Is The Real Estate Bust Coming To An End? (Orlando: short sales, foreclosure)

[44nutman]

Noone knows what the market is going to do but I will give an educated guess. I think we are going to have a short period of the prices becoming stable. Then the next wave of foreclosures are going to hit. There a lot of foreclosures not on the market. There are a couple articles on ghost inventory and combined with more stringent lending guidelines are going to create a large pool of active listings and a smaller pool of qualified buyers. Orlando is one of the top 10 vacant cities in America. When the inventory reaches an acceptable level than we will start to see a leveling.
I would stay away from newer built subdivisions and condos. Espicially condo conversion markets unless your mortgage can be covered by market rent. YOu figure 300 to 500 a bedroom plus your HOA fees. If your mortgage is less than that then it might be worth it. The condos are raising HOA fees to cover the bank owned properties. The condo conversion market is wrought with tons of fraud. Cash back to buyers, straw buyers and what not.
The newer built subdivisons have a higher foreclosure rate due to loans resetting. YOu cant afford a 300k to 400k home on a 40k salary. When it came time to refinance the value was gone.
The banks are now renting the home back to the owner due to the market. There are people that have not paid their mortages for ayear still living in their home. Those homes will work their way onto the market eventually. The bank does not want to be a landlord.
By all means if you see a deal because there are some out there than buy it. I have seen a couple that I have appraised that I wanted to buy.

[Rich_CD]

Originally Posted by Sam.Morgan

What is your opinion AND why did Engle raise their prices by so much?

If you do a search here you'll see that I was telling everyone the bust was coming, but most didn't listen.

The U.S. is in a depression! There are tent cities in CA and NV. Many people are living in their RVs. Close to 40% of the population is unemployed.

Things are gonna' get *much, much* worse!!!

I don't know why Engle raised their prices, maybe their costs have gone up? Inflation is out of control (it's one factor that sent us into a depression).

[Rich_CD]

Originally Posted by ngrome

I also hope so. I've been posting on these boards that the bottom is coming sooner than you think.

I really hope it picks up, as I am looking forward to putting up my house for sale in two years.

The housing bottom is here. The prices have fallen by 60-70%. But, the U.S. is in a depression. They can drop prices by 90% very few people have a job to get a loan to buy a pack of smokes let alone a $200K home!

It's gonna' take 8-10 years to get things straightened out.

[LisaJonz]

No one can predict if the bottom is here or not. The only way we'll know that we hit bottom is when the bottom has already passed us by. I don't think we're there yet....unfortunately.

[Rich_CD]

Originally Posted by AONE

As soon as the bargain priced homes are sold the "bust" will end. and prices will make dramatic moves ( my opinion).

The problem is people have a hard time seeing a bargain for the bargain it is and they hem and haw while others act faster and take the deals.

The price "moves" will be homes that are owned by people who can sit on them for 4 or 5 years.

Well a bargain based on inflated prices is not a bargain. A home that was $300K during the boom should have been $150K. Now that the bust happened $150K is not a bargain, it is the "proper" price. Today a home that was $300K during the boom should be $120K for it to be a bargain.

Home values (the cost to live in a sqft of house on a sqft of land) appreciates at about 3-4% per year. You can find the proper price of any home based on sqft pricing for new homes then project that price to any point in time. There are factors that make a home worth more or less than it's "proper value".

[Rich_CD]

Originally Posted by LisaJonz

No one can predict if the bottom is here or not. The only way we'll know that we hit bottom is when the bottom has already passed us by. I don't think we're there yet....unfortunately.

I'm not predicting it. It's here, right now.

There's no more value to lose, it's all gone!

[LisaJonz]

Originally Posted by Rich_CD

I'm not predicting it. It's here, right now.

There's no more value to lose, it's all gone!

I agree to disagree on this. There are still a number if neighborhoods in my market where prices are still dropping. Again, I think it's unfortunate, but I think it's going to get a little worse before it gets better - or levels out at least...just my opinion.

[Rich_CD]

Originally Posted by LisaJonz

I agree to disagree on this. There are still a number if neighborhoods in my market where prices are still dropping. Again, I think it's unfortunate, but I think it's going to get a little worse before it gets better - or levels out at least...just my opinion.

You're just not understanding. You're thinking is that of an average consumer.

If a home is built at the proper adjusted cost today (say $1) and is sold tomorrow for less than the cost to build (say $0.50), it didn't lose any value. It's value is still the "proper adjusted cost" ($1). If it sells for two times the proper adjusted cost the next day ($2), it didn't gain any value. What!!! Didn't gain any value?!!! Right and how do I know that. I know that it didn't gain any value because if the person who purchased it (for $2) goes to sell it for the same amount ($2) they will not be able to sell it unless they find another sucker like their self to buy it.

If home prices reflected their "proper value" we would not have booms and busts.

Value and price are two different things and the housing market has lost all the value it can.

[MINNIEMEME]

Maybe due to the Lower Rates .

[Rich_CD]

Originally Posted by MINNIEMEME

Maybe due to the Lower Rates .

What are you responding to? I don't understand your post.