Real estate over the next few years

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I have noticed that it depends quite a bit on locality. I have read several articles that indicate that some of major metropolitan areas are seeing housing surges.

However, where we now live, many houses continue to sit on the market for well over a year and more, even with reductions in price.

In addition, in one area of a neighboring state where we are considering moving, we continue to see a series of "price reduced" updates on many of the houses listed on the MLS. A large number of these are taking a very long time to sell, or are not selling at all.

I too think that we are hovering near the housing bottom right now. However, if (when) there is another financial crisis similar to, or worse than, the 2008 event, the bottom will likely get deeper.
 
Hey Vox, you waited a while before telling us ........ great news anyway. It sounds like a really good location and you now have the security / peace of mind that comes with this ownership :cheers:

And i am now actively seeking a suitable site in the south west of england.

Found one with sea views and 60 acres of land, most of it mature woodland and a crappy old bungalow. Seriously close to paradise. Offered top money but was turned down :flushed:

Finding and purchasing a site will be my way of saying thank you to everyone here for all the entertainment and banter, cos immediately after i turn the geld into paper to transact, that will be its cue to go parabolic :flail:
 
I have read several articles that indicate that some of major metropolitan areas are seeing housing surges.

...yeah, I've read that too, here in Ireland, since the crash landing in 2008 (stalled still, somehow) - well maybe not "surges", but over and over again from the mainstream tubes: "...this is THE BEST TIME EVER, to get onto the property ladder, housing has bottomed, and quick, quick, QUICK, go and buy yourself a property, because once they are gone, they are gone(!!!)"


...four years straight of articles like that. Meanwhile, the economy is in TOTAL shambles, there is still oversupply of houses even from the boom times, I cannot possibly see who in this economy can still afford these houses, speaking in average terms (even at these lower prices), and the real estate goes NOWHERE but down, all the time. This bubble bursting was superficially stopped from happening full-on, thus it is still going nowhere BUT down, you can't fight the physics.

And if you look into the pipeline of things to come:

A) mortgage interest rates tax credits are expiring this year (here, people were entitled to get interest paid on their mortgages back, from the taxman, so to speak). How it will affect the pricing, do you think? "Honey, I know that Joneses were JUST able to afford that mortgage on their house, but that was before, and now, the government would not pay us back the interest that we are paying to the bank. So we cannot afford the same house, that they were able to get, even having the same budget."

B) Every third residential mortgage is in arrears for 3 months or more. Every seventh residential mortgage is in arrears of 6 months or more. Practically, that means a lot of these are going into receivership down the line, sooner rather than later, especially with stalled economy.

I just wait till A+B start to coincide, early next year, and just keep laughing at this year's "...it is THE BEST TIME EVER, to buy the house in Ireland, they never been so cheap, buy them before they are all gone(!!!)" articles.

So I guess my whole point is, be very careful with the press articles, when making your long term obligation decisions :rotflmbo:

Remember, after any bubble bursts, the downswing below the "normal" line is usually as big, as the upswing was (in percentage terms), before things start to rise organically again. I am not following the US market closely, but from charts that I've seen from guys like Mike Maloney, who follow these long-term trends and chart different asset classes versus each other (instead versus US Dollars, which, as we know here, is a COMPLETELY wrong approach, but unfortunately - widely accepted) - housing in the US has shortly retracted just to the "normal" line, before bouncing straight up back again. Never went BELOW the normal line, as you would expect, after an EPIC bubble burst. Probably reacting to all kinds of stimuli - but still, a dead cat bounce, if you ask me.

...and this is even before we factor in things like demographic - i.e., all these Baby Boomers that just start to retire, and very likely, trying to downsize their lifestyles - first thing to do - get rid of their current house.

Somehow, I cannot see this market bouncing back to life within next two decades, I think. Of course, one still have to live somewhere, so that might be Good Enough moment to anyone in particular to jump on, but, better to make an informed decision/trade off. Gives you a better outlook

my $.02$.02$.02$.02
 
Here in the US (in general) there is still a large backlog of foreclosed properties around, they are dribbling them out. Some are going to go cheap because they aren't worth much after sitting unoccupied (or squatted in) for a few years.

I'm glad I already own my estate. I wouldn't be buying in this country (or most of it) anytime soon. I think there's more downside unless something radical, like the whole army coming home and needing housing, happens. What are the chances of that any time soon? (rhetorical, we know the answer).
 
bushi, the U.S. housing market was not allowed to completely crash like it needed to do. I can currently finance a mortgage 5 times my gross income, with less than four percent interest, with less that five percent down any day of the week. I am not saying that is a remotely good idea, but that is what the "market" says right now. The U.S. banks are getting flooded with extremely cheap (sub 2%) money from the FED, so the market is getting heavily distorted. Combine this with terrible unemployment rates (a) and a huge shadow inventory (b), and I expect real estate isn't going any where soon.

a) Realistic unemployment in the U.S. is ~23%
http://www.shadowstats.com/alternate_data/unemployment-charts

b) Most of the largest banks in the U.S. are sitting on housing inventory that they were forced to take control of when the underlying mortgages defaulted. If this backlog hits the market it would cause prices to drop again.
 
(...)I can currently finance a mortgage 5 times my gross income, with less than four percent interest, with less that five percent down any day of the week.

that is preposterous... Gosh, such lending "standards" are the definition of stupidity! And that is what they call "tightening the lending standards", "avoiding toxic loans", etc.? It is Newspeak all over the place. :rotflmbo:

How this thing, that's called US Economy might have any chances of survival, when such idiots are driving it straight to hell, is beyond my comprehension. It clearly is beyond the point of salvage.

There will be hell to pay, fuck me...
 
And congratulations on the new property Vox. It looks like you did your homework well and ended up with a fabulous piece of property. Enjoy!
 
I see good stuff advertised around here - not long ago you could get way over 60 acres and a half decent farmhouse (with water, woods, arable land etc) for 120-150k. Not sure how it is right this instant, but there's still good stuff around here.

SW VA is one area that we are still considering also. You never know, I might be saying howdy neighbor one day.:)

and in my case, I don't care anyway, my roots are down, someone else will have to sell it after I die. So, if it goes down, so do my taxes, am I missing something here?

Heck no you are not missing anything if you have already bought and your roots are down.
 
Thanks for all of the well wishes.

I must admit that it has been a labor of love but well worth the time and effort.

To me, owning real property is the only sensible decision right now for my currency. That and PM's...but I keep losing all my PM's in those boating accidents. Truly unfortunate.
 
In real terms, I think real estate has a little ways to go still. Mainly I think it needs a lot of time.

I believe that property taxes will continue to increase while our ability to pay for those taxes will decrease. In past depressions, people lost their homes due to their properties being cash flow negative. The chances of a property being cash flow positive without having to put a ton of work into it is pretty slim IMO..

I also believe that interest rates will rise and that should put pressure on prices to the downside for a while. How much do you think your average American would pay for a home if he couldn't use leverage?

I guess what I'm saying is that I would rather be flexible and mobile than building a fortress. I get the idea of buying a house and paying it off in debased currency. I am just not sure it's the best idea simply because one might need to relocate to find work or for some other variable we simply don't see currently. The better option is probably to hold gold and silver and wait for the dust to settle.
 
that is preposterous... Gosh, such lending "standards" are the definition of stupidity! And that is what they call "tightening the lending standards", "avoiding toxic loans", etc.? It is Newspeak all over the place. :rotflmbo:

How this thing, that's called US Economy might have any chances of survival, when such idiots are driving it straight to hell, is beyond my comprehension. It clearly is beyond the point of salvage.

There will be hell to pay, fuck me...

As an update, I just got quoted 2.75% to refinance my home! Something is definately odd when long term interest rates are less than inflation.
:noevil:
 
The American home mortgage market has, for all practical purposes, become nationalized since the 2008 financial meltdown, according to an analysis by ProPublica, the non-profit investigative journalism project.

The takeover, without which the housing market could barely function, has occurred against a backdrop of little planning or public discussion.

In fact, nine out of every 10 new mortgages are now backed by the U.S. taxpayer, up from three in 10 in 2006.

“It is creeping nationalism,” said Jim Millstein, an investment banker and former Treasury official in the Obama administration.

Fannie Mae and Freddie Mac, the taxpayer-supported housing giants, alone guaranteed 69 percent of new mortgages in the first nine months of 2012.
...

More: http://www.moneynews.com/StreetTalk.../2012/12/21/id/468658?s=al&promo_code=113F0-1
 
As an update, I just got quoted 2.75% to refinance my home! Something is definately odd when long term interest rates are less than inflation.
:noevil:

we tried to refi our house at Wells Fargo, since we are paying 8.25, and they quoted us 8.75. New law. Since our mortgage is nominal, and our only debt, and since we could pay it off on a moments notice we decided to stay with it a little longer... (I'm in Burnet, Texas).
 
we tried to refi our house at Wells Fargo, since we are paying 8.25, and they quoted us 8.75. New law. Since our mortgage is nominal, and our only debt, and since we could pay it off on a moments notice we decided to stay with it a little longer... (I'm in Burnet, Texas).
I understand that you don't want to pay the loan back. I'm certainly not a US RE specialist, but couldn't you refinance yourself by replacing this high rate mortgage with a low rate mortgage?
Even if the current contract has a fixed duration and no termination clause, you could get out by selling the property to somebody you trust and then repurchase a short time later. I'm suggesting this, because the sale of a property immediately terminates any mortgage agreement here in Switzerland. Maybe this is totally different in the US, though :flail: ??
Other aspects that I don't know anything about are things like RE transaction taxes, attorney fees for the paperwork, speculation taxes for short holding periods of RE (tax incentives to not buy and sell in brief timeframes) etc...
 
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