Market Conditions in 34652>Question Details

Stephen Wied…, Real Estate Pro in Spring Hill, FL

All the indicators for the market in 2010 appear to suggest the market will continue to decline at a rate of approximately 1-2% per month. Do you?

Asked by Stephen Wiedler, Spring Hill, FL Wed Jan 6, 2010

agree?

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12
Kevin Olson & Jessica Laude’s answer
I would agree. Unless there are some harsh changes made that dictate the rate foreclosures are released into the market it is a realistic possiblity across the US... every market area will be affected. Some areas will have a higher rate, others will be lower, but all will be affected by it.
1 vote Thank Flag Link Wed Oct 13, 2010
Unfortunately, things have gone from bad to worse. We are one of four states to get slammed in the housing bubble and our count, Pasco, has probably been hit as hard as any county in the state of Florida. Now the banks are calling for a moratorium on foreclosures letting teh shadow inventry multiply for months plus. I see stagnation ahead for the forseeable future and possible price declines in pockets across the state. I hate to sound doom and gloom. The Fed should have fixed housing first but had more immediate fires to put out and an electorate that was spineless to do more. For that, we Americans will suffer for the next decade or more.
1 vote Thank Flag Link Wed Oct 13, 2010
The continuing problems in housing have changed the way Americans consume, borrow, and invest. And that's all to the good. Instead of purchasing things with money borrowed via home equity loans, we're buying things with cash from earnings or savings. That may mean spending somewhat less, but spending somewhat smarter. Capital investment, instead of going into new housing and condo developments, is going into solar plants and retrofitting existing buildings. Growing without housing, and the cheap money it spun, may be harder. But it's not impossible. The real question that may have significant effect on the real estate market is the shrinking value of the dollar. To avoid inflation the Feds may resort to increase interest rates.
That will answer at least one question with the state of the unemployment less people will qualify for mortgages.
1 vote Thank Flag Link Fri Jan 15, 2010
So far, "all the indicators" were, well, wrong.

The S&P/Case-Shiller Home Price Indices show that values actually were up 2% for the first half of 2010 (last report is for July), which is different than being down six to twelve percent.

Miami and Tampa were down about a half of a percent in the first half of 2010, again, that's one-twelfth to one-twenty-fourth of what the "indicators" suggested.

New York was up 1.77%, which is also different than being, "down."
0 votes Thank Flag Link Thu Oct 14, 2010
I New York it will decline but I'm not sure about the 1-2% per month. I think we have another 5-10 percent at worst and by the end of next summer we will bounce along a bottom for a while with a recovery starting in 2013.
0 votes Thank Flag Link Thu Oct 14, 2010
It's great to look at a question in hind sight, 10 months after it was asked. From the two recent answers, I'm sure glad I'm not in Colorado Springs or New Port Richey. Rather clearly prices are not down 10 to 20% here in Central Florida during the past 10 months. In fact they went up 5% from August to September. For the most part year on year comparisons now show flat to slightly lower values.

It was sad that this question was originally from and appraiser. Part of the problem or part os the solution?
0 votes Thank Flag Link Thu Oct 14, 2010
MACK, HERE IN CENTRAL FLORIDA HAVE BEEN dropping 20 to 25 % a year for past 2 years. Homes that sold in 2006 for $400,000 are now $150,000.

In one development lots that sold for $ 1,149,000 in July 2006 are now on market UNSOLD at $19,000.

UGLY!
0 votes Thank Flag Link Wed Jan 6, 2010
I have no idea what "all the indicators" suggest, but I'm sure their compilers have good, if not excellent, reasons for those projections. I mean, "Suggestions."

Fact is, the future is uncertain. You can almost always find reasons for the most recent trends to continue, and you can almost find reasons that the most recent trends will change.

But a drop of 10-20% over the year? Last time we had that, it was accompanied by massive global recession. Is that what they're forecasting?
0 votes Thank Flag Link Wed Jan 6, 2010
Where did the info come from Stephen? Would like to look at it.

I think for Central Florida this might be right - many over priced homes on market now.

When I was getting me Econ degree they often warned us about predicting the market.

They said there are two type of economist that predict the future

One is the Economist that knows he does not know the future
and the second
is the the Economist that doesn't know he does not know the future.
0 votes Thank Flag Link Wed Jan 6, 2010
I think it all depends on the individiual region, state or city/town. Here in NH i see a leveling off in some area's while an increase in foreclosures of homes that are just disasters. Home sthat need work are declining slightly while good clean homes are holding steady. The true test will come once the weather breaks to see if activity with your average home buyer comes out. The investors are buying up everything in sight and young families are taking advantage of FHA and getting some incredible deals. Most sellers are sitiing out right now waiting while missing out on the buyers that are looking for good homes. With inventory down right now, prices wont go down in any great margins, the banks are holding back alot of homes from the market and seems like releasing them in a very limited pace.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Wed Jan 6, 2010
I don't believe that is true for all markets. First American CoreLogic, a market research company that specializes in real estatae is forecasting a 1.56% uptick in the Reno/Sparks median prices within the next 12 months.
The company also commented that the following 4 cities will rise: San Francisco 5.7%: Los Angeles 5%: San Diego 4.7%; Sacramento 4.6%.
Detroit is expected to see a 13% decline.
0 votes Thank Flag Link Wed Jan 6, 2010
I aggree there is no catalist for the market to level out. There is a wave of Foreclosures still to come and no sign up unemployment slowing. CNBC said we need to create 150,000 jobs for the next 48 months to get under 10% unemployment.
0 votes Thank Flag Link Wed Jan 6, 2010
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