Both existing-home sales and housing starts slowed sharply last month, especially in formerly hot areas like Florida and California. Meanwhile, more than two dozen metro areas reported outright price declines. In Boston, nearly half of all homes on the market had been reduced in price at least once, and more than a third have been marked down in San Diego and Phoenix * * * Trouble is, many areas that have enjoyed the biggest run-ups in real-estate values have also seen corresponding increases in housing-related jobs, leaving them especially vulnerable. That could create a vicious cycle as job losses in the housing sector begin to undermine the overall economy, leading to an even deeper downturn in housing. * * *
I'm only the messenger. I did not write the editorial. Take your complaints to U.S. News. How many jobs will be lost? Already, thousands of jobs have been lost in the mortgage industry. There may soon be thousands more. Realtors are already carping about 'hard times' on industry message boards. But the situation will get worse. Just wait until the 4th Quarter of 2006: By then over $ 4 trillion in ARM loans will begin to reset to current interest rates. Increased costs from a 2.5% loan to a 7.2% loan (plus costs) on a $ 400,000 home are daunting. The increase may average as much as $ 1,500 a month. Get ready to see foreclosures skyrocket.
This is not a "gloom and doom" post. It is a "buying opportunity" post." [Want to nearn more?] National median real estate prices in 2007 will be about 10% - 20% lower. By 2008, many people will be able to pay cash for their dream home. For the naysayers out there: "Nothing going on here. Not in my neck of the woods. Lock your doors and windows. Time to move on."
My gosh, in central Texas the boom continues unabated. I've never seen anything like it. If someone in construction can't make it now, they need to find another profession.
My wife has worked in the title business over 30 years, it is phenominal and we're talking about new constuction. Of course, there will be the inevitable slow-down but this market ain't "crashing" here.
*Ping* !
And I made an obscene fortune on Y2K. That went away, too, but I still make money.
All around the country homes were being built endlessly. Here in the swamps of Delaware we've got three new housing developments all built and ready to sell.
Every once in a while it's time to take a deep breath and sell out the inventory.
I'm really a bit sick of all this gloom and doom and hey, the Lamestream keeps finding doom and his brother gloom under every bed.
There is no bottoming out of the housing market. The market will take care of that. If people want homes and there are none after this small pause is over, MORE WILL BE BUILT!
Lots of people settle down to where they are this time of year what with school starting up right soon. Kids off to college, summer over...that kind of thing.
As for ARM mortgages and 7.5% interest rates, I recall Jimmy Carter and the infamous interest rates of 17% or higher. My own first mortgage was 8% and I could handle it.
Slow news....it's either Jonbenet Ramsey or doom and gloom.
I'm only the messenger, but interest rates on fixed rate mortgages have been going down for four weeks now, and they are going lower. The real estate correction is almost a year old now. The crash better hurry.
It depends on what area of the country you're in. The Huntsville/northern Alabama area is booming. There's no housing slump here.
Scary tho think how developers have been able to burn out the housing market with way too much building in too short period of time. I can easily see why the housing market is in trouble.
Who vandalized my KEY WORDS and removed my post from the Editorials section?
Silver Lining:
If the housing bubble 'pops' there will be many more (unemployed americans) demanding that we put up a real fence and deport the illegals.
FOR THE LAST TIME, WILL YOU PLEASE STOP PROMOTING YOUR "NEWSPUNDIT" WEBSITE ON EVERY DAMNED POST YOU WRITE.
I've never seen that many keywords added to a thread in my years on FR.
Real estate is a cyclical business; it goes up and it goes down. It has ALWAYS been like that.