead their readers? The slowdown in sales, as their own headline states in big bold letters, especially after "the real estate boom," is a unmistakable precursor to the real estate price collapse! Need proof? here it is: take a look at 5-year stock price charts of some of US home builders:
http://finance.yahoo.com/q/bc?t=5y&l=on&z=m&q=l&p=&a=&c=&s=tol+ryl+kbh+len+ctx+hov+phm+dhi

The common among all ot them is that they all without exception peaked in the summer or fall of 2005. That's THREE YEARS ago! The other thing that happened in the early summer of 2005 was the leveling off of residential home sales in the USA. Early summer of 2005 was the absolute peak of sales, i.e. the number of homes/condos sold compared to the prior year, but for the next 12-15 months the prices still remained in a slight uptrend! The first noticeable price declines happened over a year AFTER the sales leveled off, in the late-2006 and early 2007, when in February of 2007 a major bank (i believe HSBC) took first major writedown for the losses in their real estate portfolio. The severe price drops began in 2007, around 18 months after the sales have peaked, and a full-blown crisis began in the summer of 2007, full 2 years after the slowdown in sales was detected.
This is not a unique situation, but a typical patters of real estate collapse.
The Daily herald doesn't seem to "get it". The builders can "adjust" all they want - the developers in Florida and elsewhere tried and failed. The slowdown is a major warning sign, a red flag, it means that you are in the hole, and literaly it's time TO STOP DIGGING!
Unless someone will come with a bail-out, and will buy all the unsold properties on the spot (and I don't see why someone would feel so charitable toward the developers of those monstrocities,) I don't see how the crisis can be avoided....

// Now_USA_Resident //