Please do not comment about your local real estate market. Nationwide, when and why do you think residential real estate will bottom out and begin to rebound to the point where prices not only stabilize but actually begin to appreciate?
When will residential real estate hit bottom?
By RayAmerica Follow Wed, 17 Feb 2010, 2:42pm 58,066 views 993 comments
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Manchester, NH
Right..........................................................................
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Manchester, NH
Some markets have barely moved. Some markets have fallen 50%. All real estate is local.
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What's the point? There is no "national" house. If nationwide prices hit bottom, but in your local market prices have already gone up 20% or are still falling, why do you care about what the nation as a whole is doing?
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Alexandria, VA
I went to my local wachovia bank today.
According to the finance guy, the bottom is "RIGHT NOW" and I should take a loan because the home price will definitely go up at this summer.
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next tuesday
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CNN.COM had the stones to print that "70%" of real estate is afordable.
Afordable for whom, Foreigners?
Since when did Americans become such Pu$$ies that we let elected city, county, state and federal officials either sit back and watch or make closed door back room deals to replace their constituents with better paying tax payers of foreign decent?
We elect these Son of a Bitches, and they are openly and actively seeking foreign investors to buy the RE stock in the best areas. They so hell bent on doing so, they'll let them rot, while they spin would be domestic buyers wheels of going through the process of applying for a mortgage app, they have no plans of either approving the loan, or the sale of the estate.
The bottom wont come until Mussolini gets ran out of American politics on a pole.
Or after the revolution, which ever comes first.
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RE original post.
2012 at the soonest, when the effects of inflation truly begin to manifest again (assuming Bernanke is successful). If he is not successful, then the answer is: real estate will be revalued in our new currency after the dollar fiat scheme collapses.
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Camping is correct. There is no national real estate market--all real estate is local.
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Burbank, CA
tatupu70 says
All real estate is local that collectively adds up to the NATIONAL market. The national market does in fact play a major roll in the recovery, or the lack thereof, because it is so heavily linked to the health of our entire economy. If real estate continues to deflate on a national scale it will have enormous ramifications. That is precisely why I asked the question regarding the national collective market. Maybe some of this is too deep for some of you liberals. LOL
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RayAmerica says
Is that a liberal/conservative issue?
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Burbank, CA
camping says
Too brilliant to allow to be posted only once.
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Burbank, CA
tatupu70 says
Using your logic, if your local Ford dealer is having a bad year, does that mean Ford nationally is too?
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Ray,
If realestate is up 100% in Oklahoma but down 50% in Oakland or Stuyvesant Village, just what do you mean?
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Burbank, CA
sybrib says
Pockets of unusual activity have always existed in every real estate market, often between various neighborhoods, streets, etc. within the same city. I'm looking for the general, collective market bottom where it statistically states and the general consensus confirms that buying a home is again considered to be a sound investment (generally) due to reasonable expectations of future appreciation. The expectations now are basically negative, of course there are exceptions in various local markets. Again, I'm looking for the general, overall expectation of when the bottom will hit and why.
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camping says
The bean counters do this thing, they take a look at the actual selling price of houses. Then they add these all up and average them together. It gives us an average sale price of a home in a given area. Lets call this area "The United States of America." Then they can record these average sale prices over a period of time and make a chart or graph depicting trend lines. The trend goes up and down. Following a housing bubble there is usually a "bottom."
Unless I am mistaken Ray asked a simple question.
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I don't think get it. One underwater house in Cool and Hip Bay Area could cancel out ten more equivalent properties in equivalent neighborhoods in Oklahoma City.
One apartment complex called Stuyvesant Town in NYC could probably cancel out an entire county of properties in the black in Oklahoma.
Probably the overall magnitude in dollars or other units of capital is what really matters.
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AdHominem says
sounds to me like a great argument for limited national government with more powerful state and local authority.
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AdHominem says
lol--what doesn't sound like a great argument for limited national government to you?
The point of mine and others' posts is that a national price is basically meaningless to anyone thinking of buying a home. CA, NV, AZ, FL distort the national data so much that it renders it useless to someone looking for a house in IL or NH. Why would someone in the Northeast care if prices are still falling in Phoenix or in LA or in Miami? It has no bearing on the price of a house in Boston.
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Oakland, CA
All real estate is local, almost down to the neighborhood. Ray, it's like you are asking if it will be snowing or sunny in America tomorrow.
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what is the temp of the ocean
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Davis, CA
2015 at the earliest.
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tatupu70 says
I would guess that Ray was looking for a straight answer for philosophical/conversational reasons rather than investment advice.
tatupu70 says
not much
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Murrieta, CA
Yes but the Banks That "own " The loans are not local.
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Danimal says
So what you are saying is that a housing bubble in a few localized areas caused a national crisis? Hmmm.
Too bad Ben and the Maestro didn't see that coming (or so they say).
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what was that federal program that BFrank and his boyfriend drempt up that mandated those "national" banks make loans in particular LOCALS? Cant seen to recall the name ... three letters I think .. hmmm ... darn it, what was it again .... lol
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Davis, CA
I forgot to add, it could be 2011 recovery if we GET THOSE DOZERS ROLLING! Ya gotta plow under millions of excess housing inventory, and keep them rolling until the last Baby Boomer has moved out of their rambling McMansion into the old folks home. Inventory bipping up again, ROLLING ROLLIN ROLLIN!
I estimate this would keep the Caterpillar company in great shape for at least 5 years.
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San Ramon, CA
2013-2015 in California. Most people here are still in denial about the value of their grossly over inflated property value. Some areas in the Central Valley and Southern Cal are coming close, but the Bay area has maintained somewhat, but 2010 and 2011 will be horrific times if the government doesn't intervene. If they do, it will pro-long the inevitable housing value corrections forthcoming to Nthe Bay area.
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when everyone believes housing has crashed and the price will not back to 06 level, it is the bottom.
right now, some many owners are hanging and hoping the price will come back soon.
and, the banks are not unloading their inventory. tons of houses have been listed for month and years with the "day dreaming" price
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2020
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LandShark is right.
Greedy, stupid, dreamer, LoanOwners are holding hands in a circle with the REpukes and praying for those 2003-2007 prices. They are tossing money into a pit called RELobby. The media, politicos, and bankers all feed at the pit.
All the while, bitter renters like me stand off in the distance, point at them, and laugh like Boris Karlof.
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In unrelated stories from Patrick's front page:
http://latimesblogs.latimes.com/money_co/2010/02/mortgages-sour-at-increasing-rate.html?source=patrick.net
"The rate of homeowners falling behind on mortgage payments surged unexpectedly in the fourth quarter, with home loans 60 or more days past due reaching 6.9% of all home loans nationally, 11.0% in California and a whopping 18.5% in Riverside County, according to a study released Tuesday by credit reporting firm TransUnion."
http://www.latimes.com/business/la-fi-mortgage-mods17-2010feb17,0,7573498.story?source=patrick.net
"As of December, 11.4% of California homeowners were 90 days or more late on their loans, according to First American CoreLogic, a Santa Ana real estate data firm. That compares with a delinquency rate of 8.4% nationwide."
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Landru3000 says
No it's not, and THAT, is the fundamental problem in South Florida.
People with a 1200 sq ft 3 bed room shit hole in a lower middle class suburb on the west side of 95, are demanding the same price of a house East of US1.
The houses east of US1 do command 250-450K, they are blocks from the beach, streets are lined with 60 foot tall royal palms, and they have private Alley access.
Where as any house west of 95 are only 5 blocks from the most down trodden distressed neighborhoods, with dirt lots and box shot gun shacks.
Just because some 30 years ago, decided to build a 2100 sq ft house in a neighborhood of typical 1300 sq ft 3 br houses and even more 900 sq ft 2 br houses, doesn't make that 2100 footer worth the money that it would be worth if in a neighborhood of typical 2100 sq ft houses.
Take this house for example
http://www.ziprealty.com/buy_a_home/logged_in/search/home_detail.jsp?source=SEFMLS&cKey=d9tdb52q&listing_num=F1055588&mls=mls_miami
284? sure in Hollywood lakes, this house isn't even situated in Hollywood Hills.
And if you go to the Satalite view on the map, you'll see, just one block away is a warehouse district, that has typically been shared with the "Walefare" state crowd, rental units. If you park a car on 56 and Washington over night, it will just be metal frame the next morning.
http://www.bcpa.net/RecInfo.asp?URL_Folio=514207120250
This person paid 64K in '77, the 2009 taxes aprasied it at 210K, YET! this idiot claims in the MLS listing...
"not a "short sale or foreclosure", just a realistic seller ready to sell!"
Yeah about as "REALISTIC" as anyone claiming that all Real estate is local right now.
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47 male
Lafayette, CA
Premium
2009 was the bottom for all intents and purposes in the Bay Area. For some areas 2009 had minimal gains. In other areas minimal losses. I'm betting 2010 will either remain flat or will tick up slightly.
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It has been what "Should have been the bottom" for many cities. The problem is, due to all of the fudging of numbers, price fixing measures by local governments, federal governments and the REA active interference of the free markets, will cause an "OVER CORRECTION" of those cities, towns or subburbs that have already fallen in line with a good historic price. With inflation adjustments factored in from 1999 to now that negates the last decade of growth, while allowing for proper 3% YOY growth from 1999.
Those homes will be less desirable as the last hold outs hopping for a miracle return of exuberant investors, abaindon this non sense and their prices start to fall in line. Will trickle those already down even lower, to make room in that price demographic for the hold outs.
It seems RE has bottomed, but really there are a lot of DOG properties filling the 150K-220K that have no business even listing over 120K.
But don't take my word for it, I'm hardly ever right. }:-}
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I heard on NPR this morning, that in So Fla, 99% of the Foreclosures aren't even on the market. This was from the spouse of an RE attorney.
I can wait, INCOMING!
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iwog says
Thank you I am rushing to my real estate agent.
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I can see some value in a high level view of the housing market.
For one thing, the Fed would start to put away the bazooka. It is just one metric.
Some folks here focused on the BA like it is the crown jewel.
For me, BA is like a freak show that has little connection outside of 50 mile radius.
Even my own city, it isn’t a good time to invest in rentals despite some bargains being under cost to build. That’s just my own view, I own rentals since 1987.
It gets old to be a landlord, dealing with other people’s problems. My houses are cash flowing positive but costs are rising faster than rent.
Reality is, eventually you will rent to the Adam’s family and it is a nightmare until they are evicted, separate you from thousands of dollars.
A national bottom would be useful as one indicator of entry to REITs.
I made good, effortless money in 2003-2005 in REITs. They are liquid and don’t need 6 months, a ton of work and expensive parasites to be paid off to liquidate.
The financial world is drastically altered, harder for the little guy. There are few long term trades when the market is run by hucksters, front runners that make money by manipulation of the markets. To counter that on a personal level, I need to be quick.
When the big boys move, my money must go with them, to anywhere in the world. And brick and mortar houses are SLOW money.
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kt says
You just explained why I don't invest in this market. I'd rather take my chances in Vegas, at least they put up and feed losers. Or is that the Government that does that?
Now I'm confused, who's running thins again?
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Portland, OR
Guess I'm perplexed why housing would be such an important indicator of the health of the nation. Was our country healthy in 2006? Sure looked like it if you just went by the housing prices.
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Baltimore, MD
2013-2015 at the earliest.