Gwen

Thanks for your input. I've done a lot of research and I couldn't help but notice a lot of homes in this area are in the high 3's low 4's and have been sitting on the market for a long time. 1-2 years on many. Why? There seems to be no reliable # to go by because the #'s are all over the place. Houses seem to be sitting in this area. I am interested in putting in an offer on a few homes, this one in particular but are turned off because the prices are so unrealistic. I will wait as long as I have to till prices are a bit more reasonable because I feel that these homes are WAY overpriced. I noticed a few homes recently sold in low 3's high 2's. Would this be a starting point since the numbers in this area are so off base? Just started to look, but will wait like everyone else because this it too frustrating. Seeing how one seller can ask so much for their home just because what another house sold for at the height of the market seems ridiculous. It is like comparing apples to oranges. Especially if no work has been done to the property in a long time. Is this what most realtors are dealing with? It appears most sellers are not realistic with asking prices and are not aware of current market/mortgage situations. It still amazes me that most sellers think they should make a 150K+ profit on their home with or without home improvements. Especially in this "dead" market and tight credit lending. Honestly, I don't mean lowballing, I mean putting in a fair offer for what you get for the house. I am tired of sellers saying they are offended by buyers offers, but honestly, I feel offended by their asking prices. In the late 90's early 2000, homes were selling close to appraisal price. Proper appreciation on houses in this area would put these homes in the high 2's. Advice greatly appreciated on how to approach this situation. - Thu Nov 6 2008, 06:18

Due to the sub prime mess the real estate industry is in, most banks are requiring 20% down on a 30 year fix loan. This is not just an American issue, this is a global issue. Buyers will need to put more money down, have debt to income ratio below 36% and an excellent FICO score (750+) or you will not even be considered for a loan. If you do not have the money to put down on the house don't even consider taking out one of those "too good to be true" loans even if they still exist. If you do willingly and you know that you cannot afford this home, then you too could end up like the millions of Americans who are facing or will be facing foreclosure because they put no or only 2-3% down on their homes. Also keep in mind that you should by a home only 2.5 times your salary. Most websites have mortgage calculators to help you figure out how much you can afford. Depending on how long this home has been on the market and how much competition is within the neighborhood, you could get it for less then asking thus requiring less for your down payment. Also, Berks County prices will soon reflect those prices from 2002!!! In some areas, homes are over priced by at least 20% and are already falling because banks are really tightening their lending as well as loan rates are rising. Right now, buyers are getting smart and sitting on the sidelines. Good Luck! - Tue Oct 14 2008, 10:53

Darin hit the nail on the head. Homes prices in your area are still high. You will find this out when you try to get a loan for your home. Banks are now sending out their own appraisers to get true market values. Some banks are not even approving loans for homes that are overpriced. Homes now being appraised are beginning to resemble the appraised market value from 2002-2003. Banks are being very picky. The run up on home prices these past few years have banks facing a large volume of foreclosures in the coming year due to false appraisals and many other reasons. The entire housing market needs a total correction until prices fall back into an affordable range. What the media is portraying is NOT hype. Most Americans really do not know what is happening with the economic downturn due to the housing market. It is very serious. Do not feel that you are going to insult anyone with your offer. If you feel you can start at 30% off the asking price then do it. It can't hurt. If not you then someone else will go for it. I am sure the owner is still making a nice profit. However, in you area, prices will fall well into 2010. I do a lot of research in this field and I highly recommend people to really do their homework. Back in 2001-2002 most home owners were only getting $10,000 to $20,000 above their assessed price. Now people think they will get $100,000+ above their assessed price. This is not the case and that is why there is way too much inventory and homes are sitting on the market for months, possible a year if not longer. I wish you all the best but be advised that property values will continue to decline. Also, most advice from this site will be from realtors and they will advise you that now is a great time to buy. They do offer some good insight; however, it is all business. I know many in the real estate business and the realtors I deal with are already declaring this year a wash. Trust your instinct, do your homework, and if you feel that your starting point is a good start then go for it. Remember, a house is only worth what someone is willing to pay for it!!! - Mon Aug 25 2008, 10:37

I know many people who bought a Forino home and would never buy from them again. The company is probably the most afforadble builder in that area, makes you wonder why. I have heard many complaints about these homes too. Also have seen many of these homes and to many homes look the same. There is no uniqueness. You can spot a Forino developement a mile away. If you are looking at Forino for affordability, remember, you get what you pay for. I don't want to slam this builder, but I have not heard too many good things about their homes. If you could, look at other builders and start to negotiate with them. You might be surprised. However, if you can wait till next year when prices continue to drop you may get a really great deal with another builder. Good Luck! - Thu Aug 7 2008, 06:03

Tameka, I understand your desire to stress that "now is the time to buy” because it is your bread & butter. It is your lively hood & I am sure you work very hard at your job. However, to advise one to buy now because rates will rise is just ridiculous. It is a catch 22. Rates fall & prices increase. Rates rise & prices will fall. Example is in 2005 when rates fell to historic lows, home prices elevated to unrealistic and unaffordable levels. Thus the creation of “interest only” & “adjusted rate mortgages” resulting in the 2008 Sub-Prime mess. Especially in this market, too-too much inventory in a time where lending across the board is becoming VERY TIGHT and foreclosures are up in every state by the thousands. It amazes me that when the housing boom was at its peak, you never saw an advertisement on TV, in the paper or on the radio telling you that now is a great time to buy. But now advertisements are everywhere. Makes me wonder how NAR truly feels about the market but is not admitting to it. The saying goes, if you need the business, advertise for it. I am sure your area is still holding its own... for now. The northeast is finally feeling the housing slump and the economy woes right now really will not help. Unemployment numbers are at their highest levels. This will affect the housing market even more. As for the housing bill, it is a complete joke. It will only help roughly 400,000 homeowners (if that) nationwide and that is nothing compare to the 2 million foreclosures this country will be hit with at the end of this year & in 2009. What we all need to do is let the housing market truly correct itself. As for your comment that homes double in value every 10+ or so years. That is somewhat true. However, you would basically need to live in your house 30+ years. But most people in this day and age do not stay in their homes that long. Prime example of appreciation in California which normally runs on the high end:
1968-1979 = 10.86%
1980-1989 = 7.95%
1990-1999 = .94%
2000-2006 = 12.29
38 years average appreciation 7.75%.
Keep in mind, as for the last 3 years, California showed unusually record high sales and now they are in serious trouble due to these homes “over appreciation” values. CA prices are falling and will continue to fall well into 2009 along with many states across the nation. So even though prices did increase from 05’ - 07’, this chart will be hugely affected by the significant price falls over the next 5 years if not longer. This will most likely be the first time since the depression you will see a negative in home appreciation. Home appreciations over the past 5 years were skewed due to scrupulous brokers, lenders and yes even realtors. It is because of them, the rest of the country will be affected. Things are so screwed up that banks are not even letting people borrow on the equity of their homes due to scrupulous appraisers. As for all these buyers incentives, if now is such a great time to buy, then why offer the incentives? Especially when dealing with home builders and new homes... Builders are too much in over their heads that they are offering buyers almost everything with the exception of their first born. When this will not appeal to buyers, more incentives will be added & prices will fall. It will be the builders’ last resort before their companies either go bankrupt or fold. Let me ask buyers out there, how ticked off will you be when you paid $400K+ for your house when in 2010 it will be worth $330K? This is already happening in most suburbs across the country. I would rather pay less, or in realistic terms, pay a reasonable price for a home that is in line with the average American working salary pay raise, at a slightly higher mortgage rate then have my home reassessed because I paid $200K more than its real worth & have my taxes go above and beyond my affordability. And in PA, school taxes are ridiculous! And in time if rates decline, then I will refinance. Prices in 2003 were reasonable & with in two years house prices practically doubled. This is NOT realistic and any realtor telling a buyer differently only wants a bigger commission. I do my homework and I know that you never should buy a home with no money down or with only 5%. Even 10% is too little to put down on a home. You should buy a home 2.5 to 3 times your annual salary with 20% down thru a fixed-conventional loan. That is why the country is in a mess now, because too many bought with stupid loans, no money down & paid too much or way beyond their means. As for me along with many other logical Americans, we will keep our money & wait. Prices will continue to fall everywhere. Realtors need to accept that the over inflated home prices are a thing of the past and prices will decline. I have many friends in the real estate industry who are saying this is the worst it has been in over 40 years. I trust them and respect them because they too admit the market needs a total correction! - Thu Jul 31 2008, 12:17

I agree with David. Some agents on this site will tell you now is the time to buy. But wait!!! It took the southeast of PA to catch the housing market boom almost a year after it started. Now it will be almost a year till you see any significant price decrease in this area. Prices are beginning to fall, it will just take a little more time till we see prices reflect closer to 2003-2004 numbers in your area. It will just need to sink in with sellers and realtors that the housing bust will affect this area significantly. The signs are there since houses are taking a longer time to sell. Especially now that lending policies are really tightening. The economy will also play a huge role... Inflation + too much supply + overpriced homes will = homes not selling and staying on the market for a year or longer. The realtor below mentioned buy now because rates will go higher. This will push prices down. This is a prime reason prices were inflated beyond reason. Rates dropped to an all time low e.g. 4.75% on fixed and lower on arms. As a result homes became inflated three times what they really are worth. Appraisers, realtors and mortgage companies should be held accountable for the housing mess as well as buyers who knew they could not afford a home of $500.000+ on a salary of $60,000. I love it when realtors say the media is exagerating things. I personally feel that the media is not presenting enough regarding the housing down fall. I have friends who are realtors and they are not afraid to say that the market is in a real mess and due for a complete correction and that this is the worst they have seen EVER. Those are the realtors I respect because they are not selling me on a lie that "oh the housing market is doing fine". Any realtor that tells you that now, do not do business with them. I also do a lot of reasearch regarding the housing market and it will be beyond 2010 until we see any turn around. Possbile longer if the govt. decides to bail out people with subprime loans. My advice is if you can wait... Then do so and you will find a home that will be priced right. Good Luck. - Mon Jul 14 2008, 12:49