patrick.net

They should make the FHA limit lower. I don't want a $729,750 loan. Let the prices fall!

Vote Ron Paul he'll save us all...

corntrollio says

This is just bad policy. We shouldn't be subsidizing mortgages that large at all.

Agreed!

Obama housing policy is higher prices (artficially supported by taxpayers/money printing/low rates/bailouts/foreclosure moraratiorium/federal loan mods/etc' and 'everyone gets to be a debt slave'.

Same as BushCo.

This translates in this environment as permanently high foreclosure rates.

When do we have a currency collapse? They cant spend double what they take in from taxpayers and print/borrow the diff forever can they? We know its politically impossible to cut federal spending by 50% (actually need to cut way more than that to reach solvency they have to cut spending in half just to break even then to pay off the deficit have to cut spending even more. impossible.) Thus we are headed for something awful?

I recently purchased a home in San Diego and I am very happy with it. I paid over $368k for it, and that is reasonable in our area ($575k in 2005). San Diego has 2 of the top 20 colleges in the US, and 3 of the top 20 high schools in the US. I believe we hit a bottom because it takes about 6 months of trends to show this, and recently we had a 6 month gain in prices. I would tell anyone who is thinking about buying, “buy” because as the economy turns around you are going to be bidding for your home. Homes in San Diego currently have 5-7 bids over asking price. This to me signals a recovery! So if you wait and people expect homes to drag along the bottom people are going to be inclined to purchase, and you are going to pay more money because of bidding wars.

Mr B says

I recently purchased a home in San Diego and I am very happy with it.

Are you just posting this over and over in hope that it sticks? I discussed this exact post already in another thread:

http://patrick.net/?p=531422#comment-778386

Alternatively, are you trying to shill for the San Diego housing market?

When people see a bottom they will most likely purchase a home because of the increases of rents. We recently seen inflation in food and gas, and a house is hard building materials which are tangible goods. It takes natural resources to build a home. I don’t think homes are going to go up or down. I think homes have leveled off and will continue to hit bottom but interest rates will go up when the EU has a sign of a recovery. If rents go up you will have a crowding for housing. If this happens along with a little inflation you will see a housing market return. I remember when everyone said you will make money if you purchase a home in 2005. Now be prepared for the rebound because everyone is saying the crash will go on for years, but remember they could be wrong. I remember Warren Buffet saying in one of his interviews how to get rich was to “run the opposite way of the crowds and you will make out”. I believe now is the time to buy and I am betting on it.

Mr B says

We recently seen inflation in food and gas

No, we actually didn't -- you completely made that up. The most recent inflation numbers specifically cited lower gas costs as a reason for the lower numbers. Food prices had barely any inflation too. First news link off Google from two days ago when the new inflation numbers came out, the headline is "Consumer Inflation Eases On Lower Gas Prices" and it says food prices rose at "the slowest pace this year":

http://www.npr.org/2011/11/16/142387452/consumer-inflation-eases-on-lower-gas-prices

Mr B says

I remember Warren Buffet saying in one of his interviews how to get rich was to “run the opposite way of the crowds and you will make out”. I believe now is the time to buy and I am betting on it.

That's a paraphrase of his quote, but I don't think the crowds are convinced that housing is going to tank enough to see it as a contrary signal.

That said, I don't see prices as rising too much or falling too much. I think they will stay closer to level, but probably drop in real dollars due to inflation in the next few years. We still need more foreclosures and short sales to get the market moving and to have some deleveraging. Let's also not forget that a lot of government stimulus has gone into housing via the Fed and the Dept of Treasury, and that is what has kept housing prices from really hitting bottom and overshooting.

Mr B says

I am very happy with it

Mr B says

I believe we hit a bottom

Mr B says

This to me signals a recovery!

http://en.wikipedia.org/wiki/Post-purchase_rationalization

Mr B says

Homes in San Diego currently have 5-7 bids over asking price.

I think your realtor told you that.

This is very disappointing. I have a feeling that the artificial supports will never be removed and prices will never be affordable in the high cost areas. I wrote my congresswoman to oppose the extension of high loan limits, and I received a letter back thanking me for supporting the extension of the loan limits. It's as if they don't even realize how much they are hurting future borrowers, I think the NAR and NAHB have lobbied so hard to maintain the limits that congress just assumes any letter from constituents personally related to the loan limits is in favor of extending them.

The other oddity is that they only extended the FHA loan limits, which will just give FHA a bigger share of that market.