Does the market look like its stabilizing?

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February 11 2011 - Mesa
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It's too soon to tell.  We are definitely seeing signs of some market recovery; however, I continue to hear from certain lenders that there are still a lot of foreclosures coming that could elongate the recovery time.  We are cautiously optimistic.
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March 29 2011
Profile picture for dacolan
A forecast from CNN Money based on a FiServ analysis that includes Phoenix-Mesa-Glendale, AZ projects a -12.8% decline through the third quarter of 2011 and another -4.8% decline through Q3 2012.
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March 29 2011
That's a very broad question, but my quick (and honest) answer is no.  Prices will continue to drop over the next 12-18 months, albeit at a slower pace than the past 2-3 years.  If you're looking to buy, now is an amazing time to start looking and even to purchase.  Prices have already dropped 30%, so right off the bat you're getting an incredible discount, and we're now at 2001 pricing levels.  Start looking now, and when you see something you like get aggressive.  Offer what you think it's worth and I bet you'll get it.  Good Luck.
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March 29 2011
The market will stabilize when distressed property inventories decline and the number of foreclosures and short sales entering the market for sale, is significantly reduced. 

I wouldn't hold my breath just yet!
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March 24 2011
Presently, the phoenix market on average is stabalizing. Inventory is dropping, sales are actually fairly strong, so i wouldn't expect overall (every area will have it's own trends however) prices to drop IN THE NEAR TERM.

However:
1. We had robosigning slow down of foreclosures. Those are ramping back up to huge numbers again, A few thousand extra foreclosures thrown on the market could definitely change the trends.
2. Our prices have dropped very strongly over the past few months, setting new lows in most neighborhoods since the crash started. They have dropped hard enough to bring out value investors, who have waited for years. Which is bigger: the number of foreclosures coming, or the number of investors buying? only time will tell.
3. first time buyers and move up buyers are all but absent. Can investors hold up our market forever? time will tell.

There are risks way too big, to predict more than a couple months out at this point. do not buy unless the home is a very good deal compared to the current rental price.
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March 23 2011
The other shiller said in the last several weeks was that he could see the possibility of a further drop of 25% in the housing market. I don't believe that will happen and current indications are for a busy upcoming spring market.
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March 23 2011
Which market(s) and where?  I just read that New Builds are now at a 50 year low.
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March 23 2011
Profile picture for Pasadenan
"I bet most of the agents cannot tell you the difference between the median and the average." -

If they don't even know the difference between a median and an average, how are they possibly going to interpret the output of a crystal ball?

The equipment may work just fine, and they will completely misinterpret it and state something entirely different and un-related.

Sure, the median and average are the same for a normal distribution, but what really follows a normal distribution?  Certainly not any prices, incomes, nor economic data.
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February 16 2011
Karl Case of Case/Shiller and the Case/Shiller S&P House Value Index said recently; "For people with a realistic version of the american dream, buying a house now can make a lot of sense."

And The Wall Street Journal recently reported; "With home sales starting to improve, and with prices now possibly forming a bottom, real estate could well be the asset class that represents the best low-risk buying opportunity out there today."

In my opinion the market is stabilizing and now is a great time to buy.
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February 16 2011
Profile picture for SteadyState
Pasedanan - Forget linear regression. I bet most of the agents cannot tell you the difference between the median and the average.
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February 15 2011
Profile picture for Pasadenan
"He might want to return his crystal ball for a full refund." -

For a long time, the REA's complaint was they didn't have a crystal ball.  But now it is exposed that they don't even know how to use one!  You can't get a refund if you just don't know how to use the equipment you purchase.

I saw some nice crystal balls for sale yesterday that are "solar powered".  They are very efficient and work quite well.

And I still suggest, that for most people that want to do predictions, Excel is a very cost effective solution, especially with free data from Zillow and the U.S. Census Bureau.  Especially if one does some linear regression on the data.
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February 14 2011
Profile picture for SteadyState
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February 14 2011
Profile picture for dacolan
The most recent Case-Shiller Index shows prices down in 19 of the 20 major metros measured and has been declining across the board for several months.
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February 14 2011
Every market area is different Brad.  Some areas have stabilized, and some have a ways to go as they are still riddled witha  fair amount of forclosures.  If you are looking to buy or sell, I would strongly advise you to talk with an agent  that has a fair amount of experience and is an expert in your market.  I would advise you to break that down even to the neighborhood level in which you are looking to buy or sell in.  THX!
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February 14 2011
Profile picture for the_country_hick
The simple way to figure this out yourself. How many months of inventory are there and what percentage of sales are foreclosures and short sales? A high number for either points to lower prices.
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February 14 2011
Profile picture for sunnyview
Only time will tell if values are holding in Boston or anywhere else. One blip of the market is not a recovery. Buyers who want to be invest wisely need to do their own homework and seek value in their market.
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February 14 2011
Really depends are where you are in the country.  In Greater Boston, values are holding and the demand for normal inventory is there.

Buyers are jumping at the non-short sale listings and the non bank owned homes. So basic economics, the need is there, the supply of non-distressed is not, so the values is there.

- Evan
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February 14 2011
Profile picture for sunnyview
I hope you're not talking about this Karl Case here who couldn't forsee more drops in markets like Las Vegas a year ago. Or this Karl Case here that forsaw a "soft landing" for home prices in 2006.

If so, I'm not sure that Mr. Case is a good predictive source. He might want to return his crystal ball for a full refund.
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February 14 2011
the well known real estate economist, Karl Case, believes that real estate in the US will bottom out in 2011.
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February 14 2011
Certainly not in the State of Nevada.
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February 14 2011

Is the market stabilizing is the question on every realtor, seller and buyers mind right now.  The answer is it really depends where you are selling and buying.  Trends are showing areas close and within major cities such as New York, Philly are doing very well and in some areas prices and units sold are actually rising.  Areas which are far away from major employment centers and far away from any mass transit can still be depreciating; but the good news is it seems to be stabilizing somewhat in the New Jersey market and areas that are depreciating are at a slower level.  ALL real estate is local so the best advice is to talk to an agent who specialized in your town and county specifically. 

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February 13 2011
No.
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February 12 2011
No.
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February 12 2011
Profile picture for Pasadenan
Well, it is not surprising that someone would label anyone that is buying a house or condo that is not planning on living in it an "investor", but that doesn't mean they are.  There is a huge difference between an investor and a speculator.  And an even bigger difference between someone experienced in investment in a given asset class and someone with no experience that is being lied to in order to be sold something that will decrease in value and will have a negative return.

Of course someone is going to buy!  There was never any question about that.  If someone wants to sell and needs to sell, they will keep marking the price down until a buyer comes forward.  And as people don't want to live in those homes at the prices being asked, who else do you expect to come forward except those that won't live in them?

Even if being purchased as rentals; there are only so many households in the U.S. to occupy the units, and the government has continued to state they will not raise immigration quotas nor streamline Visa applications.

(But it is really nice that these new "landlords" want to subsidize someone else's living expenses.)
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February 12 2011
I am happy to say that in our Market, many more investors have recently come out of the woodwork than in previous seasons. People are getting more of a gut feeling that the Market is stabilizing, but who is really to know?
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February 12 2011
Profile picture for Pasadenan
"what is the government planning to do with Freddie and Fannie? How will this affect the housing market?" -

What can the Government possible do with these agencies that will increase prices and increase number of sales?

Since you already know that the government will have to do something with these entities, and that the government has already spent billions toward bailing out these pseudo companies that are pseudo government agencies, you already answered your own question; prices will continue to fall, and the demand for house purchasing will not rise.

But what does one mean by a "stabilized market"?  A market where there is a large percentage of foreclosures to be liquidated, and continued downward pressure on prices?  Or pricing back in line with historic trends, meaning less that prices of houses approximately track the national inflation rate?
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February 12 2011
"crystal ball" comments are so grossly stupid, they should be banned forever. As if measuring job growth, shortsale listings, foreclosure filings and absorption rate in an area required some magic. 

Thankyou housing bubble! by coming along, and ALL of my competitors not having the ability to see it, and respond I am now so wealthy I don't care to bother being polite or looking for clients any more!
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February 12 2011
Profile picture for Alan Donald
Crystal-balling the future is next to impossible. It depends!
From a first-time homebuyer perspective, the COST (affordability) combination of low(er) home prices and low(er) interest rates makes this market very attractive.

I believe inflation (and mortgage rates) are on the rise, and in my humble opinion by this time next year interest rates will be in the 6-7% range. Yes, some real estate markets have not finished their declines. But by waiting to pick the bottom buyers may miss out on the best affordability combo.

A similar analysis can be conducted for investors (unless they are cash buyers, in which case the variable to consider would be the opportunity cost of capital).

In our local market (Charleston, SC) we have different sub-markets and they are behaving differently. In Mount Pleasant, a higher-income residential community, inventory has been steadily declining since 2007. For entry-level homes (below $300K) we only have about 7 months' inventory, so it is becoming a "neutral" market and prices are starting to stabilize. Homes above $500K still have 10-15 months' inventory, so those prices will probably keep falling for a while.

As I said before, it's a hard question to answer (and the one most commonly asked) and the best answer is not very reassuring: "It depends...".

The fact is that there are too many variables in play (i.e. what is the government planning to do with Freddie and Fannie? How will this affect the housing market?)
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February 12 2011
I am actually frighten to answer this question after reading other agents comments.  Personally, this has been my strongest start.  I have heard that there were still some buyers on the fence and with the rate increase they jumped in.  I am not so sure I believe that as rates were so low before, I personally would not allow rates to factor into my home purchase. 
It is similar to catching a falling knife with stocks, hard to buy any commodity at the "bottom" until the bottom has been established.  We are not there yet here in Tucson, AZ and I am not a fortune teller as far as predicting when that might be. 
I believe it needs to be the "right time" for each individual person/buyer Vs timing the market in general. 
Best of luck.
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February 12 2011
The market where?  Some markets are stronger than others.  This is a tough question to answer as there are many different schools of thought.  One day you here one thing and the next another.  Many people even contradict there own answers.  Yes, there is a lot of inventory, but there are also many steps to slow down the process in place now than ever before.  I don't think there are too many people that can really answer this question.  There are just too many variables.  I do however, see light at the end of the tunnel... call me an optimist.
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February 11 2011
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