Housing Prices are Rising- A Very Good Sign (unemployment, insurance, cost)
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I did pay too much, but I'll survive. None of your comments negate the fact that a housing recovery will strengthen the economy more than just about any other short-term change in economic factors.
With all do respect, when home prices rise, and incomes fall, its not good..
Supply and demand. If the demand wasnt there the prices would not be rising.
But there was not a shortage of supply in housing. That's the other part of the equation.
When you make low interest loans to people who have little economic sense those people will pay higher prices for that product. People who received the sub prime loans are not the ones to count on to know value. How could they? They don't save and they don't manage their money. If they did, they'd have a good sized down payment and would have a good credit history.
Just as you would not give the car keys to a drunk you shouldn't give the house keys to economic drunks.
It is not stable around the whole Country. The housing crisis is picking up in some areas. In many parts of the Country, you have areas, still hit very hard by the recession, with many bank owned properties, repos, and short sales, still in many neighboorhoods.
And in these areas, they are not selling. I was a realtor for 15 yrs and know many fine realtor friends from around the Country, many areas, have not picked up, they are still as sluggish as they were a year ago.
There is a overflow of bank owned properties, with a list of many thousands to get listed. What the hell do we do with the ones already on the market, that have not sold. Brings down the home value of a regular listing.
For those areas that are coming up, and my area is up, that does not mean squat for all the areas, that have been hit hard, and still being hit by this nasty recession. Not going to name Counties in States, but many are still under water.
I am happy a bit of progress has been made, but if you think this housing criris is over, think we are all wrong.
Looks like year over year rises in housed prices were the highest in 6 years. That is a very good sign.
Ultimately, most Americans' net worth is tied up in real estate, and now that housing has found a floor, we can begin the recovery in earnest.
A housing recovery will help either Romney or Obama. In the former, it will give a better impression that would probably be deserved, and would undoubtedly help with reelection prospects. With the latter, it will vindicate the hard work of the last few years, that were being undermined by the steady drop in house prices, which was hammering the middle class well after the "recession" was over.
Housing getting too high in price helped cause a global depression which was "bad".
Housing prices going up again is now "good."
Nothing more amusing than the paradoxes of the economically illiterate.
But there was not a shortage of supply in housing. That's the other part of the equation.
When you make low interest loans to people who have little economic sense those people will pay higher prices for that product. People who received the sub prime loans are not the ones to count on to know value. How could they? They don't save and they don't manage their money. If they did, they'd have a good sized down payment and would have a good credit history.
Just as you would not give the car keys to a drunk you shouldn't give the house keys to economic drunks.
When 20% down is required, it links housing prices to wage levels. Even if there is a big supply of credit beyond it, it at least tends to prevent the price of housing being set to what ever a bank will lend against it. It will tend to reflect market demand much more. Once you had 5% and zero down, it was a financial ponzi scheme that bloated all prices and jacked up the money supply, not just housing. Of course it didn't even stop there with 110% loans and 40 year mortgages.
What essentially happens is housing will be priced much more closely to putting workers at subsistence to maintain the "asset". Lots of big barns out their without furniture in the Halcyon days. So now with debt levels high and their "assets" low. They are much closer to the subsistence level with no compensation. It proves the old Rousseau prophesy true. The rich run the system and the poor game it. The poor were able to live off the fat of the land for a spell while the wealthy indebted the middle class.
*the rich collect rent
* the poor collect welfare.
The reason why "the middle class" is so important is because their income is from goods and services. It would make much more sense to be nice to them.
The next wave of foreclosures and ARM resets will take care of all those gains.
I would be fine with all of the phony gains in the housing market vanishing.
But I think when the Fed sees things dropping...they will do the same thing they do when the Stock Market starts showing weakness....jack money into the markets and promise even more money down the line.
It is not stable around the whole Country. The housing crisis is picking up in some areas. In many parts of the Country, you have areas, still hit very hard by the recession, with many bank owned properties, repos, and short sales, still in many neighboorhoods.
And in these areas, they are not selling. I was a realtor for 15 yrs and know many fine realtor friends from around the Country, many areas, have not picked up, they are still as sluggish as they were a year ago.
There is a overflow of bank owned properties, with a list of many thousands to get listed. What the hell do we do with the ones already on the market, that have not sold. Brings down the home value of a regular listing.
For those areas that are coming up, and my area is up, that does not mean squat for all the areas, that have been hit hard, and still being hit by this nasty recession. Not going to name Counties in States, but many are still under water.
I am happy a bit of progress has been made, but if you think this housing criris is over, think we are all wrong.
You call it a "housing crisis".......I call it a natural correction, mainly in response to the Feds corrupt, insane policies.
It is not stable around the whole Country. The housing crisis is picking up in some areas. In many parts of the Country, you have areas, still hit very hard by the recession, with many bank owned properties, repos, and short sales, still in many neighboorhoods.
And in these areas, they are not selling. I was a realtor for 15 yrs and know many fine realtor friends from around the Country, many areas, have not picked up, they are still as sluggish as they were a year ago.
There is a overflow of bank owned properties, with a list of many thousands to get listed. What the hell do we do with the ones already on the market, that have not sold. Brings down the home value of a regular listing.
For those areas that are coming up, and my area is up, that does not mean squat for all the areas, that have been hit hard, and still being hit by this nasty recession. Not going to name Counties in States, but many are still under water.
I am happy a bit of progress has been made, but if you think this housing criris is over, think we are all wrong.
Good post. I agree that the local markets are all over the map. I also agree that getting on the "get rich quick" housing gravy train would be beyond stupid. However, I am happy that people like myself, who are classic middle class, never cheated will not be so utterly screwed. I mean when the middle class (not the flipper and huckster, but the people who work hard, save, and use credit sensibly) is doing ok, it is a good think for America, IMHO.
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