One of my relatives who is a perpetual bear on the housing market sent me this link to a BusinessWeek article:
http://www.businessweek.com/magazine/content/08_06/b4070040767516.htm
I'm not quite sure what to think when I read something like, "Housing prices could drop another 25% on average." Sure, they could. Or they could rise a bit. And then there's that part about "on average." It's almost completely meaningless. I don't live in an average area - maybe you do, but I'm sure there are lots of factors that make your area not-so-average.
It could be that some cities in the county where I live (Santa Cruz County, California) will see further price declines of 25%. Before we get to that point, though, I expect to see sales volume pick up quite a bit. In some parts, prices can't go much lower before the mortgage payment is less than the amount the property would get per month as a rental. I understand that there are some areas in the country where that is par for the course - it's cheaper to buy than to rent - but I can never remember a time where that has been true around here.
What do you think - can you see your market dropping another 25%?
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Seb Frey - The Real Estate Guy
Broker Associate, Thunderbird Real Estate
(831) 293-6727 / sebfrey@sebfrey.com
Specializing in Santa Cruz Real Estate
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NO! Not even! At least in my area and yours. We live in areas where there is pent-up demand even now.
Vickie Nagy, Empire Realty Associates, Danville, CA