Profile picture for rajagopk

Home price decline percentage

Hi:

When you say in one of your polls that house value will decline 70% from peak what do you mean? My house was 325K in the peak. Which would mean the home will be valued at 97K. If this is correct way of calculating, then prices will be going back 50 years. So please explain with examples.
Thanks
Krishna
  • November 10 2009 - Vista East
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Answers (4)

Profile picture for rajagopk
Thank You Alan.
  • November 13 2009
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Profile picture for Mr Caveat
in some of the hardest hit markets, absolutely 70-80% and more. there are some essentially value-less homes...

more appropriately i think is the statement that homes will return to 'affordable levels' ... on the coasts this means starter homes in the range of 70k-120k, 2-4 BRs 130k-250k and the fancy homes targeting the well off in the 200-350k range.

it will be very difficult to justify a half million dollar mortgage, and even more difficult to qualify.

but thats my opinion. people are misguided using percent value as any kind of an indicator because that "peak" value really has nothing to do with your house or anything else. it may as well be a number you picked out of thin air.
  • November 10 2009
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Wow! good math.
  • November 10 2009
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Profile picture for Alan Grizzle
Krishna,

Real Estate is a local market. If homes in one area are 70% down that does not mean that every home in America is down 70%. Some markets were over built and in some areas way to many bad loans were made that foreclosed.

Keep this in mind. If you home is paid for or you are not upside down in the loan and you are moving up if you sell for $200,000 less than you could have two years ago and you buy back a nicer home for $400,000 less than you could have two years ago you just made $200,000
  • November 10 2009
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