Why is ANYONE considering buying a house right now in this market unless you have to? (Chicago: renters, mortgage broker)

[TimtheGuy]

Originally Posted by fairmarketvalue

I gues as they say, all markets are different, depending on the area. But if there is anything I truly believe something that even you would have a hard time argueing, it's that it would be a mistake to wait until next year, for that occasional "good deal" as interest rates will most certainly rise and the banking/mortgage industry is making it harder and harder to get approved for any reasonable, conventinal loan. So those that are still able to buy now, will not be able to next year, based on these 2 facts alone.

Whatever predictions you "believe" about the market going lower, as chett everett put it, what crystal ball do you pocesss that we all do not have? It's a true shame that people are not rising above this very concentrated data, and if interested in moving up, buying for the first time, or just any other reason that up until now, has prevented them from buying, they really are missing the boat, at least here in our area. Builders are still doing fine, around here, and continue to build more and more expensive homes (over 1mil), and they are selling at pre-construction prices. So the wealth seems to still be speading- somewhere.
FMV

OMG...you are in such denial with the one track 'I need to sell' and 'all these buyers are crazy' frame of mind. There is little certainty that 1st mortgage rates are going to rise over the next year. Could they...sure. Could they stay relatively flat...yep. Is there any chance they could actually go down...afraid so.

There is also little probability that qualifying will be more difficult next year for conventional loans than now. The 'big' changes in mortgage guidelines have all ready taken place. If anything a year from now I think they may loosen back up a little. They just recently revised the 'declining market' policies that were requiring larger down payments in most markets. I too am in the camp that prices will continue to decline in the next 12 months and volume will remain on the low side.

It's not a "true shame" and it is highly unlikely that anyone will be "missing the boat" anytime soon.

[Angelatc]

I'm betting that interest rates will rise like crazy after Obama takes office. When Carter was in office, the Democrats had people financing homes at almost 20%. I see no reason to think things will be any different this time around. But I don't think home prices are coming back any time soon, nor should they. When the median housing price is 3 times more than median income earners can afford, something is very wrong.

[TimtheGuy]

Originally Posted by Angelatc

I'm betting that interest rates will rise like crazy after Obama takes office. When Carter was in office, the Democrats had people financing homes at almost 20%. I see no reason to think things will be any different this time around. But I don't think home prices are coming back any time soon, nor should they. When the median housing price is 3 times more than median income earners can afford, something is very wrong.

That is why you need to vote McCain!

[Nysee53]

Absolutely, as a home builder I can say that the real estate market is always better during a republican presidency. Cost-to-build is lower and homes sell faster because of a stronger economy. Many builders are not building simply because of a strong democratic candidate. I am supporting John McCain for president as I did in 2000. To be honest I supported Mitt Romney in the primaries, but he lost, I was upset, but then decided McCain is better than Hillary or Obama, so! McCain it is!

[middle-aged mom]

Originally Posted by Nysee53

Absolutely, as a home builder I can say that the real estate market is always better during a republican presidency. Cost-to-build is lower and homes sell faster because of a stronger economy.

I did not realize Bush was a Democrat.

[Nysee53]

The economy has not been bad until there was high speculation that the US would have a democrat as president in 2008. The market was so hot for the longest time between 2001 and 2006. It is not his fault for this collapse. Bush started a plan to aid minority home ownership and reverse-redlining led to bad mortgages and ruined the market, it is mostly the banks and lenders fault. Like Suze Orman says, if everyone practiced like her we would not have such a global economic problem with borrowing and debt, etc.

[fairmarketvalue]

Originally Posted by TimtheGuy

OMG...you are in such denial with the one track 'I need to sell' and 'all these buyers are crazy' frame of mind. There is little certainty that 1st mortgage rates are going to rise over the next year. Could they...sure. Could they stay relatively flat...yep. Is there any chance they could actually go down...afraid so.

There is also little probability that qualifying will be more difficult next year for conventional loans than now. The 'big' changes in mortgage guidelines have all ready taken place. If anything a year from now I think they may loosen back up a little. They just recently revised the 'declining market' policies that were requiring larger down payments in most markets. I too am in the camp that prices will continue to decline in the next 12 months and volume will remain on the low side.

It's not a "true shame" and it is highly unlikely that anyone will be "missing the boat" anytime soon.

No problem, you have your opinion, and I have mine. I think I wrote this post almost 2 weeks ago. Regardless, We are not, nor have a we ever been desperate sellers. The real estate threads explain our situation in more detail so won't go into it. As for being in denial- we sold, since this post, that home we were so "desperate" to sell, (listed since March 24 of this year) for roughly 2% below asking. All my posts explain a much different scererio for the more affluant suburbs of Chicago, as prices are down, yes, but not in record #s as compaired to the national averages and lately, although inventory is a little high (also not nearly as high as some of the nations areas in trouble), it's starting to move and prices are staying still, for the most part. Still firmly believe it is a good time to buy, if you want to. Doesn't mean you have to, just as long as it's not because the national "doom and gloom" is saying so, which would be a shame. Anyone this easily persuaded, as it seems you are, are not probably the potential buyers in a normal market either. Bargain hunters are always hoping things get worse; it might actually give them the opportunity to buy in any case where they would not normally have been able to. As for interest rates, wrong again. 2mo. ago, we could have re-fied our new home for 5.5% but couldn't becasue we hadnt' sold the previous home. We are locked on the new home @6.5%-30fix for the primary loan(jumbo) and the bridge loan will be paid off after we close on the previous home in 7 weeks. But on the off chance that you are right on this one, good, we'll re-fi instead of re-casting the primary loan. And you know what's really scary? That these comments are even being made in reference to mortgage rates. I remember our first home as adults, in 1988, and the interest rates on our $168,000 dollar home was 12.99%. OMG, how did ANYONE afford, let alone get financing approved, for a home back then? And OMG, how is there any real estate left, 20 years later? OMG!

[Lookout Kid]

Originally Posted by Nysee53

The economy has not been bad until there was high speculation that the US would have a democrat as president in 2008. The market was so hot for the longest time between 2001 and 2006. It is not his fault for this collapse. Bush started a plan to aid minority home ownership and reverse-redlining led to bad mortgages and ruined the market, it is mostly the banks and lenders fault. Like Suze Orman says, if everyone practiced like her we would not have such a global economic problem with borrowing and debt, etc.

That's the most ridiculous thing I've ever read. Bush is the worst President since Hoover, and deregulation of banking was a large factor in the current economic downturn. If the Republicans stayed in power for more than a few terms, the middle class would cease to exist in this country.

Comparing Obama to Carter is just silly talk. There is absolutely no basis for that.

[Nysee53]

I am in business with the upper-class and from what I see the economy is doing great. Demand for luxury homes and concierge medical services is through the roof. The 2008 market is slower than 06' but Bush and Bernanke have been doing there job because my partner and I have received 4 orders for homes in 2009 priced at $2,950,000 to $4,695,000; which is very good for an election year.

[oakparkdude]

Originally Posted by Nysee53

I am in business with the upper-class and from what I see the economy is doing great. Demand for luxury homes and concierge medical services is through the roof. The 2008 market is slower than 06' but Bush and Bernanke have been doing there job because my partner and I have received 4 orders for homes in 2009 priced at $2,950,000 to $4,695,000; which is very good for an election year.

Well, its definitely true that over the past decade the rich and ultra-rich have done quite well financially. Unfortunately, the rest of the country (the non-rich) have not shared in the economic bounty. If present trends continue, we'll end up like a Latin American economy with a tiny economic elite, a huge poor population, and no middle class.