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James48843
09-03-2008, 10:21 AM
This article says home prices are still way too high, and should contnue to fall for some time to come.

http://finance.yahoo.com/tech-ticker/article/52640/House-Prices-Still-Too-High-Despite-Collapse

It's worth reading.

James48843
09-04-2008, 09:49 AM
And here is the REAL meat regarding all those ARMs that are going to be resetting over the next few years.

Here is a graph of the amount in dollar value of ARM resetting projections on the left, and then, on the right, the amount of anticipated "shock" those ARMs could move up if current projections hold.


4585


The story where this came from is here:
http://www.cnbc.com/id/26529207/site/14081545?__source=yahoo%7Cheadline%7Cquote%7Ctext% 7C&par=yahoo

According to this article, while it may look temporarily like the home mortgage crisis is bottoming out, this is only a slight reprieve and breather, before the big shock waves hit ARM holders in 2010 and 2011.


If this data is correct, we're in for some real tough times ahead in the real estate market.

mick504
09-05-2008, 03:21 AM
Interesting data....I've never and would never buy an A.R.M....how often and how many times do A.R.M.'s reset?

ChemEng
09-05-2008, 06:03 AM
Interesting data....I've never and would never buy an A.R.M....Not all ARMs are bad--you just have to know what you are buying. PENFED has a 5/5 ARM (https://www.penfed.org/productsAndRates/mortgages/mortgageCenter.asp) that looked really tempting when we were buying our house.

DCguy
09-05-2008, 08:07 AM
ppl seem to only care much about the house prices. Yes, the prices are falling, but the mortgage interest rate's going up. 1% mortgage interest rate increase over 30 years on $100k is equal to about 35k or 35% of the original house purchase price. In 2003, I think the mortgage interest rate was only about 4.5%. Now it's about 6.5% and we all expect the mortgage rate to go up. I'm sure it will go up again to about 10% just like the last time we had the housing bubble burst. If you add up all property tax, house purchase price, and mortgage interest you pay over 30 years, you find out that the total amount of money you spend on house today will be much less than how much you will pay about 10 years later. and if you rent, you lose more.

mudigha
12-31-2009, 12:06 AM
That is also why i have refinanced this month. Now is the time. We wont see another for 5 to 10 years from now. Good Luck!

LTInvestor
10-27-2022, 02:43 PM
It looks like we're in that same type of market again, where home prices are starting to fall again. Luckily most people seem to have refinanced over the past couple of years - we definitely did last year with a 10 year ARM. I don't think we'll have the same type of price decline as 2008, since the banks are in a much healthier position. And a much higher percentage of owners used fixed rates rather than the ARMs during the last recession.

But in the next year or two we should see some nice bargains. While it's tough that mortgage rates are so high, this will be a great environment for cash buyers, especially since it doesn't seem like rents will fall as much as home prices.

TommyIV
12-07-2022, 12:55 PM
Have home prices peaked? Demand for homes has plummeted with high prices and high interest rates. The only problem is supply is also very low. It is a stalemate between would be buyers and sellers. Both are waiting to see what happens next. Home prices have come off their recent peak yet are still higher than last year. Are we about to see the 'bubble burst'? Or do market bubbles only burst when nobody expects it. Would be buyers looking for a repeat of 2008 will be quick to buy when price come down, but will that mindset keep prices buoyed?

Anyone have any thoughts to how this will turn out? Bragging rights to whoever is right in 6 months. :notworthy:

What’s Going On With the Housing Market?
(https://www.wsj.com/articles/whats-going-on-with-the-housing-market-11670430769?st=2wwwi94q7qg95en&reflink=desktopwebshare_permalink)

tsptalk
12-07-2022, 01:22 PM
I haven't read the article yet, but I would think the rental market could help predict the direction of the housing market. As you mention, higher interest rates make it tough for the average person to get a giant mortgage, but they have to find a place to live. So do the people of the mass influx of migrants from the south. So, landlords will set the rents accordingly and if it stays hot because of demand, there will be enough people with money buying rental properties, whether apartments or houses, to rent out to take advantage of the passive income.

TommyIV
01-03-2023, 09:04 PM
I would think the rental market could help predict the direction of the housing market.

Apartment Rent Growth Set to Keep Slowing This Year (https://www.wsj.com/articles/apartment-rent-increases-slow-a-relief-to-tenants-after-two-years-of-steep-rises-11672701414?st=9qeabhc1sit4m96&reflink=desktopwebshare_permalink)


Demand for rent is slowing, higher interest rates are cutting the profit margin for landlords, and "nearly half a million new apartment units—the most of any year since 1986—are expected to complete construction by the end of 2023".

Bullitt
08-17-2023, 04:02 PM
Funny to look back on the beginnings of this thread which began a golden era for home buyers. The most favorable affordability numbers were from 2008 to 2020. Right now is the least affordable time in 40 years to buy a house.

58633

Bullitt
09-27-2023, 02:41 PM
Home prices have an upward bias. How much higher can home prices go with a 30-year mortgage at 7% though?

58945


https://www.zerohedge.com/personal-finance/us-home-prices-hit-new-record-high-despite-soaring-mortgage-rates

tsptalk
09-27-2023, 03:13 PM
Maybe people are counting on the govt eventually forgiving mortgage debt? What's a few more trillion in spending? :sick: :laugh:

Bullitt
09-29-2023, 02:41 PM
Home prices are going to have to come down for people to afford a 7.5% 30 year mortgage payment.

58962

https://twitter.com/LizAnnSonders/status/1707395943409107325?s

Bullitt
10-06-2023, 10:04 AM
Some economists believe that the housing boom of the 1920s contributed to the overall economic instability that preceded the 1923 crash. Fueled by easy credit and a surge in speculative investment, home prices in the US rose by an average of 40% between 1921 and 1925 before crashing in 1926.

100 years later, and home prices need to come down. Chart below shows how unsustainable this is.


A homebuyer on a $3,000 monthly budget has lost nearly $40,000 in purchasing power over the last year, as mortgage rates have risen from around 6.5% in October 2022 to nearly 8% today.

59008

https://www.redfin.com/news/housing-market-update-mortgage-rates-soar-new-listings-hold-steady/

Bullitt
10-07-2023, 09:02 AM
30-year mortgage now at 7.9%.

In 2021, a $500,000 30-year mortgage would have cost $1,972 per month at the available 2.8% mortgage rate. With a 7.9% rate today, that payment would be $3,488 — a 77% increase.

Buyers look at one thing when they buy - the monthly mortgage cost. Low rates, tax write offs and first time home buyer credits created artificial increases in price that have yet to budge lower. How much longer can this go on without a large drop in home prices?

nasa1974
10-07-2023, 03:37 PM
30-year mortgage now at 7.9%.

In 2021, a $500,000 30-year mortgage would have cost $1,972 per month at the available 2.8% mortgage rate. With a 7.9% rate today, that payment would be $3,488 — a 77% increase.

Buyers look at one thing when they buy - the monthly mortgage cost. Low rates, tax write offs and first time home buyer credits created artificial increases in price that have yet to budge lower. How much longer can this go on without a large drop in home prices?

Back in 2019 that $500,000 house was probably $220,000. In 2012 I refinanced my 30 year mortgage to a 15 year mortgage for 2.9%.

Epic
10-08-2023, 11:43 AM
So here's just a generic real estate question before I find a realtor forum of some sort......
So, I want to move, but I'm in no rush. It's just me......no family to consider.
Been poking around on Zillow for almost a year, just lookin. One thing I've noticed that's consistent is that right before they list, they jack the price up 100 to 200K.
Below is just such a typical sales / price chart that can be seen on each listing.
I'm not much for playing a bunch of "Pricing" games. I'm happy to pay whatever current market value is, but not your greedy 200K listing markup. I hate that........ Price gouging greedy bastards.
I'm sure at some point I'll have to work with a realtor, or just go with a new home through a home builder.
It's just frustrating. :12: ​UGGHHH.....

59021

tsptalk
10-08-2023, 12:05 PM
Looks like a bubble to me. Insane!

JTH
10-08-2023, 04:23 PM
I've bought, lived in, remodeled, & sold two homes, both in 2009 & 2019. While I did make a nice profit, it was mostly sold for the going market value, and I know the labor I invested was essentially given for free. As a kid I remember in the 1980s seeing a boat-load of empty VA houses in my neighborhood. Part of me wonders if we will re-visit those times in 12-18 months....

As for scalpers, my ex-Sister-in-law tried to scalp her Vegas house just before the 2008 housing crash. The whole market went to ****, she defaulted & burned her credit...

Bullitt
10-09-2023, 06:42 AM
Jack the prices up before going up for sale so it looks like the agents involved have brokered a major deal. This is also explained by the endowment effect. People tend to value items that they own more highly than they would if the item did not belong to them.

Epic, in your case, check other websites that give price estimates and make comparisons. Unless there's gold buried somewhere on that property, something looks wrong there.

Skooby
10-09-2023, 09:18 AM
I feel like I'm going to be a forever renter.

46 and no home. I live in the DC region so homes are always expensive.

Whenever I'm retired I figure I'll move somewhere else that has a lower cost of living.

Epic
10-09-2023, 04:35 PM
Epic, in your case, check other websites that give price estimates and make comparisons. Unless there's gold buried somewhere on that property, something looks wrong there.

Yeah, I hear ya. I'd say I see the price get jacked like that right before listing on about 7 out of 10 properties that I look at. It's most likely just a trend to get more money, but I just want to buy a house for a fair price, and not pretend that I'm on Pawn Stars or American Pickers having to haggle on a price when we all know what the fair market value is. :sigh:
I think I can work it so I can make it a Cash Buy also, so that should work in my favor.
I just need a larger (more land) place so I can have a shop, but property taxes where I'm at are high (Md. suburbs) at 1%. I can get 3 acres with a small rancher in WV, and only pay .5% (half) in property tax.
I'll find it sooner or later...... No rush..... :D Just gonna keep looking.

nasa1974
10-09-2023, 06:59 PM
In my area I know the homes are going higher than what you might see on Zillow or the county auditor web page. The funny thing is there are some homes that are being offered 5-10% more than the listed price because a couple of people are bidding on it.