Drop foreseen in median home price

[Anonymous]

what the Gov. should be doing is putting 2gether a super-think tank to not only slow down inflation but restore the dollars value as well...imagine what goods and property will cost in 5 yrs!!!! Gov. spending is far out of the realm of fiscal sanity.

[Anonymous]

If I were King of America:

• Federal usury law
• Term limits for Congress and Senate
• Repeal the 16th Amendment (income tax)

For starters.

[George2037]

Hey Noah got two words for ya: "Ron Paul", not sure if he's sane or a complete nut job but he shares some of the same veiws....(I honestly like the guy).

I think it's going to stay a buyers market for some time to come.  Median home prices dropped 7-8% y/y for August, number of homes sold dropped 26% y/y.  The number of homes on the market now (new and resale) provide an 18 month supply (at year ago sales levels), lots of arms get reset in October and even with the half point drop people are still going to see a point or two raise ($200-500) in their statements.

This is what I would like to see happen, but I think #5 is the most likely in the near future:

1. Sellers realise they can't make that profit they have been planning on and drop the asking prices.

2. Banks go back to 10% down or no loan.

3. Apraisers factor in the bubble's inflated prices (to help put realistic prices on the homes).

4. Intrest rates go to 8-10% for one year, then back down to 6-8%.

5. Me win the lotto and not care about home prices, move to my own private island in the tropics, and train monkeys to farm the land so I can sit back and drink margaritas for the rest of my life.

[Anonymous]

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George2037 wrote:

Hey Noah got two words for ya: "Ron Paul", not sure if he's sane or a complete nut job but he shares some of the same veiws....(I honestly like the guy).

---

I like the guy as well, I do like some of his ideas, and I think he is true to his word--something very uncommon in politics today. However, he has no chance of winning the nomination. I have a better chance of being issued an AMEX Centurion card.

[Anonymous]

Ron Paul not only would never be permitted by TPTB to win the nomination...but if he did ever look viable, all he'd win himself would be a dirt nap. I guarantee you that guy would have an "accident" by the end of his first month in office.

[George2037]

Unfortunately I think your right NewWorld, the days of honest Constitutionalists Republican left around 150 yrs ago and if one was elected I'm sure he would be hanging out with Saddam having a drink saying "you know what, That Bush is really good". 

Now all we have left are Bush lovers, and Spend happy democrats (Liberals are only worthy of a parenthesis notation *no offence to any one*).  Just hope Bush hasn't screwed things up so bad that the democratic nation our founding fathers dreamed of doesn't fall like so many other Military complexes....(Russia, Japan, French, German.......)

OK sorry for turning this political, I'll stop, but remember the men and women who are elected to office.......eventually decide what happens with your money, your family, and YOU!.....

Message Edited by George2037 on 09-26-2007 04:07 PM

[Gigi77]

George- I live in DC - btw Capitol Hill/ and the SW waterfront area... and I agree-- something's gotta give... 2br/2ba condos are listed at $485K here! Plus condo fees are btw 400 and 700 (in the older buildings). I pay $1550 for my 800 sf one br apartment- and I've lived here since 2001! To make matters worse- my employer's based in houston and HR does not give a rats a** about cost of living in dc- there's only 3 of us here.

Heres a really interesting article on the dollar worries from last weeks New Yorker ( just gave away my political bent)... It really put this all into perspective for me... we are in for a rocky road these net few years

http://www.newyorker.com/talk/financial/2007/10/08/071008ta_talk_surowiecki?printable=true


BTW- I like Ron Paul..

Message Edited by Gigi77 on 10-13-2007 10:25 PM

[George2037]

Gigi77-  I'm in the Baltimore area and were in the same boat.  It's like the whole DC/Baltimore area has just gone into a West Coast state of mind and believes that everyone can afford a Million dollar home.  My companies HDQ is based in Dallas and they just can't understand why we have such a hard time retaining employee's, but the pay scale is based on the TX economy which a $40k a year salary will get you just about what ever kind/size home you want.  Here is MD $40k a year is borderline poverty and no one wants to stick around.

This BRAC deal (Base Realignment) is supporting the median price for now (false hopes for sellers), but once the now empty homes stay empty that's when we will see a major adjustment to home prices.  If not the value of the dollar will be so week that employers will be forced to adjust salaries so people can survive off their paychecks.

BTW~ Great article, just an other way the American people are being protected from reality.....

Ron Paul has the right idea and captures the views of 90% of the American population, just too bad he's being censored by the media.  Half the time he's not even listed on the polls (they claim it's because of spammers), it's going to be interesting in '08.  Not much to chose from and the only viable candidate is being shunned.

[Gigi77]

So do you think that we'll see real price correction in this region by next summer?  If so, do you forsee prices bouncing back to where they were in 2004?  Is there any way to really gage that?  Seems like most sellers would rather pull thier listings off the market and rent the properties  than really reduce thier profit margins..

[George2037]

My opinion is that the price correction has already started but it's being hidden in concessions (ie. closing cost help, renovations, all around extras).  For example one development in Catonsville ($600k+ homes) the builder is offering $10-20k in closing costs or a shopping spree at the local car dealer if the buyer pays listing price.  Eventually the sellers will give up and rent it out but there are only so many renters, once the BRAC starts (1st quater '08) and the demand for homes isn't as strong as expected you'll start to see price correction in the 5-10% range but not much more than that. 

Lot's of people over paid for their homes and really can't drop the price enough to give much more.  My plan is to start shopping in the end of 1st Quarter '08 and keep the additude "It's cheaper to rent" and be aggressive with my offers.  I was shopping beginning of this year offered $205k on a house listed (2 months) for $255k, they came back at $240k and I walked away....3 months later it sold for $215k (not sure on concessions), if I stuck with it I could have got it for $220k seller pay all closing costs but I had a roof over my head and wasn't in the mood to play games.

Summing it up, the price correction is there you just have to find it.  Ideally if the house was bought prior to the boom you can get a much lower price if you keep at it, the real estate agent should be able to tell you what they paid for the house and you can gauge how much lower they are willing to go by how long it's been on the market.  Some people need to just break even, expecially if empty.