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September 10, 2007 at 5:16 PM in reply to: Rumor – is CW reselling properties back to borrowers as short sales? #84101
highpacific
ParticipantHi Susa,
which brokers are saying this? Do you have sources or is this just what you feel they are saying?Really curious as to where your post came from. It is rather long.
-high
ParticipantParticipantParticipantOh come on sdrealtor!
Is it really that hard to imagine a drop of 10% between December and January of this year? Look at the case-schiller index (and Rich’s last post). Hell, it dropped 6% in just the last 12 months in SD. ( of course the coast will be the last hit, obviously )
My money is on “10% down” in 2007. Its in the bag.
ParticipantOh come on sdrealtor!
Is it really that hard to imagine a drop of 10% between December and January of this year? Look at the case-schiller index (and Rich’s last post). Hell, it dropped 6% in just the last 12 months in SD. ( of course the coast will be the last hit, obviously )
My money is on “10% down” in 2007. Its in the bag.
ParticipantWeak Dollar only bullish when wages rise…
I don’t buy your argument at all about week doller being bullish.
I think inflation of consumer prices is actually bearish for the housing market (in the short term 1-3 years). Consider these three arguments:
1. Inflation on energy, food, and other necessities takes money out of peoples housing budget and forces them to look for cheaper places to live.
2. Globalization and agricultural advances are keeping costs of necessities somewhat in check. Our dollars are worth less but so are the goods we seek since there is constantly more production (supply) going online worldwide.
and
3. Wage inflation is what really will push houses up. But wages are not rising fast enough and always lag consumer inflation. Besides housing is up so high over fundamentals that inflation would have to soar (super-inflation) to prevent the bubble from continuing to burst in the near term.
Don’t fall for the hype. The level of inflation we are seeing won’t save the housing market. To the contrary it will just excacerbate the forclosure rate 🙂
ParticipantWage inflation could save the ship.
Many good points on the posts here. I think that significant wage inflation say 10% in the next year could really bouy up the market. If a significant percentage of the population moved into the affordability range. Yes that would help.
Not a very likely scenario in my opinion. But it is good to keep an eye on the affodability and risk indexes. They take this all into account.
Like the PMI Groups reports. Latest was back in Fall 2006 and showed San Diego topping the Risk Index chart ( 60% chance of a price correction )
http://media.corporate-ir.net/media_files/irol/63/63356/ERETFALL2006.pdf
Here is a better link:
http://www.pmi-us.com/lenders/media_lenders/pmi_ERETappndx_06v1.pdf
-Sane
ParticipantI could see Oil going down to $50. I think there is already a speculative premium in the oil market. How big? I don’t have a guess. The current high price is causing more and more investment into locating, and extracting more and more oil. ( there is still a ton out there ) At the same time it is causing more people and industries to look for ways to conserve and be more efficient. The laws of supply and demand in my mind dictate that the pendulum will swing back.
Just my opinion of course. I own a lot of oil stocks and watch closely. I think it will eventually be over priced and correct.ParticipantAlright. You caught my sarcasm. Damn, there are a lot of clever people on this message board.
What has me up at night is wondering:
Will the Fed be able to contain inflation? How much of the stabalization of housing prices will occur due to price drops and how much balance will be brought about by wage inflation? What about the net population loss in San Diego?OOhh, the drama of it all…..
But, to be serious. I rent and would like to own. Just so I don’t have to worry about being kicked out and moving. But the risk of buying has me spooked.
I have lately been reading a lot of the market bull websites(realtor backers) out there to try and balance out what I read on this board. Still not swayed. For now I am betting with the odds and keeping my money in my pocket. I leave the odds to the professional real estate handicappers, (PMI insurance company), who have SD listed as the market with the highest risk of price correction in the country.As soon as I can place a bet with the odds in my favor, I’ll be a buyer.
Ready and waiting.
-highParticipantIf all Mr. and Ms. Median Wage were forced out of town and replaced by wealthy tycoons who all want winter homes to enjoy the great San Diego weather. 10% per year could be practically guaranteed. The answer to your question, powayseller, is simple. The great weather will cause house prices to continue to rise.
ParticipantI for one feel the same as nin_sis. Renting is better than buyin right now. I currently rent in Penasquitos, $2000 for a 2400 sqft 4 bed house. I feel quite comfortable in it. Landscaping is included so I don’t have to do much. Garage door opener broke just last month. Cost me $0 to fix it(the one time you are glad you have a landlord).
Using a fairly sofisticated Excel spreadsheet to track my exact situations cost of buying vs. renting. I would like to buy but it doesn’t make sense for my situation yet. I would have to pretty much stop saving money in my retirement and savings accounts in order to meet the payment. Basically we would be on a razor edge budget.
As a rentor I am socking away $2000+ per month in savings and feel more financially secure. I can qualify for the $525k mortgage + $75k down( houses seem to be around $625k where I am at). But bottom line is the house will be the same, neighborhood will be the same. I see no benefit to buying yet. It adds up to more risk, less lifestyle, and no savings for me. -
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