They asked 27 economists, but forgot to ask 1 REALTOR (ME)... Why don't they ask me or put me on FOX NEWS or CNN or MSNBC? I have some experience and an MBA for goodness sake!!
Larry Kudlow -Call Me! 916-751-1800
http://money.cnn.com/2011/07/06/news/economy/home_prices_real_estate/index.htm?iid=H_E_News - CLICK
Couple thoughts... Need JOBS!!
Couple more... People will continue to default and short sale until we are out of the cycle of mortgages and equity lines that were placed against properties purchased or refi'd between 2004 and 2008. Reason - People can't get out any other way. Life still happens i.e. divorce, having to move for a job, losing a job, pay cuts, the list goes on which requires people to change their housing situation. And some simply see the economics of paying for the next decade or longer to break even on a property they are upside down on to the tune of hundreds of thousands of dollars. For most people to pay off that zero gain debt without an appreciating market would take 100% of their income before taxes for close to a decade... Work for free to pay off a collapse that was caused (many think) by the same lending institutions that were given significant amounts of government money and are now paying bonuses to the same people that were collecting big in the glory years... People either want or need to get out from under the burden of a 50-60% loss. I digress...
Lastly... Good news is that not much in the way of "new" inventory has hit the market in 4 years. So, the pre-existing inventory will not take forever to work through because people need to live somewhere and injection of new supply (Homes) into the market is very limited. And, some homes will end up just being razed to the ground. That said, I just do not see another 25-50% drop in prices providing the economy can find a way to create jobs.
Let's see where things are in 36 months. I think the picture will be far more rosy.
See -- I can have an opinion too! :-)
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