I was raised in the US, and it’s interesting to look at those cities through the lens of foreclosure markets. You can see that time has not treated the real estate values of the different cities the same way, as some aren’t doing that badly and others are a catastrophe. The interesting thing is that I don’t know anyone could have predicted how these cities’ fortunes would evolve. Makes you wonder about where you currently live!
check it out:
depressed foreclosure real estate in detroit, mi
more depressed foreclosure real estate in st. louis, mo
but perky foreclosure homes in bethesda, md

Robert Shiller in the New York Times today makes a case for Why Home Prices May Keep Falling.

His argument centers on the idea that people decide to buy/sell/rent based on life factors which are years in the making and not very easily reversed. These can include major changes in life-stage (getting married, retirement), family considerations (job of spouse, continuity of kids’ schooling), or psychology (caution or fear from long past experiences).

The common message of Japan and the US in the 90’s are cited:

After the bursting of the Japanese housing bubble in 1991, land prices in Japan’s major cities fell every single year for 15 consecutive years.

Even if there is a quick end to the recession, the housing market’s poor performance may linger. After the last home price boom, which ended about the time of the 1990-91 recession, home prices did not start moving upward, even incrementally, until 1997.

It’s a simple message, but important to bear in mind. How would your decisions change in the next year if you could be reasonably certain that housing prices would not rise *at all* for the next 10 years?

You think the California budget cuts are harsh?

From Ambrose Evans-Pritchard yesterday:

Latvia has become the first EU country to face a sovereign debt crisis after failing to sell a single bill at a treasury auction worth $100m (£61m), prompting fears of a fresh storm in Eastern Europe as capital flight tests currency pegs.

If the US is finding it harder and more expensive to finance it’s debt (just have a look at treasury yield curves this year), then what hope does a tiny, massively overleveraged country like Latvia have?

The finance ministry expects GDP to contract 18pc this year. House prices have fallen 50pc , the world’s most spectacular crash. A third of the country’s teachers are being fired and public salaries will be slashed by up to 35pc to meet bail-out terms imposed by the IMF and the European Commission. The policy risks a deflation spiral that defeats its own purpose.

Wow…stunning what is happening to these small countries. Will it stop with the Latvia’s, Iceland’s, and Ireland’s, or are larger countries also at risk?

An editorial today in Spain’s largest newspaper, El Pais, argues that for the real estate market to recover faster prices need to drop faster.

Let’s put a few numbers in perspective.

In 2007 roughly 800,000 homes were sold in Spain. In 2008, just 560,000. So far in 2009, it looks like there will be 300-350,000 sales.

It’s estimated that there are roughly 1.2 million homes unsold, on the market. This may or may not include a further estimated 400,000 homes which have been repossessed by Spanish banks due to foreclosure.

What an incredible overhang of inventory on the market. At current sales rates, it would take 3-4 years to completely remove the unsold housing, without accounting for any additional supply in the market. One newspaper today went so far as to estimate that banks will need 10 years to clear out their foreclosed, or repossessed, properties.

The only way for true market prices to re-emerge will be for these homes to be sold at whatever price people are willing to pay today for them, which is probably much, much lower than current asking prices. But there is no choice in going down this route- it’s a case of severe pain now, or slow pain over time. The ability of buyers to pay 2007 prices are long gone, and not coming back anytime soon.

Even Paul Kedrosky, who is normally irreverant in covering economic news is calling the changes in US debt markets “hugely important developments“.

The price of long-term US debt has been falling steadily for the past six months, with an acceleration in recent weeks, and a “massacre” taking place just yesterday.

This is really scary. As Ambrose Pritchard-Evans points out, “Governments worldwide have to raise some $6 trillion in debt this year, with huge demands in Japan and Europe.”

With falling prices, yields go up. There will be increasing competition for scarce capital, which means that eventually borrowing costs are going to increase for everyone.

Tom Vanderwell over at Bloodhound Blog has a great post on how this might impact housing markets.

If governments are unable to borrow to fund their “stimulus” programs, then they will have to resort to any number of otherwise deeply unpalatable options:

1- not spend the money. otherwise known as austerity- cut salaries, cut programs, generally reduce the size of goverment spending. (examples: Latvia, Ireland, Iceland…)

2- take the money peacefully, otherwise known as taxation- not terribly popular either. (examples: just the UK that I can think of so far)

3- take the money forcefully. Hugo Chavez and what´s he´s done to Venezuela as an example of this.

4- just create the money. Hello Zimbabwe?

Of all the alternatives, 1 is really the most responsible. But 4 is the least painful short term and so the easiest to get away with.

No wonder some investors are making statements like they are “100% sure that the U.S. will go into hyperinflation“.

Keep a close eye on America´s yield curve…if it continues to steepen, then get ready for the start of “crisis chapter 2″.

It’s been interesting to see how twitter has evolved the past couple of years. There seems to be no single way of using it usefully; like blogs, different people/companies use it differently. Here are some use-cases I’ve been observing:

- vanity feed: telling the world about me, me, me – “I like spaghetti”, “I think blue is better than purple”, blah blah..
- marketing: my company just did this, my company just did that, special promotion on today
- short-form communication: “good to see you at the conference, @whoeveryousaw”, “@same, yeah, you too; see you next year”
- voyeurism: just reading what people we’re interested in are writing (celebrities, respected people in our field)
- trends: who’s talking about specific things (#amazonfail, #budgetbond) – and how do people feel about those things.
- sharing links: this is replacing the old way of doing things, which was to email a friend something you thought was interesting. Now you just have to publish a link you find interesting and all your followers will have the chance to see it.

So I’ve decided to jump back in and give it another shot. What’s my use case? It will have to come naturally, but I suspect what I will enjoy doing most is sharing links I thought were interesting, and leaving comments on brands I want to draw attention to for positive or negative feedback. We’ll see how it goes.

If you’re interested in following, my username on twitter is also yannick.

We’re now www.enormo.com!

After more than a year after launching our website, a lot has changed and it was time to adopt a new name which better reflects the mission of what we do.

Growth has been very strong in recent months: Enormo now have 6 million properties for sale and rent in more than 50 countries around the world. This massive database of properties is the biggest of its kind in the world…and it’s still growing.

Enormo also now serves more than 2 million visitors every month, from all over the world…and the audience is still growing.

So welcome to Enormo, the largest real estate website in the world!

My friend Jeremie Berrebi let me know a few days ago that the much-hyped new search engine “Cuil” was returning a Properazzi page as the top result for the keyword search, “Cuil”

He even posted this on his blog (in French).

Funny enough, Techcrunch picked up on this and even included in their post a nice screenshot that has a fairly prominent mention of our name.

Considering that getting 125×125 pixels on Techcrunch is worth $12,000 per month, I’d say that visual mention of us is worth at least a few hundred bucks of TC front-page pixel space

I’d love to say we did it on purpose as part of a diabolical plan to guerrilla-market our way into TC, but this was just serendipitous- so, thanks to team Cuil!!

(by the way- greetings from sunny California, where I’m taking a week off to tour the coast with a group of friends. It’s amazing here!)

Nice article about Properazzi in today’s Guardian!

Jemima Kiss’s Elevator Pitch column is a good place to catch profiles of interesting startups, it’s part of the Guardian’s Digital Content Blog.

Barcelona house prices in theory are only falling by small amounts like 0.1% monthly. But these are based on asking prices, or what owners want their properties to sell for.

I’ve just posted on recurring thoughts (my other blog) about how a friend is simply going around bidding 25% below asking prices, and getting plenty of sellers agreeing to sell around 20% off.

20% off asking price! Wow. It wasn’t that long ago people would bid above asking price to buy a property.

Of course, this is just anecdotal. But when what people on the street actually transacting are telling you something that is radically different than what you read in the papers, it makes you think: what is the truth?