Is it over or is it going to get deeper? A tale of two stories-you decide
I want to share this article to you guys. It is hard to find real estate reports like this-balanced, fact based and easy to read.
Housing slump may be nearing its end
"New-home sales fell less than expected in June and inventories dropped to a 3 1/2-year low, the government said Friday, fueling hopes that the worst of the housing slump is over. Meanwhile, durable goods orders and consumer sentiment unexpectedly rose"
Wait,it may take longer
"Stronger sales and falling inventories are hopeful signs. But the housing and mortgage markets remain deeply troubled.
Existing-home sales fell 2.6% to a new low in June, the National Association of Realtors said Thursday. The supply of homes rose to 11.1 months' worth as banks unload foreclosed properties."
*Read the rest of the article here
Your thoughts? (2)
Leave a comment
| Customer Service: | 775-338-7653 | Email: | jsalcedo@chaseinternational.com |
| Office Address: | 985 Damonte Ranch Pkwy. Ste. 110 Reno, NV 89521 |
Disclaimer: All information in this Blog are deemed reliable but not guaranteed. Any action that you take as a result of information, analysis, or advertisement on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions."
How much is your home worth? Well, it all depends where you live.
The real estate market is still shaking. New data suggests that home prices have hit a new record low. In every new study that comes out, homeowners from Miami, to Las Vegas, Phoenix and Los Angeles, have seen their home value go lower every time.
Is that disappointing? Of course it is.
Should we sell? Is not a good time.
Should we stick to it? Yes, if you can.
Have we hit bottom? Nobody knows.
Banks are facing their worst foreclosure crisis.
Don’t take me wrong, it’s good if you are in the market to buy a home for yourself or if you are an investor, but if you are not, and you own a home, most likely the value of your property is down at least 15 %.
Why do banks care if you are loosing your home? By having to sell repossessed homes, banks have to literally slash their prices down. It gets very costly for them, after all, they have to pay property taxes, maintenance costs, and whatever utilities that need to be paid, all of this expenses for a house that it’s just sitting there, vacant, and the bank is getting nothing in return.
The latest study by the S&P/Case-Shiller Home Price Index of 20 cities, revealed the news that for 22 consecutive months home prices dropped. Only from April to May, 2009 the decline was of 0.9 %
Yanni,
Very interesting comment you made.
"New data suggests that home prices have hit a new record low. In every new study that comes out, homeowners from Miami, to Las Vegas, Phoenix and Los Angeles,"
That's right. Data does suggest that.
You mentioned that, "Should we sell? Is not a good time.Should we stick to it? Yes, if you can." I think this needs some added notes.
While I agree that if you can stick it out, that could be a good idea, but they should also know that it would take them years and years to recoup losses. Say for example a lost of $70,000 in home value, how long will it take to recoup that? For a $200,000 home and pretending that the market has already bottomed, A 5% increase per year will lead to $10,000/year of appreciation and considering compounded results this could possibly get your $70,000 in five years.
This is conservative estimates. People should also consider that after the market bottoms out it takes a while (maybe 2-3years) before going back on the 4-7% appreciation. If you can wait that long then that's good.
I made a video on this topic:http://www.renohomeblog.com/reno/2008/03/reno-real-estat.html
I am not suggesting that people should default and relinguish responsibility on their home. What I'm saying is people should know what they are getting themselves into whatever they decide on doing. Because ultimately they are the better judges of their situation. Their role is to understand what's happening.
Yanni, I also think that we can know when the market bottoms out. Perhaps not the exact time and date but certainly graphs can give us great clues when topping and bottoming happens.
Thanks for the very insightful comment.