Home sales fall to lowest in 15 years

[rockzilla]

http://hosted.ap.org/dynamic/stories/U/ ... TE=DEFAULT

This is referring to the # of homes sold, which fell 27% in July. They were expecting only a 13% drop (due to the tax credit expiring, etc.) so this is a much bigger drop than expected.

On one hand, I feel for the folks who are having a tough time selling their home. On the other, I am optimistic about our ability to buy a home in the next 2-3 years. We watched the market skyrocket in 2005+, and it was quite discouraging to have "experts" tell us that we HAD to buy a home then or we'd be priced out FOREVER. Hopefully this indicates a return to sanity in how homes are being priced relative to incomes and comparable rental properties.

 

[Selkie]

I was thinking about this today after hearing it on the news on my way to work, and I completely agree. We bought at the end of December, 2008, when the first tax break ($7500, but we have to pay it back) was in effect. Demand was fairly high, and rates were low, but not as low as they are now, and people were still holding back a bit. After buying, I continued to track listings in our area, noticed the fluctuations in the "desirable" properties, and saw how few decent places were available during the height of this latest mini-boom. Now, with the more recent break expired, but rates still low, it seems like it's still great market for people who don't need the extra incentive (i.e. have enough saved for at least 10% down) especially since there will probably be more stuff available, cheaper. Who knows how long it will last? People will always need houses. Maybe this dip is so strong just because people were really rushing to meet the deadline (who might normally have spent more time looking), and it will pick up again in a few months. Of course, it also depends where you will be buying, since Southern California's market is so much more volatile than most other areas.

 

[NewEnglandLady]

We just bought this summer, but I still get the MLS listings because...well, probably because I'm insane and still like looking at houses. Anyway, while a 27% dip is more than expected after the tax credit expired, I don't think it's terribly surprising. What surprises me is that I didn't see any decrease in houses coming onto the market. My thinking was that those who wanted to sell were interested in getting their house on the market before the credit expired. So then when the credit did expire, the pool of potential buyers would shrink and it would take awhile for the market to absorb all of that supply, but that you wouldn't see that many houses coming on the market this summer (even though I know summer is popular). But on my MLS email there are new homes popping on the market constantly, so I feel like the delta between supply and demand is just getting bigger! I'm sure it will slow down in the fall since that's when things naturally wind down, anyway, but I'm guessing anybody who has their house on the market is really motivated to sell, so I'm guessing there will be a lot of price deductions!

I'm by no means any expert, but it seems impossible that the housing market is going to recover within a couple of years. I keep reading that foreclosures are at an all-time high and the banks can only hold onto them for so long. My concern would be the interest rate--I just don't see how the market can support such an artificially low rate for as long as it has.

 

[Selkie]

We just bought this summer, but I still get the MLS listings because...well, probably because I'm insane and still like looking at houses.

That makes two of us!

 

[Selkie]

I'm by no means any expert, but it seems impossible that the housing market is going to recover within a couple of years. I keep reading that foreclosures are at an all-time high and the banks can only hold onto them for so long. My concern would be the interest rate--I just don't see how the market can support such an artificially low rate for as long as it has.

Sometimes I wonder if "recover" is the appropriate term. It probably can't, and shouldn't, ever return to the insane levels of 2004-2006 when everything was overpriced. But it seems like that is what people are hoping and expecting will happen. Aiming for stabilization, where normal people with normal jobs can afford normal houses, should be the end goal. And I don't see that as being so far off the mark. *Not an expert by any means, either, just a normal person thrilled she could afford a house before the age of 40!* I do hope the interest rate doesn't just skyrocket when they finally do stop holding so low, however.

 

[starryeyed]

But median home prices were up. Go figure. Regardless, it's a great time to buy!

 

[Dancing Fire]

http://hosted.ap.org/dynamic/stories/U/ ... TE=DEFAULT

This is referring to the # of homes sold, which fell 27% in July. They were expecting only a 13% drop (due to the tax credit expiring, etc.) so this is a much bigger drop than expected.

On one hand, I feel for the folks who are having a tough time selling their home. On the other, I am optimistic about our ability to buy a home in the next 2-3 years. We watched the market skyrocket in 2005+, and it was quite discouraging to have "experts" tell us that we HAD to buy a home then or we'd be priced out FOREVER. Hopefully this indicates a return to sanity in how homes are being priced relative to incomes and comparable rental properties.

i told my daughter to save,save,save so she can put a d/p on a house within the next 2-3 yrs. IMO,housing prices in Ca. will not go anywhere until employment picks up.

 

[zhuzhu]

I think the home price is a very regional thing. Where we live the housing price has gone steadily up in the past 6 -12 months.

 

[NewEnglandLady]

I'm by no means any expert, but it seems impossible that the housing market is going to recover within a couple of years. I keep reading that foreclosures are at an all-time high and the banks can only hold onto them for so long. My concern would be the interest rate--I just don't see how the market can support such an artificially low rate for as long as it has.

Sometimes I wonder if "recover" is the appropriate term. It probably can't, and shouldn't, ever return to the insane levels of 2004-2006 when everything was overpriced. But it seems like that is what people are hoping and expecting will happen. Aiming for stabilization, where normal people with normal jobs can afford normal houses, should be the end goal. And I don't see that as being so far off the mark. *Not an expert by any means, either, just a normal person thrilled she could afford a house before the age of 40!* I do hope the interest rate doesn't just skyrocket when they finally do stop holding so low, however.

Completely agreed! I'm looking forward to the day when home values go up instead of down, but with that aim toward stabilization. Growth should be steady or it becomes too volatile. Even buying this summer was a tough decision because all indications point to home values continuing to go down (like you said, stabilize), so it became an issue of when we were ready to buy as opposed to when the market was most prime. Still, the fact that I still look at MLS listings every day is a pretty big indication that I still find the market really interesting!