US Home Values Bottomed Out?
 

Are there any financial/economist/predictors out there? What are your opinions on the housing slump that has affected many parts of the country? How long do you think it will last before prices are on the rise again? So many of us are just hanging in waiting for our northern homes to sell so we can finally make it down to TV. Opinions????

Re: US Home Values Bottomed Out?
 

Looking at my watch. In my opinion it should bottom out soon.

My opinion only, for what it is worth. We bought in April. Got a new home for what we considered a very good price. I think some are lower still here.

As my sainted mother would say about your selling your house. "Things are bound to get better soon".

Re: US Home Values Bottomed Out?
 

Prices here in Maryland are the same as they were a year ago. Nothing has dropped but things are just sitting too. We put our house on the market in mid April after returning from our annual winter in TV and its just not moving. We should have made the move a year ago but it just wasn't the time. A year ago our house would have sold within the first couple of weeks. Now we can't get people in to look. There is just so much inventory out there now.

If it ever sells we'll be one of "The Village People" to. If its meant to be it will happen.

Its not like we're miserable here. There is just so much more for us in TV.

Re: US Home Values Bottomed Out?
 

IN N Va I have been reading it will not get any better until mid 2009 at the earliest. Even that prediction does not mean price increases.....most likely it means stabilization of prices and not reductions. Since the fall of 2006 prices home prices (400-500K range) have dropped about 21% but there are still many houses available who cannot sell even with a 21% price reduction. There is simply put alot of inventory out there either foreclosures or people that need to move and cant. Once things start to stabilize in fall 2009 and into 2010, you then will have the people who rented instead of selling and NOW have to sell for tax purposes ie need to live in your principal residence 2 out of the last 5 years for no capital gain tax. This will result in another increase in the number of properties available for sale which would not be good for price appreciation. In fact the people who NEED to sell because of tax reasons could actually bring the market price back down because of the "time" issue an these properties may be harder to sell since they are now occupied by tennants!
My prediciton is that it is not going to be the hey-days in real estate (2004-2005) for a number of years to come.

Re: US Home Values Bottomed Out?
 

Read in the San Francisco paper today that 44% of May home sales in Contra Costa County and 26% ditto in Alameda County were foreclosures. These are the two "East Bay" counties with a total population of about 2.5 Mil. The article further stated that due to the large number of foreclosure sales it was driving the average sales prices down to about 25% of what it was at the peak; however, sales of non foreclosed homes were only about 5 - 7% lower than the peak. Historically, foreclosure sales are much lower than normal sales.

Re: US Home Values Bottomed Out?
 

My friend, a Realtor, in San Antonio sold 6 homes this month. I need to ask him if the sellers got good prices for them.

Re: US Home Values Bottomed Out?
 

Don't forget that the MAJOR job layoffs haven't begun yet. Of course, the airlines and banks have started to furlough employees but what about the other industries once the consumer really starts keeping the purse closed. When the other parts of the economy look to conserve cash by letting employees go, foreclosures will rise even further. This is the worse housing mess since the Great Depression. 2009 is too early for the end. IMHO we're only in the 7th inning of a 9 inning game hoping it doesn't go into extra innings.
Keep an eye on the unemployment rate; layoffs are the enemy of housing.

Re: US Home Values Bottomed Out?
 

HOPE
Any house can sell if you give it away and alot of people have to do that in ordder to move on with their lives. Granted not all major markets are effected as much as others but from what I am reading MOST are. Houses are selling in N Va but at dramatically reduced prices. The fact that they are selling is GOOD...but there are alot of them out there!

Re: US Home Values Bottomed Out?
 

Selling at market value is not "giving your house away". It is accepting what a willing purchaser will pay, and moving on with your life. Prices now in TV are also low. Win/win!

A Villages sales rep tells me that due to the increase in gas prices, and the cost of purchasing and transporting building materials, the price of Villages new homes will soon be going up. Hard to see how this can happen if the prices elsewhere are going down! But the Villages Sales Department has always maintained that because TV is "unique", the price decreases aren't as severe in TV.

I hope that tkret is wrong, but IMHO, I think he may be right.

Re: US Home Values Bottomed Out?
 

We live in Maine, on the water with a dock and a deep salt water mooring for a boat. We thought we would have no trouble selling. Think again. We have lowered the price 50K since it went on the market-- no takers. Only three lookers. With the high fuel costs even the boaters are down about 50%. Well, we got tired of waiting and bought in the villages about a month ago. Will be down in October. Will return to Maine next summer to try again. It sort of gets one down. But thinking on the bright side-- we are moving on with our life. See you in the fall.

Franz and Pat :bigthumbsup:

Re: US Home Values Bottomed Out?
 

Here is food for thought: historically when the inventory of unsold homes on the market is at 6 months or under, prices tend to rise. However, when that figure rises above 6 months, of course the opposite takes place. Currently, on a national level, the inventory of unsold homes is just under 10 months with some areas of the country significantly higher than that.

When a merchant has too much inventory on his store shelves he has no alternative than to put it on sale. Homeowners, although they don't think so, MUST price their homes to market. They must price it at what a consumer (buyer) is willing to pay for it.

Re: US Home Values Bottomed Out?
 

Thanks for all interesting input. From your comments and from what I'm hearing on the news, the hard hit areas will not begin to rebound for at least another year to year and a half. In fact, perhaps we haven't seen the end of the decline yet - especially in places like the Northeast. Trouble is that the foreclosures are bringing our property values down. Those who bought 3 years ago have seen a decline in value of approximately 13% - so far. Can you imagine the influx of people to TV once the market gets back on track, whatever back on track means.

Re: US Home Values Bottomed Out?
 

I agree, with all the news I think it may only be the sixth inning

Re: US Home Values Bottomed Out?
 

Agree with "tkret".

Some things to think about.....

Gas at $4,$5,$6 /gallon. Who can afford 100 mile commutes on a daily basis?

Food prices increasing dramatically due to drought, floods, ethanol, etc. up about 23% year over year.

Heating oil at sky hi prices...$650 for a tank fill. That shoe will drop this fall.

Increases to come from utilities for energy related costs.

Municipalities increasing taxes due to revenue shortfalls

Not to mention bank failures, and the soon to arrive consumer credit crisis.

Oh, and the likely bankruptcy of at least one major auto maker and perhaps more than one major airline.

The dollar is dropping like a stone due to the Fed's lame policies which is and will continue to wreak havoc on the cost of our imports, which if you haven't noticed is just about EVERYTHING we use on a daily basis.

These are just the basics. Seriously, does anyone remember a time when so many thing s were lining up in a financial "Perfect Storm"? I don't.

It's all going to be a BIG problem on folks with fixed incomes VERY soon.

Hoping for the best, preparing for the worst.....

Re: US Home Values Bottomed Out?
 

We need to stop the bleeding. Try to encourage legislation to keep people from getting loans with ARM and making them have a down payment. Hopefully this awful time will scare people into realizing that the old habits of saving and living within your income are good ones.

The oil issue is not easily resolved and that is frightening. We will have to make drastics changes there. I am absolutely without an answer.

Re: US Home Values Bottomed Out?
 

OK, folks. This is what's up. I did not know I was going to write this. I did not plan to stay so long at the keyboard this morning. I tuned in to this thread. And whoops! I was off and running. (typing) I am not a cutter nor am I a paster. I just tell stories. You do not have to read them. But here goes:

I wish I could find out who said, "Unrestrained greed is not only bad morals, it is bad economics."

I am a fan of business. But lending industry practices that we have witnessed recently do not resemble ethical business in any way, shape, or form. The bloated in DC have been so wined, dined, and propped up by lobbyists that they can no longer recognize ethical business practices, if they ever could.

The CEO of one of the largest lenders was selling his stock through programmed stock sales. Yeah, I know. That's legal. He set it up ahead of time. And he and so many other lenders set up those wide-eyed American Dreamers.

I am weary of hearing, "But the borrowers should have known." Yeah, they should have. But they did not. And their lenders knew they did not. And their Congress knew they did not. There seem to be no laws to protect the American people from the lending industry. Things have happened that should never have happened. And we will all pay.

I don't care about the speculators. I do care about those first home buyers who walked right into it, trusting the guy with the briefcase and the big desk, telling them what they wanted to hear. Vile stuff out there. And we will all pay.

I saw it coming. And I am certainly not a learned economist.

In the fall of 2006, I actually rescued a good friend's daughter from one of these loans. We are talking about a smart young woman with a good job who was walking right straight toward the wall, the cliff, whatever. Her parents could not get her attention. She was hell-bent on doing this "on her own." And thought she understood it. She is in her 20's. And she knows how to do some serious math. Whoda thought?

I asked if she would at least let her dad introduce her to someone at their local, longtime, conservative, bricks and mortar bank to see what that lending department could offer her. It worked out fine. I have no idea why she listened to me. But she did.

There is another circumstance that I have seen up close. A couple in their late 30's who are family friends transferred west. Both have excellent jobs. They bought last fall in a nice neighborhood, getting what they thought was a good deal.

They had to sell their SC house for less, but they felt they were buying for less and the new jobs dictated a move.

This couple knew not to get into the wrong kind of mortgage. And they did not. This young couple did everything they were supposed to do.

And they settled into their new and quite lovely neighborhood.

Now they are watching their neighbors walk away. They are watching their neighborhood turn to rental where possible. They are watching growing grass and general property neglect. They are surrounded by yards that have unmaintained pools. They are even seeing multiple families live in one house. And we are talking about those Ken & Barbie houses. And this young couple did things as they should have been done.

I care about the people in my little stories. I care about those who are like them. Those I do not know. And I care about the fact that we will all pay in one way or another, or in many, many ways. And I care that those who should pay, will not.

So anyway, you did not have to read it. If you are reading this sentence, I guess you did. I did not intend to write it. But I did. So I will hit send. And I will move forward with my life. But I will still care very much. And I still believe that "Unrestrained greed is not only bad morals, it is bad economics." And I still wish I knew who said it. And I wish I had.

I just looked back and saw that I did not give my opinion, directly anyway, on when the overall housing market will bottom. Well, I do so love my sayings. And one of my favorites is "It's not over 'til the fat lady sings." And I'm sad to say that I don't hear her. And I'm really sad to say that I'm not even sure she is approaching the stage. I guess, truth be told, I don't even think I see her limo pulling up to the theater.

Boomer

Re: US Home Values Bottomed Out?
 

Note what the Chief Economist of LendingTree.com says about the prospect of the end of this mess. His opinion is in the middle of the article.

http://www.kansascity.com/438/story/684260.html

Re: US Home Values Bottomed Out?
 

WOW Boomer......... that was interesting; makes sense to me.

I'm-a-thinking I might just stay put, hold on to my savings, and wait it out :dontknow:

Re: US Home Values Bottomed Out?
 

Boomer,
Great piece. The most disturbing thing about it all is the complete lack of ANY leadership in Washington around any of these issues. It's almost like they are letting it happen.
I just get so furious about the whole thing I can't even articulate it.

Re: US Home Values Bottomed Out?
 

Thanks so much for your post, Boomer. My daughter is also in a bad situation with this mess. No, she didn't get an ARM and she isn't in danger of losing her house. But both she and her husband now have close to 2 hour commutes and a new baby. They'd love to move closer to their jobs but the house is now worth probably $20K less than the mortgage on it. If they did sell, not only would they have nothing to put down on another house, they'd still owe a bundle on this one. A realtor told them to just walk away, but then who would give them another mortgage? And I'm sure they aren't alone.

Re: US Home Values Bottomed Out?
 

Great article Boomer. I just purchased in Hemingway village, unable to wait for the market to turn around. Plus we got a great price, even made a few dollars according to the prices on TV's web sit. I had my house on the market since January here in South New Jersey and no takers. We are selling it our selves, had open houses with visitors but no buyers. Two years ago, this house would have sold in less then a week. But it's like you say, no one in DC is listing or even cares. It seems the name of the game is GREED.

Re: US Home Values Bottomed Out?
 

Re: US Home Values Bottomed Out?
 

YEP YOPU NEED TO GET A HOBBY -- Way too long to read

Re: US Home Values Bottomed Out?
 

but, but, but, but, but, but, Happy 62,

You said, "YEP YOPU (sic) NEED TO GET A HOBBY -- way too long to read."

And you yelled the first part at me.

sniff. sniff. sniff.

but, but, but, but, but, a few people liked it I think. sniff. sniff.

And, and, and, and, I am really a pretty nice lady. And I try to never be rude to anybody on here.

sniff. sniff. sniff. sniff.

And if you tell me who was making you read it, I will ask them politely to stop making you read stuff.

sniff. sniff. sniff. sniff. sniff.

but. but. . .

But right now I am going to go play with the alligators.

sniff. sniff. sniff.

but. but. but, Happy62, justsoyaknow, that was only the first chapter.

Boomer

Re: US Home Values Bottomed Out?
 

Things here at the Delaware shore are at a standstill as far as houses being sold.

How bad is it?

A house down the street from us that when put on the market a year ago was listed at $600,000, a fair price for this house. The price was reduced to $400,000 this season
--and it still hasn't sold!!!

Re: US Home Values Bottomed Out?
 

Don't cry, boomer. I loved your post. :bigthumbsup: I think you are a very smart lady and I never want to get to the point that I refuse to read a good post because it's "to long".
Let your fingers fly!!!!!!!!!!!!!! 040

Re: US Home Values Bottomed Out?
 

:agree:
Boomer,
The post was not too long, and it said just enough to make me think about those individuals you described and really feel for them. There is something basically wrong when CEOs who mismanage a company walk away with huge golden parachutes. Many of us have seen it first hand, and the company cuts never seem to affect those who made the very decisions that caused the problems to begin with.
Individuals shareholders have very little say, as the large mutual funds and pension funds (in addition to wealthy foreign investors) make the calls that are perpetuating these problems, and it all boils down to the next quarterly profit report.
I am not saying there is anything wrong with profits, but there is no longer any long-term corporate (or government) strategy. Everything is focused on the next election or the next earnings report.
Yet how many of us even read, no less vote, on proxy statements when we receive them?
Financial education, disclosure and more transparency in corporate governance are needed.
I know, this was probably too long as well, but maybe we've all become too accustomed to "sound bites" and need to delve more deeply into the issues.
Thanks, Boomer, for your thoughts.

Re: US Home Values Bottomed Out?
 

If Fannie Mae and Freddie Mac are in as much trouble as is being reported we aren't anywhere near the bottom of home prices.

Basically, the problem is this...Fannie and Freddie guarantee a huge proportion of the home mortgages made in the U.S. The losses being incurred because of the flood of sub-prime loans and now the resulting foreclosures has placed the underlying capital of Freddie and Fannie under tremendous stress. I've heard several experts say that they're nowhere near insolvency, but the financial markets are reacting in a way that they will have a very difficult time raising the money they need to continue to do their business.

That means that mortgage loans will become very, very difficult to get. Only the absolute most creditworthy borrowers are going to be able to get loans. The basic protection that any lender seeks in circumstances like this is to reduce the "loan-to-value" ratio that they'll lend. So, if lots and lots of buyers who might like to buy a house can't get financing, or if they can only borrow 60 or 70% of the purchase price, the number of homes sold is going to decline precipitously. But there will still be home owners who absolutley have to sell their homes. That could include lenders who own homes from foreclosure, people who are transferred by their companies who have agreed to "underwite" the sale of the transferred emplyee's house, or people who have very low mortgages outstanding on their houses and are willing to sell at a very low price just to get out. All those types of circumstances result in much lower sales prices for houses. MUCH lower!

So much of the future of home prices and home sales rests on the willingness of lenders to make loans. And without Fannie or Freddie to guarantee those loans, I think you're going to find lenders sitting on the sidelines for quite some time to come. I think that there is a reasonable argument that can be made for a further precipitous drop in home prices in the next year or so.

Re: US Home Values Bottomed Out?
 

Kahuna, I agree.

Interestingly, I have been recently warned by a Village agent that TV will soon be increasing prices on new homes because building supply costs are escalating due to increases in transportation costs. The Village agents insist the market decline hasn't really affected Village home prices because it is a "unique" market. That has always been their "party line" in spite of much evidence to the contrary. (If you peruse the MLS site, almost every house listed has been reduced in price, many substantially.)

Re: US Home Values Bottomed Out?
 

thanks for your input Boomer and all the rest. Housing is still supply and demand, like just about every thing else, and at this time oil seems to be in demand, house owner in supply, jobs decreasing, not good situation for the country I love. Even rougher for the newer generation. No solution in sight, both candidates spouting the same old Republican and Democrate dogma.

Re: US Home Values Bottomed Out?
 

still no sign of a bottom...

http://www.msnbc.msn.com/id/19953440/
http://biz.yahoo.com/ap/080724/home_sales.html

Re: US Home Values Bottomed Out?
 

Washington is doing nothing to solve these problems because they want bad news.* And housing and gas affect all of us so they are partying in the streets.* I live here and see it.* Congress will never take any action as long as they think bad news will cause voters to give them more power.* Get rid of the incumbents in both parties and continue to do that until they respond to voters.* Congress approval rating has fallen from 34% to 9% in the last two years.* It is because we elected a Democratic congress and have a Republican President.* Would be the same if it was reversed.* Nancy Polosi and the current incumbents will do NOTHING to solve ANY problem until after January 2009.* It's all about power.*

So my best guess is that action by DC will occur next January February time frame.* Those actions will start to have an impact by May or June and everything will be grand before the next elections.* Again all about power.* That cycle will happen regardless of who wins in November.*

However those that plan to buy in TV over the next 12 to 18 months should do it soon if at all possible.* Figure out what it will cost you to carry two homes for that amount of time and see if it makes sense to buy before prices head back up.* Buying now could save you as much as 25% of what it will cost you after your home sells.* So if your buying a 250K home in TV and your carrying costs for a year are 25K, you would probably save 25K by doing it now.* Later on that 250K home will be 300K.* Besides that you can at least start enjoying it now and over the longer term you will end up saving money.* TV does have a unique market and because of that it was one of the last places prices dropped and it will be one of the first to recover.* So IMHO now is a really good time to buy and carry two homes for a year.* Remember investment advise 101, buy when things are out of favor, sell when everyone else is buying.* If that is even a little bit true, now is the best time you will ever have to be a Villages owner.*

Re: US Home Values Bottomed Out?
 

WAAAAaaaaaaaaaaaaaaaaal :'( :'( :'( Now I'm really depressed :'( :'(

On the phone..... ordering another truckload of madrone - for the wood stove :dontknow:

Re: US Home Values Bottomed Out?
 

At the risk of being accused of being a 'chicken little' by those who maintain in the face of what's going on around us that everything is just hunky dory (everything from stalled real estate to gas and heating oil prices to more and more foreclosures and the Fannie May/Freddie Mac situation to increases in the prices of food and just about everything else because of increased transportation costs and ... and ... and ... and ... you get the point ...), I believe that we are far from the end of what's going on.

However, to go back to the specific topic about whether real estate prices have reached their bottom and are starting back up, the best anyone's crystal ball can predict is that (1) it's really unknown at this point and (2) it's also going to depend where--this is a BIG country. Doesn't help much, does it? We ourselves were fortunate in that it was our intention to be snowbirds, so we didn't have to sell to buy in TV, but we know and are concerned about so many others who are caught between a rock and a hard place....

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S.L., I really didn't need to read this....LOL

A BIG Rock, and a very, HARD place!! :yikes: :yikes: :yikes: :yikes:

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I agree Donna. This is not the kind of thing those of us who are trying to get to TV needs to read.

It is hard enough keeping up a positive attitude.

I don't mean "rose colored glasses", "head in the sand while the world caves in around you" attitude either. I mean trying to stay motivated and upbeat, when you are up against impossible odds and an economy that is the result of Corporate greed and political Laissez-faire economics.

Of course the posters have the right to discuss this topic here, I just have to keep myself away from this kind of posting...or learn to love being depressed.

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Sorry, Donna and Susan&Tom, just an opinion; I could be (and wish I am) dead wrong....

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Don't worry S.L., I love you anyway!!http://www.millan.net/minimations/smileys/yes.gif

I am trying to keep a positive attitude, homes are still selling in TV, anfd that is a good sign...http://www.millan.net/minimations/sm...lissysmile.gif

Lets keep a positive attitude peeps...

Re: US Home Values Bottomed Out?
 

In our Norcal East Bay neighborhood:

A home across the street put up a 4 sale sign two weeks ago and now has a sale pending sign! And not a vacant foreclosed property.

The two vacant, foreclosed homes across the street have had 4 sales signs up for six months or so - both have sold in the past month. No more vacant homes on our block!!!


Can offers over asking prices be far behind ? ? ?

Re: US Home Values Bottomed Out?
 

Anyone interested in a GREAT overview of what's going on in the financial markets should pick up Kevin Phillips new book, "Bad Money". Also on audio.

It's a fascinating treatise on the whole run-up to what we're experiencing now and how it's all been orchestrated by the Fed and the money people to create a financial industry that will replace the manufacturing and computer industries being shipped overseas.

I'm only 3/4 of the way through and will read it again to absorb it all but it really answers a lot of questions.