Skip to comments.Trapped by the mortgage meltdown
Posted on 09/14/2007 5:37:16 AM PDT by Hydroshock
NEW YORK (Money Magazine) -- Whether you're a home seller, owner or buyer, by this point you've got to be feeling a little rattled. The bad news about the housing market seems never ending: Foreclosures have more than doubled over the past year.
Sales of existing homes are off 11 percent from this time last year. At that rate, it will take at least nine months to work off the inventory of unsold homes. And median home prices in July (the most recent figure available) dropped for the 12th month in a row.
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Worse yet, all that happened before problems in subprime lending expanded throughout the mortgage market and beyond, creating what's popularly being referred to as the credit crunch.
While it's too soon to see the impact reflected in the numbers, the immediate future is clear: As lenders tighten their borrowing standards, fewer people will qualify for mortgages.
Fewer qualified buyers can only mean that housing prices will slump further. Worst of all, economists don't see much chance for a turnaround until mid- 2008 and possibly into 2009.
(Excerpt) Read more at money.cnn.com ...
Right you are, Hydro! If you can’t afford it, you shouldn’t try to buy it. That’s an old, but good lesson; and sometimes the only way to learn it is the hard way.
There’s a simple reason I like the suburbs.
Living in the city=living with crime, liberals, freaks, gays, dirt, traffic and noise.
Living in the country=driving to the city to work unless you like living on minimum wage...
I know you’re more a fan of city living but that’s a minority of conservatives.
Why? I'm a home owner and I am not rattled. I don't plan on selling my house ever, so why should I care about the current little blip in the market? I hate broad generalizations.
Are you saying that equity WILL continue to bring profits or not? Not sure I understand your post.
The debt hangover that we have today is unprecedented at least five times worse than 1989.
This time it will take at least 15 years to unwind the excesses.
Unless the Fed hyperinflates us out of our debts.
Anything is possible.
Hmm... I was in the grocery store not more than 15 minutes ago.
What do you mean?
My house is almost 6 years old and was bought before the boom and while its value is far less than it was during the height of the boom, it is still valued far in excess of what I paid and I don’t owe much on it either.
Two of my 4 kids have now been able to buy homes at bargain prices. One will soon and the oldest is stuck in a bad loan on an existing mortgage. 3 out of 4 ain’t bad.
Hangovers serve a purpose. They tell us that we did something stupid.
Do you want the Fed to hyperinflate us out of our debts?
No, people who hope for huge crashes in the market, and millions of people losing their homes, so they can become the speculators that right now they’re cursing and bitching about.
I ask because usually a straight 20% suffices.
Well, the way to be rid of speculators would be to have government assigned housing.
Better solutions welcomed.
I just bought a house near Atlanta. I don’t make an insane amount of money.
“Rex, I bought my house in 1991, not far away from Alexandria. Even if it loses three quarters of its value, if I sold it Id still make a killing relative to what I could have made in the stock market or any other investment instrument over those years.”
The key here is selling it - the markets across the country are overbuilt and have massive amounts of inventory that’s not selling. That’s why this is happening, why foreclosures are growing - nobody can sell, because nobody is buying. Take a look in your area, and see how long houses are sitting on the market - the appraisal you’re basing your “killing” on may not be accurate anymore.
If you can afford your mortgage, and have a fixed loan, more power to you, you’ll be fine (except having your purchasing power diminish with a recession). If you have to sell, for any reason...you may be in for a surprise.
Not in southern Connecticut, unless you're willing to live in the worst part of the urban ghettos....
Prices in Atlanta are still pretty reasonable.
“I know they do not, that is why I ahve been warning of this train wreck for over a year.”
I have too - I gave it up as a pointless hobby, and I refuse to show any compassion to people who made fun of me or were rude to me when I DARED question the housing market. They made their bed, they can now lie in it, and I’ll be damned if they pass some kind of bailout on my dime.
I’m stocked up on popcorn, gonna get every ounce of entertainment value out of watching American’s greed and the shady doings of the banking and and real estate and mortgage industry tank our country into one hell of a recession. It’s too late late to change the course of this iceberg, might as well enjoy the show.
C’mon, all you mortgage brokers and real estate agents who barge into these threads and throw their attitude around, let’s get some more “NAH NAH NAH I CANT HEAR YOU” while you stick your fingers in your ears, and try to sell people 800K houses that are worth 200k. Get some more blood money while there are still a few greater fools out there. C’mon, one more round of “real estate only goes up!” “You can just refinance later when the rates reset!” “They’re not making any more land!” and “rent is throwing money away!” for old time’s sake. It’s your party, get your butts on the dance floor and WORK IT! We’re paying for it, after all.
Now, you’ll excuse me, I have to go to work now (where I havent had a raise in 4 years), gotta get gas (which is rising in price), and make some cash to pay my rent, which is half of what i’d be throwing away in property tax, insurance, and upkeep on an overpriced shitbox McMansion you real estate idiots and mortgage vultures were trying to fob off on me for the last 4 years.
Bitter? You BETCHA.
Why would you ask that?
I heard a local store was now accepting Peso’s. Maybe thats where all the money is going?
I know you feelings all to well.
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