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No problem guys... just wondering if the fairly rapid drop in rates effected mentalities at all. Either way, lower rates will help out some people who's rates are resetting or didn't get the chance to refinance earlier in the year. Whether it's time to buy or not will highly depend on inventory levels and how well we do in the next 6 months to a year in getting ourselves on a better economic track.
According to the CAR, California has already gone down to the 6.X something months of inventory. Don't know what'll happen in the slower months... but we'll see in a few weeks. If sales continue at the current pace or higher in the slow "off-season" months... then who knows.
-chuck22b
i think at every phase during a bear market you get rallies. lower prices entice a few fence sitters and then the NAR et al get on the horn and talk about a bottom. in california prices will continue to drop and that will make the next round of fence sitters a lot more cautious.
i started monitoring the market about 20 months ago. i shudder to think of the position i'd be in if my extreme lowballs were accepted back then
The CAR's estimates are always in favor of housing, they usually revise them months later. Regardless, the drop has been due to a drop in the raw inventory numbers and better sales (as is typical in the selling season). But the inventory that was taken off the market is largely shadow inventory that is going to make its way back to the market as a REO, short sale or whatever.
Housing in California is still not affordable. A family making a decent wage still can't afford a decent home. California still has another good 25% decline to go.
Timing the bottom of any market is as risky as timing the peak. You won't ever know when the "best" time to buy or sell is until after its past.
But that is why real estate is NOT about short term gain. If you are planning to live in a home for <2-3 years the you will likely lose money. You have to have amazing timing and some luck to do so. You should be looking at at least 5 years when you buy a home... or any other investment for that matter.
Anytime you are looking at month to month or 1 year fluctuations you are day trading. Its the same in the stock market, housing market and in Vegas... its speculation/gambling, not investing. Sure you can make money on it, but trying to time the market is a bad idea even for "professionals".
Buy a home when you can afford to. When you have decent reserves, good income, low debts, job stability and can buy a home that is right for you at a price you can afford. Then keep paying down the debt, saving for emergencies and wait 10 years. It's not exciting like 20% gains in a year, but its not as risky.
rcarillo,
Please tell that to the "wealthy" and the Corporations... the same principle applies to investing and growing a Country.
Timing the bottom of any market is as risky as timing the peak. You won't ever know when the "best" time to buy or sell is until after its past.
But that is why real estate is NOT about short term gain. If you are planning to live in a home for <2-3 years the you will likely lose money. You have to have amazing timing and some luck to do so. You should be looking at at least 5 years when you buy a home... or any other investment for that matter.
Anytime you are looking at month to month or 1 year fluctuations you are day trading. Its the same in the stock market, housing market and in Vegas... its speculation/gambling, not investing. Sure you can make money on it, but trying to time the market is a bad idea even for "professionals".
Buy a home when you can afford to. When you have decent reserves, good income, low debts, job stability and can buy a home that is right for you at a price you can afford. Then keep paying down the debt, saving for emergencies and wait 10 years. It's not exciting like 20% gains in a year, but its not as risky.
a home is not an investment. the fact that the majority of homes appreciated way over the rate of inflation was a "false economy" one we're paying dearly for now.
That is not how the tax credit works. You don't receive the $7500 (should you choose to take it) until tax time. It cannot be used as a downpayment. The only taxpayer stuck with the bill would be the one that takes the tax credit.
i think humbolt was referring to the presumed liquidity injection in the temp nationalisation of fm and fm. you bet bet the farm that you'll be paying for it
a home is not an investment. the fact that the majority of homes appreciated way over the rate of inflation was a "false economy" one we're paying dearly for now.
Generally speaking... a home's value does increase based on location (land) and the economy. A house intrinsically has a value ("shelter" just like rent has a "value")... as measured by dollars. If inflation increases... the value of a home still stays the same... but would require more dollars (hence fixed asset, inflation hedge and why generally speaking homes appreciate along with inflation).
Likewise, if the local economy is doing well and is desired... the "value" of that location/house increases as well and can be reflected by dollars. A home can be an investment... but in recent years it's been seen as the wrong kind of investment and there were more investors than their should of been.
Anyhow... apparently even you see homes as having some sort of "value". Or else, if you don't see owning a home as having some sort of intrinsic value or more value than renting... why are you even bothering with looking and putting down offers? Otherwise, you'd be happy being happy renter forever.
Generally speaking... a home's value does increase based on location (land) and the economy. A house intrinsically has a value ("shelter" just like rent has a "value")... as measured by dollars. If inflation increases... the value of a home still stays the same... but would require more dollars (hence fixed asset, inflation hedge and why generally speaking homes appreciate along with inflation).
Likewise, if the local economy is doing well and is desired... the "value" of that location/house increases as well and can be reflected by dollars. A home can be an investment... but in recent years it's been seen as the wrong kind of investment and there were more investors than their should of been.
Anyhow... apparently even you see homes as having some sort of "value". Or else, if you don't see owning a home as having some sort of intrinsic value or more value than renting... why are you even bothering with looking and putting down offers? Otherwise, you'd be happy being happy renter forever.
-chuck22b
i'm looking for acreage. cookie cutter houses with strict hoa's hold almost zero value for me. i'm not looking for an investment just a place to call home. i intend building as i earn. nothing fancy but highly energy efficient because i know where energy costs are going
First off I will agree that assets make you money and liabilities cost you money, meaning that a home is a big liability. All those individuals that figured they were rich because the house they bought was up by 20% a year were fooling themselves. Unless they cashed out they didn't see any of that increase. I bet they still had to make the monthly payment though. Besides that a home cost money to maintain. Many of those "rich" people did use there acquired equity to buy cool toys. A hummer hear, a Harley there. That only placed them farther behind when paper prices declined. All this is only paper anyway. Who determines what a home is worth? What it comes down to is what someone will pay, and today they won't pay what others paid yesterday. Many aren't even entering the market because they think the bottom is no where in sight.
I say buy a home you can afford and pay it off as quick as you can. Take the money that you would have spent on the mortgage and invest it after your home is free and clear. Then you could care less what the price of a home is. A home is a place to hang your hat and live your life. Should never be considered a piggy bank that can finance a new car, trip, wedding or ??? as many banks would have you believe.
Have you read "Rich Dad, Poor Dad" from several years ago. A house is not an asset.
Not a real big fan of a lot of those people who promoted RE and excessive leverage in the past... I think they are partially part of the reason a lot of "investors" came into the market.
It's not that I think a lot of the ideas are entirely bad.... it's just that a lot of people who shouldn't have practiced those ideas came into the market and didn't really have the know how or the discipline.
-chuck22b
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