Skip to comments.No Rise in Home Prices Until 2020: Bankers
Posted on 09/30/2011 11:24:02 PM PDT by 2ndDivisionVet
Home prices are unlikely to recover before 2020 and mortgage defaults will persist for years, says a survey of bank risk managers out Friday.
The survey conducted by the Professional Risk Managers International Association for FICO, found that 49 percent of respondents do not expect housing prices to rise back to 2007 levels for another nine years. Only 21 percent of respondents said they would.
The findings, which authors called a decidedly pessimistic outlook, are a sharp reversal from cautious optimism the survey respondents expressed late last year and in early 2011.
In addition, 73 percent of surveyed bankers say they expect mortgage defaults to remain elevated for at least another five years. And 46 percent believe mortgage delinquencies will increase over the next six months...
(Excerpt) Read more at cnbc.com ...
This was a no brainer if you are in real estate. Life is a loser every day in this shit.
I have been saying this for the last couple of years. We are just in the beginning of this economic depression. The real pain is probably coming around 2013 and will last until, at least, 2020.
I can’t wait to see how counties are going to deal with real estate taxes. Remember Reagan said “a raising tide lifts all boats”, and then BamBamKennedy said he would “lower the sea level”. Well in a manner of speaking BamBamKennedy has indeed lower the sea level.
They are out here. Liberalism is a mental disorder. Look at the majority of teachers, they teach capitalism is 'evil'. And then there are some who are born and bred democrats who attend so called 'right-to-life' churches, that believe to vote for a republican is akin to voting for the 'devil'.... I mean really now WWJD is the depth of their religious teaching. And Jesus would house the homeless and set up soup kitchens for the poor. IT is wholesale/retail deception and there is no way to have a conversation. The older a liberal lives the more hard headed they become because it is like a 'dream' come true and reality of the situation is always some one else fault. ALWAYS.
Couldn’t have said it better.
And, yet 2007 levels were inflated by toxic political and banking policies that have been in place for the last 20 years. In the meantime, real incomes (adjusted for inflation) have been in decline since the 70s. Much of America has been living on credit for the last 30 years (e.g., credit cards, student loans, second mortgages, etc.). We have a massive deleveraging that needs to take place in the financial system that will takes years. This article just touches the surface in one particular economic sector.
Long before 2020 the rolling collapse will show up in other ways. Greece, Spain, Italy etc will be reshaping the world. The USA and EU are maxxed-out, Japan is mired down and China isn’t going to be able to keep it all afloat as they are selling less stuff. And yet some percentage think Bammy actually knows what he is doing.
My hope than would be some sort of tax overhaul that would lower rates and be simpler. All this can be done in 6 months or less. As the jobs start to flow, you will see a visible change in attitudes and home prices will begin to heal. People's attitudes will be totally different even if the job rate falls only to 8% from 9%. It will be going the right direction and we will have faith that things will get better.
Right now, we KNOW that things won't get better and Obama is playing "Whack a Mole" with anyone that wants to make money. The only reason we aren't growing and hiring right now is Obama and the Dems, period. It has nothing to do with consumer spending. Business is making some money and are just trying to hang on for 13 more months. 2020 is just to far away, IMHO.
Now, if Obama were to win 4 more years, America is finished, we won't come back. He will be lame duck and nothing to lose. It will be "comrade city" within months and we will ride to the gulag on mopeds. Money will be bullets and beans.
It needs to allow prices to drop and clean out the bad debts.
This isn't as bad as it may seem at first glance. Real estate cycles are much longer than stock market cycles. To go peak-to-peak in 13 years is not unusual for real estate.
Since the media can't figure out that the reason Bank Of America is charging a monthly fee for using a debit card is that they are limited in what they can charge the merchant, then the media will never be able to figure out any of the other problems that cause so many the symptoms that turn into economic troubles that the media can understand. And if they don't understand it, they can't explain it to the little people who vote. In the meantime, the media blames the greedy private banks for the fee increase.
And why are the banks limited in how much they can charge a merchant for a debit card transaction? Start working backwards and when you get to Chris Dodd and Barney Frank, you're getting warm.
I agree. If we can win in 2012 it will be such a relief from this nightmare things will get better.
Well said - I’m glad to have bought within my means and paid off early - my house is an asset instead of an anchor.
I think your time-line is very optimistic. Unless there are 60 Republicans in the Senate expect Dems to filibuster any attempt to repeal Obamacare, and do not count on the enthusiastic support of the longer serving Republican office holders. Dodd-Frank is going to be more difficult to repeal, although revising might be easier, and get some Democrat support. Comprehensive tax reform while having overwhelming support, is likely to take most of a term of congress (Obamacare took about a year).
While much regulatory reform can be done without congressional support, it will make a lot of enemies within the permanent bureaucracy, and their allies. Expect all of these changes to be demagogued by the supporters of the regulatory state (i.e. press and "progressive" NGOs).
There is definately a contradiction in the title of this article and the content in the body of the article. it says that there will be no rise in home prices until 2020, but then saying that home price values will not get back to 2007 levels. 2007 levels were pretty high and it could be longer than 10 years to ger back there. But I think there will be at least a small to moderate rise in home prices in the next ten years.
I actually agree with you if all the right things happen. If the GOP gets control which they surely will in 2013 and if they actually do what needs to be done. Some of these banks like BOFA need to fail and the toxic portfoio of REO’s needs to be put out on the market and sold off for whatever investors will pay. We need to take the pain and get it over with. Then the housing market will rebound. Until then we will just limp along.
In addition the tax system will have to be changed to promote business growth and jobs and all of the crazy regulations will have to be rolled back.
Hopefully the GOP will be up to the task.
If Obama wins in 2012, IMHO, America is finished. I don't see a way to recover. The Fed is out of bullets and we are out of money. How will we mark time or coast for another 4 years unless Obama has an epiphany? His religion says capitalism is the problem, not the cure. His textbook is Mao's little red book, or maybe he read the book Chavez gave him at that meeting back when he was first elected.
If McCain had been elected back in '08, then maybe,( I know I can't get in his mind), It may have been possible to lower taxes and cut spending to cut the recession short. A short history lesson shows Bush 43 came into office in recession and he cut taxes and his recession was the shortest and shallowest in history. If Obama had cut spending and taxes when he came in, he may have run up a short term deficit, but it would have taken the pressure off of the job creators and business would have responded sooner. As it is, he spent the "recovery" deficit money on propping up unions and sweetheart payments instead of helping the economy. Now the unions are still killing business and costing taxpayers and the donors are still giving money back to the Dems, but all we get is the bill and more deficits. He has actually done harm to the economy and not helped anyone. Even the union members will eventually be fired as there is still no money to feather bed them anymore.
The next president, no matter who it is, has no money left to "stimulate" the economy. We spent over a $trillion and got nothing but a huge tax bill. If he had just dedicated, lets say, $500 billion to tax relief, we would have at least taken the pressure off the businesses and only ran up the deficit half as much. It's not that we didn't need stimulus, but Keynesian's don't stimulate the right people. Giving wino's and retiree's $250 to spend at Walmart doesn't create jobs. When the money is spent, you wait for the next check. Same with building a bridge. When the bridge is finished, the workers are laid off and waiting for the next gubmint check. If you give a tax break to a business, he figures out how to use it to expand his business, hire more workers and build the bottom line to make more money and pay more taxes.
It all goes back to giving a man a fish or teaching him how to fish. Keynesian's are the problem, not the solution. They will tell you with a straight face that we should have doubled the stimulus package to get it to work. What we really need is a $28 trillion debt and a $3 trillion deficit and we will be rolling in jobs. That is what we are dealing with as the Obama "religion".
Good. Then let the flood of foreclosures commence instead of holding them up with a dam of lawyers and socialism. The currently high property taxes are only propping up unneeded, lazy, overpaid emergency/rescue/regulatory/social/socialist parasites and preventing a resurgence of real productivity and worthwhile business by better people (the true private sector, holding back on spending and activities until then).
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