demichae

Interview with Nicholas Perna: Jobs, Housing in Pre-Recovery

The foreclosure moratorium was put in place to allow the Administration to implement its Making Home Affordable Plan. The idea was that modifications would be offered to those facing foreclosure. However, the banks are operating at a snails pace, as they did not hire additional resources to handle the modifications, and the foreclosures are now happening again. Look for a tsunami of foreclosure hitting the market later this year. It's inevitable that cram down legislation will eventually be based, but Durbin says he won't reintroduce it until next year. If you are timing the bottom, look for sometime next year, but we are nowhere near there yet.

California and Florida Housing Outlook: More Hope for Recovery in 2010

That was popular in early 2008, but the banks quickly put an end to it. Now it's just rent and bail.


On Jun 01 09:35 AM Trane250 wrote:

> I just read about a new twist on the "great California real estate
> game" where everybody gets rich by selling each other houses at hugely
> inflated prices with no money down using other peoples money. It's
> called "buy and bail." You buy another house at a huge discount using
> a government mortgage program and then you bail out of your old house,
> you know the one that you bought a few years ago with a no down payment
> "pick-a-pay" mortgage and didn't pay any of the principal and very
> little of the interest.

California and Florida Housing Outlook: More Hope for Recovery in 2010

If I read the last California chart, it would appear you are predicting a 20% decline in California later this year. I think that's pretty accurate. Many, many homes are underwater by $100,000 to $300,000 dollars. The failure of cramdown legislation in Congress just ended any hope, in the short term, for most of these homeowners, and many will walk. (Realtors in California are predicting a Tsunami of foreclosures). I think that Congress will have to do something in terms of principal reduction, but it will take about 6 - 8 more months of foreclosures for them to actually enact anything. I predict a bottom, at 10-20% of current prices, in late 2009; after that, it's risky to wait, since Congress will have to put some real solutions in place to stem the tide.