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Anybody know where Colorado's median house price stands in relation to the median household income? I wonder if we're getting close yet.
It'll be close at $135000-$150000. I think it'll go below that though as more and more people lose their jobs. Then as states desperately try to raise property taxes to offset it'll be seen as a liability to own property.
Anybody know where Colorado's median house price stands in relation to the median household income? I wonder if we're getting close yet.
In most areas of the state, it is still not even close. The "affordability index" in Colorado still sucks. It is of little comfort that it is better than in some areas of the country. As I have said before, that is like drowning in 20 feet of water instead of 50 feet. The end result is still the same. That before layoffs and declining "passive" incomes (from bogus investments held in pension funds, retirement accounts, etc.) decimate median family income--coming soon to a paycheck or dividend check near you.
On another note, the article from Seeking Alpha that Mike posted is spot on--it pretty much reflects what I have been trying to say on this forum for a couple of years now. I especially like this quote from it:
Quote:
David Walker throws down the gauntlet and we must face up to his challenge.
We must learn the lessons of history. The Roman Republic was the longest-standing republic in the history of mankind. The Roman Empire lasted over a thousand years. There were many people that said Rome was too big to fail. I am sure that most of the citizens of the Roman Empire felt that way. The simple facts of the matter are that Rome fell for at least four reasons, and please listen carefully. A decline in moral values and political civility at home; an overconfident and overextended military; fiscal irresponsibility by the central government; and an inability to control one’s borders. Does that sound familiar? It’s time to wake up, study history, learn from it, and take steps to make sure that we are the first republic to stand the test of time.
Then as states desperately try to raise property taxes to offset it'll be seen as a liability to own property.
It won't just be states. It'll be cities and counties too....and it wouldn't surprise me to see tax increases could come at the same time that mortgage interest rates go through the roof.
It won't just be states. It'll be cities and counties too....and it wouldn't surprise me to see tax increases could come at the same time that mortgage interest rates go through the roof.
We'd all better be working hard to get our houses paid off. Then, we might have the room to make the property tax payment.
Great link, Mike...probably the best comprehensive discussion of this train wreck I've seen yet.
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November home sales in the Denver area were the worst on record and prices hit levels not seen since 2001.
Now where's that economist telling us that the worst of the housing bubble collapse in Colorado is already behind us??!
If the median price is $195,000 in Denver, then prices still have a long way to fall before they approach 3 times annual median income. And incomes are falling due to the impacts of job losses. The tenacious cling to optimism of the realtor that said he had thought the bottom was in, but it's obvious now that the bottom must still be a few months away--it reminds me of Leonardo DiCaprio tenaciously clinging to the side of the life raft in freezing water in Titanic.
Median home price slips in metro Denver, an article from The Denver Business Journal, reports that with more homes selling in the lower price ranges, the median price of a single-family home in the Denver area slipped 15% in November compared to November of last year. Homes in the $150,000-to-$250,000 range are selling more than any other price range. Days on the market averaged 97 days, down 4.9% from October and 5.93% from last year. Last month, there were 21,761 homes on the market - a 19.8% decrease from November of last year. Median home price slips in metro Denver - The Denver Post
Median home price slips in metro Denver, an article from The Denver Business Journal, reports that with more homes selling in the lower price ranges, the median price of a single-family home in the Denver area slipped 15% in November compared to November of last year. Homes in the $150,000-to-$250,000 range are selling more than any other price range. Days on the market averaged 97 days, down 4.9% from October and 5.93% from last year. Last month, there were 21,761 homes on the market - a 19.8% decrease from November of last year. Median home price slips in metro Denver - The Denver Post
Lawrence Yun would be proud.
Of course there's no mention of two hugely important facts here, first, that sellers traditionally take their houses off the market during the normally slow holiday season, and second, that many sellers that don't absolutely have to sell now have capitulated and taken their houses off the market hoping to try again at a later date after the market "has recovered" (and they're in for a nasty surprise if they try again next year). Add to that the "shadow market" of foreclosed houses that the banks are not listing for sale, and the "inventory" numbers on the MLS are not so indicative of true inventory levels at all. So it's no surprise, and not a sign of market strength at all, that "inventory" has declined.
Days on market is so widely manipulated by sellers and realtors that it's an utterly useless number. All that's needed is to take the house off the market and re-list it, and voila, the counter gets reset to zero. Many of those houses have been repeatedly re-listed for years...there are some specific listings in Colorado Springs that I've been watching for almost three years now.
I've said it before here, and will say it again...if you have a 20% or more down payment, good credit, can swing a loan that costs no more than 25% of your net pay, your holding period is at least ten years, and you can find a house you like that's massively discounted (i.e. 25-40% discount to peak prices), it may make sense to buy in this market. Otherwise, odds are high that you're setting yourself up for some real a** pain later.
It won't just be states. It'll be cities and counties too....and it wouldn't surprise me to see tax increases could come at the same time that mortgage interest rates go through the roof.
Longmont's restructuring to a 3-tiered electric rate billing model. People are whining, even though we still have the lowest elec. rates in the state. I expect my property taxes will go up also, in the near future.
Days on market is so widely manipulated by sellers and realtors that it's an utterly useless number. All that's needed is to take the house off the market and re-list it, and voila, the counter gets reset to zero. Many of those houses have been repeatedly re-listed for years...there are some specific listings in Colorado Springs that I've been watching for almost three years now.
MLS rules do not allow for the wanton manipulation of DOM. You must be unlisted for 30 days for the number to reset to zero.
The numbers are from the same time period; November 2007 & November 2008. Inventory and DOM are down over last year.
Banks do list their inventory in MLS. So do most builders.
MLS rules do not allow for the wanton manipulation of DOM. You must be unlisted for 30 days for the number to reset to zero.
OK, so you take your listing down for 30 days over the holidays and re-list. That's wanton enough for me. Seeing a lot of those here in Colorado Springs. If there was any integrity in the system it'd list DOM based on cumulative days on market since the last sale and a break period of at least six months to reset. Some MLS systems elsewhere keep these sorts of stats.
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Originally Posted by 2bindenver
The numbers are from the same time period; November 2007 & November 2008. Inventory and DOM are down over last year.
But MUCH has changed since Nov 2007. REO inventory is way up due to record and climbing foreclosure rates. And with sales falling off dramatically, the explanation for inventory dropping is NOT that property is selling better. Quite the opposite. There's a tremendous amount of inventory overhang that's not being captured by the stats.
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Originally Posted by 2bindenver
Banks do list their inventory in MLS.
Yes, but not all of it. I watch houses go to a foreclosure sale, get deeded over to the lender, and months later there's still no MLS listing for the property. There's lots written about why that happens...lenders not wanting to depress values in an area where they hold multiple REOs to avoid mark-to-market asset writedowns on their other holdings, properties moved to Level III column under FASB 157 to hide declining asset values, overtasked bank REO offices, market timing etc.
Debt is Diabolical
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