Home Prices Still Higher Than In 2007 2006 2005 2004 2003
Sacramento Bee: Five-year price picture isn't all doom and gloom
The bottom may have fallen out of Sacramento home prices, but most owners are better off than five years ago, says a new federal analysis of the nation's home prices. Home prices remain 22 percent higher in El Dorado, Placer, Sacramento and Yolo counties than in 2003, according to the Office of Federal Housing Enterprise Oversight.From CNBC:
The economy will never recover if housing doesn’t find its footing first. But when will that happen? Cramer said he expects a bottom by the third quarter of 2009.From Forbes:
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[E]ven these horrible areas – Bradenton in Florida and the Central Valley in California – are bottoming. The first to fall is usually the first to return, Cramer said.
Central California is the epicenter. Among the top 10 debt capitals are six of California's major inland urban centers--not a good sign for the state's economic recovery...Housing price declines are the culprit, economists say. In California, prices in Modesto, Merced and Stockton fell between 41% and 45% after peaking in early 2006, the sharpest decline anywhere. The declines "have taken out the economy" in these cities, says Mark Zandi, chief economist at Moody's Investor Services' economy.com.From the Appeal Democrat:
A West Coast furniture retailer with a long history in Yuba-Sutter announced Tuesday it plans to close after almost nine decades in business. McMahan's Furniture said it will shut all 15 of its stores, including Yuba City, within the next few months.From the Voice of San Diego:
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The company, which has been in business for 89 years, cited a slump in the home furnishings business that has been ongoing for two years. "McMahan's has experienced downturns before and always managed to rebound; however, this decline dating back to late 2006 has been considerably longer and deeper than anything (McMahan's) previously experienced," the company said.
"People are saying the reason prices are falling are because of all of the foreclosures, but the foreclosures are happening because the prices are falling," [Chris] Thornberg [founding partner at Beacon Economics] said. "They've got it backwards. The prices are falling because they're too freakin' high."
16 comments:
but most owners are better off than five years ago
So if you bought in 2004 or later you are screwed, and if you bought before 2004 and took out money you are also likely screwed.
So if you bought in 2003 and didn't take any money out, you still have an opportunity to sell. But that window won't be open for too long. 22% isn't that much given the declines we are seeing.
The bottom may have fallen out of Sacramento home prices, but most owners are better off than five years ago
Why is it that home prices are the primary reflection of whether or not we're better off? It seems to me that our incomes and debt are a better reflection of how well off we are, in which case, the housing bubble has left almost everyone worse off than they would have been otherwise, including those who weren't even homeowners.
Why does this remind me of what the airlines did to improve their 'on-time' performance?
For those who may not know, what they did was make that 1 hour LA flight be 1 and 15 minutes. And voila! watch your on-time performance 'improve'.
Of course, if we go back 10, 20, 30 years to see how prices have 'improved', then you could say we are OK right now.
The longer people wait to confront reality, the longer it will take to recover from this mess.
A freind of ours who owned a really nice bakery & restaurant in a new part of Folsom just killed himself on Saturday as a result of his failed business. He had just left his wife after selling her Mercedes and taking every last dollar out of the HELOC to keep the business going. Now the part time hairdressser ex-wife is stuck with a $4000 house payment and must vacate. He just catered our party back in June.
From what I've been seeing, it's a rare homeowner who didn't tap their equity. Once your eyes are opened, you see the evidence of it in every neighborhood. It doesn't matter when you bought your house if it became a habit to bleed your house in order to maintain a lifestyle that you couldn't maintain on your paycheck.
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A friend of ours who owned a really nice bakery & restaurant in a new part of Folsom just killed himself
>>>>
This is a sad story. Before people go there, they should realize that it's never too late to declare bankruptcy...even big and famous people have done it...in fact some have even done it multiple times.
Well said Paranoid. Even Donald Trump had a negative net worth in the early '90s. I'll keep what you wrote in mind at the memorial service on Saturday.
A friend of ours who owned a really nice bakery & restaurant in a new part of Folsom...
I just went out to the grocery store and saw the sign on the bakery door (I live down the street). I'm really sorry this happened. Please share my condolences with the family.
BTW, are you sure we are still higher than 2003 prices? The house I was planning to buy in Feb 2004 is now going for 20-25% less than that price.
Home prices remain 22 percent higher in El Dorado, Placer, Sacramento and Yolo counties than in 2003
Some great 'famous last words'!!
Mopar:
Condolences from my part as well. That's just horrible.
I was checking out Zillow prices and was surprised to find that the house we purchased in Gold River was basically at 2003 prices.
And I was watching one of those home shows today. And these shows are getting fairly interesting lately.
It showed what happens when you wait to sell at the price you want.
Woman let go of a $290K offer, as it did not cover her mortgage.
She later sold it for $260K...
Yea I just watched that one. She made the chihuahua clothes.
It was funny, she fires he realtor friend that was doing the job on a lower commission, then the new realtor tells her to make the same changes the original one told her to do months before.
And the original offer would have paid all her bills except $5k, which included a loan for $75k for a failed business.
Still some decent equity.
Add in carrying costs for the months it took for a second offer.
The first offer wasn't good enough but she was later happy to take an offer for considerably less...
People still have expectations of making a lot of money on their home just because they have lived there a couple years, that is changing.
I also noticed on My House Is Worth What? that they are going back further and further for the original purchase. Usually before 2003 for sure, some in the 90s.
Go back far enough to get the equity number you want.
"Go back far enough to get the equity number you want."
A corollary -
"Own long enough for the equity number you want.
Jacob:
Can't you see the huge # of people that will be in that position soon?
In their concern for 'not giving their house away', they'll manage to lose thousands.
Have personally seen it happen twice. A house up in EDH was on sales for $1.875K, they got an offer for $1.850K. Realtor told owner to wait for better offer. Final sale price...$1.500K
Greed will get you every time.
If you get an offer within 5% (which this one was) I think that is pretty good.
You really can't expect to get a full price offer these days, unless you price it below market (but then is it really a full price offer).
Gone are the days where you list a home and within days (or hours) get offers for 10-25% above listing. Long gone.
It takes time, but as we move further and further from the peak (in terms of time) and as foreclosures mount, there will be fewer people in homes that remember the 2005 prices, or remember a neighbor selling a home for so much money.
I always find it funny when people say they are not going to "give away" the home. We must have a different definition of giving something away... You are still charging 100s or 1000s of dollars...
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