Excellent summation why housing market will be terrible for a long time

[StaunchLibertarian]

[quote=briansd1]
To me, this statement below is very indicative of borrowers in over their heads. They need prices to remain high, in order to refinance (kick the can further down) or sell.

Despite talk by some that homeowners have plenty of equity and wherewithal, the facts are that the $8,000 rebates and the GSE increasing the limits following the 2008 crisis did spur homebuying.

Now that the incentives are gone, the market is taking the appropriate hit.

If a homebuyer really needs an $8,000 rebate to buy a house, then we have still have an affordability problem.
[/quote]

You’ve hit the nail on the head, I believe. The government (either through GSEs or FHA) is something like 95-100% of the mortgage market now and the government is planning to make it harder to get a mortgage. Just look at all the predicted doom and gloom over the proposal to have the government raise effective down payments on FHA mortgages from a measly 3.5% to to a slightly less measly 7%.

http://www.irvinehousingblog.com/blog/comments/republicans-propose-tighter-lending-standards-to-limit-taxpayer-liabilities/

Can we really be near a housing bottom when a proposal to raise down payments from 3.5% to 7% causes so much push back from the gangs of crack …. I mean home-dealers?

Previous housing booms coincided with good economies or job booms. I doubt that all of those fancy new jobs created by the boomlet in Cousin Burger franchises and the like are going to be enough to fuel a new housing boom.

The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s or Spatula City, housing isn’t going anywhere.

[davelj]

[quote=StaunchLibertarian]
The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s…[/quote]

I would appreciate it, Sir, if you would not denigrate a fine eating establishment and a fine place to work!

[davelj]

[quote=StaunchLibertarian]
The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s…[/quote]

I would appreciate it, Sir, if you would not denigrate a fine eating establishment and a fine place to work!

[davelj]

[quote=StaunchLibertarian]
The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s…[/quote]

I would appreciate it, Sir, if you would not denigrate a fine eating establishment and a fine place to work!

[davelj]

[quote=StaunchLibertarian]
The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s…[/quote]

I would appreciate it, Sir, if you would not denigrate a fine eating establishment and a fine place to work!

[davelj]

[quote=StaunchLibertarian]
The dollar may collapse, but if the plebeian hordes can only find work at Chotchke’s…[/quote]

I would appreciate it, Sir, if you would not denigrate a fine eating establishment and a fine place to work!

[moneymaker]

Ok let’s say person A recently bought a house that is now worth half of what they paid. For the same mortgage that they are paying now they can go out and buy a house that is twice as good as their present one. Would anyone blame person A for letting their present house go in favor of buying a better one at the same price? My only question is how does person A go about convincing the bank that they are a good risk when it might be obvious what they are planning to do and can an investor afford to take the credit hit in favor of making the “right call” of cutting losses.

[moneymaker]

Ok let’s say person A recently bought a house that is now worth half of what they paid. For the same mortgage that they are paying now they can go out and buy a house that is twice as good as their present one. Would anyone blame person A for letting their present house go in favor of buying a better one at the same price? My only question is how does person A go about convincing the bank that they are a good risk when it might be obvious what they are planning to do and can an investor afford to take the credit hit in favor of making the “right call” of cutting losses.

[moneymaker]

Ok let’s say person A recently bought a house that is now worth half of what they paid. For the same mortgage that they are paying now they can go out and buy a house that is twice as good as their present one. Would anyone blame person A for letting their present house go in favor of buying a better one at the same price? My only question is how does person A go about convincing the bank that they are a good risk when it might be obvious what they are planning to do and can an investor afford to take the credit hit in favor of making the “right call” of cutting losses.

[moneymaker]

Ok let’s say person A recently bought a house that is now worth half of what they paid. For the same mortgage that they are paying now they can go out and buy a house that is twice as good as their present one. Would anyone blame person A for letting their present house go in favor of buying a better one at the same price? My only question is how does person A go about convincing the bank that they are a good risk when it might be obvious what they are planning to do and can an investor afford to take the credit hit in favor of making the “right call” of cutting losses.

[moneymaker]

Ok let’s say person A recently bought a house that is now worth half of what they paid. For the same mortgage that they are paying now they can go out and buy a house that is twice as good as their present one. Would anyone blame person A for letting their present house go in favor of buying a better one at the same price? My only question is how does person A go about convincing the bank that they are a good risk when it might be obvious what they are planning to do and can an investor afford to take the credit hit in favor of making the “right call” of cutting losses.

[eavesdropper]

[quote=ctr70]This was from Barons…Mark Hanson is a well known mortgage industry guru…
“Toss in unfavorable demographics, mounting energy costs, a miserable excuse for a mortgage market and inexorably declining home prices…well, you get the point. Housing is one of those festering sores on the economy that will be with us for quite a spell. And so long as it is, or until jobs grow more abundant and consumer income muscles up, the likelihood of a decent and sustained rebound for the industry seems a good piece off. And, we’re afraid, the economy’s recovery is apt to maintain its desultory pace.”[/quote]

After reading this, I was gratified to hear Mark Zandi, chief economist for Moody’s Economy.com, being interviewed by Gwen Ifill on the PBS Newshour today.

http://www.pbs.org/newshour/bb/business/jan-june11/housing_05-31.html

Zandi apparently showed up to make his regularly scheduled quarterly prediction that the housing market would hit bottom later this year, and then start its recovery (he was also quoted on NPR newscasts all afternoon). For those who haven’t had the good fortune to follow Zandi, he’s been making this same prediction since 2006:

http://www.ritholtz.com/blog/2010/09/zandi/

I have a very busy schedule, and a lot going on in my life, so it’s good to know that I can count on a reputable firm like Moody’s to keep a guy like Zandi on staff, and in the public eye, to ensure that I get accurate, up-to-date, expert advice on the latest in housing trends.

Seriously, it’s bad enough when the general public lionizes so-called “experts” who are anything but. But when leading policymakers and the most respected of journalists continue to use them as authoritative sources of information, I get really depressed. There’s simply no hope. I mean, how tough is it for journalists or the staffs of leading political office holders to do a little background research into these people? It’s not like the days where you had to go through miles of microfilm or pore through hundreds of pages of crumbling newsprint. The worst you have to do today is to winnow out the reputable stuff from the crap on the internet when you engage in information harvesting.

Don’t ANY of these people question why the name “Mark Zandi” keeps coming up as an “expert”, and yet the predictions he makes NEVER come true? If I was a journalist, I’d be mortified to find that I had presented opinions from this guy as expert, and that I had staked my reputation as a journalist on the “information” he was providing to my readers/listeners.

[eavesdropper]

[quote=ctr70]This was from Barons…Mark Hanson is a well known mortgage industry guru…
“Toss in unfavorable demographics, mounting energy costs, a miserable excuse for a mortgage market and inexorably declining home prices…well, you get the point. Housing is one of those festering sores on the economy that will be with us for quite a spell. And so long as it is, or until jobs grow more abundant and consumer income muscles up, the likelihood of a decent and sustained rebound for the industry seems a good piece off. And, we’re afraid, the economy’s recovery is apt to maintain its desultory pace.”[/quote]

After reading this, I was gratified to hear Mark Zandi, chief economist for Moody’s Economy.com, being interviewed by Gwen Ifill on the PBS Newshour today.

http://www.pbs.org/newshour/bb/business/jan-june11/housing_05-31.html

Zandi apparently showed up to make his regularly scheduled quarterly prediction that the housing market would hit bottom later this year, and then start its recovery (he was also quoted on NPR newscasts all afternoon). For those who haven’t had the good fortune to follow Zandi, he’s been making this same prediction since 2006:

http://www.ritholtz.com/blog/2010/09/zandi/

I have a very busy schedule, and a lot going on in my life, so it’s good to know that I can count on a reputable firm like Moody’s to keep a guy like Zandi on staff, and in the public eye, to ensure that I get accurate, up-to-date, expert advice on the latest in housing trends.

Seriously, it’s bad enough when the general public lionizes so-called “experts” who are anything but. But when leading policymakers and the most respected of journalists continue to use them as authoritative sources of information, I get really depressed. There’s simply no hope. I mean, how tough is it for journalists or the staffs of leading political office holders to do a little background research into these people? It’s not like the days where you had to go through miles of microfilm or pore through hundreds of pages of crumbling newsprint. The worst you have to do today is to winnow out the reputable stuff from the crap on the internet when you engage in information harvesting.

Don’t ANY of these people question why the name “Mark Zandi” keeps coming up as an “expert”, and yet the predictions he makes NEVER come true? If I was a journalist, I’d be mortified to find that I had presented opinions from this guy as expert, and that I had staked my reputation as a journalist on the “information” he was providing to my readers/listeners.

[eavesdropper]

[quote=ctr70]This was from Barons…Mark Hanson is a well known mortgage industry guru…
“Toss in unfavorable demographics, mounting energy costs, a miserable excuse for a mortgage market and inexorably declining home prices…well, you get the point. Housing is one of those festering sores on the economy that will be with us for quite a spell. And so long as it is, or until jobs grow more abundant and consumer income muscles up, the likelihood of a decent and sustained rebound for the industry seems a good piece off. And, we’re afraid, the economy’s recovery is apt to maintain its desultory pace.”[/quote]

After reading this, I was gratified to hear Mark Zandi, chief economist for Moody’s Economy.com, being interviewed by Gwen Ifill on the PBS Newshour today.

http://www.pbs.org/newshour/bb/business/jan-june11/housing_05-31.html

Zandi apparently showed up to make his regularly scheduled quarterly prediction that the housing market would hit bottom later this year, and then start its recovery (he was also quoted on NPR newscasts all afternoon). For those who haven’t had the good fortune to follow Zandi, he’s been making this same prediction since 2006:

http://www.ritholtz.com/blog/2010/09/zandi/

I have a very busy schedule, and a lot going on in my life, so it’s good to know that I can count on a reputable firm like Moody’s to keep a guy like Zandi on staff, and in the public eye, to ensure that I get accurate, up-to-date, expert advice on the latest in housing trends.

Seriously, it’s bad enough when the general public lionizes so-called “experts” who are anything but. But when leading policymakers and the most respected of journalists continue to use them as authoritative sources of information, I get really depressed. There’s simply no hope. I mean, how tough is it for journalists or the staffs of leading political office holders to do a little background research into these people? It’s not like the days where you had to go through miles of microfilm or pore through hundreds of pages of crumbling newsprint. The worst you have to do today is to winnow out the reputable stuff from the crap on the internet when you engage in information harvesting.

Don’t ANY of these people question why the name “Mark Zandi” keeps coming up as an “expert”, and yet the predictions he makes NEVER come true? If I was a journalist, I’d be mortified to find that I had presented opinions from this guy as expert, and that I had staked my reputation as a journalist on the “information” he was providing to my readers/listeners.

[eavesdropper]

[quote=ctr70]This was from Barons…Mark Hanson is a well known mortgage industry guru…
“Toss in unfavorable demographics, mounting energy costs, a miserable excuse for a mortgage market and inexorably declining home prices…well, you get the point. Housing is one of those festering sores on the economy that will be with us for quite a spell. And so long as it is, or until jobs grow more abundant and consumer income muscles up, the likelihood of a decent and sustained rebound for the industry seems a good piece off. And, we’re afraid, the economy’s recovery is apt to maintain its desultory pace.”[/quote]

After reading this, I was gratified to hear Mark Zandi, chief economist for Moody’s Economy.com, being interviewed by Gwen Ifill on the PBS Newshour today.

http://www.pbs.org/newshour/bb/business/jan-june11/housing_05-31.html

Zandi apparently showed up to make his regularly scheduled quarterly prediction that the housing market would hit bottom later this year, and then start its recovery (he was also quoted on NPR newscasts all afternoon). For those who haven’t had the good fortune to follow Zandi, he’s been making this same prediction since 2006:

http://www.ritholtz.com/blog/2010/09/zandi/

I have a very busy schedule, and a lot going on in my life, so it’s good to know that I can count on a reputable firm like Moody’s to keep a guy like Zandi on staff, and in the public eye, to ensure that I get accurate, up-to-date, expert advice on the latest in housing trends.

Seriously, it’s bad enough when the general public lionizes so-called “experts” who are anything but. But when leading policymakers and the most respected of journalists continue to use them as authoritative sources of information, I get really depressed. There’s simply no hope. I mean, how tough is it for journalists or the staffs of leading political office holders to do a little background research into these people? It’s not like the days where you had to go through miles of microfilm or pore through hundreds of pages of crumbling newsprint. The worst you have to do today is to winnow out the reputable stuff from the crap on the internet when you engage in information harvesting.

Don’t ANY of these people question why the name “Mark Zandi” keeps coming up as an “expert”, and yet the predictions he makes NEVER come true? If I was a journalist, I’d be mortified to find that I had presented opinions from this guy as expert, and that I had staked my reputation as a journalist on the “information” he was providing to my readers/listeners.

[Author]

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