Existing Home Sales UP - Page 11 - New England Patriots Forums

FootballYouBet · 08-26-2008, 10:03 AM

A friend of mine is a Real Estate agent. She says that home values are not expected to return to 2005 values, until 2011.

PatriotsReign · 08-26-2008, 07:10 PM

Quote:

Originally Posted by BelichickFan

Please stop editing posts, it is real hard to respond when you add to them.

In theory I agree with you but there's realities too. If you have two working adults in more houses, prices will go up. If you have kids paying no attention in school and coming out without what it takes to get a good job they won't be in the housing market. I have a lot of respect for today's kids but I wonder about those in inner cities who treat school as a joke. They largely won't be future home buyers. And when they are and lending standards are eased, we're seeing the results today.

I can't help editing posts...stop trying to answer them so quick!

You make some valid points here, but also consider the fact that the number of children living in cities (or the percent of children) is far, far less than it was in 1960.

Like I stated previously, plumbers, bus drivers and school teachers should still be able to purchase a home. That has nothing to do with the quality or interest in inner city education or the tax reform act of 1987.

PatriotsReign · 08-26-2008, 07:12 PM

Quote:

Originally Posted by FootballYouBet

A friend of mine is a Real Estate agent. She says that home values are not expected to return to 2005 values, until 2011.

Real estate agents are typically not experts on predicting short or long term market trends. I would trust the opinion of someone on Wall Street or a respected national economist before I'd listen to her.

***BelichickFan*** · 08-26-2008, 07:32 PM

Quote:

Originally Posted by PatriotsReign

You make some valid points here, but also consider the fact that the number of children living in cities (or the percent of children) is far, far less than it was in 1960.

Note, I wasn't trying to be correct, I just wanted to point out that showing median income and property values may not tell the whole story.

Quote:

Originally Posted by PatriotsReign

Like I stated previously, plumbers, bus drivers and school teachers should still be able to purchase a home.

Sure. OTOH, buying a house the moment you have an income isn't a God given right either. House prices had gotten too high - and I've argued many times here that I don't care too much about the foreclosures because they help right size the market and allow a new wave of potential home buyers in - but there's also some good for people to have to save for the 20% down payment that used to be the norm.

PatriotsReign · 08-26-2008, 07:40 PM

Quote:

Originally Posted by BelichickFan

Yes I know that. I'm just saying that the stats may not tell the whole story. If the bottom 70% are still one income and have some sort of moderate increase that would overpower the 71% - 90% that may be two income but buy significantly more house based on that. I'm not saying that is skewing the numbers but it very well might be.

The other point is for sure, though, the increase in house price is dulled by the mortgage deduction as 1/3 or so of the payment for a new 30 year mortgage (almost all interest) is paid for by the tax payers.

Keep in mind the Tax Reform Act of 1987 was introduced during the Reagan administration. That was the beginning of "bubble econometric theory" and added to the illusion of prosperity. Introducing this measure was just like lowering the prime rate and/or lending standards. It put more money back into the hands of the consumer, which increased consumer spending which increased the value of corporations which finally lead to the dramatic rise in the stock market.

It was no coincidence that the stock market mega-boom began shortly after that.

Real World · 08-26-2008, 11:34 PM

Quote:

Originally Posted by FootballYouBet

A friend of mine is a Real Estate agent. She says that home values are not expected to return to 2005 values, until 2011.

I think she's wrong. She should try 2015 if she's lucky. First and foremost, she'll a real estate agent, so they always give an unrealistically rosie outlook of the market. I remember telling a couple of REA friends that the market was going to crash hard, and they laughed. There is simply no way that a 1 bedroom condo is worth $300k, or a single family house in Chelsea, $400, nor a 3 family in East Boston, $700k. Those prices aren't going to return for a long, long, long time. Thank god.

BTW, welcome to the political forum bud. Please post often!

Run DMC · 08-27-2008, 01:17 AM

What are these people smoking? I'd like a bag:
http://normxxx.blogspot.com/2008/08/...ome-sales.html
http://normxxx.blogspot.com/2008/08/...ew-record.html

PatriotsReign · 08-27-2008, 05:57 AM

Quote:

Originally Posted by BelichickFan

Note, I wasn't trying to be correct, I just wanted to point out that showing median income and property values may not tell the whole story.

Sure. OTOH, buying a house the moment you have an income isn't a God given right either. House prices had gotten too high - and I've argued many times here that I don't care too much about the foreclosures because they help right size the market and allow a new wave of potential home buyers in - but there's also some good for people to have to save for the 20% down payment that used to be the norm.

But since home price have risen twice as much as incomes have, 20% pushes the enty-level market out of reach of the average Jack & Jill. The 20% rule is no longer viable. Since housing has increased at twice the rate of incomes, 10% should be the new rule. But definately not below that.

The worst thing that could happen in the housing industry would be that home ownership is no longer affordable for the lower end of the middle class.

If anything, it should have gone the other way around.