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Location: Halfway between Number 4 Privet Drive and Forks, WA
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I have my own theory, but I'm curious to see what other people think in regards to how the internet age will play a part in the current housing decline...do you think it will hurry it along or not affect it in any way? Do you think the internet will make the decline more intense?
The reason why I ask this is because nowadays we have so much information at our fingertips...unlike prior price declines or corrections. What might have been going on in one market was not likely relayed to another market, except on the 6:00 news...
Now you can easily pull up Case Shiller indices and find numerous blogs with heaps of information not before known to the average Joe Schmoe...people shop for home online and can easily track declining (or inclining) prices....
I question whether buyers or sellers care about market conditions. It seems to me that when the market is going down, buyers and sellers will go for the best deal they can. When the market is going up, buyers and sellers will hold out for the best deal they can.
I also question whether a higher volume of information results in better decision making and analysis. If an individual has an opinion, chances are there are interested parties pumping out "factoids" to support it.
I do think that in an environment like this, with many markets declining from historic bubbles, buyers in disclosure states pay CLOSE attention to previous purchase prices. Sometimes I wonder whether the sellers realize that the moment they list, I can compare what they're asking to what they paid in during the bubble.
Combine that with headlines that say prices are back to 2002 and yes, I think the internet is a contributing factor to the rate of decline.
Then it's a feedback loop.
The fact that we didn't buy last year and we can see prices are 100k lower this year, only gives us confidence to hold off further before making a purchase.
I do think that in an environment like this, with many markets declining from historic bubbles, buyers in disclosure states pay CLOSE attention to previous purchase prices. Sometimes I wonder whether the sellers realize that the moment they list, I can compare what they're asking to what they paid in during the bubble.
Combine that with headlines that say prices are back to 2002 and yes, I think the internet is a contributing factor to the rate of decline.
Then it's a feedback loop.
The fact that we didn't buy last year and we can see prices are 100k lower this year, only gives us confidence to hold off further before making a purchase.
Where are you looking to find prices that are $100K lower this year than last? My neighborhood has increased in value over the past year when looking at the dollar amount received for sold homes last year versus closed sales this year. And, we are looking to move 3 states away and I've closely watched the asking prices there (for over a year) and they are not moving one penny! But, houses are selling. I've seen a few that I had mild interest in sell quickly and they were NOT priced below value.
ITP - I agree with you. But like there are some delusional sellers out there who have priced their homes out of whack, there are just as many delusional buyers out there who truly believe that housing prices are going to drop another 30-50%. So we are at a stalemate in a lot of transactions.
PG - I think the internet has just as much MISinformation as it does useful information, and I think people jump on the information that they WANT to be correct, because that's what they NEED the market to do before they buy or sell. In answer to your question, when it all shakes out, I doubt it will have too much bearing one way or the other. It's what the Federal Government does that will matter the most.
ITP - I agree with you. But like there are some delusional sellers out there who have priced their homes out of whack, there are just as many delusional buyers out there who truly believe that housing prices are going to drop another 30-50%. So we are at a stalemate in a lot of transactions.
PG - I think the internet has just as much MISinformation as it does useful information, and I think people jump on the information that they WANT to be correct, because that's what they NEED the market to do before they buy or sell. In answer to your question, when it all shakes out, I doubt it will have too much bearing one way or the other. It's what the Federal Government does that will matter the most.
This thought of the internet contributing to the stalemate makes a lot of sense. Sellers read the good news. Buyers read the bad news. Both are trying to protect their interests....incompatible forecasts lead to incompatible offers and counter offers.
Anything that makes information more widely spread efects the markets;plain and simple. It really doesn't matter what the number of differing opinons expressed. I thnik that it definitely has made epople decide for themsleves like the availble comps displayed in most areas like me. I can see what other homes in the area have sold for in my state.i can also see what the demographic of certain areas are likely to change before buying in a area that could go downhill quickly.I know alot of epople that are on hold wanting to buy a home for the long term not buying because many neighborhoods are decining as a future place to live.
Location: Halfway between Number 4 Privet Drive and Forks, WA
1,516 posts, read 4,590,742 times
Reputation: 677
Quote:
Originally Posted by texdav
Anything that makes information more widely spread efects the markets;plain and simple. It really doesn't matter what the number of differing opinons expressed. I thnik that it definitely has made epople decide for themsleves like the availble comps displayed in most areas like me. I can see what other homes in the area have sold for in my state.i can also see what the demographic of certain areas are likely to change before buying in a area that could go downhill quickly.I know alot of epople that are on hold wanting to buy a home for the long term not buying because many neighborhoods are decining as a future place to live.
I agree TexDav.
I will go further to say that, no matter if the market is in decline or doing really well, I think the media AND especially the internet, do it's part to fuel the fire...so to speak.
My theory is prices will fall at a faster rate than in previous declines and will bottom sooner than in decades past.
And same thing in reverse to an appreciating market. It's as easy to ask the question do you feel the internet helped feed the initial bubble areas?
Absolutely nothing to back this up, just a hunch I have.
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