U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 08-13-2009, 06:46 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,653,120 times
Reputation: 4343

Advertisements

15 million home owners underwater, or ~30% of all mortgage holders! But but.....real estate always goes up!

Calculated Risk: American CoreLogic: More than 15.2 Million Mortgage Holders Underwater

Here in Southern California everything thinks there is going to be a recovery in house prices. Many properties in decent areas are getting multiple bids due to low inventories and this is creating an impression that prices have bottomed. Of course, there are record foreclosures and inventory at least in my neck of the woods seems to be increasing just when it should be decreasing (since the selling season is just about over).

At least in California (due to both state and federal manipulation) I think the inventory is going to build in the decent areas over the fall/winter and attitudes will change come spring/summer 2010. The inland areas are already toast and back to 1998 or so nominal prices. Its amazing that so many people think there can be a recovery when Californians unemployment rate is ~12%.
Rate this post positively Reply With Quote Quick reply to this message

 
Old 08-13-2009, 07:38 PM
 
Location: Pennsylvania
5,726 posts, read 10,863,359 times
Reputation: 9783
Serious question - how do they determine that stat? Is it based on median home prices in an area? I can't imagine somebody has gone around and appraised every house with a mortgage on it.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 07:50 PM
 
Location: Sputnik Planitia
7,288 posts, read 10,235,532 times
Reputation: 8108
Rich Toscano's interesting take on this temporary spring rally in housing...it's about 60% into the feed:

http://a1135.g.akamai.net/f/1135/182...T_TITLE=Friday
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 07:55 PM
 
44 posts, read 25,492 times
Reputation: 43
I think the statistics can be misleading on a national level. Real estate is local and markets can vary tremendously depending on locations and local economies. I just saw on the news today that in Nevada 1 in every 56 homes are in foreclosure.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:08 PM
 
28,461 posts, read 78,791,925 times
Reputation: 18599
Aggregate stats are pretty silly -- not only did no one really appraise 15M houses, neither has anyone run the actual numbers on 15M mortgages. Further of those 15M houses I suspect that a large percentage are investor owned, some are owned people that would NEVER consider selling unless prices rebound, and others are owned by folks will probably DIE in them...
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:17 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,653,120 times
Reputation: 4343
Quote:
Originally Posted by maf763 View Post
Serious question - how do they determine that stat? Is it based on median home prices in an area? I can't imagine somebody has gone around and appraised every house with a mortgage on it.
I'm too lazy to read the whole report so I'm not sure what they are using, but I doubt its the median. The median has been a rather unreliable measure of value lately as the distribution of sales keeps changing (changes in median price can result from a shift in the distribution of sales rather than any real price movement).
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:29 PM
 
Location: Great State of Texas
86,068 posts, read 78,955,675 times
Reputation: 27669
In the long run though it will make California more affordable for people.
I do feel bad though for the folks roughing it out there and hope they can just hold on.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:36 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,653,120 times
Reputation: 4343
Quote:
Originally Posted by chet everett View Post
Aggregate stats are pretty silly -- not only did no one really appraise 15M houses, neither has anyone run the actual numbers on 15M mortgages.
Aggregate stats are pretty silly? Oh gee, you better go tell the government to stop reporting, labor statistics, GDP, CPI, etc etc. They are all aggregate statistics!

Quote:
Originally Posted by chet everett View Post
Further of those 15M houses I suspect that a large percentage are investor owned, some are owned people that would NEVER consider selling unless prices rebound, and others are owned by folks will probably DIE in them...
I don't think this is accurate. Most of the underwater investors have already jumped ship at this point, more recent investors are cash-flow investors paying cash. In terms of people "never considering selling", that depends greatly on the market sentiment. Right now, I believe that many people are holding out despite wanting to sell. But they are holding out because the media is filled with happy talk, if come Spring inventories raise and prices drop yet again the sentiment is likely to change. The move-up market in previous bubble markets is almost dead...there is really no where for "move-up" homes to go but down in these areas.

Surveys show that a rather large number of people would like to sell right now, but the "low prices" are preventing them from putting their house on the market. But slowly, I think these people still start selling regardless as most can only hold on for so long. The unemployment rate alone will force a lot of sales.

I think it will have a rather negative impact on the state-level economies if the bubble areas do not continue to decline in price to prices justified by local incomes. Even today, the decent areas of Southern California are double similar areas in Texas. Why would a young family stay?
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:44 PM
 
28,461 posts, read 78,791,925 times
Reputation: 18599
The difference is that some long collected aggregate stats do have at least a glimmer of usefulness and is generally collected by agencies that have at least the credibility of having been around for decades. I have never HEARD of "American First CoreLogic"...
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-13-2009, 08:58 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,653,120 times
Reputation: 4343
Quote:
Originally Posted by chet everett View Post
The difference is that some long collected aggregate stats do have at least a glimmer of usefulness
All aggregate stats have to start at some point...ALL measures of the economy are "aggregate stats" your objection here is a objection to economics. I guess, alternatively you could interpret tea leafs?

Quote:
Originally Posted by chet everett View Post
I have never HEARD of "American First CoreLogic"...
Umm.....so what? That says nothing about the usefulness of the information.
Rate this post positively Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics

All times are GMT -6.

© 2005-2021, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top