If you price your house to sell now, you will regret it in two years. Wait it out
don't give in to the mass panic!!! Be smart about it ... look at history.
Well Said!!
I have 2 specs for sale at cost. They are beautifull with "ALL" the upgrades and are not even getting looked at. I was/am willing to lose a few grand on them just to get back my original investment. But you are right...I think I should just rent them for a year or two and then sell them when the market comes back around (It always does). I think I will be kicking myself if I just dump them. That's it...
For Rent!
Thanks for talking me into it ....I'm calling my rental agent now.
Michele
If you price your house to sell now, you will regret it in two years. Wait it out
don't give in to the mass panic!!! Be smart about it ... look at history.
Just wondering, what happens if the market does not get any better in two years? I remember it took longer than last time around.
Just wondering, what happens if the market does not get any better in two years? I remember it took longer than last time around.
My guess is about 2012 before market starts upward again. It might not go down from here, but with all the inventory it's certainly won't go up. That's if Hilary doesn't bail out all the subprime borrower's.
I'm going to go check my crystal ball. Be back with results in a few minutes
My guess is about 2012 before market starts upward again. It might not go down from here, but with all the inventory it's certainly won't go up. That's if Hilary doesn't bail out all the subprime borrower's.
I've seen some stats that support this opinion, although most feel it will recover before then. The market is definitely in a bad way right now, in terms of sales volume. With the lending guidelines what they are, it's tough to get buyers into deals. Many buyers are still waiting on the sidelines, and many of the active ones think they're going to steal a short sale or think they want a foreclosure. Those deals aren't always all they're cracked up to be. We'll be coming into the slow time of the year, so don't look for much in the next few months. If you've got money and good credit, and are looking for a place to stay a while, this is your time.
I have a friend in Naples Florida that I spoke to yesterday. He was telling me about rents dropping due to seller/investorsnot willing to take current market price or below for their homes so they rent them out for a loss per month. Homes that used to rent for $1200 are now $700. This has happened by the 100’s. Now that the refi cash out hands are tied for Jumbo products things will be much more difficult for these so called investors.
As a Broker I would suggest 2-5% under the last sale or reasonable comp in your neighborhood. Be prepared to cut further, work on curb appeal and make the inside of your home gleam. Agent choice is a key factor. Help u smells will sit. Right now you need a professional to get the job done. We are at or over record inventory in LA, OC, IE, LV and AZ. It’s only going to get worse as we go into the holiday market with all the REO’s coming on line from arm rests and the .5% -1% rate increase in rate for a jumbo loan. Yes, 1 REO comp is no big deal but 2-3 will set the new market price in a tract. I’ve read for every .5% of rate increase to a consumer you have to reduce the price of the home by 11% to match the payment and since so few sellers are realistic and will not do so 8% of the willing buyers cannot buy at that price.
Sellers need to wake up and realize the buyers have the reins now. Basic econ 101. Supply and demand.
I own page 2!
My guess is about 2012 before market starts upward again. It might not go down from here, but with all the inventory it's certainly won't go up.
My Dad's .02. He has done pretty well as an investor in Real Estate since the late 70's (He was/is not a Realtor, he was an engineer now comfortably retired in Hawaii). Real Estate seems to have a 10-year cycle. Remember the late 80's. Real Estate hit a high then dropped in early 90's only to come roaring past the high's of the late 80's in the late 90's and early 2000 (same thing can be said for the 70's to the 80s, Interest rates in the 70's we in the double digits and the economy was not nearly as diverse as it is today). Things got pretty crazy price wise in the early 2000 mainly due to cheap money and mortgages (very creative financing). This is a wild card and I'm not sure if we will see that kind of cheap money anytime soon. Keep an eye on interest rates. If they go back up into the high 7% or low 8's (remember those numbers about six years ago), housing prices will fall, they have to. There is definitely an inverse relationship to interest rates and housing prices. If rates were to go to 7.5%-8% and housing prices dropped say 20%, that would be a good time to buy. Rates will go down and you can refinance back in the 6's. This mainly applies to investment properties. If you are looking at a primary residence and you can afford it, it is usually better to own than rent.
Just wondering, what happens if the market does not get any better in two years? I remember it took longer than last time around.
It might have taken more than two years but it was a great payoff .... people doubled and tripled their investments. Its the people that wonder "what if"
things don't get better and just dump there house for whatever they can get
will lose. There is a time when you just hold and don't sell.
If you price your house to sell now, you will regret it in two years. Wait it out
don't give in to the mass panic!!! Be smart about it ... look at history.
Well I guess I am looking at history. Never before did we see housing prices climb at a rate much faster than median income. What fueled this rise was 1st the drop in interest rates, but then the mortgage market got real creative to do no money downs, option arm mortgages, etc. The housing affordibility index is near an all time low. Nobody gave a crap about affordibility index 2 years ago when they signed up for a teaser rate, but I think they are learning the hard way what affordibility means.
Take a look at what is costs to rent a nice house. It is about 40% to 60% of the cost of owning the property. Years ago rents were close to what mortgage payments used to be using 30 year fixed rate financing. The barrier to purchasing real estate 10 years ago was the down payment, that is why many people had to rent. Now that lending standards are tightening up, that barrier for people who don't have a down payment is going up again. The teaser rates are disappearing, interest rates are rising. These are not terrible things, but this does remove a certain percentage of buyers who would like to purchase real estate. Therefore, lower demand means lower prices ahead. Long term real estate will be one of the best investments you can own. Stocks are a great investment to own long term also, but the nasdaq peaked out at 5300 in the peak of early 2000, dropped 80%, and has been recovering for years now, but it still needs to climb 100% to reach the levels it was at 7 years ago. Fundamentals drove the stock market in the mid 90's, emotion fueled it in the late 90's, and then fundamentals broke the nasdaq in early 2000. Fundamentals drove real estate prices higher in early 2000's when interest rates dropped, ninja loans and emotion drove real estate prices higher in the mid 2000's, and finally the economic fundamentals are driving prices back to affordibilty levels once again.
I have no idea how much it will correct, but it would seem logical that a person with the AVERAGE household income should afford the AVERAGE home price with AVERAGE financing (80% ltv 30yr fixed). Today we are far from that.
It might have taken more than two years but it was a great payoff .... people doubled and tripled their investments. Its the people that wonder "what if"
things don't get better and just dump there house for whatever they can get
will lose. There is a time when you just hold and don't sell.
I hear what you are saying and agree with most of it, but there are people who can not hold on for that long and if they do, and prices go down even more, then they will end up loosing even more money. I hope you are right, as I would hate to see anybody I know loose their home.
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