Skip to comments.Insight: Falling home prices drag new buyers under water...(Circling the drain?)
Posted on 04/27/2012 11:31:07 AM PDT by AngelesCrestHighway
More than 1 million Americans who have taken out mortgages in the past two years now owe more on their loans than their homes are worth, and Federal Housing Administration loans that require only a tiny down payment are partly to blame. That figure, provided to Reuters by tracking firm CoreLogic, represents about one out of 10 home loans made during that period. It is a sobering indication the U.S. housing market remains deeply troubled, with home values still falling in many parts of the country, and raises the question of whether low-down payment loans backed by the FHA are putting another generation of buyers at risk.
(Excerpt) Read more at reuters.com ...
—When the stock market drops it will be so damn fast no one will have a chance to get out.—
Reminds me of this:
Here’s your money quote:
“We have all three branches of government trying to keep people in four bedroom houses who can’t afford chicken coops.”
And I just finished my 8x8 chicken coop last night. 14 hens.
The Federal government is just playing three card monte with us....It’s all crap!
Interesting views...The larger cities could indeed just fall apart.
“Even for loans taken out in December - less than four months ago and the last month for which data is available - nearly 44,000 borrowers, or about 7.5 percent of the total, now find themselves under water.”...
Next up: principal writedowns. Not many bullets left in the chamber after you've reduced the interest rate to 2%, reset the maturity to 40 years, and foreborne principal of $100K (or more).
So, really bad time to get a house. Crap, we’re in process right now...
No, it's a great time to buy a house as long as you have a fixed rate mortgage. As soon as hyper inflation kicks in, you'll be able to pay off your house for the price of a cup of coffee.
The “No better time to buy” and “housing is at the bottom” buyers. Then again it depends on how much they’re under water + taxes and financing vs. accumulated rent payments to determine if they’re really losing money.
I bought my 13 acre farm and new home in central KY two weeks before Obama was elected. It cost less than one years wages. It’s actually worth more now.
However, that is because people are slowly moving from the cities into rural areas (me, for example) and there was no price runup to speak of out here.
I lived in Seattle when we bought this place. There is NO WAY I would have purchased ANYTHING in that place. Or any other city. For starters, the only reason I bought this place was because you don’t rent a place like this. It is a tool for survival and where we expect to die.
I agree. Especially within ones means. With % rates so low, its better than renting because rental rates are skyrocketing.
snip-The laundering of trillions of dollars of U.S. taxpayer money and the wrongful taking of the homes of those taxpayers was known by the Administration and expressly supported by it.
Everyone who ever held an auto loan has been under water from month one.
It is a GREAT time to buy a house. The people buying them today are investors. Most of the doom and gloomers bought at the top of the cycle and wish they could buy at the current price. The important thing is do not buy more than you can afford. Also, lock in your interest rate(3-4%) for as long as you can. All real estate is local. It is better to buy a cheap property in an expensive town than the opposite. Your house should never be worth more than the others in your neighborhood.
Where are you buiyng ?
no one buys a vehicle to use expecting it to appreciate.
I pulled out all the equity I could, refi'd at 3.75 fixed for 30 yrs, and plan to pay it back with Baraqqi/Bernanke minibucks.
House prices are still insanely high for the market (or lack of). Could be that many of them are listed so high, because the borrowers have mortgaged them to the gills. There won’t be an upside, until all of them are foreclosed and resold cheap. Maybe not even then (see decades of us Baby Boomers croaking).
Yeah, but then property taxes will eat you alive.
Nuts! I am fortunate as mine is a fixed rate and I only have approximately 2 1/2 years until mine is paid off in November,2014.
It wasn't too long ago some people on these boards were saying that "now is the time to buy" and disregarded warnings about trying to catch a falling knife.
Aren’t there a lot of foreclosed houses being dumped on the market right now, since the “robo-signing” deal got settled? That’s got to drive the values down for everybody else.
Agreed, but there were many people here sounding like things could only go up from 2009 and were making blanket statements.
Things in Nevada, outside of Las Vegas as well, are still drifting downward in a stagnant market - even among the under $200,000 range. In my desert area, lots that were $15-20K shot up to $40K - and people bought in - are now at $8.5K are starting to sell - from people around the Salt Lake City area.
It’s very localized as others have pointed out. There are decent brick three bedroom, two bath ranchers with basement on an acre here for $115,000. Combine that with the low interest rates and people are starting to buy again. Unemployment is still historically high and wages are stagnant to declining overall, but for those properties that actually are in some way desirable and are priced within reach and within the historical guidelines of 2.5 to 3 times household income, they’re selling, finally. More “sold” signs than new “for sale” signs popping up around here.
They're STILL saying that around here. Reminds me of the guy who jumped off the Empire State building, and as he passed the 50th floor, was heard to say "So far, so good". :-)