|
quote:In most major markets, the answer is still 'no.' Every market is different, so you're still going to your own research, but you should consider a couple different factors. First, check out the historical home prices. The Case-Shiller Index is a good place to start. They compile housing data for most major markets and the numbers account for inflation. The February data shows that prices are only down to Sept 2003 levels, and probably will fall another 20%+ in most major markets to be in line with post-WWII historical levels. Past prices of housing does not dictate future prices of housing based on some curve. Population growth, social trends versus housing, and population movement are all major factors that are completely different than 20 years ago. Trying to estimate where house prices will be next year or 5 years from now based upon a graph of the past prices is just going to be nothing more than a complete guess, especially with this administration and this market.
|
#
¿
May 11, 2009 20:32
|
|
|
|
| # ¿ May 2, 2024 11:08 |
|
|
moana posted:How can you reconcile this with the past few years, then? Aren't we saying that the housing bubble broke because people really couldn't afford what they were buying? I'm adding these posts to the OP since I'm sure this will generate a lot of discussion and because I'm curious what people think will happen. Based upon historical data from what? The last 10, 15, 20, 100 years? Just because something was a bubble does not mean that it needs to return to its starting point after it burst. If that is the case I guess the entire 20th/21st century is one giant economic bubble, we better watch out. Economies are forward moving entities which may be influenced by the actions of the past, but are by no means bound by previous performance. Another thing to add to your OP too is the pitfall of "waiting for the right market": How long do you plan on living? Let say 80 years if you are lucky? What age can you realistically buy a house: 25-30 if you are luck? That's around 50 years you really have to work with for owning a house. I have heard some people say "I am going to wait another decade to buy a house", which to me sounds absurd. If you want to buy a house, do NOT try and "time" the market into getting the absolute, 100% best price you will ever get. If you are trying to invest in real estate for some sort of profit, this is the wrong thread. If you are trying to invest in real estate for your life and well being, take a step back and evaluate what you are really loosing by nitpicking your entry into the market. Even if you get an extra $20k by timing the market on your house purchase by waiting, you are still loosing out on the commodity that matters most, time. Living in an apartment when you do not desire such so you can "get the best deal" is pointless. Buy in when you want to and can afford it. A house in an investment both financially, and personally. You get a lot more out of living in a house for five years than the equity you earn from it. Cheesemaster200 fucked around with this message at 22:53 on May 11, 2009 |
|
#
¿
May 11, 2009 22:33
|
|
|
Don Wrigley posted:That's the whole point. The past few years, there were exotic mortgages that made houses affordable (in the short term), but this is long term unsustainable because in actuality the homes were not affordable. But my point is what is keeping the same thing from happening again for the next 15 years? Interest rates are at record lows right now, and I think the major thing keeping back the housing market is spending reduction do to the recession rather than the housing market still imploding. People generally save during recessions, and once the economy publicly turns around, there will be a lot of large down-payments ready to dispersion into the housing markets. Houses which were previously overpriced will get a haircut sure, but locations which were close to realistic value will see a big increase in price in my opinion. Either way, we don't know what will happen specifically, and saying "we still got a long way to go!" based entirely on historic data is not very founded.
|
|
#
¿
May 12, 2009 02:40
|
|
|
swenblack posted:Each generation generally doesn't make the same mistake twice http://en.wikipedia.org/wiki/Savings_and_Loan_crisis quote:so it'll probably be at least 20 years before we see a large run-up in price again. Even then, it probably won't be as dramatic as we saw, and it'd have to be coupled with a large increase in future perceived earnings or real income. Neither is likely to happen any time soon. quote:It is likely that most areas will never see real (adjusted for inflation) home prices as high as they were in 2006 again in our life times. quote:With low interest rates, higher prices are more affordable, so it'll keep housing prices up until interest rates are at normal levels, when you'll need more money to afford the same price (since the interest payment is higher). Prices will have to go down, rates will not stay this low forever. Cheesemaster200 fucked around with this message at 03:57 on May 12, 2009 |
|
#
¿
May 12, 2009 03:46
|
|
|
Dik Hz posted:You are absolutely dead wrong on every single statement in your post. Well I guess I can't argue with that! quote:But a lot of tech stocks never did rebound. The NASDAQ in particular has never come close to its previous peak. What I am trying to get at here, which I think people are misinterpreting as "housing will skyrocket again" is that trying to predict the future based upon a graph is nothing more than a guess. I mean gently caress, isn't one of the main reasons this whole mess got started because everyone used the false logic of "housing prices have only gone up over the last 10-15 years, how can I lose?!?!" Cheesemaster200 fucked around with this message at 14:54 on May 12, 2009 |
|
#
¿
May 12, 2009 14:36
|
|
|
Dik Hz posted:You are wrong on so many levels, its quite impossible to even start. Read what other posters have posted in this thread and think critically about your own positions. Then stop posting in this thread. Wow, what a counter argument!
|
|
#
¿
May 12, 2009 16:18
|
|
|
Kobayashi posted:I don't get what you're trying to say here. It's not that the NASDAQ "never really saw" its previous highs, but rather, 10 years later, it's never even come close. Yes, there was a strong uptick over the past 6-7 years, but after the latest crash, it's much, much closer to its 10 year low than its 10 year high. And yeah, the S&P and the Dow did a lot better, but you specifically mentioned tech stocks, so that's why I brought it up. I don't think the major tulip indexes have ever really recovered, either... What I am trying to get at with all this is that the future of markets is still uncertain. It may go up, it may go down more. Some markets may see highs, others won't. Earlier in the thread people were making accusations that the housing market has to align to a historical curve that adheres closely to inflation adjusted values like it is a law of economics. However, I think that there are so many variables with housing markets, that anything could potentially happen. In the context of this thread, making a decision based upon where the market "should" be on a curve is silly because housing prices could go in any direction at any point in time, especially if you consider the massive differences in regional markets.
|
|
#
¿
May 12, 2009 18:46
|
|
|
Dik Hz posted:On the contrary, Cheesemaster being ridiculed for being stupid will help people buying houses, lest they think like him and wind up upside down on a spiffy new condo. He's arguing that tech stocks rebounded from their highs at the start of the decade. That kind of delusion could harm naive individuals if they latch onto his beliefs. And he surely doesn't need a cheerleader in this thread. Props on the reading comprehension. quote:Well duh, the bog standard disclaimer for pretty much everything is, "past performance may not be indicative of future results." The point people are trying to make is that there is no real, sustained evidence that homes are good investments. Sure we just had a huge bubble, and I guess it's possible it could re-inflate, somehow, but all the evidence suggests that this was a once in a lifetime orgy of free credit and rampant speculation. I am not trying to marginalize the trends of housing, but this isn't a scientific experiment where we can make a conclusion from data points observed previously. The housing market is just too large of a dynamic entity. Yes, in the past it was rather linear, but that was before jumbo loans, ARMs, government subsidy for housing, modern mortgages procurement, and tons of other factors which led to this bubble in the first place, factors which aren't going away Cheesemaster200 fucked around with this message at 20:33 on May 12, 2009 |
|
#
¿
May 12, 2009 20:00
|
|
|
Kobayashi posted:I didn't see your edit earlier, but this is just all wrong. Isn't that where this whole argument started? Someone making a comment about real home prices being rather steady over the past however long due to some home study and that they should theoretically be around 110ish on that graph? My original argument (and what I am still trying to argue) is that might not be the case due to advancements (as formerly noted) in the real estate business, population growth and the culture of owning a home in this country. I am not saying houses are going to go up, down sideways, diagonally or whatever in price. I am not saying they are awesome or horrible financial investments. I am saying there is no magical level derived from past home prices which the market needs to reach. As far as jumbo loans and ARMs are concerned, what makes you think they will go away? Sure, they won't be abused (as much), but they have become part of the system. I mean gently caress, I am refinancing my house right now and the mortgage agent wouldn't shut the gently caress up about it. The same poo poo is going on, there is just a bit more caution on the side of the banks.
|
|
#
¿
May 12, 2009 21:30
|
|
|
swenblack posted:You're also looking at interest rates wrong. Banks are not giving out a discount to get business right now. That would be the credit crisis you've heard so much about. There are a lot of people who would like to get a mortgage either to buy or refinance but aren't able to right now. Can you please cite some sort of source that states that increased home demand leads to higher mortgage rates, because that runs counter to all literature I've seen. Usually home prices follow interest rates (almost like bonds) not vice versa. The fed currently has the discount rate at .25% right? That is a historical low because they want private (non-government) banks to lend, increasing the amount of credit available to the entire system. This is also because the fed wants to help the housing industry by making low-interest loans available to the general public with the thought that if interest rates are at sub-5%, more people can afford a house (which is correct), and more people will subsequently buy. This works out for the banks as well as the housing market as the banks are originating more loans and making more money, and more houses are being sold. Now, once the recession "ends" or the housing market gets back to normal operations (housing prices not diving and foreclosures slow), the fed is going to increase that rate again (albeit slowly), driving up interest rates. You also have to consider that an interest rate is going to be based upon the factor of the fed rate, inflation, risk, and subsequently profit for the banks as this is where they get their money. Inflation is going to go up heavily after the recession slows down (hell it already is) as the fed as the government has pumped in inordinate amounts of cash into the economy to combat deflationary pressures. Finally, the amount of profit taken from risk assessment will most likely go up after the banks aren't as hosed up as they are now based entirely on the common principle of "lets not let that happen again". When the banks aren't grubbing for every refi and new mortgage out there, they will (hopefully) be a bit more stringent in their lending practices. Therefore, the addition of these three factors will see a rather big jump in interest rates once the recession is over. The recession won't be over under house prices stabilize to reasonable levels and people stop going under in droves. Now the interest rate obviously will be tied to home prices and a lower rate will probably mean lower prices. However, it is just another factor going into a situation that will be extremely different from what we have seen before. The point, as always, is that the historical data from the last 60 years probably doesn't mean to much.
|
|
#
¿
May 12, 2009 23:17
|
|
|
swenblack posted:I agree with you on these points regarding interest rates. I just don't think it's wise to throw out the historical data. I think I've laid out my position and given people enough resources to form their own opinions, so I'll shut up now. If anyone wants to continue the debate or wants my opinion on individual markets, feel free to shoot me a PM. You are probably right with most of them anyway, and my arguments do have a lot of holes in them. I am just very skeptical of "trends" in financial markets since when people all get on the bandwagon of "hey, it has been doing the same thing for XXX amount of time!" the opposite ends up happening eventually.
|
|
#
¿
May 13, 2009 01:45
|
|
|
Does the Making Home Affordable Refinance option require an escrow account? I know the modification one does, but there is nothing that says on the website that the Refinance does.
|
|
#
¿
Jun 24, 2009 02:28
|
|
|
MrMidnight posted:Thanks for the info man. After some research I figured that's what it was. You lose the short term use of your money. They need to build up a buffer, as well as pay everything in advance. Because of this, you put a lot of money down in front. ..and they can still gently caress up your taxes and insurance.
|
|
#
¿
Jun 24, 2009 16:06
|
|
|
MrMidnight posted:I close on the 29th of this month. Is it too late to tell my lender to not set up an escrow account? Absolutely not, you even have three days to tell them to go gently caress themselves after you sign the papers.
|
|
#
¿
Jun 24, 2009 18:23
|
|
|
MrMidnight posted:
By law, you can opt out of the loan contract within three business days. More of an issue if you are refinancing (as I am currently doing), but still might be a factor if you are buying as well.
|
|
#
¿
Jun 24, 2009 21:11
|
|
What do you mean by that?
|
SlapActionJackson posted:Depends on the state, and rescinding is usually an all-or-nothing deal. I.e. you can't keep the refinance and drop the escrow account. That depends on your loan and how much the bank wants it.
|
|
#
¿
Jun 25, 2009 03:03
|
|
|
Steve Yun posted:QUESTION ABOUT REAL ESTATE AGENTS: can you have multiple agents at the same time like porn stars, or are they like sports agents where you're only supposed to have one at a time? That depends if you are selling or buying. If you are selling, yes. If you are buying, depends on the broker. Remember, real estate agents make their money off the seller.
|
|
#
¿
Jun 25, 2009 23:34
|
|
|
FidgetyRat posted:Things may have fallen, but the bond market is is complete chaos at the moment. One day it could raise .1 and another fall .1. It just so happens that this week was a falling week, but it could have very well raised just as much and we could be at 6% right now. Your lock at 5.5 was wise so don't feel bad about it. That and lending is extremely cheap for the banks right now. Once things start picking up and the fed starts to increase rates, mortgages are going to get a lot more expensive.
|
|
#
¿
Jun 26, 2009 14:58
|
|
|
quote:Assuming home values decline, should I expect property tax rates to drop as well? I guess I could see the value in waiting it out while home prices drop some more, but I'd really like to take advantage of the $8,000 credit for my down payment. Tax rates will most likely go up due to the assessed value of everyone's home going up. The city needs its money somehow. What pisses me off is that tax rate will probably stay up after home prices recover. So goes the cycle of increased dependency on government spending...
|
|
#
¿
Jul 1, 2009 21:18
|
|
|
Arzakon posted:But the assessed value of everyone's home are going down recently. The problem has been tax rates are staying high during the home pricing drop, making $150K houses that were assessed at $350K 2-3 years ago have prohibitively high tax rates. Eventually enough homeowners/sellers/banks will put in the effort to challenge their assessment to a more reasonable level but will probably never get back to to a realistic level until housing prices head back up. Homeowners and sellers are too uninformed to care, banks are too lazy to challenge assessments on the foreclosures they own, and government is too dependent on the revenue to make the process actually move. I could see a slight automatic drop off as assessments are triggered from sales or other causes based on the jurisdictions laws, but not a rise right now. Eventually as housing prices start to rise they will meet these levels again and taxes will obviously stay the higher rate. Err, my bad, meant the assessed value going down prompts the tax rate to go up to compensate.
|
|
#
¿
Jul 2, 2009 05:24
|
|
|
FidgetyRat posted:I'm genuinely curious as to why people even go for townhomes/condos when SFH's are available. At least in my area, a Condo/Townhome can sell for just as much as a full 2-story home on a decent lot where neighbors aren't sharing walls. I live in the city, can walk to about 20 bars, do not have a lawn to mow, have little or no maintenance on the house, and my heating/cooling bills are probably half that of a free standing house. My neighborhood also has a quick turnover when I want to sell.
|
|
#
¿
Jul 6, 2009 16:28
|
|
|
geetee posted:I'm really tired of having to go at the pace of the slowest link. I want to be finished! Welcome to the wonderful world of homeownership. If you want my advice, I would learn to do as much as you can yourself, it makes it so much more rewarding, easier and cheaper.
|
|
#
¿
Jul 16, 2009 19:57
|
|
|
|
| # ¿ May 2, 2024 11:08 |
|
|
SlapActionJackson posted:It will also mean much more of it gets done correctly the first time. Thats what epithets are for!
|
|
#
¿
Jul 30, 2009 02:01
|
|