Home Values going down the toliet?

Author	All Replies
dogma XYZ Premium join:2002-08-15 Boulder City, NV kudos:1	Home Values going down the toliet? said by USA TODAY : WASHINGTON (AP) — Mortgage finance company Freddie Mac (FRE) will no longer buy subprime mortgages that have a "high likelihood" of payment shock and foreclosure, a surprise move that came amid a deteriorating market for subprime loans affected by slumping home prices and rising interest rates, the company announced Tuesday. The median price of an existing home sold in January dropped to $210,600, a decline of 3.1% from a year ago. It marked the sixth straight month that the median price has been down compared with a year ago. The January decline was the third-biggest drop in history. The end of subprime lending is at hand, coupled with the third biggest drop in home prices for the Month of January in HISTORY. Since "subprime" (under a 660 FICO I think) has been the market, the driving component that has pushed home values past reality over the past 10 years. And considering 70% or so of potential home buyers fall into the subprime category, this move effectively locks them out of the market. Add the increasing mortgage default rates rose 67% and bankruptcies rose 9.6% during Q4 2006. (BTW, BK's are pretty much irrelevant nowadays due to the BK laws being rewritten by the "BigLending" cartels) In a Filing footnote, I find: Freddie Mac renegotiates the terms of the loan with someone who is delinquent, then, voila, that person is no longer delinquent. It seems to me that since about June of 2006, Freddie Mac is struggling to keep this Ponzi scheme afloat...at least until today. So we may see foreclosures quadruple month over month by years end. It is pretty clear we are looking at a 40% value drop in home value over the next 2-4 years, IMO. And moreover, as was mentioned yesterday by Alan Greenspan, a major economic recession is headed our way by years end...which may have helped precipitate the massive DOW/S&P 500 sell off today. What do you think?
	to forum · permalink · 2007-02-27 16:41:59 ·
tacoma Bleeding Dodger Blue Premium join:2001-05-18 Rancho Cucamonga, CA	The down closed down 546.02, 4.3%. 'Massive' sell off would be overstating. Think globally! Wall Street succumbed to a global market plunge sparked by growing concerns that the U.S. and Chinese economies are cooling and that equities prices have become overinflated. The housing market isn't much news, as there were tons of warnings over the past few years that this would happen.
	to forum · permalink · 2007-02-27 17:16:52 ·
Valkyre Premium,ExMod 2002 join:2000-12-25 Valhalla	reply to dogma Counter that, with this: (Italics added by me) »www.dailybreeze.com/news/article···656.html Consumer confidence rides up to a 5-year high quote: New, 9 a.m.: Research group sees economic growth continuing; hopes are up that the housing market is climbing out of severe slump. By The Associated Press NEW YORK - Consumer confidence rose to its highest level in five-and-a-half years amid optimism that the nation's economy is creating enough jobs, a private research group said today. The New York-based Conference Board said that its Consumer Confidence Index rose to 112.5, up from a revised 110.2 in January. Analysts had expected the reading to be 109. The February index was the highest since August 2001, when the reading was 114, indicating that consumers will continue to fuel the nation's economic growth in the near future. -- Certainty of death. Small chance of success. What are we waiting for? - Gimli
	to forum · permalink · 2007-02-27 17:23:18 ·
81399672 Premium join:2006-05-17 Los Angeles, CA kudos:2	reply to dogma Never going see 40% drop, prices are actually going up very slowly but are going up. While prices may have dropped around the country that's not the case here in socal -- i am not a lawyer but I do play one on tv
	to forum · permalink · 2007-02-27 18:11:29 ·
HappyBunny Hi. Cram It. Premium join:2001-06-23 Long Beach, CA kudos:1	I am just biding my time and then will buy my first home...
	to forum · permalink · 2007-02-27 20:06:20 ·
81399672 Premium join:2006-05-17 Los Angeles, CA kudos:2	said by HappyBunny: I am just biding my time and then will buy my first home... If you think you going to see a house in 400k range any time soon in a good location then you will be waiting for long time -- i am not a lawyer but I do play one on tv
	to forum · permalink · 2007-02-27 20:07:24 ·
aztecnology O Rly? Premium join:2003-02-12 Murrieta, CA 1 edit	reply to dogma said by dogma: said by USA TODAY : WASHINGTON (AP) — Mortgage finance company Freddie Mac (FRE) will no longer buy subprime mortgages that have a "high likelihood" of payment shock and foreclosure, a surprise move that came amid a deteriorating market for subprime loans affected by slumping home prices and rising interest rates, the company announced Tuesday. The median price of an existing home sold in January dropped to $210,600, a decline of 3.1% from a year ago. It marked the sixth straight month that the median price has been down compared with a year ago. The January decline was the third-biggest drop in history. The end of subprime lending is at hand, coupled with the third biggest drop in home prices for the Month of January in HISTORY. Since "subprime" (under a 660 FICO I think) has been the market, the driving component that has pushed home values past reality over the past 10 years. And considering 70% or so of potential home buyers fall into the subprime category, this move effectively locks them out of the market. Add the increasing mortgage default rates rose 67% and bankruptcies rose 9.6% during Q4 2006. (BTW, BK's are pretty much irrelevant nowadays due to the BK laws being rewritten by the "BigLending" cartels) In a Filing footnote, I find: Freddie Mac renegotiates the terms of the loan with someone who is delinquent, then, voila, that person is no longer delinquent. It seems to me that since about June of 2006, Freddie Mac is struggling to keep this Ponzi scheme afloat...at least until today. So we may see foreclosures quadruple month over month by years end. It is pretty clear we are looking at a 40% value drop in home value over the next 2-4 years, IMO. And moreover, as was mentioned yesterday by Alan Greenspan, a major economic recession is headed our way by years end...which may have helped precipitate the massive DOW/S&P 500 sell off today. What do you think? 2007, the year of the reckoning... We've got 1 foot in the recession bucket The market dropped 400+ points today NOD's are up Foreclosure's are up Property tax lates are up Prices are coming down (Don't be fooled by the MEDIAN price) Subprime mortgage lenders are imploding and going bankrupt Freddie and Fannie will lead the way in the credit crunch The fed is in a catch 22, battling recession/printing money they probably can't do anything meaningful with interest rates Lenders came up with a grey area called Alt-A (620-680) which now sits between prime and subprime, and for the most part subprime is considered as anything below 620 Bubbles eventually correct to their historical trend line, always, and tend to over correct at that -- "Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:\|:. Say no to the IRS Yes to the Fair Tax
	to forum · permalink · 2007-02-27 20:24:27 ·
81399672 Premium join:2006-05-17 Los Angeles, CA kudos:2	Yes 400 lost but it may not mean much actually. Most you going to see is 10% correction. I understand you want prices to go down but chances of that happening right now are that high. This month buying/selling will show us the picture which i predict will be that sale of houses have slowdown but prices is still going up -- i am not a lawyer but I do play one on tv
	to forum · permalink · 2007-02-27 20:32:08 ·
dogma XYZ Premium join:2002-08-15 Boulder City, NV kudos:1	reply to tacoma said by tacoma: The down closed down 546.02, 4.3%. 'Massive' sell off would be overstating. I don't think I am overstating (perhaps sensationalizing), as it relates to real estate. Isn't it historically true when stocks go down, interest rates go up. If this is a trend over the next 2 quarters, we will see adjustable rates rise. If that happens, those subprime folks who are already hanging on by a thread will have their rates automatically trigger up to the max allowed. All those trillions of dollars of "re-adjustments" is what everyone has been cautious of. If there is a flood of foreclosures, then values will sink. said by 81399672: said by HappyBunny: I am just biding my time and then will buy my first home... Never going see 40% drop, prices are actually going up very slowly but are going up. While prices may have dropped around the country that's not the case here in socal If you think you going to see a house in 400k range any time soon in a good location then you will be waiting for long time Ylen, you have simply not been here long enough to remember the last time people said: "SoCal real estate will never go down!" Some areas ... those "good" areas went down over 40%. This was just 16 short years ago. Frankly, the environment seems exponentially worse to me now.
	to forum · permalink · 2007-02-27 20:38:40 ·
aztecnology O Rly? Premium join:2003-02-12 Murrieta, CA 1 edit	said by dogma: Ylen, you have simply not been here long enough to remember the last time people said: "SoCal real estate will never go down!" Some areas ... those "good" areas went down over 40%. This was just 16 short years ago. Frankly, the environment seems exponentially worse to me now. Truth. People couldn't give homes away 15 years ago... -- "Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:\|:. Say no to the IRS Yes to the Fair Tax
	to forum · permalink · 2007-02-27 20:47:44 ·
81399672 Premium join:2006-05-17 Los Angeles, CA kudos:2	said by aztecnology: said by dogma: Ylen, you have simply not been here long enough to remember the last time people said: "SoCal real estate will never go down!" Some areas ... those "good" areas went down over 40%. This was just 16 short years ago. Frankly, the environment seems exponentially worse to me now. Truth. People couldn't give homes away 15 years ago... population has increase since then. We are no longer in 1989, 1993. February housing report should give good indication of housing market -- i am not a lawyer but I do play one on tv
	to forum · permalink · 2007-02-27 20:49:48 ·
aztecnology O Rly? Premium join:2003-02-12 Murrieta, CA	said by 81399672: said by aztecnology: said by dogma: Ylen, you have simply not been here long enough to remember the last time people said: "SoCal real estate will never go down!" Some areas ... those "good" areas went down over 40%. This was just 16 short years ago. Frankly, the environment seems exponentially worse to me now. Truth. People couldn't give homes away 15 years ago... population has increase since then. We are no longer in 1989, 1993. February housing report should give good indication of housing market It's worse this time, much worse. People can only live off of MEW for so long. Incomes do not support housing prices. Loose lending + Fraud + Speculation + any wild variable = Recipe for disaster... I'll use the OC as an example: The median income for a household in the county was $61,899 »en.wikipedia.org/wiki/Orange_Cou···lifornia The current median house price $605,000 »blogs.ocregister.com/lansner/ Lending use to require a down payment, use to require mortgage obligations to be no more than 28%-36% of income, use to require house affordability at 3-4 times annual income... $62,000 x 4 = $250,000 $62,000 /12 = $5,166 $600,000 @ 5% for 30 years = $3,220 with generous terms $480,000 @ 5% for 30 years = $2,576 with a 20% downpayment $3,220 / $5,166 = 62% $2,576 / $5,166 = 50% This doesn't even factor in property taxes and other credit obligations The #'s speak for themselves... -- "Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:\|:. Say no to the IRS Yes to the Fair Tax
	to forum · permalink · 2007-02-27 21:23:41 ·

81399672 Premium join:2006-05-17 Los Angeles, CA kudos:2	Like i said lets wait for february #'s to come out. All of those that are hopping that prices will drop and you can get in to the market can dream but you will most likely will have to dream for long time before it happens -- i am not a lawyer but I do play one on tv
	to forum · permalink · 2007-02-27 21:45:49 ·
aztecnology O Rly? Premium join:2003-02-12 Murrieta, CA	The day Los Angeles's bubble burst - By Mr. Ben Stein, a must read. It happened in the 80's, it happened again in the 90's, and it's happening again in the 2000's... -- "Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:\|:. Say no to the IRS Yes to the Fair Tax
	to forum · permalink · 2007-02-27 21:58:28 ·
Lovehound join:2005-08-18 Northridge, CA	reply to dogma said by dogma: It is pretty clear we are looking at a 40% value drop in home value over the next 2-4 years, IMO. Cool! Way cool! My house is paid off but I face huge capital gains taxes if I sell and move into a less expensive house (in a better locale, away from LA). Any loss in national home values will benefit me since I intend to purchase a nicer house, elsewhere. Lower housing prices will mean little or no capital gains taxes for me. Bring it on!
	to forum · permalink · 2007-02-27 23:32:51 ·
No_Strings Premium,Mod join:2001-11-22 The OC kudos:6 Host: Wireless Networking All Things Unix Cox HSI Efficient Southwest Chat	Um, here's how this whole tax thing works: If you earn money, you owe some of it to some entity in the form of tax. Regardless of the rate, regardless of how much contempt you hold for the taxing agency, you still have more money than you did before. I'm happy to reduce the amount of tax I pay, but not if it means less income.
	to forum · permalink · 2007-02-28 00:02:56 ·
aztecnology O Rly? Premium join:2003-02-12 Murrieta, CA	reply to 81399672 said by 81399672: Like i said lets wait for february #'s to come out. New-home sales plunge 16.6% to 937,000 Commerce Department reports biggest percentage drop in 13 years. »www.marketwatch.com/news/story/n···BD8C9%7D -- "Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:\|:. Say no to the IRS Yes to the Fair Tax
	to forum · permalink · 2007-02-28 11:27:51 ·
No_Strings Premium,Mod join:2001-11-22 The OC kudos:6 Host: Wireless Networking All Things Unix Cox HSI Efficient Southwest Chat 1 edit	reply to dogma I listened to part of Fed Chairman Bernanke's remarks this morning and took away a couple of things, paraphrased liberally: The sub-prime lending market, while important, is not broken or headed for a train wreck. It is worth watching. Housing is not a catastrophe by any stretch. The overall economy is not headed for recession. In fact, modest growth is expected and any inprovement in housing would mean strong growth. We need to fix what is a looming train wreck in the form of social entitlements before they wreck the economy. Social Security, Medicare and Medicaid could sink the ship and the longer we wait to start bailing, the more likely we will find there aren't enough life rafts. Modest recovery in the US stock markets this morning as a result of his comments (after I sold some stuff - d'oh!). edit: I realize his remarks apply to the US economy and your post relates more to So Cal, but it's all relevant.
	to forum · permalink · 2007-02-28 11:57:05 ·
ksw_92 join:2001-05-13 La Verne, CA	said by No_Strings: I listened to part of Fed Chairman Bernanke's remarks this morning and took away a couple of things I never pegged you as a Kool-Aid drinker. Bernake's hasn't been tested by fire yet and is following the old Fed playbook of giving the market tame bromides. When the MBS market unwinds we'll see how sure-footed he'll be. And it will unwind. We've already seen the start of a credit crunch in the sub-prime and Alt-A markets and underwriters are now asking for more than mirror-fogging abilities. This, coupled with a rise in defaults, has just started to put downward pressure on home prices. There's a certain amount of jiggery-pokery going on still with comps but you can only play that game for so long before the real numbers start sneaking in and then you can get into an over-correction. Maybe Bernake thinks all the major manufacturing sectors that have been recording shrinking numbers are just burning all those vacation days that were banked during last few years of balls to the wall production. And a predicted GDP growth that's less than real inflation is still growth, right? Yeah, that's the ticket!
	to forum · permalink · 2007-02-28 12:25:37 ·
No_Strings Premium,Mod join:2001-11-22 The OC kudos:6	I simply noted his comments without commentary. I miss Al, too.
	to forum · permalink · 2007-02-28 12:39:45 ·

Regional Talk > Southern California > Home Values going down the toliet?