Colorado sub-prime Impact to the housing market (Denver, Boulder: real estate market, mortgages)

[oldhorse]

Quarterly Home Value Reports | Zillow Real Estate

In summary: Grand Junction bucked the trend with nice gain. Boulder area held up well. Less established neighborhood got hit the worst.

[dj32]

whoo hoo... my neighborhood went up 2.4%- about what I thought.... Just shows that real estate is local! unfortunately I think the neighborhood I want to move to went up 5.4%!

[2bindenver]

Nice real estate porn.

There are nice properties to be had in every neighborhood. Real estate is local.

Most of the credit challenged have been forced into FHA loans. NBD.

[formercalifornian]

Why does everyone think the sub-prime market is solely to blame and that it's no big deal? Even prime borrowers got sucked into the easy money scheme, along with baby boomers who should be paying off their mortgages about now.

This evening, I surveyed the public documents for a street in a nice Centennial neighborhood where I'm considering buying a house. I wanted to know how secure ownership is in the area before I take the plunge. (You can do it, too. Just type a name in the public records search at the Arapahoe County website. If you need the name, check the property tax records.) I'm now re-considering based on what I discovered.

It's an older neighborhood with lots of early baby boomers who bought in the 80's and 90's. I figured I'd find mostly paid-off loans, so you can imagine my surprise when I found that the street was filled with serial re-financers (one of whom had been hitting the housing ATM for 20 years!) and more than a few houses that are upside-down.

I don't think there are any safe, stable, financially-secure neighborhoods anymore, even those that didn't see massive appreciation over the early 2000's. The housing ATM was just too easy and too tempting for everyone! Want a new boat? Outdated kitchen? Daughter getting married? Son accepted to Stanford? No need to plan and save. Just tap that equity! What's going to happen when banks shut down the HELOC's? See this article for an eye-opener.

I'm not a housing doomer by any stretch. I love having my own home, but I wonder how this nation's irrational borrowing behavior is going to play out over the next few years. It's not just young, over-built, exurban neighborhoods that are feeling the pressure. Apparently, baby boomers in prime, inner-ring suburbs have also been spending like drunken sailors for Lord-Know-What during the last few years, leveraging themselves to the hilt. I just wonder what will happen to housing prices when it's time for them to pay the piper, since tightened lending standards have effectively decreased the number of qualified buyers who could purchase their houses when time comes for them to sell.

[jazzlover]

Originally Posted by formercalifornian

Why does everyone think the sub-prime market is solely to blame and that it's no big deal? Even prime borrowers got sucked into the easy money scheme, along with baby boomers who should be paying off their mortgages about now.

Just for kicks, I surveyed the public documents for a street in a nice Centennial neighborhood where I'm considering buying a house. I wanted to know how secure ownership was in the area before I took the plunge. (You can do it, too. Just type a name in the public records search at the Arapahoe County website. If you need the name, check the property tax records.)

It's an older neighborhood with lots of older baby boomers who bought in the 80's and 90's. I figured I'd find mostly paid-off loans, so you can imagine my surprise when I found that the street was filled with serial re-financers (one of whom had been hitting the housing ATM for 20 years!) and more than a few houses that are upside-down.

I don't think there are any safe, stable, financially-secure neighborhoods anymore, even those that didn't see massive appreciation over the early 2000's. The housing ATM was just too easy and too tempting for everyone! What's going to happen when banks shut down the HELOC's? See this article for an eye-opener.

I'm not a housing doomer by any stretch. I love having my own home, but I wonder how this nation's irrational buying and borrowing behavior is going to play out over the next few years. It's not just young, over-built, exurban neighborhoods that are feeling the pressure. Apparently, baby boomers in prime, inner-ring suburbs have also been spending like drunken sailors for Lord-Know-What during the last few years, leveraging themselves to the hilt. I just wonder what will happen to housing prices when it's time for them to pay the piper, since tightened lending standards have decreased the number of qualified buyers who could purchase their houses when time comes for them to sell.

I saw the same thing starting years ago when I regularly perused the public records as part of my work. I knew the whole thing would unwind some day--I'm surprised it's taken this long to start to unravel. Your wondering about what is going to happen next is a very lucid observation. It's like Johnny Carson on the old Tonight Show playing Carnac the Magnificent:

Answer: Siss-boom-bah.

Question (Carnac the Magnificent): Describe in reverse the sound of an exploding sheep.

That's the real estate market when the bubble bursts--"siss-boom-bah"--in reverse. Except those poor indebted homeowners are the sheep.