Housing Bust Far From Crisis, Survey Says
A recent Wall Street Journal poll of 49 economists paints a fairly sanguine picture of the housing market. Although more than 2/3 of the economists said they thought the worst was behind us, as a group they still see prices on a national level falling slightly in 2007. “We’re nearing the end of the slowdown…
A recent Wall Street Journal poll of 49 economists paints a fairly sanguine picture of the housing market. Although more than 2/3 of the economists said they thought the worst was behind us, as a group they still see prices on a national level falling slightly in 2007. “We’re nearing the end of the slowdown for most markets,” said Ethan S. Harris at Lehman Brothers. The consensus seems to be that unless you are in a particularly bubblicious market like Florida or Arizona, the pain should be fairly muted. “Tthis is a small bubble–Prices are just about 20% too high,” says Harris. “In the history of bubbles, this will go down as one of the smaller ones.”
Economists Say the Worst Of Housing Bust Is Over [Real Estate Journal]
Photo by jekemp
from CNN/Money, via The Big Picture:
“While month-to-month declines in home prices are not uncommon, year-to-year drops had been rare before the recent housing slump. Last August was the first month in 11 years to see such a decline.”
permalink: http://bigpicture.typepad.com/comments/2006/11/existing_home_s_1.html
I saw this and thought the same as 6:10. What, this discussion AGAIN? The wild west period is over, we are experiencing a correction, if you want to buy and flip, forget it, but so what?
If it is your long term housing solution, you are fine, particularly if you have tenants.
This is all pointless. Buy a home and live in it for 10+ years and you’ll make money no matter what cylce anyone here is talking about. If you’re not going to live in a house for an extended time, don’t buy. With the closing costs in NYC you need 10% appreciation just to break even.
Housing in the U.S. was undervalued before 1999 so the run up that ended in 2005 was appropriate. Sure, now it’s a little too high and that’s why we’re seeing an adjustment (it’s certainly not because of interest rates which are still very low). But the downward cycle shouldn’t be long-lasting unless something goes haywire with the economy as a whole. That said, prices might continue to come down because of the glut of new construction about to come onto the market. But it won’t effect brownstone prices much because supply is always so very finite. Look at housing prices in the UK and especially London. There are ups and downs there — and boy do they obsessively study the monthly stats — but overall it’s ever upwards, in spite of the fact that fewer and fewer Brits can now get on the property ladder at all.
“So what’s the speculation about?”
Prices, not sales.
“…my house in L.A. at that time went up in value 30% between ’94 and ’96…”
That was from the bottom. Your predecessor(s) couldn’t say the same from ’87 to ’91. That’s pretty much the stage where we are now.
Talked to a friend/broker about the market for 2bd/2 bath 1000+ sq ft coops/condos. Used to be there only a few and all $1MM+. Said yes — and many are not even being put on web sites — particulalry new ones — so it doesn’t look as bad as it is! We have not even begun to scratch the bottom…
What, this debate again? Are houses not selling? They’re totally selling. So what’s the speculation about? Just look outside your window and in your own neighborhood to see what is selling and after how much time and for how much. No need to read the Wall Street Journal to find out what’s going on. Sheesh. ’nuff said.
As for those cycles everyone likes to talk about, the last one which was SUPPOSEDLY ’90-’96, my house in L.A. at that time went up in value 30% between ’94 and ’96 and houses in my ‘hood there were selling like hotcakes. So whatever. Again, what I need to know about my own neighborhood’s real estate market, I like to observe for myself with my own two eyes. And not listen to the armchair-speculation.
“Even with talk about the bubble burst I still can’t get a brownstone in a bad area for under $550K.”
5 years later…
“Even with talk about the brownstone market rebounding, I still can’t sell a brownstone in a bad area for over $550K.”
It took 5 years for the run-up. Why would it burst overnight? Real estate markets work in slow motion.
Even with talk about the bubble burst I still can’t get a brownstone in a bad area for under $550K.
The houses in these pics are nice but wonder if this style would fly in bkln.