6 Months of Gains
According to the S&P, home prices have had six straight months of gains. Well, at least for 14 out of 20 principle metro areas. Sorry if you don’t live in an “up” city. But I just report the facts, I don’t make them.
However, home prices are just part of the picture, says the chairman of the S&P index committee. Apparently price gains slowed in November. So while prices are rising, they are slowing.
However, for some major cities in the study, annual figures showed that they had finally reached positive territory. This hasn’t been seen in 2 years in cities like Dallas, Denver, San Diego, and San Francisco.
So what can we take from this information? Prices seem to be stabilizing, but they don’t necessarily indicate a sustainable recovery.
More time is needed to see if the gains that have been achieved can be maintained. We seem to be at pre-housing-bubble levels. Can we achieve the heights we saw previously, this time with a more stable foundation?
That data will be forthcoming after the first quarter stats of 2010 come in.
Hi Cory,
I hope that the prices start to go up as we get farther into 2010. In FL were unemployment id at an all time high of 12% and as you know florida was one of the hardest hit foreclosure wise. With that said the hole US is on sale so if you have the cash now is the time to buy. Have a great day
In the SE Florida the inventory of homes of homes has dropped from 17 mos to under 4 mos.Investor homes are getting multible bids and going above list price
Unfortunately, lenders are still holding back often competing with what is happening in this current market. They still control alot of inventory that has not been put back on the market. In a sense, they are manipulating prices at this time and so I would say we are seeing now is a false and temporary recovery particularly in lieu of the jobs market.
No way do we go back into pre bubble levels, in any market including those cited which are clawing back to reasonable median levels, vis a vis median income, aka affordable ratios. It will be 5 years before the current new and resale inventory, as well as Vacant houses get occupied. That is if the commercial downturn doesn’t further exacerbate the unemployment disaster. Loss of commercial retail real estate means further loss of jobs. No jobs, no recovery.
Hi Cory, I want to thank you for the glowing remarks. There is nothing that would make me happier than to be able to serve my fellow man. I have been trying by going to webinars and studying as much as I can but I can’t seem to pull it all together. I will continue to read your blog and hope that I can in the near future pull it all together. It would be the most wonderful thing in my life right now to be the proud owner of Freedom Soft. Thanks for your belief and trust.
Cory -
Couldn’t agree more. It looks as if progress is being made but not sure I’d call it a sustainable recovery yet — especially in certain cities throughout the US.
Here is St. Louis the other Real Estate investors and I always discuss where is the “growth” going to come from? We’ve lost a number of large companies that have been bought, merged, or moved their corporate HQ’s out of town and here in the Midwest, there doesn’t seem to be enough new nimble start ups forming and replacing those that left. New home construction is still almost now existent and that is a leading and a lagging indicator as to the health of the economy overall and to the real estate portion in particular.
Cheers
I appreciate the optimism but I believe the recovery in the housing market will be slow and long. We still haven’t hit the bottom with some of the financing that was done in recent years. We will be paying the price for this for a long time to come. I expect home values to be relatively flat for several years to come.
Craig
I live in Florida on the south central east coast. I have been doing short sales and wholesaling for about a year and know the area pretty well. The market here has far from stablized and continues to decline. There is still and over supply of REO’s and pre-foreclosures to keep the market from stablizing. With the wave of new option arm and Alt A loans resetting in the neear future, I would say we’re a good distance off from market stablization. Traditional Real Estate sales are very challenging and trying to sell a ten year old home for more than a two year old home down the street just doesn’t work.
God Bless,
The Word of God says, “According as His divine power hath given unto us all things that pertain to life and godliness…” II Peter 1:3 KJV.
This verse is not about Religion. It is about truth and It is talking about the “life” that we live today. Whether you honor the God of the Bible or some other god (all of us are worshiping something) one cannot deny what we see and experience in this natural world in which we live.
Whatever we believe, one thing is undeniable, and that is that in this universe there are laws; some natural and some spiritual. OK, so some don’t believe in spirit; that does not make it go away.
The natural laws scientists continue to study and most of us did too in school. The spiritual ones most all scientists ignore, yet they know that there are things that they are unable to explain. UFO’s for instance.
What’s all this have to do with the question of the day? It is simply this, “What goes up must come down”.that’s a law! And what went up in Real Estate values came down. Will it go up again? Of course. Why? Because it is a law!
If you have followed any financial market you have seen this over and over again. The wealth of this Great Nation has to move somewhere. Wise investors do not sit on hordes of cash, because it it devalues with no interest to balance it out Do you remember interest rates? When you could get 10% interest or more on your deposits from any bank? I do.
There are only three choices in the accumulation of wealth in the struggle for appreciation and against depreciation, and these are precious metals, stocks, and Real Estate. The wise investors have all three.
The kicker to Cory’s question today though, is stability? This word “stability” is an emotional one. Used by all sorts of politicians. Stability is an illusion and will never stand in the face of speculation which will always exist in any financial market.
No, Real Estate will be no more stable than it has in the past. It will hold for a while and again change with the flow of wealth. The heights will exceed those in the past though: that’s not Science; that’s History. So, the peaks and valleys will always exist because it is a law!
“Go (look) to the ant, thou sluggard; consider her ways and be wise: which having no guide, overseer, or ruler, provideth here meat in the summer, and gathereth here food in the harvest.” Proverbs 6:6-8 KJV
The harvest is here.
In Christ,
AJ
I reside and work as an agent in the high desert of California, that being said, it appears we have a minimum of ten offers on each listing that is taken, and to our astonishment, these listings, if listed at market value, are active at a minimum of one week before the status becomes pending. Thus, sellers are begining to receive offers without going down on the value, in fact, many home owners are receiving more than the asking price, therefore, these sellers are setting the value for the neighborhoods within the poximity of their house; so yes, we are beginning to see a change.
We will start seeing more home prices go up or stabilize as more banks start lossening there purse string again and jobs start coming back strong and stabile. In my area houses didn’t go down as low as the rest of the country. It just start taking a turn down this last year. There are a few more forclosers then two years ago, not as many as other states around us or even other cities near by.
Merla
I believe that we have a long way to go before we recover from this housing crisis. This is because there is alot of foreclosures to come in the near future. I would say that within 2 years we may recover.
If Zillow is any sort of guide, home values in the Tucson area continue their slide. They report that their value model says my home ($200k in Jan 2007) is now down to $142k, losing 4.4% just last month. I have yet to see prices stabilize here. I would guess that the S&P numbers are somewhat selective (“14 of 20 principle metro areas”) and not representative of the country as a whole.
Although the “900lb Gorilla is currently Happy”. This may yet be another “calm before the storm”. The looming Third Wave of foreclosures That Rick Sharga of Realty Track referenced in an interview with Diana Olick of CNBC, may be just the shortage of bananas that pisses of the gorilla again.
I am glad to see the 6 months gain price in housing. The question is in which area? According to the unemployment report going up how many people can effort to keep the house and no. of foreclouser going up. These factors would not help in price increase on housing. Possible that the investors compete among each other so it trigger the price up. May be S&P brings positive news to stimulate the economy?
The perceived recovery is a myth because it’s being built on shaky foundation. Without the 1st time home buyers credit look how much more deep the economy would be underwater. Notice the decline in home sales between the stimulus packages. The only way we will get out of this mess, stop sending manufacturing job outside you 50 states.
Ivry
Isn’t it amazing that when this whole real estate market started going down the prediction was originally 1-2 years. Well, as we can all testify, it’s lasted a whole longer and has gone a lot deeper and affected so many other industries and economies than anyone expected.
Unfortunately, we not at the end, we haven’t it bottom. I glory days of real estate of the past are truly the past. We have to reeducate our selves to thrive in this new real estate climate.
I’m amazed that people want home prices to start going back up so soon, in my opinion, real estate is still to high.
I believe that real estate prices back in the nineteen ninties were truely affordable, we needs to go to the back to the prices that we were paying for houses 15 to 20 years ago, and then start the upward trend from there, but with all the stimulus money going to the banks, It’s just delaying the real estate reset that needs to happen. Yes, with out Gov’t help, some of the large banks might have shut down, but there would have been other banks that were doing well that would have took over those loans for pennies on the doller and would have truly been able to help people from going in to foreclosure. But the Gov’t wanted to do the stimulus thing hoping that home prices would not go down, but it’s not working, there are still lots of foreclosures and prices will start to come back down again when the Gov’t stops giving home buyers $8,000 to help with the down payment, actually I think it’s a $8,000 loan, not sure though.
OK, now I’m talking to every one in the Gov’t from the President on down, there are three types of people in this country, poverty stricken (poor people), middle class and wealthy people, the banks won’t lend money to poor people to by a house because they can’t pay the mortgage, wealthy people can pay all cash for their home and be free and clear of any mortgages, so that leaves the middle class to get loans from the bank to buy a home, we make $25.00 to $40.00 per hour which only allows us to to buy a house that is less than $140.000 and still pay the mortgage with out working 80 hours a week and being totally stressed out.
When people in the middle class start making $50.00 to $85.00 per hour, it is only then that we can buy those $250,000 to $350,000 homes and pay the mortgage with out working 80 hours a week and stessing out. This is just my opinion.
I know that this may sound a little crude, but thats OK, I’m not a politician, I don’t have to be politicaly correct.
Cory, a recent local business review publication noted my farm area is now ranked 190 of 203 in the foreclosure statistics so I’d say here the recovery is in full swing. I have to shift my focus to bank-owned properties which there are less and less hitting this market. Do you have any training for how best to succeed in this category and are there investors looking for properties for 20% instant equity?
I love your training materials, personal successes, and outlook on life. Sharing as you do, modeling your beliefs, walking the talk, are truly gifts to all of us out hear. Please keep up your mission.
Richard
Cory -
It’s Sat, and news appears to be that the economy is sputtering. This will be a long and drawn out revival but one that Millions will be lost and made and I plan and expect to be on the winning side of this recovery.
Cheers –
-Jeff Mishkin
I live in Dallas and now is the best time to invest. There are parts of the Metroplex (Dallas/Fort Worth) that are and always have been appreciating and a knowledgable investor knows where they are. Luckily we did not see the major up swing that a lot of other areas saw so we did not see the drop either. Prices have always been fairly stable here. That’s not to say that we don’t have our challenges as well… mainly with financing… and FHA, Fannie and Freddie rules… and appraisals… don’t get me started on the appraisals (my apologies to all you appraisers out ther). All in all, though Dallas has been a great market for the 4+ years I have been investing full time.
Jeff R. Texas
I sure hope the gains will continue her in our market. We are lucky to be in a stable market in my area but the more buyers the better. I am having trouble moving properties right now and it has really made my business struggle. I sure hope things continue to turn around so that I can have some better luck moving the properties that I have in inventory.
Neal B., North Carolina
A point to consider: Being attentive to where each Community Researched is in its recovery process. ie: Are Property prices holding, gaining or loosing, in that particular area… this will assist in the Strategy to use and assist the buyer to purchase wisely…
Right now I have 3 verbal approvals on short sales and have been trying to get Fannie to send the written so we all can close on these. Fannie is hanging all 3 up. I too, have had the challenges of the multiply BPO’s on the part of the lender. The value came in on one of my deals the same the first 2 times and now 2 months later came in 10,000. higher!!! This was after the verbal. We will see how this turns out, on this same deal they want the homeowner to sign a promissory note. It keeps getting better and better.
Go figure.
Donna W., Missouri
I never knew the S & P tracked real estate markets I thought it was strictly for company stocks. I saw a webinar program recently put on by Ken Wade an expert in applying technical analysis principles to real estate markets. His program tracks moving averages and sets up indicators that give you buy sell signals. It may be a good way to catch the next appreciation swing.
Xavi P., CA
Honestly, I have not seen an accurate projection of the housing market yet. I remember hearing an investor almost 2 years ago say that we were “at the bottom”, and I had that little voice in my head saying “What if this is worse than anyone thinks?” I am glad to see some good news about the market, but all the projections in general just reinforce to me that I stay very conservative in my offers so that, no matter what (almost), I cannot go wrong. It is going to be interesting to see how it all pans out.
That is good news for Investor’s who bought propeties back when the houses crisis started. Now they are going to see a big return on there investment. However I think that the houses prices are going to go back down because of all the job losses and the arms are coming due for 2010. I feel like in will be up and down for at least the next 5 to 7 years or longer until the banks get rid of all the bad assets on there books. Thanks Chris J. Alabama
I have been working short sales in the St Louis area for the past 7 years and wholesaling them to other investors that has the cash to close the deal. But that market is very volatile.
No I’m buying in the luxury short sale market now in Florida, St Louis and Las Vegas with a financing partner. All three areas in the luxury market has prices still declining. I expect this to continue as this market is ‘not typical’ of the rest of the real estate industry. This makes it more difficult to find an end buyer unless we can buy it on a short sale for a very low cost. But that is why I’m using the best negotiating service in the country. I expect that in this market I can finally make some real money.
If anyone has to funds to buy, now is the time. There are great deals out there. But prices having gains…mmmm? I guess so in some markets, (very few). It is going to take some time for us to recovery from this mess…quite some time. Prices in some areas have fallen so drastically that it will take years to regain some stability or value.
As cliche as it may be I definitely believe that it is a false stabilization that we are seeing at least here in San Diego where I live. Actually I wouldnt even call it stabilized because prices are still dropping slowly but what seems to be a market that is near turning back around to the upside is an illusion. All the experienced RE market gurus here agree; you have to look at the evidence. Unemployment rate here is staggering at over 20% and rising, foreclosures are still high as ever and a new wave is coming with sub prime and ARM loans, plus the commercial sector crashing. Banks are holding onto inventory (which they will have to unload sooner or later) and on top of all this, the government, although it doesnt like to admit it, is over extending itself and about to create a financial emergency of its own which will have massive ripple effects on every aspect of the economy.
As cliche as it may be I definitely believe that it is a false stabilization that we are seeing at least here in San Diego where I live. Actually I wouldnt even call it stabilized because prices are still dropping slowly but what seems to be a market that is near turning back around to the upside is an illusion. All the experienced RE market gurus here agree; you have to look at the evidence. Unemployment rate here is staggering at over 20% and rising, foreclosures are still high as ever and a new wave is coming with sub prime and ARM loans, plus the commercial sector crashing. Banks are holding onto inventory (which they will have to unload sooner or later) and on top of all this, the government, although it doesnt like to admit it, is over extending itself and about to create a financial emergency of its own which will have massive ripple effects on every aspect of the economy.
Sam H. San Diego
Six months of gains in some cities is certainly encouraging as far as the overall economy goes. I don’t think, however, that that can be a true representation of a market stabilization. There are just way to many areas where home values are still dropping and properties sit on the market for quite some time because of financing restrictions.
We’re still crawling into a recovery, so it should be some time before we see pre-housing-bubble levels again.
In the Pittsburgh area and the seven country region, we weren’t hit as hard with the number of foreclosures as other places. While home prices did fall, the drop wasn’t as steep as other places as well. So while the the banks are being just as stubborn about loosening credit and they’re giving us a hard time when it comes to getting hold of REOs, there are properties to be had here, if you can find them and get to the right person at the bank.
It is going to be some time before things truly stabilize, IMO. But in the meantime, there is business to be done. Let’s go do it!
Be blessed! Craig W.
I dont think that the Real Estate market has bottomed just yet. The banks are sitll holding a huge inventory of “Bad Loans”. Until this inventory is off the books the market will have to deal with the pricing of distressed properties.
The solution? Is investors!
Only we can make The overpriced … affordable (shortsale), the ugly … attractive (rehabbed), the empty … full (resale), the problem … fixed (profit).
Ernie O. New Jersey
We live in a rural area of PA. I really don’t see a recovery in the real estate market here. I am waiting to see how the commercial foreclosure side will effect our fragile economy. I think we have a long way to recovery in the housing market.
So, what we can gain from this “positive” info on house price gains is that instead of the hole we are in being 100 feet deep it is only 95 feet deep. Long way to go before we see a light at the end of the tunnel.
tom p. from Ohio
It’s hard telling how the price will be affected once the tax credit period ends and banks finalize more foreclosure actions that they had suspended last year.
In the D.C. Metro area where I live the housing prices are starting to rise. However, I believe more foreclosures are coming, and I don’t think the number of foreclosures are going to drop much any time soon. Though housing prices are on the rise, I still believe it’s a buyer’s market and that there are tons of deals waiting to be found.
In the D.C. Metro area where I live the housing prices are starting to rise. However, I believe more foreclosures are coming, and I don’t think the number of foreclosures are going to drop much any time soon. Though housing prices are on the rise, I still believe it’s a buyer’s market and that there are tons of deals waiting to be found.
Kelly H., Virginia
How can any recovery be sustainable when we have real unemployment at 17%, consumers still slightly unsure about spending their money, banks still afraid to lend money, and economic policies that don’t promote long term economic recovery?
I think you have to pay attention to the areas that you live in,and then look across the states to have true indication,the fall into place type of scenario.Now with unemployment such a big hurdle,that statement may not be accurate,you need money to flow,no money flowing ,no houses being sold,no houses sold means discounts.Doesn’t look that way to me,don’t believe everything you read.
Just did a recent search of my area, and there were only 15 Bank Owned properties. Once the inventory is down, prices will go up. And that’s what happened in 2005 to drive the prices so high. But, I know there are more coming.!
If prices continue to go up in some of these areas, you can bet that the banks with properties in those areas will want more money for their REOs and good discounts will become less common.
If you have been considering investing in REOs but haven’t yet started, NOW would be a good time to do so.
Craig S., California
hi cory once again this is great info. government should say thx you to real estate investors buying there bad debts creating biding wars for these properties, fixing them up and selling them to first time buyers. i feel that is the reason for any gain
Lenders are still not releasing funds, they are still in control of the market and their inventory, thereby making it harder for us to buy and sell at “fair market value.” They still continue to make matters worse, then they try to blame the American people for the situation at hand. When in all reality, they should be looking in the mirror thinking of how to make it right and help reshape the real estate market.
It is nice to hear some positive news even if it is based on just some of the facts and not all the facts. There is alot more to come in the foreclosure market so it will be interesting to see where house prices go. I do agree that we need to concentrate more on the recovery of jobs before we see any stability in the housing market.
Jamie L., South Carolina
Well, allot of really good thoughts brought out here too, and some very interesting perspectives to enjoy as well…! Hello, Ladies and Gentlemen, it’s Joseph from the ‘Republic of Connecticut’, (the Constitution state!) here again, and it’s really great to have other like-minded folks out there like #9 above, Anthos Jordan (AJ) teaching us the WORD of God online, and he quoted to us an awesome verse in II Peter 1:3; “According as His divine power hath given unto us all things that pertain to life and godliness…” II Peter 1:3 KJV. What this means to us is that all true believers will continue to ‘prosper and grow’ spiritually in God’s Grace and Mercy, no matter what happens here on the Earth… In other words, God is faithful, He will perform it, He will be our provision in all things, because He is faithful who called us…” How that applies ‘to the Markets’ and ‘to Real Estate’ in particular, I’m not 100% sure, however, I’m praying about that now, except to say we are always to be “…Wise as a Serpent and as meek as a Dove…” So, I think continuing to learn as you grow, be teachable, humble and work as hard as you can, (like the Ant’s in Proverbs 6:6-8) trusting only in God for the increase, being conservative and back only what you know will work for sure, don’t take huge risks reck-lessly, unless again, you know it will work for sure, etc… As AJ said, ‘Yes!’ there will continue to be ups and downs, be faithful to God and love your brother, only do unto him that which you would that he do unto you… God Bless all. jbm…!
I see some trends starting to happen here slightly behind the other states that got hit even harder than we did. There are starting to be multiple offers on the “working joe’s” homes. And more luxury homes are going to foreclosure and short sale. I expect that as some “pundits” are saying we are in for another wave. This economic downturn may be starting to even out but I think there’s a good chance we will go down again before the year’s over.
I think as long as investors have to depend on banks for loans we will be in this slump a lot longer than we have to. I think the banks are part of the problem as to why we have so many foreclosures and more to come when the loans come due for commerical properties. I will be the investors who find cash buyers that will help pull the housing market to where it needs to be and S&P dont know it all the rely on stats we are the ones who are out on the grind so I say lets start investing and have fun and cash out now and later
I do not believe at all with this report. I think that banks are manipulating the numbers to make their stoke numbers look better for their boards. In a five mile radius of my neighborhood there are vacant houses everywhere that are know REO’s yet there is no way of getting information on most of them in regards to when they are coming on the market. The homes have been winterized and I assume the banks are waiting until the spring to put these homes on the market. In my opinion the housing market will not recover until companies start hiring again, I believe that the worst is unfortunately to to come.
Preston’s Blog: “More time is needed to see if the gains that have been achieved can be maintained. We seem to be at pre-housing-bubble levels. Can we achieve the heights we saw previously, this time with a more stable foundation?”
My response: I agree with a comment made about “companies need to start hiring again” and to add to that, and pay well. I am a recipient of getting a job after 1 1/2 of seeking and getting paid 60% less than I was making 1 year previously. That is a shame! My answer is NO we will not achieve heights we saw previously until the attitudes of big business spending change. Family value needs to be restored back into big business. It’s still about how much the CEOs can make and not about the employees. A change must happen before the housing market can get better.
I don’t know whether or not to agree with the banks’ reports. What constitutes a ‘gain?’ At least a percentage point? A percentage of a percentage point? I could go on… REO lists from banks are getting longer. More homeowners seem to be missing payments. More employees seem to be losing their jobs. I tend to believe that the housing market will continue on a downward spiral for a much longer period than is being reported.
Real estate is a localised market, where one neighborhood, or area within the state can do better than the other, regarding sales and resilience to significant down turn in the value of the property. For instance, San Francisco and Marin Co ( on the north side of the Golden Gate Bridge) have been quite resilient, loosing a small value of their inflated pre-kaboom values, yet areas in the Sacramento Valley have been hit exceptionally hard. Here in Florida, Tampa has been hit hard (save a few communities) and homes have lost a significant amount of their value, leaving many borroweres upside down in theeir homes. People are loosing their jobs, have to short sell or go through forclosure proceedings on their property. This adds more homes to the already swollen inventory, and in turn will mean a longer period for a favourable turnaround in the housing market, ( and the commercial market). Some neighbourhoods, will tun around quicker than others. How long is mere speculation. I head of worse case scenario markets, may not begn to recover till 2015.
The upside is for us to get to the investors, and help them to take advantage of this, and stimulate the market
Hi! Cory:
Looking on the positive side of this home deflation/inflation debacle.
This is absolutely another one of those best times in the history of an industry to invest in a tangible product like real estate and get rich.
If a person has money to invest in real estate in the next 5 years or less they will be wealthy.
History repeats it self often and again in real estate it will go full circle like it always in the past.
It’s just that the conditions and the standards will change.
Real Estate is the most solid investment even beyond stocks & securities over time.
If the stock market crashes you lose paper and liquid assets, but in real estate you will always have something tangible even in the event of the loss of some equity.
I look at this from the bright side instead of the gloom and doom.
I know it will change for the good perhaps in the not so near future, but it will surely change and get better again.
Regards, Jerry P.
Here in the Dallas area we are seeing changes in the different “sub-markets”. The local paper just showed what housing has been doing. In the area I live it shows it as flat, in the area I own another property it shows a 10% decrease. In another area I am working it showa a 3% increase. So one needs to check it’s market and know wht areas are doing what. From what I have seen and heard from other investors these numbers seem to be true. I will just need to change my strategy and focus on another area for the time being. Hopefully we will continue to see this rise in value and be able to take advantage to help our business and prospective homeowners/renters find an affordable place to live. What are you all seeing in your markets?
I would tend to agree with what Dan said in terms of a false manipulation of the markets. I would also state that the Obama admin has a lot of room to maneuver and change how they react to the banks they loaned money to in the bank bailout. Impose their wishes upon them or call their loans due and watch them do one of two things. File for BK protection or rush to pay their loans of also. Why do you think Bank of America paid their Tarp loan off? They didn’t want to be under the control of the federal government. I don’t blame them but I would venture to say in this particular environment we all have a part in the recovery and if some folks or entities don’t want to participate then keep complaining and rage against the inevitabel change that those that take advantage of right now will most undoubtedly do and become wealthy.
Jason K TX
I think it is going to be some time for things to change. I dont think they are doing enough to help, especially with people who are upside down on their loan. The loan mods are not working because they only extend the year of the loan and lower the interest which doesn’t deal with the upside down part. They have to lower the amount of the loan for a loan mod to really work. that is the only thing that is going to work.
rose r, california
It a mixed bag in many parts of the country, pretty wide swings in the county I live in & even within the nearby Metro city. Looks like there’s an upward trend that’s beginning to develop, but a sustainable one is a ways off. Not until the residential foreclosures get eked out of the system, the banking industry and government starts cleaning up it’s act, how clean it gets, I don’t think anyone’s holding their breath on those players. Even so with the general economy still very weak, the forthcoming Tsunami of commercial ARM’s coming due, dim prospects on re-fi’s, we’ll see how well private investment capital comes in those forclosures. So it looks like it’s up to people like us to create solutions to get the market flowing & figure out the best strategy in whatever particular market one’s working in, the opportunity doesn’t get any better than that.
In general I believe the trend towards higher prices will continue, especially in areas where people want to travel… Florida in particular. People have never been able to buy properties at the prices they are getting them at now. It will take time and hopefully there is a stronger “foundation” for these prices and values to continue to rise. Other parts of the country may take a longer period of time… There is still a huge amount of foreclosures in the pipeline which tend to do one thing, bring the price and values down. It is going to take a while to get through all of this.
Tim P., North Carolina
Does S&P know the rule about supply and demand? Hello? Anyone?
There is such a large supply of housing right now that we will not see a significant change in the market until a goodly number of these homes being sold. That will only happen when either banks start making home loans more accessible or sellers start accepting creative transactions more readily.
Once the glut of available homes had been dimished, housing prices will rise naturally.
Robert P., California
I think that small gains in realestate market is good for this economy. We should be very carefull at rate of increase so that we don’t return or prolong the current situation.
This software will allow anyone to see real estate profits in any type of market!
A few years ago when loans were easy to get, prices began to rise out of control. In my town of Santa Maria the FHA insured loan has caused some of that same effect. Because of the ease of getting an FHA, coupled with the first time buyer tax credit, the buyer pool became so large that retail buyers were competing for homes. FHA and the tax credit have created a bit of the same effect that easy to get loans created a few years ago. If FHA loans are a harder to get and the tax credit goes away then I believe that home price gains will subside.
The demographics are on our side IF (and it’s a really big IF) the job market can begin to rebound simultaneously. The Echo Boom, those kids between the ages of 16-30, are as large a generation as the original Baby Boomers. They’re getting out of college, just getting married, and just looking for places to live. Likewise, some Boomers, and certainly The Silent Generation, are in the market for smaller, more chic homes in large metro areas with an array of amenities.
So, the people are there. The reasons are there. The question is–is the money there? I believe that if the country can add about 1.5 million jobs this year (a pitifully small amount, mind you), and if those jobs are within the service and transportation industries, we’ll have a winner. Other industries will help (e.x., construction, factories, etc.), but the beauty of the first two is in the ripple effect that they have on the economy. We are no longer an industrial-based superpower, but a knowledge-based one with less reliance upon single large employers. If we get those sectors heated up again, then I think we can see the beginnings of another real estate climb. Otherwise, the prices will totter for awhile and fluctuate to a new bottom until we once again reach a curve of sustainable economic growth.
Sorry but a jobless recovery and the very real threat of massive government spending, taxation and regulation will further slow economic growth. The longer the unemployment rate stays in double digit territory, the more likely we are to see a second dip or recession in the US economy. I think the price gains of late are tied to the stock market recovery and represent investor money moving not main street people buying homes. The fundamentals are just not there to sustain either the equity market or the housing market over the mid-term. Think what would happen if the Christmas bomber not been so inept. Our economy is on fragile footing still, it really wouldn’t take much of a shock to the system to grease the slope again.
I think the Short Sale business is in no danger of slowing due to rebounding prices. So go make hay while the Sun shines!!!
Houses in my area have been selling..there is movement to be seen…they have sold often for under the asking price. We haven’t seen the worst, because I understand investors have about 20% of the marketshare that will plummet, just like the last meltdown last year. Still, I believe there are opportunities in any economy to make money. Someone will always need a roof over their head. It is up to us to find the opportunity, flexibility, and method to succeed.