Will the house prices keep dropping in south florida? (sale, rental market)

[Wild Style]

Originally Posted by heydade

Prices have hit bottom. THey will remain flat for at least 2 years.

and yet every month they (prices) keep falling and will continue to do so. Oh and that bit in the article about home sales rising, its called fuzzy math. That is where they include bank purchased homes from the court (foreclosures)

[mes271]

I don't think they're falling all across the board as much now as in the spring. In the foreclosure market there appears to be some stabilization and/or slight uptick (albeit artificially influenced by the tax credit and the banks purposely dragging their feet in listing, along with the traditional summer surge). I'm speaking of Fort Lauderdale here, not Miami.

[eger]

Prices of housing continues to fall, but the interest rates have shot up. So you're going to pay through the nose no matter what, unless you pay up front in cash.

[Wild Style]

Originally Posted by mes271

I don't think they're falling all across the board as much now as in the spring. In the foreclosure market there appears to be some stabilization and/or slight uptick (albeit artificially influenced by the tax credit and the banks purposely dragging their feet in listing, along with the traditional summer surge). I'm speaking of Fort Lauderdale here, not Miami.

Foreclosures are up because 1. people are losing their jobs and 2. Alt A prime and near prime loans are resetting starting this month. You have seen nothing yet in terms of foreclosures. The amount of near prime and prime Alt A loans make sub prime look like a walk in the park. They start resetting from now until about January, then they will slow and then more reset in the spring/summer of 2010. It will continue on like that until 2014.

Banks as you said are dragging their feet and they are not putting all of the foreclosures on the market. They are holding back a massive amount of foreclosures from hitting the market. If they did allow them to hit the market you would see the R.E. market destabilize like nothing we have seen before.

here is a little snippet showing what i am saying link however the best article to read if you can find it is one by the sf gate. They showed and proved beyond a shadow of a doubt what these banks are doing.

As for interest rates rising yes, they are rising but not so much so that they will ever off set the deflating home prices in relation to what they were at the height.

Alt A and Sub prime explanation link

[justsir22]

Re: loans mods, they don't apply to everyone. You have to prove that you absolutely can not afford to pay your current mortgage, and then the bank advises you to actually stop paying. It takes months for them to even start trying to do something. Meanwhile, your credit can gets destroyed. And different banks deal with this situation differently, so there is a risk of going into foreclosure. Many do see this as a way out, which drives the prices down even further. But not everyone wants to go into foreclosure voluntarily, and they don't qualify for a loan mod. I'm just saying, that sometimes people should try to put themselves into someone else's shoes. But if I did not own and was looking to buy right now, I would be happy with this mess as well.

[Wild Style]

Originally Posted by justsir22

Re: loans mods, they don't apply to everyone. You have to prove that you absolutely can not afford to pay your current mortgage, and then the bank advises you to actually stop paying. It takes months for them to even start trying to do something. Meanwhile, your credit can gets destroyed. And different banks deal with this situation differently, so there is a risk of going into foreclosure. Many do see this as a way out, which drives the prices down even further. But not everyone wants to go into foreclosure voluntarily, and they don't qualify for a loan mod. I'm just saying, that sometimes people should try to put themselves into someone else's shoes. But if I did not own and was looking to buy right now, I would be happy with this mess as well.

My heart isn't bleeding for anyone who's home value has dropped. My thing is, you purchase a home to live in, not for investment. R.E. has never been a good investment and was only talked up as such in the last decade or so. With that said, it is horrible what they are doing with these mortgage modifications. I had one lady at my job call the bank and tell them her husband lost his job and they will lose the house if they do not modify the loan. The bank basically said what you just said, tough doo doo, call us back when you have not paid in six months. Now those in that situation I do feel bad for.

[TANaples]

As long as they SELL and I can get out, I don't care.

[bocamom]

So, why are rentals in Boca still so high? I looked at a place for sale for $599k with a rent of $1500 in Delray, and a place I liked in West Boca, for sale for 133k, for rent for $1700.

if I sit tight in the rental I am in for six more months will rental prices ever drop? Realtors tell me it is everyone losing their homes driving UP the price of rentals but I'm not convinced. Decent places in Boca are still well over 2k a month. Is that where someone goes after a foreclosure? What's going on?

[fauve]

I think it's because most people are more comfortable renting than owning right now, which to me anyway, says it's time to own. We're actually playing with the idea of renting out the foreclosure we just got. The return is very high from a landlord point of view on a foreclosed property.

[Wild Style]

Originally Posted by bocamom

So, why are rentals in Boca still so high? I looked at a place for sale for $599k with a rent of $1500 in Delray, and a place I liked in West Boca, for sale for 133k, for rent for $1700.

if I sit tight in the rental I am in for six more months will rental prices ever drop? Realtors tell me it is everyone losing their homes driving UP the price of rentals but I'm not convinced. Decent places in Boca are still well over 2k a month. Is that where someone goes after a foreclosure? What's going on?

From what I have gathered (from speaking with owners and people in the rental industry) the following occurred. You see how people purchased homes at the top of a ridiculous R.E. bubble? Well the same happened for real estate property. For instance, where I live now, they went from 1300 a month for a 3 bedroom to 1550 in less than two years.The reason is, when we first moved here one company owned this place. They owned it for almost 20 yrs or something like that. I was told they purchased this place for something like 8 million (might be a bit more, I forget the exact figure). Anyway the new people who own this place purchased it for something like 20 million dollars (that figure might be a bit more, I don't remember). Well, naturally they MUST jack up rental prices to cover their mortgage. The same goes for a lot of these places, you should check who owns the property you are at or want to move to and how long they have owned it. If they purchased during the bubble years then naturally they can't afford to lower those prices. Thanks to depopulation and a glut of rental properties (apartment buildings, condos and single family homes) there is tons of competition and tons of reasons to lower the rental fees. But some places can not lower the fees without having a income shortfall every month. What we are in right now can be categorized as a "hot mess"