- This topic has 5 replies, 4 voices, and was last updated 18 years, 7 months ago by
powayseller.
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June 7, 2006 at 8:37 AM #6685June 7, 2006 at 1:16 PM #26387
powayseller
ParticipantSales are down nationwide, foreclosures are up, builder sentiment is down, inventory is up. All this portends price declines. Nationwide.
June 7, 2006 at 2:45 PM #26395Bugs
ParticipantI disagree. I think the past indicates to the future. Not all areas of the nation have gone up enough to need correction. There will continue to be a baseline relationship between local income levels and the pricing of housing for that locale. The areas that will adjust the most will be the areas that got distorted the most. It’s possible the metro markets have distorted enough to affect the nationwide average enough to show a net loss but I kinda doubt it. Short of the multi-faceted economic Armegeddon some people are forecasting I’m just not seeing a collapse in pricing for the entire nation.
That said, I still think SD County is in for a huge correction, but I also think nobody can know the future.
June 7, 2006 at 2:56 PM #26396PD
ParticipantI did not like what they had to say for a few reasons.
You can’t tell a person to invest in a house if you don’t know about their local RE market. Buying a stock is the same for people in North Dakota, Georgia or New Mexico. The same does not hold true for homes. I thought the comments poorly thought out and flat out bad advice for some people.
Further, I thought their comments far too bullish on RE in general. Housing in areas that have not experienced a big increase may stay steady or even increase but they are giving general advice and you just can’t do that RE right now.June 7, 2006 at 4:22 PM #26400Anonymous
GuestNot sure what the point of this article is, maybe we need more context. But for sure real estate has regional prices so looking at the national average says nothing about whether it is a good investment in a specific locale.
Additionally, the logic is severely flawed that real estate won’t go down nationally just because it hasn’t in the last 60 years. The reality is that real estate has never been this overpriced in the last 60 years either. Bottom line, I guarantee we will see year over year median price declines nationally. In bubble areas like San Diego, at least 40-50%, and in Iowa, maybe flat to small declines. Average it all up, and you’ll get national declines, period.
June 7, 2006 at 9:29 PM #26412ParticipantBugs, I bet on price declines nationwide. Cities like Kansas City, MO are already seeing high foreclosures and price declines. The auto industry states are also hurting. Cities like Omaha, NE are experiencing a record DOM and foreclosures, although prices are still flat.
Look, these exotic loans are doled out nationwide. Our negative savings rate is a national phenomenon. Folks in Lincoln, NE were just as likely to get an ARM to buy that new car as the couple in San Diego, CA. It’s only a matter of degree. The Lincoln NE family borrowed $40K on their $120K house. Interest rates are up, and they are struggling to make the payment.
By end of 2007, you will see nationwide price declines of 3-5% in all towns, and 25-35% in the bubblicious cities.
Add the recession to the mix, and you can increase the losses.
I am surprised that as an appraiser you are not more aware of the national market. I would love to hear your comments after you speak to some colleagues in other cities. How much of their business if cash-out refis? That will tell you a lot. I think you will be convinced only once you start talking to appraiser in some other states.
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