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why prices have bottomed and will slowly rise

By EastCoastBubbleBoy   Follow   Sun, 30 Sep 2012, 8:46am   4,844 views   60 comments
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1) low interest rates
2) rising rents
3) unemployment, although high, has stabilized.
4) pent up demand
5) manipulation of housing stock.

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1. bgamall4 Follow Befriend (14) 750 threads 2,580 comments 63 male Las Vegas, NV bgamall4's website Premium

   21   8:14am Mon 1 Oct 2012   Share   Quote   Permalink   Like (4)   Dislike   War says Housing Demand is at 1997 lows and falling. This is another reality you seem to run from. There is a mortgage depression at about 2.4 million per year. There are an additional 2 million homes purchased by cash, mostly by Wall Street. Watch out, it is a scam of a bubble. I don't think it is sustainable, but they are keeping inventory off the market and potential rentals off the market. They don't give a damn about main street.

2. Raw Follow Befriend 10 threads 694 comments

   22   8:55am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   bgamall4 says War says Housing Demand is at 1997 lows and falling. This is another reality you seem to run from. There is a mortgage depression at about 2.4 million per year. There are an additional 2 million homes purchased by cash, mostly by Wall Street. Watch out, it is a scam of a bubble. I don't think it is sustainable, but they are keeping inventory off the market and potential rentals off the market. They don't give a damn about main street. Gary Anderson strategicdefaultbooks.com Demand for homes is rising along with the prices. Cash buying means housing is developing strong foundations going forward, because cash buyers cannot end up in foreclosure.

3. Raw Follow Befriend 10 threads 694 comments

   23   9:00am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   War says 4. Housing Demand at 1997 rate is directly from NAR's own data sets. 5. If you think 28 MILLION excess empty housing units is high, you'll be stunned over the coming years when an addition 35 MILLION housing units hit the market as boomers die off. You believe the NAR? Even politicians are more honest. The baby boomers who kick the bucket will sell to the next generation. With a rising population it should not be too difficult. Infact I think there will be a housing shortage down the road.

4. 37108605 Follow Befriend 1 threads 1,055 comments

   24   9:31am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   bgamall4 says Watch out, it is a scam of a bubble. We see it. They need to watch out because again history has seen this all before and the results are far from pretty.

5. 37108605 Follow Befriend 1 threads 1,055 comments

   25   9:32am Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike   War says Raw says Demand for homes is rising along with the prices. Cash buying means housing is developing strong foundations going forward, because cash buyers cannot end up in foreclosure. Demand is at 1997 levels and currently falling. Raw says With a rising population it should not be too difficult. Pop growth in the US is the lowest in US history per 2010 Census. "housing shortage"? BWHAHAHAHAHAHAHA. Not with 25 MILLION excess empty houses currently in inventory. Demand will only continue to fall. This is only the beginning of the final result of their sinister greed coming back to crush them.

6. BoomAndBustCycle Follow Befriend 28 threads 351 comments

   26   9:43am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   War says 1. No. Buy when rates have bottomed. 2. Rents are falling. That's long since been established. 3. Employment has nothing to do with it. Housing formation does. And household formation is at pre-WW2 lows. 4. Housing demand is at 1997 levels. That too has long been established. 5. 28 MILLION excess empty houses is a reality. You better get used to it. Hmm housing demand at 1997 levels? Sounds good to me, housing skyrocketed from 1997 to 2006... Plenty of demand.

7. Raw Follow Befriend 10 threads 694 comments

   27   9:48am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   War says Raw says Demand for homes is rising along with the prices. Cash buying means housing is developing strong foundations going forward, because cash buyers cannot end up in foreclosure. Demand is at 1997 levels and currently falling. Raw says With a rising population it should not be too difficult. Pop growth in the US is the lowest in US history per 2010 Census. "housing shortage"? BWHAHAHAHAHAHAHA. Not with 25 MILLION excess empty houses currently in inventory. Those 25 million excess empty houses must all be within walking distance of your home, because I sure as hell don't see any.

8. FunTime Follow Befriend (3) 38 threads 801 comments San Francisco, CA

   28   9:49am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   It's important not to confuse "rents are rising" with "rents have risen." In fact, a statement like "rents are rising" must be filled with so many qualifications to be helpful, it's probably confusing and confusingly suggests knowledge of the future. Same with "prices", "falling", "stocks", "housing," "the market" and so on.

9. Politicofact Follow Befriend (3) 99 threads 464 comments

   29   9:53am Mon 1 Oct 2012   Share   Quote   Permalink   Like (4)   Dislike   What about PMI tripping since Oct 2011 and home Insurance doubling? Look at the costs of say Sink hole insurance in Florida or flood insurance etc.... double and triple again Pent up demand .....lol With what credit and which job to support it? Rent are fluctuating mainly downward There was always manipulation of the housing market! Until jobs spectacularly return in the USA so will real estate prices. So I DISAGREE, strongly.

10. Politicofact Follow Befriend (3) 99 threads 464 comments

    30   9:55am Mon 1 Oct 2012   Share   Quote   Permalink   Like (6)   Dislike   Histrionically the right time to buy is when interest rates go UP So you can see where we are headed with this. 0.25 rate increase = $1 TRILLION in increased debt the government will owe It's not happening anytime soon.

11. Politicofact Follow Befriend (3) 99 threads 464 comments

    31   9:59am Mon 1 Oct 2012   Share   Quote   Permalink   Like (3)   Dislike   I have seen this graph before and agree with it. However the bottom was described around 2015/2017 The recovering end of this graph is over a 10 year period through 2025/2027 quite some time away.

12. Politicofact Follow Befriend (3) 99 threads 464 comments

    32   10:02am Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike   As you can see we are "Just" entering the years of "DEPENDENCY"

13. bgamall4 Follow Befriend (14) 750 threads 2,580 comments 63 male Las Vegas, NV bgamall4's website Premium

    33   10:15am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw says Cash buying means housing is developing strong foundations going forward, because cash buyers cannot end up in foreclosure. I disagree. They won't end up in foreclosure, but they won't spur demand from the people who buy most of the homes, the people who take out a mortgage. My view is this: the 30 year fixed mortgage was evidence of a golden age in America. Cash buying and easy money mortgages are evidence of instability in the real estate market going forward. It could go up and it could go down. And the 3 percenters will default in large numbers.

14. bgamall4 Follow Befriend (14) 750 threads 2,580 comments 63 male Las Vegas, NV bgamall4's website Premium

    34   10:18am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw says Infact I think there will be a housing shortage down the road. There could be a debeers shortage for a time. But more people are reconsidering their living arrangements and having less kids.

15. Raw Follow Befriend 10 threads 694 comments

    35   10:25am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Politicofact says I have seen this graph before and agree with it. However the bottom was described around 2015/2017 The recovering end of this graph is over a 10 year period through 2025/2027 quite some time away. We are at the hope stage. Old British saying - "While there is life, there is hope"

16. Goran_K Follow Befriend (4) 25 threads 1,517 comments Laguna Beach, CA Premium

    36   11:17am Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw. I was just outbid by a FHA backed couple. I really want the house. Should I start killing or wait until their offer gets blown out by the appraisal?

17. Raw Follow Befriend 10 threads 694 comments

    37   12:58pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (1)   Dislike   Goran_K says Raw. I was just outbid by a FHA backed couple. I really want the house. Should I start killing or wait until their offer gets blown out by the appraisal? hmmmmm...There is no chance that home will appraise for an FHA loan if they were the highest bidders. This home will be back on the market within 2 to 4 weeks. Go back up, and keep pestering the listing agent. You can go ahead and kill if the back up offer does not work. Remember, you only want to kill as a last resort, because when you bury them it only puts an upward pressure on land prices.

18. Goran_K Follow Befriend (4) 25 threads 1,517 comments Laguna Beach, CA Premium

    38   1:03pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw says because when you bury them it only puts an upward pressure on land prices. That's an excellent point. I never considered the impact of dead bodies on land prices...

19. Raw Follow Befriend 10 threads 694 comments

    39   1:06pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   bgamall4 says Raw says Cash buying means housing is developing strong foundations going forward, because cash buyers cannot end up in foreclosure. I disagree. They won't end up in foreclosure, but they won't spur demand from the people who buy most of the homes, the people who take out a mortgage. My view is this: the 30 year fixed mortgage was evidence of a golden age in America. Cash buying and easy money mortgages are evidence of instability in the real estate market going forward. It could go up and it could go down. And the 3 percenters will default in large numbers. Gary Anderson strategicdefaultbooks.com As soon as they start loosening lending standards you will see another phase in the real estate boom. This time by the average person. A 30 year mortgage rate at less than 3% can only be construed as the golden age of American real estate. 50 years from now granpa's will be telling their grand kids of 2.5% mortgage rates, and those kids will say "Wow, even the big bad wolf could have bought his own house"

20. FortWayne Follow Befriend (13) 102 threads 3,762 comments

    40   1:11pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike (1)   Well, we as a nation have bigger problems. Some of them will and do impact housing, but it impacts all of us long term. We have aging population. And it's not good for the nation when more people are old than young. That means more people using services than providing them. Next 10 years or so you'll see a lot of housing demand disappear simply through basic after death inheritance. Our inability to deal with rising debts another problem. Something will have to give. Credit cards don't last forever. And it will cost dearly the longer we wait. Future generations are saddled with so much debt that they won't have any money after taxes to even have a lifestyle so many of us are used to today. Sure doom and gloom, but I don't see an answer from either political party. There aren't any solutions government wants to attempt.

21. FortWayne Follow Befriend (13) 102 threads 3,762 comments

    41   1:13pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike (1)   Raw says 50 years from now granpa's will be telling their grand kids of 2.5% mortgage rates, and those kids will say "Wow, even the big bad wolf could have bought his own house In a market where price is held only by "how much a month" low interest rates are absolutely the worst case scenario. Government only pushing low rates to reduce number of strategic defaults and to let people refi into lower rates. It isn't for buyers. Prices soar when rates tumble, and wise versa.

22. Raw Follow Befriend 10 threads 694 comments

    42   1:15pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   FortWayne says Well, we as a nation have bigger problems. Some of them will and do impact housing, but it impacts all of us long term. We have aging population. And it's not good for the nation when more people are old than young. That means more people using services than providing them. Next 10 years or so you'll see a lot of housing demand disappear simply through basic after death inheritance. Our inability to deal with rising debts another problem. Something will have to give. Credit cards don't last forever. And it will cost dearly the longer we wait. Future generations are saddled with so much debt that they won't have any money after taxes to even have a lifestyle so many of us are used to today. Sure doom and gloom, but I don't see an answer from either political party. There aren't any solutions government wants to attempt. Freedom 1789-2012 Cheer up! There is nothing America cannot handle. If we can come out of the great depression, we can come out of anything.

23. Raw Follow Befriend 10 threads 694 comments

    43   1:17pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   FortWayne says Raw says 50 years from now granpa's will be telling their grand kids of 2.5% mortgage rates, and those kids will say "Wow, even the big bad wolf could have bought his own house In a market where price is held only by "how much a month" low interest rates are absolutely the worst case scenario. Government only pushing low rates to reduce number of strategic defaults and to let people refi into lower rates. It isn't for buyers. Prices soar when rates tumble, and wise versa. Freedom 1789-2012 Low rates are for anyone and everyone who can qualify. If you can't qualify now, you just have to wait. Prices do soar when interest rates go down, which is exactly what is happening now.

24. Politicofact Follow Befriend (3) 99 threads 464 comments

    44   1:25pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike   Raw says We are at the hope stage. Old British saying - "While there is life, there is hope" We are not in the hope stage. We are in the dependency stage. Then comes despondency. To be in "HOPE" would mean that we are out of depression, that's nowhere close to happing.

25. Politicofact Follow Befriend (3) 99 threads 464 comments

    45   1:26pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike   Also the British are in a recession. Very hopeful, not.

26. JG1 Follow Befriend 3 threads 243 comments Los Angeles, CA

    46   1:26pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   War says 2. Rents are falling. That's long since been established. So long ago it isn't true any more? Where are you getting your rents are falling info.? http://online.wsj.com/article/SB10001424052702303933404577505260835025948.html

27. Politicofact Follow Befriend (3) 99 threads 464 comments

    47   1:29pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (4)   Dislike   Rents are falling, like the value of the property you live in.

28. New Renter Follow Befriend (3) 13 threads 2,206 comments San Jose, CA Premium

    48   4:26pm Mon 1 Oct 2012   Share   Quote   Permalink   Like (2)   Dislike   Raw says As soon as they start loosening lending standards you will see another phase in the real estate boom. This time by the average person. A 30 year mortgage rate at less than 3% can only be construed as the golden age of American real estate. 50 years from now granpa's will be telling their grand kids of 2.5% mortgage rates, and those kids will say "Wow, even the big bad wolf could have bought his own house" Raw says Prices do soar when interest rates go down, which is exactly what is happening now. So exactly who IS this a golden age for? Realtors? certainly!, Sellers? for sure!, County coffers? Perhaps., Buyers? Well lets just say the Big Bad Wolf's going to have a very rude awakening when he watches his home's value plummet if/when interest rates rise.

29. bgamall4 Follow Befriend (14) 750 threads 2,580 comments 63 male Las Vegas, NV bgamall4's website Premium

    49   8:13pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   Generally, lending standards are loosened while interest rates rise. Is that a correct analysis guys? Because I don't think interest rates can rise.

30. Raw Follow Befriend 10 threads 694 comments

    50   8:31pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike   New Renter says So exactly who IS this a golden age for? Realtors? certainly!, Sellers? for sure!, County coffers? Perhaps., Buyers? Well lets just say the Big Bad Wolf's going to have a very rude awakening when he watches his home's value plummet if/when interest rates rise. The golden age is for anyone who wants a piece of the pie. Free money is a dream come true. As far as the Big Bad Wolf is concerned, I think it is the 3 little pigs who had a rude awakening... The first little pig had a house of straw, because he came in with no down payment, and then could not pay the mortgage. The big bad wolf had to come and foreclose on him. The second little pig had a house of sticks, because he came in with a 3.5% loan. When he could not pay, the big bad wolf foreclosed on him too. The third little pig paid all cash. When the big bad wolf came, he had to go back disappointed. The first 2 little pigs then rented rooms from the third pig making him a rich capitalist pig everyone hates. What is the moral of the story?

31. Mark D Follow Befriend 63 threads 480 comments Simi Valley, CA

    51   10:11pm Mon 1 Oct 2012   Share   Quote   Permalink   Like   Dislike (1)   don't forget this graph

32. rubyrae Follow Befriend (1) 39 comments

    52   7:43am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   I live on the East Coast and the market is still very high in our area, it was actually lower in 2007/2008 and then shot back up. I watch the market very closely especially around town and there are many homes that are vacant. So last weekend I started to research several of them and what I found was the banks bought the homes back in 2008 and 2010 and these homes are just sitting vacant. The are still not on the current market. I've tried contacting the banks in order to put and offer in and I'm told I can't I have to wait until it's put back on the market with a realtor. After the savings and loans scandal, you could contact the bank and get a deal. Not any more, they are manipulating the inventory and as a result the prices. There were two condos / two condo until side by side near the beach, bank owned, they told all potential buyers they would not accept and offer under 300k a piece. The properties were distressed. They didn't get the offers they wanted so they pulled them off the market let them sit for 2 years. Tried contacting the bank to purchase one, was told I had to wait until it hit the market. They never hit the market again. Well, drove by one day and there were workers renovating both units. I was told later by my realtor, that a local bank purchased both units from BofA for 140k a piece. The game is rigged.

33. rubyrae Follow Befriend (1) 39 comments

    53   7:45am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   Oh and those condo's are now listed for about 475k a piece.

34. Waitingtobuy Follow Befriend 8 threads 190 comments

    54   8:14am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw says The golden age is for anyone who wants a piece of the pie. Free money is a dream come true. As far as the Big Bad Wolf is concerned, I think it is the 3 little pigs who had a rude awakening... The first little pig had a house of straw, because he came in with no down payment, and then could not pay the mortgage. The big bad wolf had to come and foreclose on him. The second little pig had a house of sticks, because he came in with a 3.5% loan. When he could not pay, the big bad wolf foreclosed on him too. The third little pig paid all cash. When the big bad wolf came, he had to go back disappointed. The first 2 little pigs then rented rooms from the third pig making him a rich capitalist pig everyone hates. What is the moral of the story? There is a shadow inventory of bacon that is being held back.

35. Waitingtobuy Follow Befriend 8 threads 190 comments

    55   8:16am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   FortWayne says Sure doom and gloom, but I don't see an answer from either political party. There aren't any solutions government wants to attempt The answer is pay the appropriate rate of taxes to bring down the debt and deficit. But no one wants to do that, just take, take, take, and no political party has the guts to do what is right in this situation. Whatever happened to pay as you go?

36. bgamall4 Follow Befriend (14) 750 threads 2,580 comments 63 male Las Vegas, NV bgamall4's website Premium

    56   8:54am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   Waitingtobuy says Whatever happened to pay as you go? With the private sector not buying, pay as you go would result in a Great Depression. However, trying to make a bubble in the housing market will likely lead to the same thing. :(

37. Mobi Follow Befriend 1 threads 241 comments

    57   9:22am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   I believe the main reason is LOW supply due to two reasons: 1. Banks foreclose in slow motion (my last investment sits empty for ~ 3 years before I bought it.) 2. Owner sellers cannot/do not want to sell for a loss. So, they keep the houses off from the buyers in one way or another.

38. Bigsby Follow Befriend 2,826 comments Monterey, CA

    58   9:26am Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   Aunt Mildred says Mobi says I believe the main reason is LOW supply due to two reasons: Who cares about "low supply"? Housing demand is non-existent at 1990's levels and still cratering. Low demand+low supply= moribund market with sliding prices. Not another name change.

39. New Renter Follow Befriend (3) 13 threads 2,206 comments San Jose, CA Premium

    59   8:25pm Tue 2 Oct 2012   Share   Quote   Permalink   Like   Dislike   Raw says What is the moral of the story? Ah but you are forgetting the prologue and the epilogue to the story: Prologue: One day three little pigs decided to get into the housing market. The market was hot and the inventory was low. Thanks to criminally negligent lending standards by the wolf the first little piggy qualified for an enormous no-down loan. The second little piggy was not quite so fortunate but thanks to the same criminally negligent lending standards was able to land a 3.5% down no-doc loan. The third little piggy was hardworking and industrious and decided to pay all cash because ANY interest paid was money lost. They all went house shopping. The first house they looked at was made of straw. The sellers realtor (who looked suspiciously wolflike) told the three pigs there were already man offers on the table so they had to bid 30% over asking just to be in the game. Thanks to the criminally negligent loans the first two pigs had plenty to bid with. A bidding war soon ensued and the first little piggy "won" his house of straw. The other two continued their search and came upon a house of wood. The two pigs again listened to the sellers agent (another wolf) and began bidding. Up and up the price went until the second pig with little skin in the game "won" his house of wood. The third pig continued to look for a house and found a house of brick. The sellers agent (yet another wolf) showed the third pig the comps in the neighborhood. The comps showed a huge spike in recent sales so the brick house was now "worth" many times the price it had been just a year before. The third pig fearing if he didn't buy that house would be forever priced out of the market spend every last cent he had on the house. But he was happy because housing never depreciates, right? Raw says The golden age is for anyone who wants a piece of the pie. Free money is a dream come true. As far as the Big Bad Wolf is concerned, I think it is the 3 little pigs who had a rude awakening... The first little pig had a house of straw, because he came in with no down payment, and then could not pay the mortgage. The big bad wolf had to come and foreclose on him. The second little pig had a house of sticks, because he came in with a 3.5% loan. When he could not pay, the big bad wolf foreclosed on him too. The third little pig paid all cash. When the big bad wolf came, he had to go back disappointed. The first 2 little pigs then rented rooms from the third pig making him a rich capitalist pig everyone hates. Epilogue: The two renters lived in the brick house with their landlord. For a while they paid rent This made the third pig greedy for more. He decided to become rich in RE. The third pig took a HELOC to buy another brick house at a grossly inflated price thanks to the high comps. The wolves collected the commission, while their banking brothers collected fees. The third pig rented out his second brick house to tenants who paid rent on time and in full. For a while life was good. A while later the rent checks stopped coming. The pig had to evict the deadbeats who then vanished into the night. The pig then found out his tenants had been running a meth lab which had contaminated the entire area. He was now obligated to clean up the mess. The other two pigs read the news of the meth lab and decided the neighborhood had gone to Hell in a hand basket. The two pigs left as did many, many others. Rents plummeted as did housing prices. The third pig now had two nearly worthless brick houses a massive cleanup bill and a gynormous HELOC loan. The wolf came to visit. The pig declared bankruptcy and was now penniless while the wolf got a bailout. What is the moral of the story? Its good to be the wolf! (and to rent)

40. EastCoastBubbleBoy Follow Befriend (11) 104 threads 455 comments Premium

    60   9:28pm Thu 4 Oct 2012   Share   Quote   Permalink   Like   Dislike   rubyrae says I watch the market very closely especially around town and there are many homes that are vacant. +1 I too am amazed at how many homes in my price range (the lower tier of the market) are vacant. Heck even some listed with photos of a "lived" in house are just recycled from the prior (short sale) listing, and once you actually see the place, you realize that its been bare ass empty for at least six months. (Not to mention at least this summer, you could smell if they had mold issues almost immediately upon entrance. But, the bigger banks won't move them unless they get "their price" or have an inside deal lined up based on a bulk purchase of multiple properties. Seems that when you can borrow money overnight at near zero from the fed, holding vacant houses indefinitely IS an option.

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