The lasting, so far, effect of the housing crisis

By
Real Estate Agent with AllMountainRealty.com

The bubble burst. Folks who bought land,condos, and homes in 2004 -2008 maybe still be upside down today if in fact they have managed to hold on to the property. So the immediate effect was a general decline in housing prices as now foreclosures and short sales figured into "comps". In addition, as housing slowed many industries that rely on housing for their well being suffered. 

But this post is not about the recession and finances. It is about the lasting psychological effect of the crisis. Todays' buyer is looking at housing as an investment. Not so much as an investment in the future for themselves and family but as a financial investment. The notion that housing prices always go up was destroyed. Todays' buyers are, to use a non technical term, goosy.  So the question is , Should they be? In my opinion no.

You can draw a straight line , from when numbers were starting to be tracked, to today and see that housing prices increase a national  average of 6 % a year. Even after the collapse the bubble bottomed right at the 6 percent growth line. (Now this was not uniform in all markets) Many markets have recovered and are in fact on the plus side with multiple offers once again becoming part of the market. Other areas have yet to recover either partially or fully. But over all the numbers are once again going up as a whole.

As a buyer then what should you look for? Look for a good Realtor. Have the Realtor give you a good market analysis.  Be comfortable with the pricing of homes based on the market. Buy with in your means Most of all buy with confidence. If you are looking in our North Georgia area  talk to one of our pros here. Enjoy your home and let's hope that regulations are in place to prevent this mess from happening again. 

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Charlie Ragonesi All Mountain Realty Big Canoe and Mountain Blog

On line at www.allmountainrealty.com Call at 706 579 1098

We sell Homes                                                    

 

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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

You are so SPOT ON.

The lasting effects of the real estate market in the past 9 years is quite devastating to many.  The effects will last many, many years.

Feb 06, 2015 06:20 AM #2
Rainmaker
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Chris and Berna Sloan
Group 1 Real Estate - Tooele, UT
Tooele UT

Love the info. While the national trends can give a good picture from 30,000 ft, the ability to not only track what's happening currently in your area, but use your "crystal ball" to forecast growth based on future events in yours and adjoining areas is invaluable. The fact is, no matter what the markets do in the future, or how the buyer philosophy changes, a good Realtor® will be worth his/her weight in gold. I also agree with Lenn that the effects of the apst will be felt long term. But, those that didn't party as hard during the bubble aren't suffering the same hangover as some that did...

Feb 06, 2015 06:59 AM #3
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Fred Griffin, on leave of absence from ActiveRain
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

     My grandparents talked about "the Great Depression", years after it was over.   They hid money in tin cans in the yard because they did not trust the Banks.

     Those who lost their savings, went bankrupt, or suffered foreclosure from the housing boom-bust of the 2000's will tell their grandchildren about it.  And they may never trust the Banks again, either.

Feb 06, 2015 10:24 AM #4
Rainmaker
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Jeanne Dufort
Coldwell Banker Lake Country - Madison, GA
Madison and Lake Oconee GA

Absolutely on target. I regularly hear some version of "I won't make that mistake again" from buyers. The damage to the confidence of buyers cannot be overstated.

Feb 06, 2015 10:58 AM #5
Rainmaker
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Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

Hopefully folks and regulators will learn something from the past few years.   A lot of folks are still experiencing the effects of the economic down turn.

Feb 06, 2015 11:23 AM #6
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Praful Thakkar
LAER Realty Partners - Andover, MA
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Charlie Ragonesi isn't up and down the part of real estate - and one thing - as your post mentions - in the long run, that straight line shows going up with time!

Feb 06, 2015 01:49 PM #7
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Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
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Charlie - The emotional effects are definitely still there and likely will be for many years to come.

Feb 06, 2015 03:40 PM #8
Rainmaker
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Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

This too shall pass I call things as the Buddhist's say myself. Good luck with everything. :)

Feb 06, 2015 04:00 PM #9
Rainer
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Linda Metallo DiBenardo
RE/MAX Impact, Lockport, Illinois - Lockport, IL

The lasting effects of the housing collapse will be around for probably several generations of buyers.   It was too devastating to many families and it has also got some of the would-be first time buyers renting.

Feb 06, 2015 07:35 PM #10
Rainmaker
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Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

The walking Real Estate wounded are still out there only they don talk about it

Feb 06, 2015 11:52 PM #11
Rainmaker
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Nicole Doty - Gilbert Real Estate Expert
Zion Realty - Gilbert, AZ
Broker/Owner of Zion Realty ZionRealtyAZ.com

I do feel like more people are looking at their homes as an investment and not where they'll raise their family. It's going to be a rare thing in the future to have someone live in their home for 20-30 years like past generations. 

Feb 06, 2015 11:57 PM #12
Rainer
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Thomas F. Scanlon
Borgida & Company P. C., CPA's - Manchester, CT
CPA, CFP

Charlie Ragonesi - Well done! Buy within your means, well said.

 

Cheers!

Feb 07, 2015 03:16 AM #13
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Russ Ravary ~ Metro Detroit Realtor call (248) 310-6239
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Homes are going up though in our Detroit market I am still seeing some people upside down.  That is why it is so important not to over pay! 

Feb 07, 2015 07:13 AM #14
Rainmaker
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Bill Reddington
Re/max Southern Realty - Destin, FL
Destin Florida Real Estate

When the madness as I call it many people were devastated. The market here is coming back and rose about 10% last year. Hopefully in 2015 it will return to normal appreciation.

Feb 07, 2015 07:21 AM #15
Rainmaker
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Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I think I already said this, but it might be a good two year cycle before we start seeing real lasting effects of any changes put in place.

Feb 07, 2015 03:07 PM #16
Rainmaker
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Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I guess in that sense you're right, Bill. But does the madness have to be so mad? The world may never know. Bill Reddington

Feb 07, 2015 03:09 PM #17
Rainmaker
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Claude Labbe
Real Living | At Home - Washington, DC
Realty for Your Busy Life

Sure, the devastation was widespread and truly killed people's spirits.

Most places have recovered.  (Even in DC, within an hour's drive..some have recovered, some have not)

BUT...even with all that, today's buyer has to consider the options.  Buy or rent?  If the former, then buy with an eye to buying a home you'l enjoy, not with an eye to make the biggest invesment for the biggest payoff when they sell in 2 years.

Smart home buying, with a good realtor, is clearly the better option.  In spite of, or more correctly, especially when considering the prior decade.

Feb 08, 2015 10:08 AM #18
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Charlie Ragonesi
AllMountainRealty.com - Big Canoe, GA
Homes - Big Canoe, Jasper, North Georgia Pros

Thank you all so much for your comments on my blog. I have been absent from ActiveRain for a while . I am now back and your comments all are a great tonic for me

Feb 09, 2015 12:35 AM #19
Rainmaker
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Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

People's memories are short-lived which is why we have to continually make efforts to remember events, some of which were extremely tragic. Talk to some of the boomerang buyers, you'll see they were cautious for a while but got over it.

The one thing they tend to have learned is to spend within their means.

Feb 09, 2015 02:00 AM #20
Rainmaker
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Roy Kelley
Realty Group Referrals - Gaithersburg, MD

This is good reading for prospective home buyers.

Make this a very productive month.

Feb 10, 2015 01:47 AM #21
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