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.
Just think positive, all will be fine! The data doesn't lie, the charts are crystal clear. Florida bombed in 1926 and it will again. Real estate was a safe investment when it was hard to get money to buy it. I was turned down for every mortgage I ever applied for and ended up building a house, and buying the property in cash. Sure they don't make any more land but they don't make any more air either, and yet it's still all around. FLorida is a difficult place to live and produces little or no resources, so don't expect the high paying jobs to support this credit and foreign investor fueled bubble. What rich person wants to live in a tiny condo or 2,000 sq foot suburban home? Luxury custom homes like those on the coast, the bay islands and other unique places will always be valuable. Yet the vast majority of properties built today are flimsy, repetitive structures built for the middle or lower class buyer. Every time I drive around south Florida I am reminded what a tasteless and artificial place it is. Nowadays they don't even connect developments together, they fence them in with a guard house with an illegal immigrant inside. While stuck in traffic there's a lot of time to examine these eyesores with names like "precious homes", "three lakes" ,"Keys gate" ,"crestview" , elan" oh I get sick thinking of them! Moving out of these places is no big loss, who in there right mind would choose to be canned like sardines and pay all that money!
The more money you make the more you spend. This is called fundamentals. .........
Traditionally buying a home was based on what you could afford. Many people were unable to qualify for a mortgage, but today loans were being given to practically anyone......
Fundamentals come into play when supply far exceeds demand.
Did we price out 80% of the population looking to purchase a home?
The majority of people moving to Florida cannot find jobs to support the housing prices. The ones that can don't want to pay the taxes and unknown insurance that comes with it.
With housing sales slowing and supply building it's a buyers market.
Supply/demand is the only economic fundamental you speak about and I agree there is a current glut but number of homes for sale and the pace at which they are being purchased has exceeded 2002’s pace and is on par with 2003. Affordability has capped the rise and so too will it cap the fall.
This excess has already leveled off and month’s supply is starting to fall.
Further, I don’t see mass panic in fact Consumer sentiment is still strong among homeowners regarding their home’s value as a place to live and as well as an investment
More relevant to affordability is the median mortgage servicing cost relative to the median income. This ratio is near the local historical average of 22.0% . It implies no widespread financial overstretching to purchase a home in our region. It allows homebuyers to obtain a larger loan without necessarily increasing monthly mortgage payments.
Here let me give you a few OTHER fundamentals to consider:
Job growth is strong, with the creation of nearly 2.0 million new jobs in the past year. Unemployment is low, at 4.6% nationally
Local job growth has been exceptionally strong. The three-year job growth of 9.5% is nearly four times as fast as the national pace. The local unemployment rate of 3.7% in the first quarter implies full employment in the region.
Inflation-adjusted wages were up 1.1% in the past four quarters reversing the prior two year declining trend
Lowest mortgage rates in 40 years
Florida population growing at more than twice the national average for more than 10 years Number of people who move to Florida each day - 1,000
Record high stock market based on healthy corporate earnings
Adjusted for inflation in yr 2000 dollars (pre 2004-2005 run-up) US Price of a home in 1940 = $30,600 The price in yr 2000 = 119,600
Florida 1940= $23,100 The price yr 2000 = $105,500 Great investment for the average person
On your other points:
Traditionally stores were closed on Sundays so much for tradition. And if you didn’t have cash or a store account you couldn’t buy anything there was no MC or Visa.
Currency and credit have been evolving since the stone age and in recent day so too has mortgage qualifying. Credit abuse has been a problem since credit started and always will be. Loans are being given to practically anyone BUT they are priced for risk – its all part of business – borrower BEWARE.
70% of our nation already owns a home – they’re not priced out they’re priced in
If as you say the majority of people can’t find a job to support the housing prices then who are the 1000 people moving here each day. Tell that to those who are working at Raymond James, GE security, Verizon, Chase Manhattan Health care companies…………………………
Arms by nature are not exotic financing and have been around for decades. Option arms with neg am are. 30%+ of loans originate in 05 were arms less than 10% of the 30% were exotic in nature and that was only a recent phenomenon not the majority of financed homes
A fully amortizing ARM makes perfect sense for someone expecting to stay short term 3-7 yrs
Quoting an acquaintance from NJ “I thought taxes and insurance would be cheaper NOT the're about the same, But I can’t get anywhere’s near the kind of house in Jersey that I can get here and I can play golf year round my kids can enjoy the outdoors and its not nearly as insane here. He’s moving here in January buying 600K
It is a buyer’s market and the savvy will get while the gettings good
Muggy Pretty charts! However they lack perspective and the home equity chart is dated
I see you got them patrick.net/housing/crash.html
I really like the guy smoking Kool-Aid from a bong on the bubble blog page patrick.net/wp/ Maybe when he comes down from that San Fran High he can post the most recent Federal reserve data instead of last years news.
This may help - Here is the most current Z1 directly from the federal reserve federalreserve.gov/releases/z1/current/z1.pdf
PS What exactly are you trying to say.
Prior to the 80’s there was little ability to easily pull equity from ones home. People moved less and made do with what they had. My parents who purchased in 54 paid off their home (as did millions of WWII returning GI’s) around the mid 80’s this coincides with the height of your equity chart.
They [my parents] still own the house and for them it’s all equity but today things are different. People are putting less down and staying shorter thereby paying less to equity and still we have a greater than 55% equity share as of your 2005 chart and the number is climbing See below:
Are you trying to say that today the average American with a better than 55% equity share in their home is a bad thing??? If someone told me that I’d definitely think they were smoking Kool-Aid
Fed Z1 Summary -Flow of Funds Summary Statistics
Second Quarter 2006 - growth of home mortgage debt slowed to a single-digit pace for the first time in several years.
As for your MEW chart
The recent Flow of Funds report showed that household mortgages increased $220.3 Billion in Q2 2006, and $436.4 Billion for the first half of 2006. Using a simple formulation(1) for Mortgage Equity Withdrawal (MEW), MEW was $81.6 Billion in Q2 2006. This is substantially below the record $180.1 Billion of MEW in Q3 2005.
Take a better look! See that big drop in your second chart?
Its not really about price. All I read here is price price price, what about its were I want to be. Live were you feel happy, stop obssesing about price, if you like it and can pay for it (without hardship) have it. Houses in Florida excluding certain areas like Miami, The Keys and some Beach areas are priced well and not bad value for money. You get what you pay for. Prices of houses will always go up, the cycle keeps going, just look at the historical data. Maybe the problem is peoples ecpectations have been distorted. A quick buck is not about to happen now, but long term investment (a place to live) will alway go up in value.
Supply/demand is the only economic fundamental you speak about and I agree there is a current glut but number of homes for sale and the pace at which they are being purchased has exceeded 2002’s pace and is on par with 2003. Affordability has capped the rise and so too will it cap the fall.
This excess has already leveled off and month’s supply is starting to fall.
Further, I don’t see mass panic in fact Consumer sentiment is still strong among homeowners regarding their home’s value as a place to live and as well as an investment
More relevant to affordability is the median mortgage servicing cost relative to the median income. This ratio is near the local historical average of 22.0% . It implies no widespread financial overstretching to purchase a home in our region. It allows homebuyers to obtain a larger loan without necessarily increasing monthly mortgage payments.
Here let me give you a few OTHER fundamentals to consider:
Job growth is strong, with the creation of nearly 2.0 million new jobs in the past year. Unemployment is low, at 4.6% nationally
Local job growth has been exceptionally strong. The three-year job growth of 9.5% is nearly four times as fast as the national pace. The local unemployment rate of 3.7% in the first quarter implies full employment in the region.
Inflation-adjusted wages were up 1.1% in the past four quarters reversing the prior two year declining trend
Lowest mortgage rates in 40 years
Florida population growing at more than twice the national average for more than 10 years Number of people who move to Florida each day - 1,000
Record high stock market based on healthy corporate earnings
Adjusted for inflation in yr 2000 dollars (pre 2004-2005 run-up) US Price of a home in 1940 = $30,600 The price in yr 2000 = 119,600
Florida 1940= $23,100 The price yr 2000 = $105,500 Great investment for the average person
On your other points:
Traditionally stores were closed on Sundays so much for tradition. And if you didn’t have cash or a store account you couldn’t buy anything there was no MC or Visa.
Currency and credit have been evolving since the stone age and in recent day so too has mortgage qualifying. Credit abuse has been a problem since credit started and always will be. Loans are being given to practically anyone BUT they are priced for risk – its all part of business – borrower BEWARE.
70% of our nation already owns a home – they’re not priced out they’re priced in
If as you say the majority of people can’t find a job to support the housing prices then who are the 1000 people moving here each day. Tell that to those who are working at Raymond James, GE security, Verizon, Chase Manhattan Health care companies…………………………
Arms by nature are not exotic financing and have been around for decades. Option arms with neg am are. 30%+ of loans originate in 05 were arms less than 10% of the 30% were exotic in nature and that was only a recent phenomenon not the majority of financed homes
A fully amortizing ARM makes perfect sense for someone expecting to stay short term 3-7 yrs
Quoting an acquaintance from NJ “I thought taxes and insurance would be cheaper NOT the're about the same, But I can’t get anywhere’s near the kind of house in Jersey that I can get here and I can play golf year round my kids can enjoy the outdoors and its not nearly as insane here. He’s moving here in January buying 600K
It is a buyer’s market and the savvy will get while the gettings good
It’s pretty clear to me that nationally we’re seeing a pullback in the real estate market. In some places, it’s truly a burst bubble, in other places not as bad. But its still nationally. I dont know
were you get this stuff . It's got to be from the get rich in realestate handbook. I'm out everyday I see the development and numbers. Your numbers are old and have changed alot in the last 14 months. And tax up north is high but you get more from it. Well I have to go walk the dog down the beach, but don't worry I wont let him pee on any must sell signs.
Florida 1940= $23,100 The price yr 2000 = $105,500 Great investment for the average person
This is total nonsense, in 1960 you could buy a BRAND NEW 1500 sq foot home for 15,000. That same home, termite eaten and with 46 years of use sells for at least 350,000. If that's not a bubble nothing is! If those were inflation adjusted numbers they should be the same or going down, if not it means that our dollars are on their way to being worth less than the paper they are made of just like pennies are now worth less than the metal that makes them. I think somewhere it's written that the dollar has lost 97% of value since that federal reserve system was created.
Florida 1940= $23,100 The price yr 2000 = $105,500 Great investment for the average person
This is total nonsense, in 1960 you could buy a BRAND NEW 1500 sq foot home for 15,000. That same home, termite eaten and with 46 years of use sells for at least 350,000. If that's not a bubble nothing is!
Sad to say, the consensus feels that due to the plethora of 100 percent financing for entry-level homes, we expect to see an increase in foreclosures over the next six to 12 months.
The problem, is that a lot of people bought homes with no money down and also financed the closing costs. As a result, they might owe $240,000 on a house originally valued at $230,000 that’s worth even less now.
A lot of those buyers are getting in trouble because they were hit this year with big increases in insurance and property taxes,
They thought they were paying $1,600 a month and now it’s $1,900,and for an entry-level buyer, a $300 surprise isn’t pleasant.
Florida 1940= $23,100 The price yr 2000 = $105,500 Great investment for the average person
This is total nonsense, in 1960 you could buy a BRAND NEW 1500 sq foot home for 15,000. That same home, termite eaten and with 46 years of use sells for at least 350,000. If that's not a bubble nothing is! If those were inflation adjusted numbers they should be the same or going down, if not it means that our dollars are on their way to being worth less than the paper they are made of just like pennies are now worth less than the metal that makes them. I think somewhere it's written that the dollar has lost 97% of value since that federal reserve system was created.
It’s pretty clear to me that nationally we’re seeing a pullback in the real estate market. In some places, it’s truly a burst bubble, in other places not as bad. But its still nationally
Quote:
Originally Posted by firemed
I dont know were you get this stuff
Quote:
Originally Posted by firemed
It's got to be from the get rich in realestate handbook. I'm out everyday I see the development and numbers
It pretty clear to the world that the 2005 rate was unsustainable and that we are seeing or have seen a pullback in real estate and according to NAR the nationally and governmentally recognized source for this information we have not yet seen a national pullback. As of September 2006 the median sale price of an existing home averaged for the year is $223,333. Vs 2005’s median sale price of an existing home of $219,000 -- realtor.org/Research.nsf/files/EHSreport.pdf/$FILE/EHSreport.pdf
The only debate now is how far and for how long will a correction continue.
Those of us who limit their knowledge to their own development and their own numbers live in a bubble and have no business commenting on or trying to define one.
You asked where I get my “stuff”? For the benefit of those interested in where I research my statistics here you go
Supply and Demand – Economists point to 6 months supply as a balanced. The current above average supply of 7.3 months IS high but 4.5% in 2005 4.3% in 2004 and 4.7% in 2003 were much further below average. Existing Home sales Seasonally Adjusted Annual Rate (SAAR) for 2006 exceeds 2002 and 2003 and is less than 1% off 2004’s sales rate (statistically even)
Months supply of inventory has peaked at 7.3 statistically for the last 3 months with a nominal fall of 100,000 units in September Source: -- NAR Existing home sale report 2003-2006 realtor.org/Research.nsf/files/EHSreport.pdf/$FILE/EHSreport.pdf
Ps you may not like hearing it from NAR but these are the numbers the Federal Government Agencies use for this data.
Job growth -- Nationally - September Unemployment (seasonally adjusted) 4.6% (*** foot note - latest release for October 2006 unemployment fell to 4.4) -- Florida - Unemployment (seasonally adjusted) 3.2% Source: bls.gov/news.release/laus.nr0.htm
Inflation-adjusted wages were up Source National Compensation Survey. -- bls.gov/ncs/ocs/sp/ncbl0832.pdf
Lowest mortgage rates in 40 years Source: Freddie Mac -- freddiemac.com/pmms/pmms30.htm -- and HUD: -- huduser.org/Periodicals/ushmc/winter98/histdat3.html
Historical Housing Values Source: US Census Bureau Historical Census of Housing Tables Home Values census.gov/hhes/www/housing/census/historic/values.html - w/ most recent year’s data available being 2000 PS, In 2006 As of 9-06 the median home price in Fla was $243,900 according to the Florida association of realtors
Florida population growing at more than twice the national average for more than 10 years Number of people who move to Florida each day - 1,000 (Rounded up from 990.4) Source: US Census Bureau -- quickfacts.census.gov/qfd/states/12000.html
Record high stock market Just read any paper
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.
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.
Lots of well priced homes
