There's a lot of pressure now to subsidize the mortgage market and reduce the number of foreclosures. If that happens, then the bottom is very near because the reduction will turn the market around. Also in places in soCal we have reached the level between new listings and purchases (example Temecula area).
Two of my rentals are close. One mortgage is about even with the market value and the other is 30,000 below. I will hang on to them until the market turns. I don't want to do the down payment and loan costs again. I would rather eat the 3,000 a year for five years and keep the houses (in good locations) than take my chances on buying and re-qualifying with my DTI ratio.
Giving advise is often not a simple thing. Each person has to consider their own situation and crunch their numbers.
Insteresting comments, but maybe not for everybody; as mine weren't earlier.
No it will not, you have the same problem the stupid lenders were trying to over come with their interest only loans. Not enough people with enough income to make the payments on over priced homes.
The last figure I saw was over ten million unsold new homes, more are added everyday and tens of thousands of subdivisions started with millions of lots. The bottom is probably 12 to 14 months are more away.
You are correct in that every situation is different - a session with a good tax lawyer and CPA is invaluable for the money spent.
FWIW, while I’d like to be optimistic, I see no relief anywhere in the next 2 years. Option ARM recasts/resets will peak in 3rd qtr 09, unemployment is just starting to ramp, and yields on bonds are starting to ramp too - good for savers but really bad for those in debt. Tightened credit, while a very good thing, will depress prices further as it removes a lot of people from the buying pool for houses and cars. Increasing numbers of people getting to retirement age (Boomers) will mean more people pulling funds out of the markets, as will those who are laid off and can’t find jobs. We can no longer HELOC our way out of repairing household “income”, so there’s no borrowing to make numbers look good.
I don’t see good news really until ‘10 or later, so yes I think we have a long way to fall yet. 5000-6000 DOW and 500-600 S&P is where I think we go based on corporate earnings and that’s a lot of pain for a lot of folks.