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Day after day I read this kind of crap about what the government "needs to do to stabilize the housing market." All of the "experts" talk about everything from interest rates to lending standards.
Why is it that these sorts of articles never mention that housing is simply too expensive still for most people? Why don't they talk about the fact that there's too much supply on the market, that easy credit resulted in overbuilding?
Day after day I read this kind of crap about what the government "needs to do to stabilize the housing market." All of the "experts" talk about everything from interest rates to lending standards.
Why is it that these sorts of articles never mention that housing is simply too expensive still for most people? Why don't they talk about the fact that there's too much supply on the market, that easy credit resulted in overbuilding?
Because you have all types of special interests and lobbying groups w/deep pockets who are in politicians ears all the time trying to push for artificially increasing home ownership. (ie NAR, NAB, etc)....
Realtors & builders need volume to earn their paycheck, no other explanation period.
Common sense would think that home prices should naturally come back down to income levels (ie historicals, affordability), however there's going to be many more attempts from Govco to "artificially" stabilize home prices.....
Just another reason why this country is going down the drain.
There are all kinds of forclosures out there for people to bid on now. I really don't think that homes are going to drop to where they are less than the price of materials and labor, Homeowners will keep their homes first and the homebuilders will go bankrupt first.If you wait to get a lower price you may endup with no home at all.
There are all kinds of forclosures out there for people to bid on now. I really don't think that homes are going to drop to where they are less than the price of materials and labor, Homeowners will keep their homes first and the homebuilders will go bankrupt first.If you wait to get a lower price you may endup with no home at all.
I don't think anyone would argue that prices should drop to labor and materials cost. They should drop to the point where they are affordable for the average person without the need to resort to creative financing. Traditionally, that has been 3x gross annual income.
Who is going to buy a house in the midst of a crumbling job market? What a liability. If your job evaporates and you need to move to find work, owning a home you can't unload is a tombstone. Browse the Michigan forums to see people trapped by homes they can't unload and without jobs.
Michigan now, somewhere else next. This is a good time to be maximizing personal liquidity, preserving the ability to pack up and take off if need be. Buying a home right now, at any kind of price, could be the mistake of a lifetime.
Maybe if the builders went back to some more traditional style homes then prices would come down.
Go look at a late 80's neighborhood. They don't have 3 car garages, media rooms, etc.
They're typical 1700-1800 3/2 homes with simple designs that ARE affordable starter homes.
There are all kinds of forclosures out there for people to bid on now. I really don't think that homes are going to drop to where they are less than the price of materials and labor, Homeowners will keep their homes first and the homebuilders will go bankrupt first.If you wait to get a lower price you may endup with no home at all.
Just because there are foreclosures out there, it doesn't automatically mean they are affordable or the right fit for the average person.
Yes, there will be pain. Once high flying homebuilders (remember they used to have "lotteries" for people to bid on homes??) will now either go out of business or continue to layoff workers because they got greedy and did not plan correctly for the future. This cycle will soon pass (maybe not soon) and building will start to increase again....
Maybe if the builders went back to some more traditional style homes then prices would come down.
Go look at a late 80's neighborhood. They don't have 3 car garages, media rooms, etc.
They're typical 1700-1800 3/2 homes with simple designs that ARE affordable starter homes.
They have started to builder smaller homes in various markets across the country. There are just not enough buyers for big homes out there right now.
Its all part of the ingredients that lead to this mess. Builders, realtors, buyers, sellers, lenders, Govco, all got greedy......now its blown up.
The reduction of house prices is the biggest fear in the minds of financiers. SO much funny money has been leveraged on inflated home values that reasonable home values would destroy all the new money of the last few years. A collapse of home prices would sweep money from the do nothings and put it back in the pockets of wage earners. Local governments would also suffer as their bloated tax revenues dry up. South Florida is a prime example of this. To this day homes are still extremely overpriced and wages have been falling. It is a disaster in the making. The funny money people have to keep pumping or they will have to actually do meaningful work. That cannot happen.
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