Alex, it doesn’t take a brain surgeon (and I can guarantee you I am not one!) to figure out that the housing market is dropping and continues to do so. I am not nearly as financially savvy as the rest of these posters, and I suspect my income is quite meager compared to the rest of these guys.
However, I started to watch the market, and check housing prices constantly beginning in 1996. Because I have difficulty making decisions and taking risks with money, it was not until 2001 that I finally bought a small house in the hood, cause that is all I could afford with a 30 year fixed mortgage. It was obvious that there was a frenzy going down. I bought the house so I would have a place for myself and my dog, and I saw rents skyrocketings and people getting booted for condo conversions. This was happenning at an unprecedented pace.
So, all these years, I continue to watch the market. Just search the MLS listings on sdlookup.com, and you will see….many of these homes were bought in 2004-2005 and the listing price is considerably less than the sales price of those years. Furthermore, I see PLENTY of short sales, and prior to these last 6 months, I was unfamiliar with the term. (Now I know what it means)
That suggests that there is trouble in paradise. I see houses in my neighborhood taking months to a year to sell, and that was not what I have been seeing in the last 5 years.
And, yes I thought people were totally stupid buying on those crazy “creative” mortgages these last couple of years. What were they thinking? Didn’t they want to know the terms? How could they think they would be able to pay when their ARMs reset? Were they expecting to inherit a windfall of cash or win the lottery? Didn’t their parents teach them common sense? Not the sharpest tools in the shed.
If I recall correctly, I remember first hearing about the interest only mortgages in 2003-2004, which makes sense now, as it is 3 years in, and the ARMs are re-setting, and guess what, they cannot pay. Thus, the short sales, foreclosures. Since those ARMs continued into late 2006, that brings us to 2009 for the rest of them to go under.
Have some lunch downtown. See all the empty condos. See the for rent signs. Something is awry. The news is mostly bogus, I pay little attention to it….just LOOK AROUND. The market is crashing.
If it walks like a duck and talks like a duck, then it is a duck.
