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Housing Prices


Jenkins

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Bil I'd like to see that chart, the pic isn't working, maybe just for me.. I don't think price drops are peaking, only starting.. People still holding on to old rules.. And housing is sticky, laggard to market action/opinion..

But re: foreclosures, I do think that if a person is able to stick it out for a year they generally prevail.. I don't have any reference though other than personal stats.. I've been tracking sales and supply for a while now, and it seems that bank buybacks happen on average about a year in.. Very rough stats, and only PVD numbers, so just personal opinion..

Its also possible that as price drops accelerate, people holding a net deb house will just walk away.. I think that scenario is sort of unlikely, as the hit to credit is borderline irreparable.. And the people willing to take that credit hit most likely would have jumped ship long ago..

Again, just my personal opinions.. Also, it seems as though the public opinion on this is far past tipping point, which generally means to me that the worst is over.. I call it the "My Mom Theory".. When my mom knows about something, its too late, the party is over, switch gears.. :lol:

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I disagree. Too many properties in Providence were sold with these loans for far more than they were truly worth, and if lower middle class and middle class folks (not investors who care nothing for the neighborhood) can once again buy into two and three family homes in the City, then it will be good for those neighborhoods.

It is truly unfortunate that many well intentioned folks are going to lose homes as a result of all these foreclosures, but I think that it is a way for the market to normalize. Note that I am neither an Economist nor a Real Estate professional. I just know that I've been locked out of this market for the past few years and now I might be able to get back in.

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Bil I'd like to see that chart, the pic isn't working, maybe just for me.. I don't think price drops are peaking, only starting.. People still holding on to old rules.. And housing is sticky, laggard to market action/opinion..

But re: foreclosures, I do think that if a person is able to stick it out for a year they generally prevail.. I don't have any reference though other than personal stats.. I've been tracking sales and supply for a while now, and it seems that bank buybacks happen on average about a year in.. Very rough stats, and only PVD numbers, so just personal opinion..

Its also possible that as price drops accelerate, people holding a net deb house will just walk away.. I think that scenario is sort of unlikely, as the hit to credit is borderline irreparable.. And the people willing to take that credit hit most likely would have jumped ship long ago..

Again, just my personal opinions.. Also, it seems as though the public opinion on this is far past tipping point, which generally means to me that the worst is over.. I call it the "My Mom Theory".. When my mom knows about something, its too late, the party is over, switch gears.. :lol:

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  • 7 months later...

This might be wrong, but I just added up the sales reported on a realtor's blog for Jan, Feb, and Mar and compared them to the 1st quarter 2007 number published by RI Assoc of Realtors, and if I'm using the correct numbers, RI just saw a major year-over-year decline in home sales.

Single Family

Sales Days on Market

1Q07 1617 93

1Q08 1201 104

-25.7% +11.8%

Condo

Sales Days on Market

1Q07 390 112

1Q08 229 115

-41.3% + 2.3%

Between 1st quarter 2006 and 1st quarter 2007 there were small increases in sales in both categories. I'm not sure if this is a temporary thing because of the credit crunch or related to the economic slowdown we're in, or something else.

I don't have numbers on prices, so we'll have to wait for the official numbers from RIAR. We'll have to see if my numbers were right or if I missed something major.

(also, does anyone know if there's a way to put tables into the editor? I used a code block, but a table would have been much better)

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I find it interesting that the DOM is relatively the same yet the volume of sales dropped significantly..

I wish they would separate foreclosures and reg sales so we could see the difference in the two..

Instead we get some hybrid market numbers that neither shows an accurate foreclosure market or a sales market..

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I wish they would separate foreclosures and reg sales so we could see the difference in the two..

Instead we get some hybrid market numbers that neither shows an accurate foreclosure market or a sales market..

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jerry2, you work in the mortgage industry, I work in finance industry.. We share many views on things economic.. I respect your opinion, and value your posts.. I have a question to you that I have bandied around to my usual suspect econ and finance peeps. Other than system failure, what is the real end game risk here? So what if people foreclose and go under.. Prices come down, rightfully so.. There is suffering for the risque and there is some defaltion in housing.. Is, globally(nationally), that such a bad thing? any time there is an asset bubble there is a contraction.. Inevitable.. Why is housing so different THIS time than any other housing bull mkt or other asset bull run? I understand the effect of subprime financing, and its effects on all financinal institutions.. But really, for the end consumer/loan user, what are the concerns?

I say for the avg "home owner or home buyer" there is some additional scrutiny.. For the speculator and investor there is das scrutiny.. For the average renter there is a periodic rise in rent, then a semi drastic drop in rent.. For finl cos there is mass consolidation and in effect there is less consumer options, therefore, long term worse financing conditions..

System failure, in reality, simply is not possible.. Black Swan or no Black Swan.. But mass financial consolidation is, and long term consumer finance suffering is.. I think the risky consumers, lay in your grave.. The fringe sufferers, possible assistance.. I think banks, lay in your grave as well..

The rest of people, we have to deal with it and roll with any boom bust mkt.. crap happens like it always does..

My pet peeve is.. WHY DOES OUR GOVERNMENT FEEL THE NEED TO ASSIST BEAR STEARNS AND THE LIKE???? Under the guise of "the good of the economy?" Who buys this BULLISH??? I know we both probably work for Fort500hundy cos but come on, how does the general PUBLIC BUY THIS BULL?? Its the biggest lie ever sold to the people.. Financial companies need buyouts for the "good of the economy".. IRATE

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jerry2, you work in the mortgage industry, I work in finance industry.. We share many views on things economic.. I respect your opinion, and value your posts.. I have a question to you that I have bandied around to my usual suspect econ and finance peeps. Other than system failure, what is the real end game risk here? So what if people foreclose and go under.. Prices come down, rightfully so.. There is suffering for the risque and there is some defaltion in housing.. Is, globally(nationally), that such a bad thing? any time there is an asset bubble there is a contraction.. Inevitable.. Why is housing so different THIS time than any other housing bull mkt or other asset bull run? I understand the effect of subprime financing, and its effects on all financinal institutions.. But really, for the end consumer/loan user, what are the concerns?

I say for the avg "home owner or home buyer" there is some additional scrutiny.. For the speculator and investor there is das scrutiny.. For the average renter there is a periodic rise in rent, then a semi drastic drop in rent.. For finl cos there is mass consolidation and in effect there is less consumer options, therefore, long term worse financing conditions..

System failure, in reality, simply is not possible.. Black Swan or no Black Swan.. But mass financial consolidation is, and long term consumer finance suffering is.. I think the risky consumers, lay in your grave.. The fringe sufferers, possible assistance.. I think banks, lay in your grave as well..

/quote]

The "real end game risk", in my opinion, is disaster for "legitimate" tax-paying homeowner's in RI for quite awhile. When you look at "boom" states that have seen 20% depreciation in the last year and get some notion that isn't so bad here, remember that many of these states actually had a positive net migration and continually support a positive net migration nonwithstanding this crisis. As far as the issue at hand in the aforementioned states, developers were over compensating with more supply than demand due to perceived continued appreciation...with people flooding the gates....why stop building?...that coupled with the fact that anyone with a pulse could obtain a mortgage with 0 down and closing cost assistance. The tightening of credit has certainly drastically affected places like FL, NV, and AZ but I feel that they will recover much quicker due to this reason.

Enter RI and many parts of NE for that matter. Escalating property values were driven by limited supply and relative demand....surely not people flocking to the area.....but demand by whom? Sure maybe some Boston commuters, medical professionals, and secondary educational professionals but mostly by the low-to middle income inhabitants that finally had a chance to live the "American" dream of owning a home. What is up with the 90% Latino surnames inthe projo foreclosure lists? Coincidence? Hmmm..The majority of these people never even asked any questions when signing at the dotted line....... The short term rise in equity in land-strapped RI propelled the economy with increased sales tax revenues as more and more "uneducated" and "short-attention spanned" homeowners cashed-out and lived a lifestyle that they couldn't afford. These are the same people that are being foreclosed on today. While the ultra left-leaning UP Pvd forum will have you believe that "speculators" drove up prices...heck even the "pro-active" General Assembly with new proposed legislation to scare away any legitimate investors(enter David Segal), my question is....after the credit tightening with minimum FICO scores and down payments, who is going to replace this demographic in RI that will invest in the state? WIth the cutting back of historic tax credits( rightfully so in tough budgetary times), who in their right mind would make any investment in the state with the tax climate the way it is, no monetary incentives, and a job climate as weak as the US Dollar?

Look...the blame game is being passed around for this crisis from one to the other. Personal responsibility and the fact that we have the ability in this country to seek help and guidance( which low attention spanned people don't have time) makes me believe that everyone that is in a precarious predicament involving real estate....deserves what they get whether it is harsh or not....The banks, lenders, and financial institutions are no more guilty than an alcoholic buying booze at the store or a compulsive gambler getting his late night fix at Twin River. Home equity in RI WAS an addictive fix. Now that the resources have dried up, it is time for people to face consequences and hopefully work on ways to stem RI becoming the Detroit of the NE. ....Is that possible?

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WIth the cutting back of historic tax credits( rightfully so in tough budgetary times), who in their right mind would make any investment in the state with the tax climate the way it is, no monetary incentives, and a job climate as weak as the US Dollar?
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