[nychiefsfan]

Originally Posted by LingLing

How about Palm Beach County? See the link
PBC property values rise just 5.2 percent (broken link)

Frankly, I don't know how they came up the number.

Yanno, house values may increase due to the fools who are paying 2005 prices for a home in a "buyers market," but the more telling picture is the overflooding of homes on the market and how sales are pathetically low.

This tells me that some people are overpaying and most people aren't willing to do so, hence the median price increases, due to existing home owners being too stubborn to drop their prices. Additionally, the existing home owners are reinforced by the median and the few sales in which people have overpaid for a home, but they're not considering that many people in this market are not willing to overspend for a house.

What good is owning your own house if you're spending 40% or more of your income on it? It makes much more sense to rent right now.

[SKB]

What we will find is what has historically worked for decades, prices that people can afford, period.
We are looking to go back to 20% down and a mortgage 2.5 times your salary. This worked perfectly, all of the other toxic stuff didn't as 77 major sub-prime lenders have now gone out of business.

Since this has now proven not to work, how are prices not going to crash in a big way if only a small percentile of the population can afford 250,000+ homes?

"PUHLEASE do not post 1000 articles saying otherwise. I can post a thousand more to support my position."

I welcome you to please post some of these articles, just as long as they are not written by the NAR or the FAR.

[nychiefsfan]

Originally Posted by Audacious

Learn from history, this is not the first RE slowdown or meltdown or bubbleburst or whatever you want to call it. There have been plenty over the last 30 years and where did the price of housing go over the last 30 years?

We can't learn from history on this bubble, because there's never been one like it....ever.

Have you seen economist Robert Shiller's home sales graph?

Here's the link:
http://graphics8.nytimes.com/images/...aph2.large.gif

Yale School of Management Professor Robert Shiller warned about the dot-com bubble before it burst. He is now warning of a similar collapse in the real estate market.

Shiller has traced the actual financial return that houses produce for their owners. He says that over the long term, house prices roughly match gains in people's incomes and that booms are more often followed by busts, thereby dissipating any major increases in equity.

The National Association of Realtors, unsurprisingly, challenges Shiller's assessment and argues that the market is stabilizing and predicts continued growth, albeit at a more sober rate.

[Obrero]

I am still consistently amazed at people who believe this is in fact the bottom the housing market in Florida. It's like previous "corrections" with people calling a false bottom all the way down. Even if you are unable to understand the most basic of fundamentals, surely you can see that houses are too expensive for the average working family to afford on a 20% down 30 year fixed loan. How on earth can those prices be sustained long term? Who do you think is going to buy all that inventory out there at these prices? Plain old common sense says it's just not feasible.

[Audacious]

Originally Posted by JimKing

Utter, total nonsense. The vast majority of Florida real estate will fall at least another 50-60%. There were no fundamentals that supported a run up over the past 7 years. In fact, prices should have stayed flat, which would mean they would have decreased when adjusted for inflation.

You can rent houses everywhere for $1200-1500 that are on the market for $400,000. Houses that rent for that amount have sold for $150,000-200,000 through out the history of real estate.

This thing has so far to go down over the next 3-5 years it isn't even funny.

Sorry my friend but I have houses with a CURRENT FMV average of 170K that are renting for between 930 and 1050 per month at least that is what the lease says and it is the same amount of the monthly rent checks. Which supports part of your statement but does not quantify comparing a 400K house to a 170K house. Lots of folks went crazy on the 300K to 500K market and found out the reality of such speculation. I did not invest in that market but in the broarder market of what the majority of people could afford. My stratagem has been very successful because I am NOT driven by greed but by basic market projections. The above numbers support what I am saying. I am usually a very easy going guy but all these "alleged" facts are really starting to get on my nerves.

How in Gods' good name can you say that "prices should have stayed flat, which would mean they would have decreased when adjusted for inflation.

Inflation as described by Webster

Main Entry: in·fla·tion
Pronunciation: in-'flA-sh&n
Function: noun
1 : an act of inflating : a state of being inflated : as a : DISTENSION b : a hypothetical extremely brief period of very rapid expansion of the universe immediately following the big bang c : empty pretentiousness : POMPOSITY
2 : a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services

Do you have any comprehension of what inflation is???
Do you have any idea of how contradictory your statement is???

When adjusted for inflation is a RELATIVE number, you can adjust your golf score for inflation (age) but the score is still the same. You can adjust todays values/prices for inflation compared to when your grandfather bought a house but guess what?? the number is TODAYS price. This is the reality of the market. Like it or not that IS the reality. I'm really surprised that my previous post has not been torn apart yet.

C'mon guys yer not trying!

[nitroae23]

In the historical context,home prices in the 2000-05 went up for three main reasons,legistlation in the late 90's which exempted profits gained on the sale of your house,which previously had been taxed after 125K or so if not immediately reinvested,generational low interest rates,and a lack of an outlet for speculators to place money after the stock market slide of 2000-02,my best guess is market probably nationwide has 15-20% more downturn to go,however,certain FLA (esp cape coral) and CAL (santa ana) have 20-25% more,coral due to incredibly bloated inventory(3 times more houses for sale than Boston,which has 600k people in its metro area,santa ana's price to income of 8.1 is highest in USA,even more than Honolulu.

[Audacious]

Originally Posted by nychiefsfan

We can't learn from history on this bubble, because there's never been one like it....ever.

Have you seen economist Robert Shiller's home sales graph?

Here's the link:
http://graphics8.nytimes.com/images/...aph2.large.gif

Yale School of Management Professor Robert Shiller warned about the dot-com bubble before it burst. He is now warning of a similar collapse in the real estate market.

Shiller has traced the actual financial return that houses produce for their owners. He says that over the long term, house prices roughly match gains in people's incomes and that booms are more often followed by busts, thereby dissipating any major increases in equity.

The National Association of Realtors, unsurprisingly, challenges Shiller's assessment and argues that the market is stabilizing and predicts continued growth, albeit at a more sober rate.

OK, we had 9/11, REALLY NASTY, where is the NASDAQ now, where is Dow Jones now. Don't you wish you bought into the market then!! Don't forget about all the naysayers who said the Fed banking system would collapse, the Dow would continue to sink to 1980 values etc etc, sound familar, the same crap 16 years later. Yikes, if you invested then you would have made a ton of $$$.
Owning Vs. renting over the long haul, as an average of all markets, you are far and away ahead by owning than renting. There are exceptions to every market, NYC vs. Billings, Montanna. I don't want to get to heavy here BUT factor in the tax advantages, overall GUARANTEED increase in equity, 20yr time span, cash out value at the end of the mortgage etc etc. Also take into account that most people who rent do not set aside $$ for retirement. The homeowner is doing so whether he likes it or not by paying his mortgage. It's called financial discipline. Most folks don"t have it.

As to Yales'/Shillers prediction of booms being followed by busts. Well my friend you need a bunch of booms in order to generate a bunch of busts. Can ANYONE out there tell me of ANY market where real estate has NOT gained over a 10 year time line. Obviously this excludes Michigan and Ohio as well as other areas that benefitted from the wonders of aggressive taxing policies. Remember folks, there are those of us who buy and sell houses and then there are those who buy homes. The home buyer is basically immune to short term abberations in the market. The homebuyer KNOWS by past history that his house will become a major appreciating assett while providing shelter at the same time.

There have been plenty of ups and downs in RE throughout time. Any fool knows that but a real fool fails to acknowledge that over the long haul RE is as good an investment as any out there. I am not not talking about flippers, who can create short term abberations, but the general population overall. It is a time proven theorum. You can argue it from here to eternity but you cannot prove it wrong. Need further proof???? Ask your Dad or Grand Dad!

[Audacious]

Originally Posted by nychiefsfan

Yanno, house values may increase due to the fools who are paying 2005 prices for a home in a "buyers market," but the more telling picture is the overflooding of homes on the market and how sales are pathetically low.

This tells me that some people are overpaying and most people aren't willing to do so, hence the median price increases, due to existing home owners being too stubborn to drop their prices. Additionally, the existing home owners are reinforced by the median and the few sales in which people have overpaid for a home, but they're not considering that many people in this market are not willing to overspend for a house.

What good is owning your own house if you're spending 40% or more of your income on it? It makes much more sense to rent right now.

How can you say that people are curently paying 2005 prices for houses today??? Go to the MLS and tell me where the houses are that are priced at 2005 levels. THERE ARE NONE! In my market area, a previously high spec area, there were NEW 1400SF houses for sale at 250K In the past 18 mos those houses have dropped to lows of 160K and are currently at 195K The market determined that based on supply and demand, the supply has deminished enough to eliminate such deals. If you do not believe me then find a new house for that price and I will buy it from you and give you a good profit.

Absolutely NO ONE is overspending for a house, they are paying MARKET value. The market has determined that the house which sold for 250K in 2005 is now selling for about 170K today. If you know of people willing to pay 2005 prices for a house today, please let me know. I can sell 20 of them and give you a GREAT commission check as well.

Money talks and BS walks. The Market is determining what is going on right now. Some areas are starting to come back and others are still languishing. There is the macro and micro assessment of the market, nationwide, statewide and local it responds in the appropiate way irregardless of you, your fellow doomsayers or the NAR has to say. The sooner most folks realize this the better they will all be.

[BahamaBreeze]

Audacious is correct.
Prices are down to 2003-2004 levels.
Except, repeat except in Miami-Dade.
Of course, there are pockets in other areas, but Miami has held it together, against all logic and it can't do that much longer.

However the rest of the State?
Southwest in shambles. Prices in some areas off from 2005 peaks by 30% according to the Realtors own stats!
1/4 acre lots in North Port from the highs of 70-80K now selling for 10s-20K.
East coast? Anyone trying to sell in St Lucie? Man, that's got to hurt.
Martin, West Palm? I've seen the prices fall there hard, real hard and not too well represented this time in the stats, the decline is much worse than reported.
Rest of the state?
The same.
Bottom?
2000-2001 prices.

[nychiefsfan]

Originally Posted by Audacious

How can you say that people are curently paying 2005 prices for houses today??? Go to the MLS and tell me where the houses are that are priced at 2005 levels. THERE ARE NONE!

I'm currently tracking 58 homes in 3 different cities, but mainly concentrating on one city in general. 24 of the 58 homes were bought between 2000-2004 for less than $200k. All of them had an existing in-ground pool, 4 BR and over 2000sf.

The median price of these homes is $299,500
The median year they were bought was 2002
The average asking price is $295,170
The average price the current sellers bought them for was $167,927
Average SF is 2202 sf
Average Asking Price per SF: $134.32

I sampled the first 25 out of 388 houses sold between July 1 thru July 31, 2005 in the one main area that I'm looking to buy, as per the Hillsborough County's Property Appraiser's "Sales Search". Here are the numbers from July 2005:

The median price of these homes were $276,000
The average asking price is $272,876
The average price the current sellers bought them for was $167,927
Average SF is 2392 sf
Average Asking Price per SF: $114.05

Feel free to check my numbers, but that's a 9% increase in PPSF since July 2005.

I'm doing the homework everyday, my friend.

Also, you used an example of a "new 1400sf" house that was marked down to $160k and are currently at $195k. The new home market has that flexibility to realize that they need to dump existing inventory, even at bargain basement prices. IMO, what they're asking right now is too much for a 1400sf home ($139.28 per SF).

Originally Posted by Audacious

Absolutely NO ONE is overspending for a house, they are paying MARKET value.

You're right in the fact that many people on the sidelines, like me, aren't overspending on a house.

Originally Posted by Audacious

If you know of people willing to pay 2005 prices for a house today, please let me know.

That's why there's a ton of homes on the market that aren't selling. That's why sales are down significantly. That's why the median price hasn't changed that much. It's because the few people who are buying are willing to overspend on a home. It's America, let 'em!!!

I've been tracking the monthly sales in this one particular area that I'm looking at. The parameters of my search are single family homes, at least 2000SF that were bought between $100k and $300k. Using the Hillsborough County's Property Appraiser's "Sales Search", there were 112 sales in March and 55 in April. This is, presumably, a "buying season" for many people and the sales drop?

What does that tell you? Sure there's tightening in lending standards, but there's a lot of people like me on the sidelines who are preapproved and living in a rented house who can move immediately, but don't because the prices are too darn high!!!

You said the buyers determine the market. Many of the ones (not all) who have recently bought have determined the current median price. The ones waiting on the sideline will determine the future market value, and if we're not willing to pay 2005 prices, then someone will eventually have to call the other's bluff.

Time is on my side, my friend.