- Find a Real Estate Professional
- Realtors®
- Mortgage Lenders
- Home Improvement Pros
- Other Real Estate Services
- Review an Agent, Lender or Pro
- Marketing on Zillow
- Real Estate Agent Advertising
- Join the Professional Directory
- Popular
- Real Estate Market Reports
- More
Replies (20)
- Lady Chattel
- Contributions:3110
The phenomenon is that REAs are convincing buyers that today's prices are the LOWEST EVER and to jump in quick, but these lemmons don't realize that the prices are still not the lowest nor are they still rational. In my county (according to Zillow data) very few homes are being financed with a 20%, 10% or even a paltry 5% Down Payment......so these people are still buying under false pretenses, I mean everywhere I look the ARM loans are still being offered. WTF! If everyone had to have 20% down then home prices would plummet, as long as they keep creating ways to get people to jump in and buy with no skin then prices will not be realistic....it will take years to see some good gains and people can sell with a profit so we have years of people either abandoning their homes for employment, life, or cause they realized that they live next door to a psycho.
- HomeSand.net, "White Picture"
- Contributions:4392
I'm not a zillowdoomer, however here is my thought.
The main reason for the home's prices drop over last 2 year was the over inflation of home's prices, the sub-prime loan only to put more fuel into the flame, whether sub-prime and ARM-option or not, the home's price had to be correct to a certainly level, now that level was meet (Rent VS price, Income VS price, Inflation VS price, etc...),
therefore the people go out for buying, if the next wave is real, i don't thing it gonna affect the future home's price very much.
The main reason for the home's prices drop over last 2 year was the over inflation of home's prices, the sub-prime loan only to put more fuel into the flame, whether sub-prime and ARM-option or not, the home's price had to be correct to a certainly level, now that level was meet (Rent VS price, Income VS price, Inflation VS price, etc...),
therefore the people go out for buying, if the next wave is real, i don't thing it gonna affect the future home's price very much.
- dacolan
- Contributions:1073
Possible? Perhaps. Probable? Doubtful at best.
After setting new historic records for foreclosures in '08, that record was broken through the first half of '09. July? Yet another record breaking month.
Today, foreclosure data was released showing that for the third time in the last five months foreclosures had set a new, all-time record.
Combined with "walk aways" (homeowners who voluntarily default and vacate their homes), the total number of homes repossessed approached half a million units in just one month. This means the U.S. is now on track to exceed 5 million foreclosures and repossessions this year – greater than the expected total sales in the U.S. real estate market.
Oversupply and demand aside, unemployment data (even the BS BLS figures) suggests the consumer base the residential RE market depends on isn't close to being able to restore stability.
Finally, even with the dramatically increased sales volume and bidding wars on the low end contributing to the seasonal bump, the latest Case Schiller data shows both the Composite 10 and 20 indexes down, including 12 of the 20 markets tracked.
Less bad is still not good.
I will say that I may begin to reconsider if these quasi positive trends last beyond September, but I'm not holding my breath.
After setting new historic records for foreclosures in '08, that record was broken through the first half of '09. July? Yet another record breaking month.
Today, foreclosure data was released showing that for the third time in the last five months foreclosures had set a new, all-time record.
Combined with "walk aways" (homeowners who voluntarily default and vacate their homes), the total number of homes repossessed approached half a million units in just one month. This means the U.S. is now on track to exceed 5 million foreclosures and repossessions this year – greater than the expected total sales in the U.S. real estate market.
Oversupply and demand aside, unemployment data (even the BS BLS figures) suggests the consumer base the residential RE market depends on isn't close to being able to restore stability.
Finally, even with the dramatically increased sales volume and bidding wars on the low end contributing to the seasonal bump, the latest Case Schiller data shows both the Composite 10 and 20 indexes down, including 12 of the 20 markets tracked.
Less bad is still not good.
I will say that I may begin to reconsider if these quasi positive trends last beyond September, but I'm not holding my breath.
- dacolan
- Contributions:1073
I should add, even if the powers that be are able to stop the bleeding temporarily, once the market manipulation currently being used to prop up the market ends - artificially low interest rates, shadow inventory, taxpayer subsidy (tax credit) - values will once again resume their decent.
- space_acer
- Contributions:4311
The foreclosures are part of the recovery. The price declines back inline with incomes is the recovery back to long term norms?
The bubble (high prices) was the anomaly, a mutant birth due to uncontrolled spending and debt.
So there will be no recovery to talk about. To even go back to 2003-07 prices require a repeat of putting the US Financial System at risk.
Todays prices is putting more sanity into all future home sales. And dont expect prices to go UP anywhere anytime.
"FOOL ME ONCE SHAME ON YOU, FOOL ME TWICE SHAME ON ME"
The talk of "multiple bids" by realtors once again is an example of poor financial controls an it needs to still be corrected with greater transparency.
Multiple offers? Prove it! Show me names, faces, and how much they bid... else forget it.
You will find the recovery when the median go to 300-400K in the BA.
http://www.housingbubblebust.com/OFHEO/Major/NorCal.html
The bubble (high prices) was the anomaly, a mutant birth due to uncontrolled spending and debt.
So there will be no recovery to talk about. To even go back to 2003-07 prices require a repeat of putting the US Financial System at risk.
Todays prices is putting more sanity into all future home sales. And dont expect prices to go UP anywhere anytime.
"FOOL ME ONCE SHAME ON YOU, FOOL ME TWICE SHAME ON ME"
The talk of "multiple bids" by realtors once again is an example of poor financial controls an it needs to still be corrected with greater transparency.
Multiple offers? Prove it! Show me names, faces, and how much they bid... else forget it.
You will find the recovery when the median go to 300-400K in the BA.
http://www.housingbubblebust.com/OFHEO/Major/NorCal.html
- Lady Chattel
- Contributions:3110
Amen.......
- cvoc13
- Contributions:70
I am fairly sure we will see a slow slide downward and maybe even another couple of fast drops but by 2012 we will / should be at National Avg. 130K and in Ca. Bay Area (East Bay Brentwood) about 200K That is what I think will happen as we face this 'new normal' with UE at say 8 and above for the next decade, Interest rates (Fed will be at 1% or less as they are now) for years to come, maybe till 2014 or so. Oil will likely go up large one more time, and then we will all be shocked to see oil back to 10 bucks a bbl (after all it was only 11 years ago it was, and if we get 5% of the cars on the road like the Volt, and HYB and slow economy we will have LOW Ultra Low demand and thus 10 bucks a bbl (now again this is after a Major Run up in the Next year to maybe even 200 first and then we fall like a stone) all the while Home prices keep falling.
intensive bidding wars on any reasonably priced home under 150K... I'm in them, its for real... [ i can't see the logic, "i gotta buy right now to get that $8k tax credit, lets bid 20k over list price"]
If paying 20K to make 8k sounds like good business to you, Allah/Buddha/God bless you and take care of you!
on the other hand, over 400K is being killed still, and this will pancake down onto the 200 to 400K zone. [there are more buyers at these prices, they are hearing the 'market is getting better' news and not understanding that only applies to the cheapest sector], but there are flat out so many foreclosures and short sales that an uptick in buying is not enough to stop the price drops.
Meanwhile the number of homes in foreclosure is still climbing. to put it into perspective, we have nearly 50,000 homes in foreclosure in maricopa county, up from 25,000 in January, and only 36,000 or so homes on the local mls.
I don't know about oil, but for housing, I'm thinking that if the tax incentive ends, we see a fairy serious drop in buying this winter. If the FED truly stops purchasing long term agency and federal debt [ie quantitative easing, or zimbabwe/argenita monetary policy] interest rates should rise at least 1% for mortgages.
Say goodbye to stabalizing housing at that point.
If paying 20K to make 8k sounds like good business to you, Allah/Buddha/God bless you and take care of you!
on the other hand, over 400K is being killed still, and this will pancake down onto the 200 to 400K zone. [there are more buyers at these prices, they are hearing the 'market is getting better' news and not understanding that only applies to the cheapest sector], but there are flat out so many foreclosures and short sales that an uptick in buying is not enough to stop the price drops.
Meanwhile the number of homes in foreclosure is still climbing. to put it into perspective, we have nearly 50,000 homes in foreclosure in maricopa county, up from 25,000 in January, and only 36,000 or so homes on the local mls.
I don't know about oil, but for housing, I'm thinking that if the tax incentive ends, we see a fairy serious drop in buying this winter. If the FED truly stops purchasing long term agency and federal debt [ie quantitative easing, or zimbabwe/argenita monetary policy] interest rates should rise at least 1% for mortgages.
Say goodbye to stabalizing housing at that point.
- Aldreth
- Contributions:4226
The millisecond the FED stops buying bonds, you can forget about any "economy".
The moronic idiots who are currently purchasing houses will find themselves alone on an island with thousands of armed natives looking for shelter.
Utter chaos will ensue.
The FED cannot stop backing securities without catastrophic consequences.
The moronic idiots who are currently purchasing houses will find themselves alone on an island with thousands of armed natives looking for shelter.
Utter chaos will ensue.
The FED cannot stop backing securities without catastrophic consequences.
- dthree1
- Contributions:6
I think the housing market will recover, but I think it will be many years before a recovery. Although I do no feal that areas are as over priced as many others. Once one consider how much higher interest rates were in 1990 "8+%" vs today rate and inflation some areas are already more affordable then they where 8 years ago. I do however forsee that prices will be forced to come down more if rates go up.
- sunnyview
- Contributions:25127
I agree with you dthree. I think it will recover to normal levels, but that it will be a long road getting there. If interest rates go up, that will really push the market back to pre bubble levels or lower in some cases where the local economies are soft already. I do not think that it is the bottom, it is only a pause in the market drop to see how bad the underlying support structure has been damaged in this mess.
- Michael Beckerman, "mbeckerman"
- Contributions:169
Supply & Demand.
Even during this crises the population of the USA is growing at 2.85 million/year. This equates to about just 1.1 million additional housing units/year (average HH size 2.6). Right now builders are building about 500,000 units/year.
So with stabilized financing markets, 90% of stimulus package still to hit the economy and positive job growth (someday?). We'll use up the over supply and housing demand will increase.
But positive job growth is very important because you need a job to buy a home. I don't see job growth until 2010 when more of the stimulus money gets spent.
Even during this crises the population of the USA is growing at 2.85 million/year. This equates to about just 1.1 million additional housing units/year (average HH size 2.6). Right now builders are building about 500,000 units/year.
So with stabilized financing markets, 90% of stimulus package still to hit the economy and positive job growth (someday?). We'll use up the over supply and housing demand will increase.
But positive job growth is very important because you need a job to buy a home. I don't see job growth until 2010 when more of the stimulus money gets spent.
- Pasadenan
- Contributions:21450
The problem with extrapulating the population growth numbers is NOT accounting for the demographics shift. The birth rate is not accounting for most of the new population and barely compensates for the death rate. And policies on imigration are presently not lossening up much. But we have an "aging population" implying the death rate will be increasing. Not only the death rate increasing, but these people that have 4 and 5 bedroom homes may need to move into assisted living or other institutional housing even prior to death. Thus, more "housing units" on the market, with less demand.
If you are going to extrapulate housing demand based on population projections, you really need to take into account the demographics and immigration polices. It is my opinion that 500k new units per year is still too many, but I won't be running those numbers again until after the 2010 census numbers are published.
If you are going to extrapulate housing demand based on population projections, you really need to take into account the demographics and immigration polices. It is my opinion that 500k new units per year is still too many, but I won't be running those numbers again until after the 2010 census numbers are published.
- BigMoose81
- Contributions:82
My question is for these hard hit markets, are investors fighting for the homes with few home buyers or are the just home buyers.
From a few friends I know they were loosing homes in riverside for all cash offers by investors. So investors are jumping in and not the general population in my opinion.
From a few friends I know they were loosing homes in riverside for all cash offers by investors. So investors are jumping in and not the general population in my opinion.
- Pasadenan
- Contributions:21450
Yes, in Riverside, many investors are jumping in for the "foreclosures" and "fixers". They typically can do some minor improvements and turn them around in less than 6 months for a minor profit. They are counting on dumping them before the market has a chance to decline that much.
- sunnyview
- Contributions:25127
The problem is the salaries for the growing population vs the cost of existing housing. More people is fine, but how much are those people making? Very few families without an ARM can afford a 300-500K house and thousands of those still stand empty even at historically low interest rates. Eventually they may be sucked up by the market, but at prices not even close to where they are now. Baby boomers looking to retire or die won't absorb them and the boomer children already got their 410K and equity of their house wiped out in many cases so no help there. I see this as a long road back to normalcy.
- Pasadenan
- Contributions:21450
And those coming into the country with work visas or hoping to get work visas to do the "home care", or similar jobs are not going to be the ones buying the homes at incomes of less than $15 per hour.
The economy was overdue of a major adjustment. Ideally, the entire economic, political, and legal system should be redone; but that won't happen due to vested interests. What the neighborhoods will look like after things settle out is anyone's guess. It is not even clear at this point what the empoyment environment will look like. Will we see a substantial rise in "work at home"? Will we see 30 hour work weeks? Will we see U.S. Citizens doing substantial work overseas without leaving their neighborhood? Will we see replacement of U.S. oil dependence with locally produced methane grown on people's own roofs? Will we see americans giving up their cars in preference of alternative transportation?
The economy was overdue of a major adjustment. Ideally, the entire economic, political, and legal system should be redone; but that won't happen due to vested interests. What the neighborhoods will look like after things settle out is anyone's guess. It is not even clear at this point what the empoyment environment will look like. Will we see a substantial rise in "work at home"? Will we see 30 hour work weeks? Will we see U.S. Citizens doing substantial work overseas without leaving their neighborhood? Will we see replacement of U.S. oil dependence with locally produced methane grown on people's own roofs? Will we see americans giving up their cars in preference of alternative transportation?
- Lady Chattel
- Contributions:3110
I agree Sunny, and I often look around me with a WTF look on my face at the caliber of people who are buying these $500K++ homes around me. Am I missing something? A person just bought the home down the street for the high $400Ks and OMG he looks and sounds like he just got off the boat......
I just shake my head.......are we just going to have another tick tick boom in 5 years time with the same crap obviously going on???
I just shake my head.......are we just going to have another tick tick boom in 5 years time with the same crap obviously going on???
(Can) Housing can RECOVER with HIGH foreclosures?
This is an interesting twist from one of the media doomers (yes she is) Diana Olick from CNBC. Read this and post your thoughts...
Key Points:
RealtyTrac's Rick Sharga - We're seeing increased levels of foreclosure activity, and we're seeing price stabilization at the same time. (Yes agreed on lower price ranges)
Sharga talks of bidding wars in some of the harder hit markets, like Stockton, CA, Las Vegas and Phoenix. (Rob?)
Sales there are way up, and the competition among bottom feeders is actually pushing some of those rock-bottom prices up ever so slightly.
there are some signs that the buyers are ready to come out of hibernation.
.....(Read the whole thing yourself)
zillowdoomers, what do you think?
Stating a discriminatory preference in an advertisement for housing is illegal. If you think this content is discriminatory or otherwise inappropriate and feel it should be removed from Zillow, please let us know by completing the information above.
We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.