Profile picture for beescos

How much will home prices rise within the next three years?

I am wondering if I should accept a loan modification in which my house will still be about 60,000 upside down and I am considering moving in three years.
  • September 23 2012
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Answers (11)

Really, I would suggest contactin a local real estate professional who specializes in your neighborhood.  Have this person visit your home and discuss market conditions...that what I would do if I were selling and not in the business...heck i am in the business and I would call a couple trusted real estate assopciates to give me their unbias opinion.
  • September 26 2012
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Profile picture for Blue Nile
Perhaps this "forecast chart" for 2013 by Zillow may help?


full sized image to read the text:
zillow.com/blog/research/files/2012/04/Q12012ForecastGraphic.jpg

This really is a location specific question, and was addressed by location, and properties in England indicated in the last post have nothing to do with the question.
  • September 26 2012
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Profile picture for beescos
Thank you for your answers. I guess I have  a lot to consider.
  • September 25 2012
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Profile picture for Blue Nile
I definitely wouldn't ask a local Real Estate "professional"... NAR told them to tell everyone that housing prices never go down, that they only go up, and that no one ever loses money on Real Estate...  and when the housing bubble started correcting, they all post "no one has a crystal ball", when what they actually meant is they don't know how to read the signs of the times, and they weren't paying attention to the market forecasting indicators.

Zillow does a lot better at looking forward than Realtors do.  And there are lots of other economic forecasters that are looking at such issues as well.

Real Estate sales people's profession is "sales", not "economics", "mathematics", "investments", nor "CPA".  Nor do the agents keep up with the lending market and interest rates.  It is better to talk with several trusted loan officers in the area as well as a good tax adviser that knows your situation and the local laws.

One thing to watch out for on some mortgage modifications is they change collateralized debt to personal debt, and make one liable for the shortfall even if in a non-recourse State.
  • September 25 2012
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Nationaly, were looking to rise about 10% in the next 4 years with prices bottoming out this winter. Either way I would look to a local real estate proffessional in the area for market statistics. Hope this helps!
  • September 25 2012
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Profile picture for Blue Nile
Though I agree with Vince on the inflation rate in Oak Hills, there are way too many unknowns to know as an outsider the financial impacts of your specific loan modification offer.

You may be able to do much better too.  (Not in lowering the principal, but in lowering the interest rates...)  You might try requesting some quotes on ZMM using the "mortgage rates" tab at the top of the page.  Rates have gone down substantially in the last 3 weeks.  See the thread:
Rates on the Move Again!
  • September 25 2012
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6%
  • September 24 2012
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Do the modification if you can...but be very careful...you need to understand the tax implications.  Get/hire a CPA before you sign any paperwork. If you get a break from the Bank you may be liable for taxes on the difference.

  • September 24 2012
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Profile picture for CallTheSisters
If you do not accept the loan modification what is your alternative? 

I would speak to an agent who is familiar with your specific market.  Some market are showing signs of upward mobility.  Others are not.  Real estate is specific not general.

If your market is showing signs of recovery it's a factor to consider.  No agent will go out on a limb and tell you for certain what will be in 3 years.
  • September 23 2012
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No one can accurately predict how much home value will rise or decline. What is paramount is making sure your in a position of ownership. Home Ownership is a staple of wealth and mobility. You cant be in the game from the sideline.
  • September 23 2012
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Your question is two-fold.

First, how much will home price rise within the next three years?   Considering my crystal ball broke years ago, it's difficult to say.   Currently, most of US has less homes on the market than 1 year ago, and many MORE buyers than a year ago.    That's a sign of a turn around.

Whether it will last or not is the unknown.   If you look at the last 80 to 100 years of real estate history, you'll see that we are likely due for an upswing, regardless of supply & demand.    Consider population and inflation!

Second question - Should you accept a loan modification.   Without seeing the terms & conditions of your loan mod, I can only assume it's like most loan mod's, wherein there is NO cost to you & your payment will go down!??     Regardless of the value of your home, why wouldn't you take a lower payment at no cost to you?   Again, in order to answer this question properly, one would have to see all the terms/conditions.    Really a great question for your personal financial adviser or accountant.

Good Luck with your loan mod!!
  • September 23 2012
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