Housing crunch (Dearborn, Grant: condo, rent, income)

[Wichitafalls]

with the housing crunch running across the us, and bush not doing anything to help. I wonder how bad it will get in michigan?
I know several people who are sitting on their homes and can not get a buyer.
Prices are dropping acorss the nation and with michigan leading the states in unemployment, and people leaving the state. What will happen to the home prices in the great lake state?
I think it is obvious.

[Sijuki]

I know several people that have turned their houses over to the bank cause they can't sell them. It took my parents 22 months to sell their condo in Dearborn.

[jumpygh]

Originally Posted by Wichitafalls

with the housing crunch running across the us, and bush not doing anything to help. I wonder how bad it will get in michigan?
I know several people who are sitting on their homes and can not get a buyer.
Prices are dropping acorss the nation and with michigan leading the states in unemployment, and people leaving the state. What will happen to the home prices in the great lake state?
I think it is obvious.

What is Bush supposed to be doing? It's amazing--anything at all can be blamed on that man.

In truth, lending practices have been too loose over the past decade. A lot of people got into loans that they couldn't afford to pay back. Lenders are tightening their requirements, so there really isn't anything for Bush or anybody else to "fix." It will just take some time for housing inventory to be reduced and then prices will stabilize.

[Torrid]

Here in Ohio, which is currently 3rd in foreclosures for the U.S., we've had to drop the price of our home from 96K (appraised at) to 67K just to get any REAL bites. Hard times have fallen everywhere. We, of course, owe much more than 67K still but, the bank told us to sell it for whatever we can, and they'll take a 'short sale' and write the remainder off. Nowadays EVERYONE wants EVERYTHING for free....or close to it! I think people facing foreclosure (provided they don't have a mortgage through Saxon.....the most heartless company there ever was) should be straight-up with their banks, let them know what's going on (your case most likely wouldn't be the first they've heard) and, discuss a 'short sale'. It's one of the only ways to get out with at least a t-shirt on your back and a li'l sanity!!! Good luck to those in this situation. My fiance has had 3 jobs this year. As with many, this is the case.....and the unfortunate outcome is usually a foreclosure.

[Driller1]

That is the difference between a bank and a mortgage company. I am a contractor, I saw people building huge houses I knew they could not afford. And in some cases I blame local ordnances. I asked a customer why they build such a large home for two people. The local planning rejected two smaller plans. One the house was big enough, but the living area was to small for the bedroom sizes.

I just came home from a job on hold because they need to cut a tree, it is over 10 foot from the house, so they have to wait three weeks to talk to the board! Until then we can not drill, and they can live in a camper.

[baystater]

Originally Posted by Wichitafalls

with the housing crunch running across the us, and bush not doing anything to help. I wonder how bad it will get in Michigan?
I know several people who are sitting on their homes and can not get a buyer.
Prices are dropping acorss the nation and with michigan leading the states in unemployment, and people leaving the state. What will happen to the home prices in the great lake state?
I think it is obvious.

Even though I'm not a big fan of his Bush is not to blame on this one. If there is a guy to blame for this whole debacle it Allan Greenspan. He's the guy that got the whole housing bubble started in 2001 after the tech stock crash. Basically He put way to much liquidity on the market for to long. And was actually cheer leading the whole thing until it got close to him retire ring and then came the infamous "irrational exuberance" comment. Granted at first the let up on interest rates did help a little bit, but it was too much. Separately you have to add the rise of all types of mortgage companies with all types of mortgage products. Which alot them in the end became really toxic to the people who owned the home and the people/companies that bought mortgage securities for investments. Lastly I think some of the blames in on the general population who bought/invested from 2002 - 2006. Greed was probably in my mind the #1 reason why the run up on the bubble reached such insane heights. I watch alot of states double, triple, even quadruple in price for houses/land. And no one seem to mind that houses were becoming unfordable and unreachable to alot of the population unless they used some of those toxic loans to get one. Of course we're seeing the fall out from that right now.
Now as for bailout don't hold your breathe. I don't believe government is going to save anyone. Your on your own. And personally I don't want to see a bailout. Actually I want the national (not Michigan) housing market to crash and crash hard. I want house on the east coast to be affordable again.
I know that a bad housing market is really bad for Michigan. But really it's not if your not a seller and if you haven't used up your credit and money on stuff that you really don't need. You should be sitting pretty and soon will be able to invest in Michigan property for cheap. That's what I going to do in probably the next couple of years. I believe in Michigan and believe it will make a comeback in 5 - 10 years. It a beautiful state with a lot to offer people.

[southernlady5464]

What is Bush supposed to be doing? It's amazing--anything at all can be blamed on that man.

If they could figure out a way, they'd probably blame the Civil War on him. Liz

[SALteacher]

Originally Posted by jumpygh

What is Bush supposed to be doing? It's amazing--anything at all can be blamed on that man.

In truth, lending practices have been too loose over the past decade. A lot of people got into loans that they couldn't afford to pay back. Lenders are tightening their requirements, so there really isn't anything for Bush or anybody else to "fix." It will just take some time for housing inventory to be reduced and then prices will stabilize.

It's like people to expect government to ride in and fix the situation. If there's one thing we don't need is government, let alone the feds coming in and screwing things up even more. The housing market is all part of a free market economy. Let it be like that. As well as this post above has stated, many people should share some accountability for getting into situations

[magellan]

I have to agree with baystater and others. There's nothing Bush can do or should do to prop up the housing market. It was way over inflated and lending practices had become a joke. The housing markets that are getting slammed right now are also decent job markets, so job losses and the housing correction surprisingly have little to do with each other. They are more closely related to:

- People acquiring interest only, 0 down and ARM loans just to be able to afford to get into a home has been widespread in the U.S. over the past five years. Now that property values are going down (pretty much nationwide now), these people are finding it's very difficult to get refinanced before their rates shift because their home won't appraise high enough. The percentage of mortgages like this in Michigan was much lower than places like Florida, Nevada, Arizona, California, Colorado and many other States, because homes never went sky high in value. Why do you think Michigan still does not rank as the worst state for foreclosures, despite 100's of thousands of jobs lost?
- Builders several years ago pretty much stopped building spec homes in Michigan because of the economy here, which excess inventory caused (and is causing) a huge glut of homes in other states and markets, forcing builders to give away homes (to make their shareholders happy), and taking the bottom out of many markets. Regular Joes in their existing homes have to compete with builder incentives of $50K off and more. It's pretty difficult to find builders still building spec homes in Michigan (except maybe a bare minimum).
- The worst year so far for Michigan outmigration was last year, and about 65,000 more people left the state than moved in. That's not even 1% of the population.
Michigan Population and Components of Change
- A lot of people are pulling their homes off of the market in Michigan because homes aren't selling. This is actually a good thing. It will allow the people who HAVE to move a chance to get a better value for their home.
- Michigan housing is still very affordable compared to median incomes. Eventually that secret will get out, if the job market can level off a bit.


Despite the job market here, I don't think we'll feel the housing crunch any worse or any better than the vast majority of the country. Some housing market values in Florida and the Southwest are predicted to go down by as much 50 - 60%.

Take a look at the Housing Opportunity Index and how overvalued some markets are, especially California. Best are at the top, worst at the bottom:

Housing Opportunity Index: 1st Quarter 2006 by Affordability Rank

[baystater]

Originally Posted by magellan

Take a look at the Housing Opportunity Index and how overvalued some markets are, especially California. Best are at the top, worst at the bottom:

Housing Opportunity Index: 1st Quarter 2006 by Affordability Rank

Thank for the link megellan. I'm going to use that link with one of our treads on the MA. If that's OK by you.