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I respect your opinion regarding the housing market, but here is my take. Let's forget about the media for a moment. Are you saying that people who need to sell their homes should hold the price line and wait for buyers to flinch first? I am fairly sure that this is not how the markets work.
For years we have been watching the price of homes run up at unprecedented levels. Economic data has shown that this appreciation has outpaced salaries by a wide margin. Then we have the lending debacle. The market MUST and WILL correct. Those who have been in their homes for a while will be fine. Those who over borrowed may need to sell. They will sell for what buyers are willing to pay, otherwise, they will hand the keys over to the bank.
I am all for being positive. I believe that this correction is necessary and the sooner it occurs, the better for the economy.
Quote:
Originally Posted by apvbguy
if economists had any real insights they'd be acting on them rather telling you about them, I give them very little credibility
even the so called best economists at the Fed, you know the US Federal reserve rarely gets it right, so you go on buying whatever the talking heads are selling.
what you show by comments like selling an over inflated market is that you really don't understand how money works. In very simple terms a market is balanced when buyers and sellers come to terms, so our real estate market can be viewed as a bit out of balance but properties are trading owners and properly priced homes do sell quickly, so that comment is not borne from any real facts.
Aren't you a Mod here? please abide by your own rule and tone it down a bit insults like this: "I'll bet you believed Kenneth lay and Jeffrey skilling too"
are not necessary, attack my opinions not me.
oh, and BTW, I'm not buying or selling, so I have no dog in this hunt. I just calls 'em as I sees 'em.
I respect your opinion regarding the housing market, but here is my take. Let's forget about the media for a moment. Are you saying that people who need to sell their homes should hold the price line and wait for buyers to flinch first? I am fairly sure that this is not how the markets work.
For years we have been watching the price of homes run up at unprecedented levels. Economic data has shown that this appreciation has outpaced salaries by a wide margin. Then we have the lending debacle. The market MUST and WILL correct. Those who have been in their homes for a while will be fine. Those who over borrowed may need to sell. They will sell for what buyers are willing to pay, otherwise, they will hand the keys over to the bank.
I am all for being positive. I believe that this correction is necessary and the sooner it occurs, the better for the economy.
if a seller has no reason to make an immediate sale, he doesn't need to chase the market, if history can offer a clue, if he holds on prices will recover. If everything dumps, he'll sell for less but his replacement will also cost less, so unless an owner plans on cashing out and not buying anything else, he has no pressure to sell at a lower level
if a seller has no reason to make an immediate sale, he doesn't need to chase the market, if history can offer a clue, if he holds on prices will recover. If everything dumps, he'll sell for less but his replacement will also cost less, so unless an owner plans on cashing out and not buying anything else, he has no pressure to sell at a lower level
and there's no pressure to buy at these ridiculously high prices for some really old homes as well ...
and there's no pressure to buy at these ridiculously high prices for some really old homes as well ...
then the answer for you is to wait.
someone will be right and someone will be wrong and since none of us have that crytal ball that tells all, we'll just have to wait and see.
The article below ties back to my post from 11-30-2007. What still gets me is that many sellers are still in denial about the stability of New Jersey's real estate market. The prices are holding because sellers do not want to drop prices and buyers are waiting for prices to drop. The standoff is going to end badly for one of them. I think it will be the sellers that are going to move first.
The problem is simple in my eyes: home prices have increased past the point that first time home buyers can get into the market. First timers can't afford much more then $300k. So anything above that price point is going to be someone "trading up." Well, in order to trade up, you have to sell your house first. If your house is listed at more then $300k, then you're eliminating first time home buyers and only selling to others "trading up." That won't work forever which is what we're now seeing.
Those who wanted to trade up, did. Those who still want to trade up, can't. And those first time home buyers who want to get in, can't... as they have seen interest rates increase by 1 whole pct point in the past year with very little drop in prices.
The problem is simple in my eyes: home prices have increased past the point that first time home buyers can get into the market. First timers can't afford much more then $300k. So anything above that price point is going to be someone "trading up." Well, in order to trade up, you have to sell your house first. If your house is listed at more then $300k, then you're eliminating first time home buyers and only selling to others "trading up." That won't work forever which is what we're now seeing.
Those who wanted to trade up, did. Those who still want to trade up, can't. And those first time home buyers who want to get in, can't... as they have seen interest rates increase by 1 whole pct point in the past year with very little drop in prices.
Perfectly said...my real estate agent told me this very thing last night.
This is why the first homeowner is the most important part of the chain.
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