2008 Florida Housing market Thread Jan - Mar (Cape Coral, Fort Myers: mortgage, credit)

[sunrico90]

The housing market in Okaloosa County is not expected to bottom out until the summer of 2009, according to a December 2007 study by Moody’s Economy.com.

[Wild Style]

is that where you are from? How bad the prices get there?

Originally Posted by sunrico90

The housing market in Okaloosa County is not expected to bottom out until the summer of 2009, according to a December 2007 study by Moody’s Economy.com.

[sunrico90]

Originally Posted by Wild Style

is that where you are from? How bad the prices get there?

If you are buying their great if you are selling not so good. Basically the prices are leveling off... Average house is getting within the reach of the avarage person. Due to our large military community, sales are good, many new developments and lots of older homes...

Question today while driving to the USAF base a few signs mentioned owner financing. Can someone explain the benefits or risk....

sales Dec 07
Santa Rosa County:202

[LM1]

Originally Posted by sunrico90

Question today while driving to the USAF base a few signs mentioned owner financing. Can someone explain the benefits or risk....

The benefits of true owner-financing are that you usually have a bit more flexibility to negotiate your interest rate, down payments and payment structure, you can save on lenders fees, etc.

There really isn't much of a downside to owner financing (on the buyers end) as long as you do it carefully and through a real estate lawyer. Buying an owner-financed home definitely isn't something you want to do with an "EZ Deeds" software package and a $5 notary. There are some downsides on the sellers end, particularly if you have to enter foreclosure, but that's a tale for another time.

Be aware, however, that a lot of large builders are absolutely overflowing with inventory and are offering "owner financing" that may be "owner financing" in the literal sense (since they own it and they will finance it), but is a world away from individual owner financing.
These outfits, the actual "owners" of the properties may be willing to finance, but their terms may not be anything better than what you could get through a bank, save for being laxer on credit standards.

And on that note- places like this tend to fill up very, very quickly with people who cannot get conventional financing because of their bad credit. If there was one single barometer to a neighborhood that judges its occupants most accurately, it would have to be credit score. If you take one subdivision and populate it with people who made their purchases through banks and another subdivision and fill it with people with 490 credit scores who bought into the neighborhood because it was the only place where they could get financed, guess which one will be the slum in 10 years time.

[sunrico90]

Originally Posted by LM1

The benefits of true owner-financing are that you usually have a bit more flexibility to negotiate your interest rate, down payments and payment structure, you can save on lenders fees, etc.

There really isn't much of a downside to owner financing (on the buyers end) as long as you do it carefully and through a real estate lawyer. Buying an owner-financed home definitely isn't something you want to do with an "EZ Deeds" software package and a $5 notary. There are some downsides on the sellers end, particularly if you have to enter foreclosure, but that's a tale for another time.

Be aware, however, that a lot of large builders are absolutely overflowing with inventory and are offering "owner financing" that may be "owner financing" in the literal sense (since they own it and they will finance it), but is a world away from individual owner financing.
These outfits, the actual "owners" of the properties may be willing to finance, but their terms may not be anything better than what you could get through a bank, save for being laxer on credit standards.

And on that note- places like this tend to fill up very, very quickly with people who cannot get conventional financing because of their bad credit. If there was one single barometer to a neighborhood that judges its occupants most accurately, it would have to be credit score. If you take one subdivision and populate it with people who made their purchases through banks and another subdivision and fill it with people with 490 credit scores who bought into the neighborhood because it was the only place where they could get financed, guess which one will be the slum in 10 years time.

Great post...

[Ten]

Concerning the Fed, please realize that every single dollar in circulation was lent there. In other words, every single dollar in circulation is a construct, an indicator not of worth, but of debt.

Let that sink in.

This means that at the least the interest on our nine trillion dollar debt cannot be paid. What would you pay it with? The answer is only one thing.

More debt. More sheer numbers entered into the debt balance sheet, each one incurring its own interest and so on and so on.

In fact, each debt-dollar is used to create nearly ten more debt-dollars, each one lent and relent, and each one incurring more debt. We call this "stimulating" the economy.

A wise man on this board just asked if we're moving backwards, living in half the home we did half a century ago and then paying double for it. And if that weren't bad enough, we're suffering this quadruple loss while living on a bubble economy, one that due to the Fed and that fiat currency can at any point lose whatever trust it has propping it up and drop through the floor all over again.

How so? Consider that at this point the only thing we can do, having blown up the tech bubble and then the housing bubble with "stimulation", is to adopt the single most idiotic strategy on the planet and actually print more money in order to cover the insolvency of an economy based on too much money.

Kinda like a heroin addict, needing just one more fix before going straight. Well, one more after that one, I mean. Or one more after that one.

This bubble, it's worldwide, folks, with writedowns of truly epic proportions occurring all over the place, and, if you can believe this, the folks we're buying oil from buying back stakes in the US's largest financial institutions. And while we literally trade US dollars for hard goods from abroad like there's no tomorrow.

Where and when will it end. Will the economy bubble itself burst one day? We're already seeing oil, gold, and foreign currencies all rising dramatically against the dollar.

A Fear That the Cure Could Be Poison

WASHINGTON — Even as the Federal Reserve grapples with the collapse of a speculative bubble in housing — the second speculative bust in less than a decade — is it at risk of repeating recent mistakes?

One day after the Fed slashed its benchmark interest rate to head off a possible recession, a small minority of economists warned on Wednesday that the central bank was in danger of invoking the same remedies that it did after the bubble in dot-com stocks burst seven years ago.

Though most experts agree that the economy is on the brink of a recession, and some even contend the recession has already begun, critics say the Fed’s attempted rescue looks uncomfortably similar to the aggressive rate reductions that aggravated the speculative bubble in housing.

“We’ve literally forgotten that this is the very policy environment that led to the housing and mortgage problems in the first place,” said Michael T. Darda, an economist at MKM Partners, an investment firm in Greenwich, Conn.

[CJFlorida]

Originally Posted by Ten

Concerning the Fed, please realize that every single dollar in circulation was lent there. In other words, every single dollar in circulation is a construct, an indicator not of worth, but of debt.

Let that sink in.

This means that at the least the interest on our nine trillion dollar debt cannot be paid. What would you pay it with? The answer is only one thing.

More debt. More sheer numbers entered into the debt balance sheet, each one incurring its own interest and so on and so on.

In fact, each debt-dollar is used to create nearly ten more debt-dollars, each one lent and relent, and each one incurring more debt. We call this "stimulating" the economy.

A wise man on this board just asked if we're moving backwards, living in half the home we did half a century ago and then paying double for it. And if that weren't bad enough, we're suffering this quadruple loss while living on a bubble economy, one that due to the Fed and that fiat currency can at any point lose whatever trust it has propping it up and drop through the floor all over again.

How so? Consider that at this point the only thing we can do, having blown up the tech bubble and then the housing bubble with "stimulation", is to adopt the single most idiotic strategy on the planet and actually print more money in order to cover the insolvency of an economy based on too much money.

Kinda like a heroin addict, needing just one more fix before going straight. Well, one more after that one, I mean. Or one more after that one.

This bubble, it's worldwide, folks, with writedowns of truly epic proportions occurring all over the place, and, if you can believe this, the folks we're buying oil from buying back stakes in the US's largest financial institutions. And while we literally trade US dollars for hard goods from abroad like there's no tomorrow.

Where and when will it end. Will the economy bubble itself burst one day? We're already seeing oil, gold, and foreign currencies all rising dramatically against the dollar.

A Fear That the Cure Could Be Poison

WASHINGTON — Even as the Federal Reserve grapples with the collapse of a speculative bubble in housing — the second speculative bust in less than a decade — is it at risk of repeating recent mistakes?

One day after the Fed slashed its benchmark interest rate to head off a possible recession, a small minority of economists warned on Wednesday that the central bank was in danger of invoking the same remedies that it did after the bubble in dot-com stocks burst seven years ago.

Though most experts agree that the economy is on the brink of a recession, and some even contend the recession has already begun, critics say the Fed’s attempted rescue looks uncomfortably similar to the aggressive rate reductions that aggravated the speculative bubble in housing.

“We’ve literally forgotten that this is the very policy environment that led to the housing and mortgage problems in the first place,” said Michael T. Darda, an economist at MKM Partners, an investment firm in Greenwich, Conn.

Thank you. To see realtors on this forum telling people that the FED did not cause this mess is very disturbing. Thank you again for a great post.

[Wild Style]

You guys should try to get January 2008 Harper's magazine. Great read on the next bubble.

[Jammie]

Originally Posted by faithfulFrank

Interesting debate.......

I cannot help but to think that some of the blame belongs to the people themselves...... I've always believed that it was always better to spend less them you make......save up for the things you want to buy......live within your means.......

I'll be 50 this year. I've always had excellent credit. Never paid a dime of credit card interest, although I use them all the time...the day I cannot pay my credit card bill in full, I'll cut them up. I pay cash for my cars and make them last.

The bank calls me "unamerican". I see young people want the same things I worked 30 years for.....I want it all and want it now thinking. They buy everything on credit because the creditors say, "Yes, you can afford it".

When will we ever learn.....?

Here is a question I've always wondered. Are we better off now then we were say 75 years ago? Think of this.

The houses that were built then, ( at least up here ) were huge....over 2500 sq ft or more.....quality built houses with nice trim, leaded windows, fancy wood flooring, etc,etc. The family who bought them only had ONE paycheck coming in......husband worked, wife stayed home raising the many kids...(hey, I'm just saying how it was....). Now that huge house was paid for with ONE paycheck, and the mortgage was NOT a 30 year mortgage...more like a 10 to 15 year mortgage.

Now...fast forward to today. smaller house, (although fancier, more efficient, fancier bathrooms, kitchens, etc...) It now takes TWO paychecks to buy it...30 year mortgages, smaller sq. footage, (sometimes)......double the paychecks, double the time paying for it......

Have we gone backward??

Just wondering.

Frank D.

That's a very good point, Frank. But keep in mind that things have changed from the era you're talking about. Back then one tv was sufficient for a family. So was one stereo and if you go back far enough, one car was what the average family had. We didn't have to buy VCRs, DVD players, automatic washers and dryers and microwaves and the list goes on.

Somewhere down the line we've just gotten to believe that we need way too many things. A lot of people feel they deserve a large, NEW house along with a pool and hot tub. And don't forget the Hummer and the Lexus that need to sit in the garage. Of course, that's not the way everyone feels, but it does explain a lot of the problems that people are now having.

The insurance and taxes took a tremendous leap and that may be why some people are having problems. But the majority of people just bought more house then they could afford. We could blame the realtors or the lenders or the government, but the fact still remains that some people themselves made poor judgement calls.

Let me guess~you're from the generation that was taught, "If you don't have the money to pay for it, keep your hands off." Yea~me, too.

[Mike Peterson]

Originally Posted by CJFlorida

Thank you. To see realtors on this forum telling people that the FED did not cause this mess is very disturbing. Thank you again for a great post.

What ever happened to personal responsibility?

Were people forced to buy homes that were more than their budget could handle?

As I stated before, the rate cuts may have spurred buying but the wannabe investor and those buying a $500,000 home on a $200,000 home budget were a cause of the bubble not the effect.