[SKB]

Hardy Congratulations Chief, for posting such valuable information. I am sure all of those links will come in handy for anyone interested in getting educated on what is really happening in the housing Market.

Although I choose Fall 2008, for me it is really my wishing date as others may very well be correct to give a date further into the future but saying that, I just can not see Americans having the financial resources (to hold on) or patience to wait much longer.

I only wish you would have included our friends on here that believe we have already hit the bottom and would have had a choice to pick that as an option. I am sure that there would be more voters if you had that selection as I feel we have left out some.


I am so glad to see that you have opened up this poll and thread as this topic is very important for all involved.

I just hope this time we all can remain calm try not to take threads personal and keep this topic civil for everyone.

Anyone wishing to vent on each other should use the PM feature to do so.

[tallrick]

We have a LONG way to go. The bottom is so far off that we either have to wait for incomes to go up or prices to come down. Current property owners are not too bright in many cases and do not realize that values can drop. This could be a Japan style 15 year drop, at least I hope so.

[JimKing]

Tallrick, you are 100% correct. Its impossible to call when the rebound will start because all the negative factors converging to decrease Florida values are still developing. We still have a few years of mega-ARM resets to go, builders adding to inventory, the effect of food and energy inflation, and a host of other problems.

This is a 10-15 year story, not a 1-2 year one.

[Obrero]

Originally Posted by tallrick

We have a LONG way to go. The bottom is so far off that we either have to wait for incomes to go up or prices to come down. Current property owners are not too bright in many cases and do not realize that values can drop. This could be a Japan style 15 year drop, at least I hope so.

Spot on, we have a long way to go. This has only just begun. There is nothing at all, except for wishful thinking, to suggest we have reached bottom or that housing prices will start to increase again. I also think that we are in for a Japan style drop. However, we have some extra goodies working against us that they didn't have in Japan. When the Japanese crash happened, the average personal savings rate was at 40% of income. Here it's in negative territory. Add in all the lovelies that JimKing mentioned above as well as the terribly weak dollar, mega government deficit and you could be looking at the perfect storm folks.

For those who think the bottom is reached or near, I would be interested in hearing your thoughts on what you think is going to be the driving force that moves housing values in the upwards direction.

[MrTudo]

Americans will surrender to 40 and 50 year mortgages just like they've surrendered to giant big government socialism with the former becoming the final nail in the coffin of a free society. Why? Because the bedrock of freedom is property ownership and property rights. There can be no human rights without property rights or vice versa.

That will keep property values artificiallly high since very few will actually "own" property. Similar to what happened to the auto business except on a much larger scale obviously.

There will be of course some whining and snivelling along the way......insults by ignoramuses will be thrown toward libertarians as they are now except to an even greated extent.

[JimKing]

Some figures from moneycentral......"Compare a 30-year fixed-rate loan with a 50-year fixed. For a 30-year loan of $300,000 at 6.5 percent, principal and interest cost $1,896.20 per month. A 50-year loan for the same amount and at the same rate costs $1,691.15 per month in principal and interest.

The 50-year loan costs $205 less per month, but the payments stretch out for 20 years longer and will cost a total of $332,058 more."

Even a 50 year loan is not going to fix things. $200 less per month when food, taxes, insurance and energy costs are going up and up is not going to prop up house values any meaningful amount.

Prices will come down a lot eventually. Whether it is 40%, propped up by 40 and 50 year loans,....or 50% without.....they have a long way to fall.

[tallrick]

It is refershing to see other educated people willing to go against the housing bulls. Inflation will force interest rates up, and force people to rethink their purchases of real estate.

[NY62]

Something everyone has to remember interest rates will make a difference but not a big one, What is going to kick Floridas market are the markets in the north. lets be real here,I will use my area, long island as an example we have no where to build homes we have resales and the prices really just stabilized they did not drop just stopped going up. I know some people will argue but if they did drop it was nothing like florida. Well anyway back to the point Everyone knows about the baby boomers they have started to retire and most like those warm climates,If they sell here they will buy there most likely with cash so 30 40 or 50 year mortgages will not affect them.You have to remember most of these folks have a ton of equity built up if not owning there homes outrite. And for whatever reason people up here dont flinch at 3000.00 a month mortgage payments so they will sell here and buy there it will happen and once it does , everyone that waits to long will be left with nothing cause prices will go up. does anyone really think that houses will be 5 figures again? Honestly.just remember a 250000. mortgage at 6.5% is 1571.66 a month P and I but a 200000.mortgage at 9.5% is 1668.50 a month so if you wait and the house price goes down the interest rates could go up and you will be paying more monthly. Once it starts with real homebuyers not some dopes trying to be investors it will not come down. To many wannabe investors is what screwed it up to begin with. take care all

[firemed]

Some baby boomers will move to Florida. But I don't see the numbers that will save the market. When the 1st wave of baby boomers start cashing out on 401Ks we will see a change in the stock market. Some may hold out at that point. Right now we see the 3 year ARMs, Just when the smoke clears the 5 year ARMs will kick in. Rates will most likley go up. But I just don't see a quick end to this. The market will be flooded. “Wall Street is bracing for a nearly $2 trillion washout over the collapse of hollow and shaky mortgage bonds, triggering fears of a recession worse than the dot-com bubble bursting.” Like I said I don't see a quick fix.

[NY62]

Originally Posted by firemed

Some baby boomers will move to Florida. But I don't see the numbers that will save the market. When the 1st wave of baby boomers start cashing out on 401Ks we will see a change in the stock market. Some may hold out at that point. Right now we see the 3 year ARMs, Just when the smoke clears the 5 year ARMs will kick in. Rates will most likley go up. But I just don't see a quick end to this. The market will be flooded.

Ahh this whole thing is one big fat gamble I dont think anyone knows for sure. But you are correct about the arms though just dont know what will happen. If the rates drop arms are good. I had one of those years ago and my mortgage went down. Doubt that will happen to any degree though. And I dont see them cashing the 401s all at once I seethem selling here and buying there with the equity,they save on taxes if they buy another home with that money . It all is just a guess on everyones part. I dont think it will be quick but I dont think people that are waiting for real cheap houses in the best areas are going to get them.take care