How much lower will real estate go? I love these morons that think real estate has bottomed. They are talking it will drop another 25% in two years. It's already down 15%. I live outside of Philadelphia and some of my stupid friends bought in Philly...they still think the value of their properties hasn't dropped.
I just went to lunch in downtown miami and there are 100's perhaps 1000's of units still on the rise...not to mention the 300-400 unit buildings that may have 2 residents as of now... while it may not continue spiraling down...i can only imagine it will take a very long time to get this excess out...and im just talking about a 30 block area...if you look up the eastern coast; it would blow your mind at how many cranes are still pumping out units...peace
My wife asked the other day, "why are they still building?". I believe it's because builders need to finish the project. If it ends up being sold in distress, a finished structure will bring a price which is greater "relative to cost" than an unfinished one. Starting new ones now... that's different.
I am interested in this too, because I would like to buy a house, and I want to buy as close to the bottom as possible. I think this article answers the question as well as any I have seen: http://www.2000wave.com/printarticle.asp?id=mwo032808 It appears that there is quite a bit of variability in the market nationwide. Where I live, prices have dropped about 5%. The article forecasts another 15%.
most of these units have deposits on them ( 5-10% I have no idea) and when the finished product comes to market some will have to fold ( walk away ) unless by some miraculous fortune, the mkt goes crazy again.....I have friends who are on that fence...not having closed yet thinking they may have to walk away...not a good feeling; some have 500k in deposits; which they took out of their equity...its going to get ugly in the condo market down here....while i may be wrong; logic dictates something ugly...
We are still unwinding the top of the market and people are looking for the bottom! Your best indicator is realty offices, when they have all closed in your area but one, and you walk by and there is one pathetic realtor in there looking bored, with the lights turned off to conserve energy costs and interest rates have not started downward for the purpose of ending the recession [hint: we aren't even in the recession yet] , it's still not the bottom. It will take as long for people's thinking to overcome the negativity at the bottom as it has for them to overcome the positive outlook at the top........ and the builders are the dumbest money in town, they will be the very last to catch on that the top is over with... we are already seeing projects catch fire in Southern California so some of them have figured it out... If you see a house you would like to own and occupy, you might rent it with an option to buy, no locked in prices at this point, just an option to buy at the market price later on, years later on, and a portion of all your rent applied to the down payment.. that option will make $ all the way down to the bottom... sellers have to be a little desperate at this point...
No one can say, it's all relative to supply and demand and that's local to the specific local market conditions. As I posted in another similar thread if apply the same simple logic of price and volume to real estate that I do to trading one would have to see increasing transactions and increasing prices to say that the market has bottomed and is now recovering. Do we have that in most areas? Hell no! I my part of Denver Metro we are flat at 0.02 appreciation for the last 12 months. This is like any bubble in that the farther and faster it went up the more it will deflate. Even in good times my neighborhood, because of excessive inventory only appreciated 3%, big deal, so mine wouldn't go down as big, I hope.
I am hearing that housing prices in some European markets are dropping too. Does anybody have good informations on that?
they went up 3 fold even higher in my area from 2000-2004/5...i bought in oct 2000 so i captured the entire run-up...but now im sure I will capture the run-down...i had 2 real estate agents callme back in 04/05 to purchase my home for 3 times what I paid for it and my wife would'nt let me sell....my idea was to rent for a couple of years and purchse the same home ( more or less ) for obviously less....hey thats life...peace
Yes search ET ppl are talking about Ireland, Great Britain, and Spain. The big difference is the most of these market, except England proper from what I read, didn't allow LTV over 80% or these BS liar loans where you don't have to prove income, stated income.