When will real estate prices begin rising again?

  1. You have chosen to ignore posts from psp312. Show psp312's posts

    When will real estate prices begin rising again?

    Ban everyone!!! Cause in the end none of this matters. Everyone is right, you can make a case for prices to continue south and be right and you can say the opposite and be right. Numbers and information are easily manipulated to make points, if you dont like the numbers from the NAR you can use Warren numbers, and if you dont like those you can use C/S, and if you dont like any of those you can just plain old make them up and source Craigslist.

    People should be looking for value not waiting for the market to rebound. If you find the right house that is priced in your range you can easily talk yourself out of buying cause you think prices will continue to go down, so why even bother looking, and thus why even bother writing on this board. Some people will never be able to afford a home which is fine but it is a reality some people must get used to. If your serious about buying you will buy regardless of when you think the market will rebound....or you can wait thinking that you are the smartest person in the world and eveyone else doesn't have a clue.
     
  2. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi psp-

    Your comment on value rather thhan price is a good one. One question - how do you measure value? I think many, perhaps most sellers still have an inflated sense of their property's value, which will adjust. For those with other options(i.e., renting), I still think patience will result in increased value.

    Good luck all!

    Finance Mike

     
  3. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    PSP, I totally agree with you!
     
  4. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    Well it looks like those transplants coming home to roost are going to be looking for work their Sammy boy...


    A new study of U.S. metro regions predicts that greater Boston will have the fifth biggest job loss in the country during 2009.
    That’s according to a new joint report by the U.S. Conference of Mayors and The Council for the New American City.
    The Boston area’s employment of 2.45 million in the fourth quarter of 2008 is forecast to fall by 58,500, or 2.4 percent, by the end of 2009, the report said. The Boston area’s unemployment rate is forecast to rise to 6 percent by the end of the year, the study said.
    In contrast, the metro areas for Detroit, Cleveland, Sacramento and Riverside, Calif., are expected to see unemployment rates of 10 percent or more in 2009, the study said.
    The New York metro will suffer the largest job drop, totaling 181,000, including more than 50,000 in financial services as Wall Street consolidates operations. Los Angeles will lose 164,000 as the Southern California economy continues to deflate after the bursting of the housing bubble, the study said.
    Significant job loss in metro regions likely will be widespread. The study said 171 metros will see job declines in excess of 2 percent through 2009. Another 141 metro areas will see losses in excess of 1 percent.

    Also

    Also from The Boston Globe: Bose confirms layoffs
    Bose Corp., a Framingham company known for its audio products, confirmed news reports that it is cutting 1,000 jobs, or about 10 percent of its work force, as it seeks to adapt to a global economy in recession.

    House prices are about to head a lot lower!!

     
  5. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    Well it appears that we are setting all-time records again! The following are the past couple days new records that were broke. The hits just keep on coming...

    Massachusetts will be directly affected off course and in some cases is one of the leaders in setting new lows.


    NAHB Report - The HMI fell from a past record low of 9 to a new record low of 8. The Northeast fell to record low of 10.
    Census Bureau Report - Housing starts fell to level not seen since the report started tracking housing starts in 1959. Building permits declined 50.6% (Northeast declined by 54.5%) YOY while Starts declined 45% (Northeast 38.6%) YOY. Completions were down 23.6% (Northeast 24.5%) YOY. This does not include the cancellations that may have occurred and will bump these figures even higher.
    U.S. Conference of Mayors is now reporting Boston will have the 5'th largest loss in jobs in the entire country. This report included all Metro Regions in the US. The unemployment rate in Massachusetts by the end of this year is now estimated to top 9% by most economist. I suggest they are being rather optimistic myself.
    The tax Foundation is reporting that Massachusetts has more debt per person than anywhere else in the country by a long shot. Nobody is even close to Massachusetts. Massachusetts per capita debt stands at $10,154.00 PP while some others (to show the disparity) are NY at $5,464.00 PP and California at only $3,029.00 PP. This will hamper any recovery anytime soon in Massachusetts.

    Notes:


    Unemployment claims rose by 62,000 to the highest total in quite sometime of 589,000 claims. This is a continuation of 500,000+ claims that have been occurring week after week for quite sometime now (26 year high set in 1982).
    Architecture Billings Index stood at 36.4% this past month. Anything less than 50 represents contraction.
    Many lenders are now reporting a substantial increase with defaults on Prime-Jumbo ARM, Prime Jumbo Fixed, Prime Conforming ARM and Prime Conforming Fixed Rate Loans. This is affecting Massachusetts / Boston in a huge way which as I have said before will only get worse. We are now more towards the middle of our decline when compared to bubble states. We have a long way to go however before we appear on the back side of this IMHO. A bottom is way off and won't even be sniffed for quite a long time from now.

    FM, be careful with the median price being reported. You must remember in unprecedented times typical data reported in many cases is not accurate enough to help figure out what is really happening. Take the MBA report for example which is very flawed, but fortunately their are other reports (MAX) that fill in the gaps. Another example is the U3 report that is used, but the U6 is a much better indicator in more volatile times. We are probably much closer to 4X - 4.5X still today in respect to non-distressed sales and the crunch we are in. I would guess that 3.5X would be closer to the norm in this area, and we have a way to go to get there on a wide scale (2011?)?

     
  6. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    Massachusetts ends 2008 with an unemployment rate of 6.9%.

    I had called for 7% by years end so I was pretty close. What I find a tad ironic is those who predicted 7% unemployment by the end of 2009 were almost exactly 1 year too late. This often happens with many of the economist who just can’t seem to figure this stuff out. Some others are calling for the unemployment rate to reach 9% by the end of the year. This is also a tad silly as that will be easily reached well before then. With the national number now at 7.2% unemployment Massachusetts has fallen in line with the rest of the country in short order as predicted. One year ago Massachusetts unemployment stood at only 4.3% and it was this that led so many to predict that Massachusetts was somewhat immune from the fall out much of the rest of the country was going through. That was obviously flawed logic as I said then and have been saying for a while now. We have finally caught up and now we are in the early stages of our housing decline here in Massachusetts. We have a way to go before flattening out. Remember that historically the bottom is reached when the condo market has fallen off of the cliff. It has just started to show cracks as of last month. Let’s review where we are at in terms of that scenario taking place.

    Reviewing the Condo numbers we can see the following:

    Oct 08 Condo Sales Declined by only 0.3% and Median Prices dropped by just 2%.

    Nov 08 Condo Sales Declined by a much larger 30.1%, but Median Prices remained flat.

    These are hardly fall off of the cliff numbers which clearly tell us we have quite a way to go still (see LV and PH). I suspect sales for December will be off 25%-40% and median prices down 3%-5% which would be an eye opener for trends and activity but hardly a free fall like SFH sales and prices have shown. Condos are historically the last to tank in sales and have always been seen falling the hardest in prices and this time will prove that to be the case yet again I am certain. With many new condo developments popping up of late and heading to the market for sale, inventory levels will start to pick up as well. Even though many are being rented which is pulling down rents all over the place due to supply vs. demand it matters not. If anything that will further distress sales prices due to added competition for those dollars and at a much cheaper price for the consumer. Why buy when you can rent in the same area or even building in many cases for much, much less?

    Their are roughly 1 million bank owned properties not accounted for due to not being listed for sale in the MLS database. This inventory (much of it condo) pushes the real inventory to around 14 months. With 3-5 million more foreclosures coming onto the market without principal reductions being done (they will be) we catapult to 20+ months in break neck speed. What do you suppose that will do to prices... hmmm...

    P.S. A Yun quote to this information "It could be a worse problem than we think,"

     
  7. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    And some more grist for the mill - the cost of renting in downtown Boston declined 2.4% in 4Q 2008, making the rent vs. buy analysis more wieghted to renting...



    http://

    and NAR numbers are out, sales up, prices down nationally:



    http://www.realtor.org/press_room/news_releases/2009/01/ehs_shows_strong_gain



    The scary part? Nationmally, an estimated 45% of sales were distressed (foreclosures, short sales, etc.).



    Good luck all!



    Finance Mike

     
  8. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi all -



    Case Schiller is out and still not showing any good news. Boston Metro is down an average 2.6% from October 2008 to November 2008.



    http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_History_012724.xls



    Low transaction volumes this time of year make the data unusually volatile and subject to noise, but it's still pretty bleak.



    To put it in perspective, if someone put down 20% and financed the rest (5x leverage) using a balloon mortgage (to keep it simple), then their total loss (not annualized) ranges from 40% of their down payment / equity if they bought in June 2004, to a high of 75% if they bought in September 2005. It isn't until purchases since November 2007 that the loss goes below 40%, and then ranges from 37% to a low of 11%. For anyone purchasing with less than 20% down, it gets even uglier. This was calculated as a simple, one period return based exclusively on index levels (excludes all transaction costs). It's an overly simplistic calculation, but gives you an idea of relative performance.



    Good luck all!



    Finance Mike

     
  9. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi all - For more detail on Genworth's underwriting guidelines, you can see their published underwriting standards here:

    http://www.mortgageinsurance.genworth.com/pdfs/Marketing/UWGuidelinesManual-20090117.pdf

    and if you were wondering, yes, Boston (as well as some other parts of MA) are considered "declining / distressed" and subject to additional limits:

    "*14460 Boston-Cambridge-Quincy, MA-NH Metropolitan Statistical Area
    Principal Cities: Boston, MA; Cambridge, MA; Quincy, MA; Newton, MA; Framingham, MA; Waltham, MA; Peabody, MA
    *Only three Divisions of this MSA are restricted, as noted below:
    14484 Boston-Quincy, MA Metropolitan Division


    middlesex CountyNorfolk County, Plymouth County, Suffolk County
    15764 Cambridge-Newton-Framingham, MA Metropolitan Division
    40484 Rockingham County-Strafford County, NH Metropolitan Division
    Rockingham County, Strafford County

    INH / Boom, thanks for the heads' up on the Genworth changes. Also, links to source materials are useful in assessing information and doing additional research....

    Good luck all!

    Finance Mike

     
  10. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hey Kaiser -

    I have not been following NH at all, but there isn't perfect correlation between Genworth's definition of "distressed" and actual sales data. My guess is that for ease of administration they list major MSAs, so some areas with "less bad" real estate markets may get caught in the overly broad net. I have no idea if that's true for NH, but just a word of caution before people use the Genworth regions to predict home values. That being said, inclusion on the Genworth list may throw some additional tacks in the road for anyone trying to get a mortgage in those areas.

    Good luck all!

    Finance Mike
     
  11. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi all -

    FHFA housing report (formerly OFHEO) link from Jan. 22 release, in case anyone wants to go deeper into the numbers:

    http://www.fhfa.gov/webfiles/401/MonthlyHPI12209F.pdf

    It's disconcerting that they note that the Oct - Nov total US decline is the largest single month decline yet. It would be encouraging if the rate of decline were lessening, but apparently it's not. At least the Northeast's declines are significantly less than some of the other regions. Check out the chart on the last page and be glad you're not in the Pacific region.

    There's also effort underway by NAR to have the home buyer tax credit become a true credit that doesn't have to be paid back. It will be interesting to see if this comes to pass, and if so, who it will eventually benefit - home buyers or home sellers.

    http://www.marketwatch.com/news/story/Realtors-seek-expanded-home-buyer/story.aspx?guid=%7B337F2F89%2D0BBC%2D425A%2DBB15%2D0CD6A81D4D88%7D&dist=hplatest

    Good luck all!

    Finance Mike
     
  12. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    For the very first time KS you have added value (if true)! I am so proud of you!!!
     
  13. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi all -

    For those interested, the Atlanta Fed analyzed subprime lending in MA's urban, minority areas. Their conclusions were interesting - subprime lending did not increase minority home ownership, but rather increased turnover ("churn") and eventually eroded the credit base.

    http://www.frbatlanta.org/filelegacydocs/wp0901.pdf

    Share this with the next lender who justifies subprime because it increases minority home ownership.

    Good luck all!

    Finance Mike
     
  14. You have chosen to ignore posts from bullseyejoe. Show bullseyejoe's posts

    When will real estate prices begin rising again?

    So the bottom is still almost a year away.

    Really?

    Well I think I'll wait and see what unemployment numbers do to change that prediction.

    And the market should fall at least another 10% in the next year

    Housing is one of the BIGGEST bubbles EVER. And people have been calling a bottom since late 2007. I'll trust what I see versus idiots who think they know what is going on.

     
  15. You have chosen to ignore posts from CBRB2. Show CBRB2's posts

    When will real estate prices begin rising again?

    It now seems that this board is truly dead.

    But I wouild like to pose a question to the last 1 or 1.5 remaining doomers. Though the beloved numbers show conceptual "declines", have prices for real, quality homes in towns that really matter gone south?

    Inside 128 still looks pretty stable to me, even after the 3 or so years this issue has been discussed here, and even as we balance on the brink of the Greater Depression.

    Wealth is not vanishing, it's simply shifting to stronger hands...just like it did in the 1930's. Toady, the rich are still getting richer (with exec. pay, bonuses, bailouts, even tax revolts amoung our bourgeoisie) and the poor are getting poorer (swelling ranks of unemployed, retiries with 401k losses and BS Joe).

    BS, are you going to wait another 3 years only to find out that you still can't afford to live here? Maybe you should go south, young man.
     
  16. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    CRB2 -

    Inside 128 still looks stable? Do you have any data for those towns you'd care to share that shows the three year average price change as being some non-negative number? If so, it would be good information. If you look at MAR's December 2008 data for the state, broken out by region (not just greater Boston), the declines look pretty evenly spread:

    http://www.marealtor.com/content/upload/AssetMgmt/Documents/Member%20Resources/Research/quarterly/2008%20YE%20Report%20-%20SF_alzru.pdf

    You may have a personal desire for the Inside 128 area to be "stable" but the available data does not back up your assertion. I personally do not trust an unknown person with a clear self interest unless they can back up their views with objective data, hence "the numbers". Anyone who suggests you ignore objective information and just "trust them" is someone to be avoided at all costs. They are usually out to take advantage of you.

    And I wouldn't say wealth is shifting to stronger hands to any greater degree than in the past. It's doing what it always does - shifting to those who take the time to make informed decisions - where it is shifting is from those who blindly listen to self-interested parties such as realtors and sellers, follow the pack and believe the slogans (e.g., real estate always goes up, they're not making any more land, etc.) to those who take the time to understand the macro trends and do some analysis.

    I find it amusing that you're resulting to an ad-hominem attack on BullseyeJoe rather than provide any counter arguments - are your arguments that weak that you have to personally attack the poster rather than their assertions? Your posts would be more compelling if they didn't make such inane comments. How do you know anything about BullseyeJoe's financial condition to make such an assertion? My guess is he can afford to live here, but chooses not to waste his money bailing out some buyer who listened to the seller's realtor and paid too much for their house.

    Good luck all

    Finance Mike
     
  17. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    CBRB2 -

    Inside 128 is stable? You better talk to Zillow, they disagree:

    http://www.zillow.com/static/xls/2008Q4_Boston_Cambridge_Quincy_MA_NH_MSA.xls


    Have any objective data to back up your claim, or like a used car salesman, do you just want people to "trust you"?

    Finance Mike
     
  18. You have chosen to ignore posts from bullseyejoe. Show bullseyejoe's posts

    When will real estate prices begin rising again?

    Yes, I have been waiting since 2004

    And I do not regret it one bit

    I believe my waiting has saved me approx.

    $150,000

    Yes, I'll wait another year to save another $50,000

    Knowledge and patience really pays off !!

    You, on the otherhand, were completely inaccurate in
    your home price predictions.

    So I'm not sure who you are trying to belittle.
     
  19. You have chosen to ignore posts from Parish-sez. Show Parish-sez's posts

    When will real estate prices begin rising again?

    Housing should never be considered a financial asset is a home and shouldn't be considered for anything but a domicile. If you look at economic history every time house is used en masse as an asset is a precursor for a major "market correction". face our modern banking system doesn't work every generation has been faced with the same financial meltdown. Our financial systems now will be looked at as ridiculous as mideviel medicine is now.These cycles are like a drug addiction so many can't face that the fact at how wrong they are about everything and keep repeating the same destructive habits until they themselves are destroyed.
     
  20. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    Hi all -

    Some opposing views:

    Why you should buy:

    http://www.marketwatch.com/News/Story/Story.aspx?guid=01da1b9391d149e4a1b10aca9ce66ff4&siteid=nwtam&sguid=z7xvEAjSGU2lAvkOmiWlHw


    Why you shouldn't buy:

    http://www.marketwatch.com/News/Story/Story.aspx?guid=22185fbd7f444a49a604a29d4225e122&siteid=nwtam&sguid=z7xvEAjSGU2lAvkOmiWlHw

    The most compelling quote:

    "This housing sale could go on for a while, so there is no need to rush. "

    Exactly. By holding off from purchasing, you don't lose much upside, and you could avoid a large downside.

    Good luck all!

    Finance Mike
     
  21. You have chosen to ignore posts from bullseyejoe. Show bullseyejoe's posts

    When will real estate prices begin rising again?

    Did the stimulus bill include the $15,000 tax credit if you buy a house?
     
  22. You have chosen to ignore posts from Bottom-call-2011. Show Bottom-call-2011's posts

    When will real estate prices begin rising again?

    VIB, are you at all serious? Sales rose 1% and you act like we added 500,000 jobs today. In fact a 1% rise in sales is still not enough to maintain the amount of workers in retail positions. This level will ensure more layoffs due to sales not meeting projected budgeted numbers. Its called business my friend...

    Unfortunately the MSM doesn't report news as it should be reported with like, you know facts and stuff. They simply spin the numbers for their own agendas for the most part. How else would this have been allowed to happen?

    Fraud is alive and well in the world...
     
  23. You have chosen to ignore posts from bullseyejoe. Show bullseyejoe's posts

    When will real estate prices begin rising again?

    In my opinion (and my opinion has been quite accurate - regardless of what CBRB2 says),

    Home prices will drop more in 2009 than they did in 2008.

    The economy is just awful. As the Clinton machine said:

    It's the Economy Stupid
     
  24. You have chosen to ignore posts from FinanceMike. Show FinanceMike's posts

    When will real estate prices begin rising again?

    BullsEyeJoe -

    Just FYI, but like Boom2bust mentioned, the tax credit for a first time home buyer will be $8,000 and will not have to be repaid. I'm sure it phases out as income increases, but haven't seen the detail.






    Tax provisions


    Individual tax cuts


    A tax credit for first-time homebuyers increases from $7500 to $8000, and will not have to be repaid


    $6,638





    Want to see how Obama spends $787 billion?

    http://online.wsj.com/public/resources/documents/STIMULUS_FINAL_0217.html

    Good luck all!

    Mike

     
  25. You have chosen to ignore posts from Bynxers. Show Bynxers's posts

    When will real estate prices begin rising again?

    Just a quick question. I'm thinking someone in the "biz" may be able to inform. Despite all the articles and advice being written now- we are getting very nebulous answers from banks about mortgages. We are prospective first time home buyers and have heard everything from needing a 20% down payment to needing atleast a 720-740 FICO score just to get a mortgage. We went to classes last year before the bubble burst- but it seems that the game has certainly changed.

    Over-all, aside from a FHA HUD program, what is out there right now and what are the expectations for first timers? I'm referring down payments, credit scores, etc.

    Any guidelines or facts would be appreciated.
     

Share