Real estate: affordable, mortgage, housing, market, 30 year loan.

KCfromNC · 02-18-2009, 08:57 AM

Quote:

Originally Posted by fairmarketvalue

This is still a hefty amount! In our area, this would take prices back to the late 90's.

Spring of 2000, actually, if you believe Case-Shiller or OFHEO numbers. You'd need another 10% drop on top of that to get back into 1998-1999 numbers.

Quote:

This is not ture, at all, at least in our area. I would also suggest that their isnt' a market out there, in the US, that is listed at peak prices, as everyone involved knows the market declined, over a span of a year and a 1/2 ago, and are pricing their homes according to these market conditions.

Using the latest OFHEO data, 57 metro areas (15% of them) around the country are at their highest point ever. That's based on values from sold houses, not asking/fantasy prices.

100 of them (26%) are selling within 1% of their peak value.

150 of them (39%) are selling within 2% of their peak value.

Why would you think that people would price below the peak if the comps for their area show that houses are selling for peak values right now?

Remember, all real estate is local. Not everyone lives in a bubble market like you do.

fairmarketvalue · 02-18-2009, 05:56 PM

Quote:

Originally Posted by fairmarketvalue

I should have read this post before posting my last one. You are absolutely correct, and this is EXACTLY how it plays out in the Chicago Suburbs. Humbolddt and I disagree and your reasons and examples of the "far out suburbs" of DC is what I have been saying about the "far out suburbs" of Chicago. mine or his (Wheaton and Itasca) are NOT far out suburbs with the "urban sprawl, cheap built homes" that went up during the RE boom. Same exact scenario. The closer in, more affluant, good schools, established communities will not see another 10-15% drop. This is just to unrealistic and for lack of better words, HOPEFUL, to assume or expect.

Humboldt, I do not see Wheaton and Itasca as similar communtiies either. I think they are quite different, and perhaps you may think Itasca will drop another 10-15%, but if it does, it's because it demographics are much different than Wheaton's. Itasca is close to O'Hare, has a lot more lower income areas mixed in with some higher, and the entire school dist. consists of 2 elem. schools, one middle school, and feeds into the Lake Park HS dist. These are hardly comparable districts to Wheaton CUSD200 with 14 elem,. 4 middle, and 2 HS. You yourself, have said you live in a 2/3 flat? and that you live in the crumiest unit of your own "investment" property. This type of housing hardly even exists in Wheaton or any of the surrounding suburbs we live wthin, including Glen Ellyn, Winfield, Lisle, St. Charles, Geneva, and even Carlo Stream. Itasca is near Woodale, Bensenville, Elk Grove Village, Roselle, Addison, etc. and these characteristics are much different than the suburbs I listed. Land locked or not, Itasca and Wheaton have very few similarities. Perhaps this is why we disagree on where our RE markets will go. I would guess that like Elmhurst, where huge homes were slapped up right along North Ave. or other similar busy (4 lane) streets or near the highways, when anyone was paying top dollar to be "in a certain community" no matter how bad the lot location, Itasca has similar problems. This "type" of home, even though high end, certainly hurts that market more than others. Wheaton and the towns like it, do not have this situation. Not at all. I always have respected you, and still do, even more as I realize that we are not really "argueing" about apples to apples here, but apples to oranges. Have a good day!

Humboldt,

My sincere apologies for your misunderstanding of my post. I did not say that Wheaton was more "affluant" than Itasca, but rather they had demographics that are much different, making them much different where RE is concerned. I actually said put our 2 communities together as to say we were not the "far out suburbs" that were seeing the price declines and the reasons the poster from DC gave as being similar for both of us. You just think your suburb will decline I do not think mine will, so I was pointing out the differences and why that might be. I still feel they are 2 very different towns, and that from a RE point of view, do not believe Our area and the suburbs I mentioned will suffer as some, even perhaps yours, as I am sure you know your own communtity better than I do. If you think Itasca is declining or will decline another 10-15% and not bottom until late 2010-2012, then I have to still say I disagree, at least where Wheaton is concerned, and perhaps other suburbs in DuPage County. Again, my apologies if I suggested that my community was "superior" in some way to yours. I honestly don't know enough about Itasca to make that judgement. I can only speak for what my opinion is on whether RE will continue to drop in price and I really, genuinally, do not think it will.

Also, I saw your thread on the Chicago Suburb forum and I can't seem to link these posts so that all can see my answer to you on the topic of Itasca and Wheaton. If you can successfully do so, please link it over for me. Again, affluancy was never the debate. Take care.

fairmarketvalue · 02-18-2009, 07:47 PM

Quote:

Originally Posted by KCfromNC

Spring of 2000, actually, if you believe Case-Shiller or OFHEO numbers. You'd need another 10% drop on top of that to get back into 1998-1999 numbers.

Using the latest OFHEO data, 57 metro areas (15% of them) around the country are at their highest point ever. That's based on values from sold houses, not asking/fantasy prices.

100 of them (26%) are selling within 1% of their peak value.

150 of them (39%) are selling within 2% of their peak value.

Why would you think that people would price below the peak if the comps for their area show that houses are selling for peak values right now?

Remember, all real estate is local. Not everyone lives in a bubble market like you do.

Once again, this all means nothing. All RE is local, indeed, and even though I don't agree that mine was a "bubble" market in comparison to others "refered" several times over, You are correct about one thing- not EVERYONE lives in a bubble market, which is why there is NO SUCH thing as a PEAK, either. These areas that are selling at or near "peak", as you put it, never had a peak, but rather a steady, NORMAL market as we all know one to be. They are selling at the prices their "market" is demanding and if that is 1% of asking(not peak or "fantacy prices" as you put it), then they are priced where they should be. Thanks, once again, for the useless data.

stosh · 02-18-2009, 08:02 PM

Quote:

Originally Posted by Humboldt1

I respect your opinion but Itasca is every bit as affluent as Wheaton. It is a smaller version of Elmhurst and has almost no apartments except a few downtown and west of the expressway. The average household income is 83K in 2000, which has grown since then. Itasca is surrounded by less affluent communities of elk grove, addison and wood dale.

There are certainly some smaller ranch homes near downtown and on the wood dale side, but I doubt itasca is that much less affluent than wheaton.

Itasca is bounded by 290 and 355, separating it from addison as well as song bird forest preserve.

Irving park road is only 2 lane thru Itasca and most of teardown activity has happened around its quaint downtown (population 8300).

My multiunit that I live in is in humboldt park, chicago. With the exception of 4 3flats along prospect road, next to mcdonalds there are no such buildings in itasca. I also own a townhome that I rent out.

Lake Park is a decent school, much better than addison trail or elk grove village, comparable with schaumburg. Certainly, there are some higher rated schools such as naperville or stevenson or new trier.

Please refer to several threads on itasca for more information. Itasca is not all that different than Wheaton, though it is closer in with more expressway access. Don't think that Itasca is like its less affluent neighbors.

Please research itasca further before making future judgments.

Hey Humboldt1, don't forget about Medinah which is the best kept secret in the area.
Agree with your assessment of Lake Park....even after 30 years.

fairmarketvalue · 02-18-2009, 08:25 PM

Quote:

Originally Posted by stosh

Hey Humboldt1, don't forget about Medinah which is the best kept secret in the area.
Agree with your assessment of Lake Park....even after 30 years.

Love Medinah, and not so secret where golf is concerned. Beautiful club, beautiful area, I agree. I believe the Ryder Cup is coming in 2012. Lake Park HS serves many diff. townships. A few communities in the mix (Keeneyville, Hanover Park) bring some compromises, though all HS have them on some level, even the "New Triers/Stevensons of the world. Many would put Wheaton North right up there with some of the best.

CouponJack · 02-18-2009, 08:42 PM

Interesting thread...

Regarding historicals, amazingly there are actually some realtors on c/d who don't believe in them....

KCfromNC · 02-19-2009, 07:43 AM

Quote:

Originally Posted by fairmarketvalue

Once again, this all means nothing. All RE is local, indeed, and even though I don't agree that mine was a "bubble" market in comparison to others "refered" several times over, You are correct about one thing- not EVERYONE lives in a bubble market, which is why there is NO SUCH thing as a PEAK, either.

Why can non-bubble markets not have a peak in prices? I'm pretty sure the maximum is a function which is defined for all sets of numbers.

Quote:

These areas that are selling at or near "peak", as you put it, never had a peak, but rather a steady, NORMAL market as we all know one to be. They are selling at the prices their "market" is demanding and if that is 1% of asking(not peak or "fantacy prices" as you put it), then they are priced where they should be. Thanks, once again, for the useless data.

I'd think that current pricing info is on topic with "more affordable now than ever". And it's got you running in circles trying to explain how markets priced higher than they've ever been aren't at their peak. It served the purpose of adding a bit of reality to the normal hyperbole (e.g. "I would also suggest that their isnt' a market out there, in the US, that is listed at peak prices") we're used to here. I don't call that useless at all.

fairmarketvalue · 02-19-2009, 08:24 AM

Quote:

Originally Posted by KCfromNC

Why can non-bubble markets not have a peak in prices? I'm pretty sure the maximum is a function which is defined for all sets of numbers.

I'd think that current pricing info is on topic with "more affordable now than ever". And it's got you running in circles trying to explain how markets priced higher than they've ever been aren't at their peak. It served the purpose of adding a bit of reality to the normal hyperbole (e.g. "I would also suggest that their isnt' a market out there, in the US, that is listed at peak prices") we're used to here. I don't call that useless at all.

Here we go again! Are you honestly that incapable of understanding the point here? Your post read as if 57metro areas (15%) of our US markets were selling at "peak" as we all define the word of late. Peak has been defined as "way over priced", "doubled in value in a couple of years", "HUGE run-ups that deviated from the normal rate of appreciation", and on and on. This is NOT what those markets you listed are going through or have gone through. SO since you, once again, removed a quote of mine, out of context, I will put it back in. When I said there is not a market out there that is listed at "peak prices" I and anyone with 1/2 a brain understood what I meant- that when prices were at "peak" and anywhere from 15-40% higher 2-3 years ago from the RE boom and peak, are not listed there anymore. These 57 metro areas never had the "peaks" you all constantly complain about and refer to when you state that homes are still overpriced and have another x% to fall. These markets have the steady, modest climb that a home has always been expected to bring- it's called appreciation! Hope this helps.

Humboldt1 · 02-19-2009, 12:10 PM

Where are most of these markets located? I honestly don't know.

I agree with you on one thing. Itasca and Wheaton are both great places to live and raise a family. I work alot in the loop so I need to be closer in, but I would definitely consider buying a place in Wheaton if I worked out in the burbs.

My bank is now forecasting 9.2% unemployment by year-end (the govt forecast is for 8.5-8.8%). Real estate may be local, but macro forces are hurting everyone right now. Even strong real estate markets that are still increasing, would certainly be increasing even faster if the economy were better. I don't totally buy the real estate is local argument for this reason as what goes on nationally affects us all, though some more than others.

fairmarketvalue · 02-19-2009, 12:21 PM

Quote:

Originally Posted by Humboldt1

Where are most of these markets located? I honestly don't know.

I agree with you on one thing. Itasca and Wheaton are both great places to live and raise a family. I work alot in the loop so I need to be closer in, but I would definitely consider buying a place in Wheaton if I worked out in the burbs.

My bank is now forecasting 9.2% unemployment by year-end (the govt forecast is for 8.5-8.8%). Real estate may be local, but macro forces are hurting everyone right now. Even strong real estate markets that are still increasing, would certainly be increasing even faster if the economy were better. I don't totally buy the real estate is local argument for this reason as what goes on nationally affects us all, though some more than others.

Found on KC's last post for the OFHEO stats. Perhaps she can reply to this question- she seems to have a lot more time to "research" everything and find all this data than most. I don't spend but maybe 1/2hr. tops on this forum, combined time in a day. No time to search and search for countless articles and stats. Even the OFHEO has such a magnitude of info, you'd be stuck on that websight alone, most of your day if not careful. It's nearing tax season and so many new laws and "messes" to orient ourselves in that I'm probably going to be on here less and less as 4/15 draws nearer. Have a good day. FMV

PS- agree about Itasca and Wheaton. And I have to agree that the unemployment is scary and these economic times. We are swamped with clients trying to "get theirs", whatever that means, and as much as I feel fortunate that we are overwhelmingly busy, it's too bad that it is at the expense of others misfortune. We are doing our best to take on a few pro bono cases but then again, even we don't want to and won't work for, free.