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Maybe not all areas experienced extreme bubble aprreciation like CA but I would say most but NOT ALL cities had some uptick in appreciation beyond the normal rate that RE usually goes up. Be prepared to hand that back if you have not already done so.
Stabilizing at "artificially high" price is not sustainable. The biggest dilemma I have with a suitable stimulus is that by nature stimulus creates an artificial environment.
In SWFL the example is similar to the Phoneix example above, but the current market has the $200k to build house on the market for the low $100ks or less! These are artificially low prices. Fear of further declines and an unstable economy is keeping people from buying. Just like the credit market "freezing up" the housing market is "freezing up".
Excellent! That's what we need. Also the construction works will have to take a pay cut.
It's easy to be caviler with someone else's pay.
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Originally Posted by bigtrees
It's amazing how many people I know that are involved in real estate, housing, or construction. Probably nearly half of my high school classmates (ten years later) have their fingers in it in some way.
Would these people be working as architects, engineers, truck drivers, IT personnel running computerized factory equipment, city planners, in the auto/truck industry, banker's. The housing industry is in every niche in our economy.
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Originally Posted by bigtrees
But that's the problem - it is a catch-22. The only to break the cycle is to get some of real-estate related people into other industries, which is happening right now.
One of the only industries that can't be shipped over seas is real estate.
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Originally Posted by bigtrees
Good! I'm glad they stopped lending to people without jobs.
I guess I need to be more prolific with the happy face... I was joking....
I hope I heard wrong today but someone on the radio said that this bailout plan for foreclosures will go to judges to decide the interest rates and length of the loan and only low income minorities are to be helped. How can they legally do that? I hope again, I heard wrong. What a mess.
Another blanket statement like the many others given throughout this forum. Home values were NOT at imaginalry levels during the "bubble" that most areas in the US did not see. Now all of a sudden, the fact that there have been ALL price ranges in real estate history, from very affordable in a town home or small single family to multi-million dollar homes, that ratio is just to be wiped off the planet? So what price point do you pick to be "slashed" so that all homes can be affordable or to "par" with AVERAGE incomes? Just curious. No, consumers need to buy homes they can afford and that's why there is a choice of homes at ANY and ALL price ranges. Granted, they are not going to get that 1/2 mil home for what 250,000 buys but if 250,000 is the price range they should be shoping in, then that's where they should be shopping! PLENTY of choices. Problem is, most want much, much more, unrealistically, for their money and think they are "intitled" to it because "housing is not affordable" to them. This is NOT the way it works folks.
PS. I did notice the artical, once again, pertains to California. At least when you make a post you should point out that you are not making this type of statement for the rest of the U.S. I think all of us that live anywhere but CA know YOUR prices were "imaginary" and why CA needs a different plan than the rest of the nation! But please, stop generalizing!
Congratulations for living in an area that didn't have a housing bubble. However, people in most major metro areas in this country didn't get that lucky.
When I talk about affordability I'm looking at what the average income in an area pulls in after taxes per month, minus expenses to keep the lights on and put food on the table compared with PITI for a typical residence is. In a lot of areas it got so it just doesn't compare. What a mortgage payment with traditional financing means would come out to became more than a person's take home pay is. Try and explain to me how that's sustanable. Any effort to defy the situation are doomed to fail, or prop up values until inflation catches up. Prices were at imaginary levels, and I'm not just talking about CA (don't know why you thought I lived there). People mentioned a few cities and I can add Seattle to that list as well.
I hope I heard wrong today but someone on the radio said that this bailout plan for foreclosures will go to judges to decide the interest rates and length of the loan and only low income minorities are to be helped. How can they legally do that? I hope again, I heard wrong. What a mess.
Wow..so you mean all those $6/hour workers who got $500K homes will get to keep them ?
Maybe not all areas experienced extreme bubble aprreciation like CA but I would say most but NOT ALL cities had some uptick in appreciation beyond the normal rate that RE usually goes up. Be prepared to hand that back if you have not already done so.
Yep, exactly. Would anyone who claims that this is a local problem in a few bubble areas care to tell us the last time the nationwide median price has gone down? Up until a little while ago, people claimed that was impossible. Now that it has happened, those same RE cheerleaders are brushing that price drop off as if it didn't mean anything.
One of the only industries that can't be shipped over seas is real estate.
Except for the "architects, engineers, IT personnel running computerized factory equipment, city planners, bankers" that you mentioned as real estate industry employees. Sure, you need local people to sell the product, but that's true for lots of industries.
RE is a fine career choice, but it's importance been blown way out of proportion in the last 5 or 10 years.
Congratulations for living in an area that didn't have a housing bubble. However, people in most major metro areas in this country didn't get that lucky.
Don't believe the hype about it being different in Chicago. Look at the annual price change for the Chicago area in this graph :
Notice how appreciation in Chicago jumped from 3-5% a year pre-2000 to 8-10% a year after it? That's classic bubble market behavior.
You can lay a ruler or piece of paper across the price increases from 87 through 2000, and it's pretty consistent. After 2000, as the housing bubble got started, prices took off - until they started dropping at about 10% a year in mid-06, of course. For an area that people claim has no housing bubble, it's an awfully big coincidence that prices there jumped right as the housing bubble got started and dropped as the housing bubble in other areas started falling.
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