But, if we ignore that nonsense, what's leading home prices to continue declining is the steady high unemployment rate and potential reductions in availability of mortgage financing, which comes from the recent downgrade in the credit ratings of Freddie Mac and Fannie Mae. They indirectly support the financing of 90% of all home purchases.
Until the national unemployment rate drops below 7.5%, it's hard to imagine any noticeable recovery in housing prices, since people simply are too worried about their job security to buy. At the same time, the big overhang of distressed inventory will only grow as home prices spiral downward by another 5% this year, feeding a vicious cycle.
Still, real estate markets are really local in nature. So, depending on how far the unemployment in your area is below 7.5%, there could be modest to strong price appreciation. Just get a broker who's not too shy about digging deep into local trends and data sets.
All of these factors can increase the buying activity and that will slow the price declines and will allow the sales prices to stabilize in the coming months.
The problem is that the price of the house is only one factor in your monthly payment:
If the Interest Rates go up appreciatably, it will more than counteract the lower prices.
Also, many City and County agencies are helping First Time Buyer's with Programs for both Down Payment and even Grants. These tend to disappear quickly.
Good luck and may God bless
It's impossible to predict for sure. If you are asking about the month of August, summer as a whole is always seasonably slow. People travel, they vacation, no one is thinking of buying real estate at 100 degree weather. Come Fall, things tend to pick up. Sales in NY for example have been off by 15% over the last 90 days, (but this doesn't mean market has dropped by 15%). Experts are saying that market should remain flat, but with inflation this may change.
One thing I can tell you is that money today is extremely cheap to borrow. Once the interest rates start going up, whatâ€™s affordable today, suddenly becomes less affordable tomorrow.
@ Dan...What was the point of your entire comment?
Call it chanting, singing or drinking the juice, facts will remain facts. YES! Markets are local whether you choose to believe this statement or not.
You can't compare South Florida with Manhattan. And you also wouldn't compare the West Village/Tribeca with Harlem or Washington Heights. One area sells $5M plus apartments like itâ€™s the last day of sale while other neighborhoods canâ€™t sell $2M apartments with similar finishes, amenities and sizes.
Probably the best way to forecast your individual area is to look at how many unsold houses are on the market in your area compared to how many have sold in that same area over the past 3 months. You can also tell if your area has a lot of foreclosures in the area or not.
"Real estate trends are extremely regionalized and can vary greatly from one street to the next depending on the market."
"Hi, All real estate ois local so be careful when listening to national trends."
"Hi Homegirl, agree completely with prior poster - markets are entirely local and so the answer to your question will lie in the local stats"
Housing prices are local? Is this a religious chant ? What would happen if a you(realtor) refused to say, "all real estate is local" Would space collapse?
Can I chant, "all water is wet" and expect something to happen? Would people look at me like some kind of weirdo the way I look at realtors when they claim that realty is local?
Good luck to you!
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Too many people get caught up with what they hear on CNN, FOX, MSNBC, etc. When you hear real estate news on any media channel they are not talking about your specific area. They are typically rehashing general data that is not always market specific.
Take the Case-Schiller index: The S&P/Case-Shiller Home Price Index is a popular measure for the US residential housing market, tracking changes in the value of residential real estate both nationally as well as in 20 metropolitan regions. 20 regions only.
This is index is sort of a cheat sheet for media outlets/pundits that are not very familiar with real estate. Most of the time that outlook is a bit gloomy so that is what they report. Even when they report "good news" I don't pay too much attention because as I mentioned, it's only a 20 region index. If you were to look at one of those regions more closely you would find pockets of strong deprecation AND appreciation.
So what I would do rather than pay attention to general unformulated blanket answers from people that do not know anything about real estate is to go local. Find out what is going on in your market and if it's going up or down. Not sure how to do that? Talk to a few agents in your area. The good ones love to talk about their respective market(s) and what is going on there.
There is a lot of good info out there. It's just a matter of talking to the right people.
The amount of empty home in shadow inventory is mind boggling.
Visit goldseek dot com for more opinion on this.