Mr Pasadena

Housing in a Death Spiral, Taking the Mortgage Industry with It

It will be at least 5 - 10 years before housing prices start moving up again. I'm looking at homes in prime California areas like Pasadena, Arcadia, San Gabriel, etc. These areas still falling in prices, slowly. Pasadena is already down over 25% from 2006 prices. I know, I own a house next to two that is down that much. But Arcadia and San Gabriel has gone down much less. Historically, these three areas mirror each other in prices appreciation and decline but Arcadia is only down about 10% and San Gabriel about 15%. I expect Arcadia and San Gabriel will go down further and Pasadena stabilize. Be realistic, how many people can afford a home in the $700-$800K range with their current family income. Unless income catches up, there is no chance prices will go up anytime soon. What did I hear? Unemployment is at 10.5% in California and 11% in Los Angeles County. In the long run, I think prices will eventually move back up. That is why I'm not selling and will be leaving my house to my daughter. When she grows up, past it to her children (my grandchildren), and they can sell it at the 2006 price.

Shiller at BAAS: Housing Will Continue to Fall

I'm still waiting for prices to fall back to earth. The areas I am looking at still think prices have no gravity. Many Arcadia sellers are still listing their homes at bubble prices with the help of their brokers. I just saw a list where the owner purchased in 2003 for $400K and now wants $900K. It has been remodeled but this is an average income neighborhood but they want nearly a million dollars.

NAR Optimists Drubbed by their Own Dismal Data

I don't know what is happening in the market place but everything said in this article sounds right. Every area has people that earns more than others. But home prices needs to be where the average person can afford with their income.

How Do You Cure a Credit Bubble?

If our government just butt out then people will realize that the last few years real estate growth is unrealistic to maintain. Most Americans do not have an upside down mortgage. They just think their asking price is real but don't want to accept the fact that the kind of money that made this bubble happen is no longer available. When they finally realize it, they will sell at historical average pricing. That will re-ignite the real estate industry. But if every home owner wants to wait for the bubble price, they the real estate industry have a long, long wait for a recovery.

Freddie Mac CEO: Home Price Drops Only 1/3 Done

I will never understand where people think a house needing a $700K mortgage should be a FHA loan. This situation just put people into more debt.

Dollar's Decline a Crisis of Solvency - Not Liquidity

This is really going to eventually hurt everyone, if not already. Inflation is real. If the Fed and our US government just let the market speak, then this will be just a short and quick downturn. The start of this crisis is real estate. Not commercial or business activity. It started with people living on credit from their ATM house. For those of us that have real savings, we are looking at lower home pricing and then spending our money on a new home purchase. That will definitely jump start the economy. There are millions of us prune and cautious people that did not get caught in the real estate ponzi scheme. But we are not going to spend our hard earn money on someone else's mistake of overpaying for real estate. Bernanke, let the prices fall and I will spend again.

Injecting Accountability into the Credit Crisis

I agree with much of his article except for the 40-45 year loan. There are actually 50 year loans available today. They were created because the cost of housing is too high. As far as I am concern, let the Real Estate market work in America. Capitalism will take care of the excess. That means lower home prices or higher income to sustain the prices. And yes, l do own my house, not rent from a bank. That means my imaginary equity wealth will go down. Everyone wants to count equity as wealth but unless you sell, you have no wealth. Our government counts this $22 trillion dollars as wealth but from what? Not everyone will sell. The only other option is an equity loan. But don't you have to have income to pay it back. Now I know that some of our beloved law makers think that paying back a loan that you sign up for is bad business. Uh? Isn't that what credit is all about? I am waiting for the home prices to come down to what it should be. No gimmick loans. Then I want to buy a second bigger house. Using 40-45 year loans just put this country into more debt. Supply and demand. That is what America is about. Let Capitalism work. Do not keep home prices artificially high. That will stop me and a lot of other American from buying a house without being a slave to a mortgage. It will also prevent us from spending additional money to stimulate economy by furnishing the home.

Latest Case-Schiller Report Shows the Sky is Falling

According to a recent article, the median homes price in Arcadia, CA is actually up over 4 percent. Does the Case-Shiller Index follow this City? I'm curious if it is because the lower end, which cost nearly $700K for 1,000 square feet, has not been selling and only the homes worth over a million is selling.

House-Price Momentum: The Good News

I completely agree with Number2son. This article would be correct in a normal market. But remembering that the only real reason people can afford these home prices was because banks and investors were giving money away for mortgages. That isn't happening anymore. Most lenders now want people to have a vested interest with a down payment. Let's see how many average income people can produce that who don't already own a house. I can afford to buy a second house but don't see it as an investment and neither does many of my other friends. Why would I pay additional property tax with a larger mortgage payment? I still need a bigger house but not at these prices. An now I can just wait or just add to my current house.

Shiller: Single-Family Housing Market Is "Grim"

I'm sorry to hear Jordan's issue. He sound like the type of buyer that should be helped. For those who just buy but didn't realize they cannot afford the price, they deserve losing it. Those are the people who pushed up the housing cost where I cannot afford. My wife and I earn over $200K but we cannot afford another house since the area we are looking at wants $1,000,000 bucks for their house. Five years ago, these houses were going for $200K- $300K. This is a middle income location I'm looking at but people have pushed up these home price because of these gimmick loans and now everyone thinks they should get a million bucks for their house. I own my current house and I don't think it worth what people are willing to pay.