Bizarro World for homebuilders

Have we hit bottom yet? Probably not. We probably won’t be there for a while.

We will have to see the overall economy improve, as well as see home prices drop while rental prices rise so much that the cost of paying a mortgage isn’t that much more than the cost of paying rent.

Also, due to the credit crunch, lenders are going to be less reluctant to loan money unless they feel that the house is affordable by traditional metrics. In my home state of California, we have the least amount of affordable housing based on household income. San Diego and the inland areas have already been hit hard by this, with Los Angeles and SF bay Areas also feeling the squeeze.

It is something of a self-feeding cycle; until lenders thing that prices are on the rise, they will require borrowers to pay higher rates unless they can put up significant down payments, meaning that sellers will have to lower prices further.

On the other hand, the weakening dollar makes US housing more affordable to international investors. But one needs to see how non-US housing markets are doing before one can tell if there will be a surge of overseas investors buying up US real estate.

America is doing just fine!
Would you people quit complaining?
Listen very carefully: Go out and get a Job!
This country doesnt owe you anything.

I bought my home in 2003 before the prices that had increased for years rocketed out of sight. I’ve paid that mortgage on time for 5 years. Jan 2nd I became unemployed. I am seeking a job but this economy doesn’t seem to have one to give. This crisis isn’t all about housing. It’s not all about finance either. Something deeper than both is the fact that we are in for a tough ride in America. Govt will hurt if property values continue to fall. Taxes will have to be increased and the burden falls on everyone.

I could afford my house at one time. It’s on the market right now because there is a job problem. My property taxes have increased. My house increased in value so my insurance had to be adjusted to that increase. The water/elec/gas/food/auto fuel and EVERYTHING ELSE, has increased. Even if I’d have kept my job I was in for a crazy ride cause I couldn’t afford what is happening in these times.

We might not have seen the end of falling housing. And I am seeing that builders continue to build here in Va. I’m not sure who they are selling to at this point. We seem to be in a dead stand still.

I think it depends where you live. I’ve had my house for sale for 2 years. I’ve had more traffic through my house in the last month than I have for 2 years. My house is currently under contract to sell. I also have friends with homes for sale and they’ve also noticed a pick up in traffic. I’m not saying it isn’t bad but I think we have hit the bottom.

I’m glad this has happened. It was going to happen at some point considering you have stupid people and greedy banks.

A home is a home and not a short term investment. If you viewed it as a short term investment and got burnt… I don’t feel sorry for you. You were actually part of the problem.

the question was if we are at the bottom? we are definitely not at the bottom. the supply is rising much higher than the demand in homes, and yes there are still new developments going up all over California. banks are trying to not offer amazing prices on foreclosures in the desert cities just yet. i heard you can get a good price on a condo in San Diego. as prices get lower, your neighbor’s house loses more value. the government needs an answer to the falling wealth in homes before the public comes back to wall street for a bull run. we already saw what happens when giant piggy banks go dry. that was the Fed getting that first shoe down. why didn’t I by BEAR at $3 when I had the chance. i might think $10 was REAL cheap in 6 months. that guy with money from the PA will definitely want to be buying Real Estate in about 9 months. new president comes in and we’re in to 2009. bye bye recession

Case/Shiller numbers show that the typical metropolitan homeowner who purchased since Q12005 has lost value in their home since purchase. Home inventories are rising and prices will fall until inventory growth reverses and falls to about 6 months supply. RealtyTrac reported February REO growth in California of about 50% of DataQuick’s total CA sales for February. All housing indicators are declining at an accelerating pace. Materially lower interest rates, looser qualifying requirements, more jobs, faster income growth and better consumer confidence will be required to turn the tide. The inverse of all these are the only things to be seen on the horizon at this time. The housing market peaked in Q42005 and has been sloping down as a faster rate for two years. From history, we can anticipate that the bottom of the value curve for a highly leveraged speculative asset will be found when a majority of the purchases are made for cash. After most homes have been purchased for cash for a year or two, we can call a bottom.

I have to say anyone who actually believes that we have hit bottom is living in a fantasy state of mind or they must be a real estate agent saying that now is a good time to buy. We are only in the first quarter of the financially distorted game of lets make a taxpayer bailout deal.

Wake up America. The current financial system needs to bleed so that we can cleanse whatt has caused such a catastrophic situation, But know this, we the taxpayer should not be responsible for the coming bailout of the banking and investment system nor should we be responsible for foolish t home owner who cannot afford what they should not have purchased.

Who was responsible for this mess? Obviously the Banker, mortgage lender, wall street, real estate agents and the home buyer.

Will things get better you ask? Not anytime soon. Now is not the time to buy as real estate agent say.

Our area didn’t see the stratospheric price increases but is still out of whack with the rental values. Hopefully those rental values will go up but I doubt it b/c the pace of townhouse and apartment construction doesn’t seem to be slowing at all. Saw a luxury home go for 30% less than its original price due to a canceled contract and none of the three builders in my area have broken ground on new construction. Glad I’m not in the industry or trying to sell right now.

Well, I’m not worried about housing prices going up anytime soon.

We’re pretty much at the bottom. A home is a home is a home. Idiots waiting for “90%” reductions are going to be waiting for a long time. Rental price increases will soon be the next big “issue.”

For those of us who own actual money (not debt), there will eventually be very good opportunities to acquire real estate at reasonable prices – say, at a 90% discount from the price at the top of the bubble. Gonna take awhile, though. Probably a few more years. Houses are still ridiculously over-priced.

Define “worse”.

For those looking to buy a house, things are going from really terribly insanely bad, to better. And I think they have quite a bit better to get. In fact, it might actually get to where the average worker can buy the average house again.

Of course, we will have to save for a reasonable down payment, keep our debt down, have income and generally be able to show an ability to pay off the loan we get to buy that house. Some people think that is a bad thing.

What’s with the price of stock for the big builders? How about “don’t know and don’t care”? Really, there is life out there off of wall street.

Housing market will struggle for a long time. The cost of a home has exceeded the ability of the comman family to afford to buy. Now that the “SUCKER LOANS” are gone and you have to prove that you really can afford to pay back a loan there will be fewer buyers. To add to the problem as gas prices continue to go up the average house hold will have even less money to pay on home loans. If the government goes ahead with a plan to assist those that got in over their heads the burdon will be put on tax payers this additional Tax burdon will cause the housing market to suffer even longer as it will prevent potential buyers as they will never get enough money for a down payment.

This development should only be shocking to a person trained to deliver “The Sky Is Falling” made-for-TV drama for a mainstream media outlet, daily.

Everyone else understands the basic market principle of: buy on value.

Hopefully people will be able to avoid the doom & gloom that’s suffocating our society long enough to still appreciate the fact that our economy moves in cycles. Which means you can buy on value based on the fairly concrete assumption that the world isn’t ending and eventually you’ll see a return on your patience.

Fortunately for us intelligent and reasonable folk, the worst case scenario has already been forced down our throats long enough to downgrade expectations, making earnings forecasts fairly easy to top moving forward. So we can expect big gains (even in the short term) on our “risky” investments.

Again, this isn’t rocket science or particularly puzzling. It’s basic economics and Trading 101.

Since we still have a long way to go bet back to affordability norms, it will continue to plummet in most areas. Granted, non-bubble areas that didn’t get that out-of-whack will not see the drastic reductions to come. But CA, NV, FL, and similar areas have a long way to go.