mlonz

Housing Bottom - Oh Really?

There are places in Texas where prices are still below 1980 levels.

Property Values - Eight Key Charts

In addition to principal and interest, you need to factor in property taxes, utilities, maintenance, insurance, and tax write-off benefits as well. This will dampen affordability slightly.

Countrywide REOs Move Back to Early 2007 Levels

Due to foreclosure moratoriums, lots of title problems have emerged recently. This is hurting liquidity big time as sellers (Banks) cannot deliver clear title on many of the properties they "Own," and therefore not clear out the inventory. I will concede that we have probably seen peak # of distressed properties on the market, but there should still be a steady supply for many years making price reversals muted.

When Will Housing Prices Return to Previous Highs?

How about this. You want to immigrate to the USA legally? You buy a house, and it comes with a passport. Problem solved.

The Sad Truth About Housing Data

A couple of New and Old issues.

-Due to consumer friendly legislation passed by states, the foreclosure process has been made more difficult for banks. Title issues are rampant, and banks are being forced to re-foreclose many properties causing at least a several month delay of the same property starting again and coming back on the market.
-The market is certainly full of speculators and they started to buy aggressively over the spring. What people don't seem to realize is that at least half of these properties are in flip mode and will be right back on the market within a year at higher prices. So if someone buys 4 cheap REO's, fixes them up, and 3 of them go right back on the market in 6-12 months, is the inventory really coming down?


I also believe that another motivation for the banks holding property off the market is in anticipation of the PPIP. I think they hoped to slightly mark up the market in spring, and hope to use these prices to wholesale a good portion of their property over the summer/fall via PPIP.

While I'm here I will also say that it is my opinion that the most vulnerable part of the market going forward are the wealthy desireable suburbs close to major metropolis'. The Westchesters and Bethesda's of the country. Prices in these areas seem to only be down 8-12% from the peak, at least in metro-boston where I am. The really depressed urban areas have already had close to a 60% move down, and I think most of the depreciation has already taken place. These upper end single family homes are far more sensitive to small moves higher in interest rates which are coming, continued pressure on manager level salaries in corporate america, and the vagaries of the JUMBO loan market.

Seven Reasons the Market Has Already Bottomed

The next 2 RE selling seasons will make it look like we have hit bottom. Being on the ground, I can see fewer properties being "given" away by the banks. Buyers are talking about the 8k tax break and are more optimistic. This will temporarily result in abating the panic selling. This will result in better numbers, and down the road, higher rates which will bring about the next move down in RE prices. We are going to experience a bear market Real Estate Rally that will last a minimum of 6 months, but could last 18-24 months.