Is The Real Estate Market At A Bottom?

[brettman9]

Quote from S2007S:

Expect another 10% drop in housing prices over the next 6-12 months.
Some areas that are overvalued will see a 25%-40% drop in prices.

Unquestionably correct.

Prices haven’t even reacted yet. I realize this is anecdotal, but it gets to the issue at hand: My parents are currently trying to sell a home in gulf-coast FL in an area where homes were routinely selling for 800K to a 1.2mm one year ago. Not a chance now. I try to tell them to think of it like this: those houses were selling at illusory premiums. They were never really worth that. It was chimerical as a result of a curve of unbelievable availability of money-to-buy-houses. That will correct. And that correction hasn’t even happened yet because we’re firmly still in the stage where no one wants to sell their home until the market “comes back”. So the inventory stays. They have just recently taken their house off the market. Like so so so many others.

So, when you see an inventory number, remember – and this is the biggie – that there are many many more houses ‘potentially’ for sale…and the moment that inventory starts to get dented at all, there will be a flood of folks (just like my folks) who will jump in line. You can’t have that sort of supply situation in a market that never sees a price correction.

 

[HOBO]

Interesting links related to housing on this web-site:
http://ml-implode.com/

 

[Ballard]

Quote from traderdragon2:

They have been calling a bottom for how long now? Wishful thinking.

When were are done reverting to the mean in about 4-6 years ill start calling a bottom. We are still way outta whack.

http://drhousingbubble.blogspot.com...enius-today-we-salute_13.html?ref=patrick.net

Exactly!

 

[AKUMATOTENSHI]

Quote from Arnie:

I think you need to see inventory levels drop first. We've never had this many homes for sale.......EVER!

Builders are offering all kinds of incentives (read: price cut).

Sub-prime is history. That's gonna shut out a whole lot of first time buyers. If they can't buy, who are exiting HO's gonna sell to, to "move up"?

Rates on Jumbo loans are 75-100 basis points above the average for conforming loans. I think a lot of those potential buyers will wait for rates to come down.

A normal housing cycle is more like a decade, not a year or two.

+1 The subprime issue is still way too topical. Even with a potential rate cut coming up next week most people will be waiting for a bargain.

Akuma

 

[dividend]

How can RE hit bottom when the recession hasnt even happened yet. Let's get real...

 

[HedgefundTrader2]

Quote from HOBO:

Interesting links related to housing on this web-site:
http://ml-implode.com/

You are confusing housing with Mortgage Business, two different things. One is financing the other is a tangible commodity.
Implode is being sued for printing lots of grabage by lenders, they were begging money for civil defense and attorneys fees! LOL!

 

[Tracy McGreedy]

Ara Hovnanian says we are close to bottom, so it must be real. He is also selling his inventory in NJ -20% last week's price.

Quote from dividend:

How can RE hit bottom when the recession hasnt even happened yet. Let's get real...

 

[HedgefundTrader2]

Quote from Tracy McGreedy:

Ara Hovnanian says we are close to bottom, so it must be real. He is also selling his inventory in NJ -20% last week's price.

Bottom is when buyers start coming out of woordworks. They have been holding off and there is a real pent up demand, when it hits the fan you will know it. These jackasses are known to stampede on each other, hike offers like bunch of rats in a sewer tunnel running toward sunshine.

 

[HedgefundTrader2]

Read this: Renters squeezed on all sides.

How long these these idiots can hold off? Having a roof is a necessity, yet these morons are sharing bathrooms and kitchen spaces with other families like a college like dorms! LOL! It isn't that houses have vanished in America? They are standing there vacant and getting foreclosed!

Why these people are so stupid and under achievers in life? It amazes me to see the blindness of these garden grown morons and jackasses !

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http://news.yahoo.com/s/ap/20070914/ap_on_bi_ge/renters__plight;_ylt=AngcmAdQT1mhAVJQq5eAARBv24cA

On both coasts of the United States, and many cities in between, hundreds of thousands of renters face comparable plights. The home mortgage crisis has received far more notice, but experts say the ranks of renters with dire housing problems are growing faster than the ranks of defaulting homeowners.

The Center for Housing Policy reports that the number of working-family renters paying more than half their income for housing has soared from 1 million to 2.1 million since 1997. Overall, advocacy groups say there are 9 million low-income renter households and only 6.2 million units they can reasonably afford.

 

[thriftybob]

Prices will need to come down to where there are buyers that can afford to buy before a bottom is in. We should see it as sales in units start increasing. I don't think any one month's data would be sufficient to convince me. I'd want to see multiple months where numbers were up over prior year. I think its at least 1 yr away, maybe 2 depending if a recession is avoided for 2008 or not. If avoided for 2008, I expect a bigger dip in 2009 after the election. That would be more typical, as its rare to see a recession in an election year, IMO.