Has the bottom hit? (Phoenix: refinance, house, unemployment rate)

[smarty]

After reading Obama foreclosure plan... I now agree we are very close to the bottom... our government has decided to keep the house value high..... and not to let the market (supply & demand) decide the value... Homeowners are going to hang on longer for a higher price since other tax payer are helping to pay the bill.

As Captain Bill was saying... there were many investors and first timers looking to buy under $200K where they are now affordable to the current income. The interesting thing will be if the assumptions ... i.e. the current income and employment rate holds.... If there is no job, $750 rent is still too expensive. Many companies in CA are offering a 20-25% pay cut.

[ArizonaBear]

Originally Posted by markas214

Tempe, Scottsdale, Ahwatukee, Cave Creek, Paradise Valley, areas in the northwestern valley, Peoria, Glendale and plenty more are still 50%-100% higher than they were in Jan,'01. Houses priced greater than $400k are still facing a big decline and since the foreclosure program announced by Obama only covers mortgages up to the conforming loan limit those areas with high priced homes will get no relief. Those are the areas most affected by the Option ARMs and other nonconforming "prime" loans that are the second shoe to drop. As they say "got popcorn?". The drama continues to unfold and will not reach the final acts until at least a year or two.

Are you sure about that?

I live in 85257 (S Scottsdale directly across from Tempe) and there are single family houses going for under $150K now--------compared to, minimum, $230K just two years ago.

Realtor.com

[azjack]

"our government has decided to keep the house value high....."

I hate to break it you, but government is not capable of propping up house prices. Thankfully.

[ArizonaBear]

Originally Posted by azjack

I hate to break it you, but government is not capable of propping up house prices. Thankfully.

No joke there............and, we have yet to see 'bottom'.

[markas214]

Originally Posted by ArizonaBear

Are you sure about that?

I live in 85257 (S Scottsdale directly across from Tempe) and there are single family houses going for under $150K now--------compared to, minimum, $230K just two years ago.

Realtor.com

Down from $230k which was likely up from $100k or less a few years previously. I've seen those $150k homes and they are small, one or no garage and very outdated. Still too money much for what you get in my opinion.

[markas214]

Originally Posted by azjack

I hate to break it you, but government is not capable of propping up house prices. Thankfully.

Offering low intersest on a declining assest only helps the bank's balance sheets. They are counting on a lot of suckers taking the deal and those who do will eventually realize paying a $400k loan for a $150k house is insane.

[ArizonaBear]

Originally Posted by markas214

Down from $230k which was likely up from $100k or less a few years previously. I've seen those $150k homes and they are small, one or no garage and very outdated. Still too money much for what you get in my opinion.

Outdated?

Face it: most of today's amenities are not actually needed............they are just nice to have. Why I say that is frugality is the coming wave: read that less is more. Besides; it is a heck of a lot easier to heat/cool a smaller house than a silly McMansion, all other factors being equal.

[Howard Roark]

Three cheers for your post! I'm turning 50 this year and I'm a cheapskate. I lived on 30% of my income for most of this decade. I suspect that the grasshoppers who fiddled for a house worth 40% of its peak value wish they invested in savings bonds and municipal bonds instead of overblown stucco boxes.

Originally Posted by ArizonaBear

Outdated?

Face it: most of today's amenities are not actually needed............they are just nice to have. Why I say that is frugality is the coming wave: read that less is more. Besides; it is a heck of a lot easier to heat/cool a smaller house than a silly McMansion, all other factors being equal.

[dano]

Originally Posted by smarty

After reading Obama foreclosure plan... I now agree we are very close to the bottom... our government has decided to keep the house value high..... and not to let the market (supply & demand) decide the value... Homeowners are going to hang on longer for a higher price since other tax payer are helping to pay the bill.

As Captain Bill was saying... there were many investors and first timers looking to buy under $200K where they are now affordable to the current income. The interesting thing will be if the assumptions ... i.e. the current income and employment rate holds.... If there is no job, $750 rent is still too expensive. Many companies in CA are offering a 20-25% pay cut.

The govenment has decided nothing except to continue to ___ us over. I believe the stock market agrees with me based on its performance today.

[markas214]

Originally Posted by ArizonaBear

Outdated?

Face it: most of today's amenities are not actually needed............they are just nice to have. Why I say that is frugality is the coming wave: read that less is more. Besides; it is a heck of a lot easier to heat/cool a smaller house than a silly McMansion, all other factors being equal.

Actually for me outdated means poor insulation, windows need to be replaced to more efficient as does the AC unit, old and worn flooring, old fixtures, plumbing, wiring, roof is worn, pool needs repair, etc. Those are replacement and repair expenses that can add up to some serious dinero. I can qualify for 400k with my income, credit score and down money. I have no intention of maxing out though and want to stay below $200k. Frugality is so much better in the long term. That we can agree on.