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  1. #1
    AM Navigator Geno Prussakov's Avatar
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    U.S. Housing Prices Will Continue to Fall
    I've just put this together. Thought some of you may be interested in it too...

    Geno

  2. #2
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    Quote Originally Posted by Geno Prussakov
    I've just put this together. Thought some of you may be interested in it too...

    Geno
    Geno, I agree with you. We have not seen the worse of sub-prime crisis IMO. More chips to fall off the table in 2008.

    That said, housing market is local in nature. Despite almost highest median home prices in Silicon Valley, the prices are pretty stable in hot pockets like Palo Alto and its surroundings. Tech. is hot. GOOG, AAPL etc. at its current valuations does not hurt the local stable home prices either.

  3. #3
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    I've been thinking of buying a second house and converting my existing one into an office... but think I'll wait it out, don't think we've hit the bottom yet... maybe in 6 months to two years.

  4. #4
    Beachy Bill's Avatar
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    We have definitely seen that here in Baltimore. We recently sold our "old" house (around the corner, literally, from our "new" house - built in 1895) and had to compromise a bit on price. Fortunately, as RTD says, things are regional - and our house was/is in a neighborhood where folks can still walk to many of the large office buildings downtown, which helped to hold pricing more stable than in other areas. Local Realtors try to paint an optimistic picture, but realistically are saying at least another year until things start to swing the other way.

    Nice page, BTW. I'd like to use something like that on a new site (needing to be developed - soon) about Baltimore Homes. I've got the dot-org, but just don't have the time right now.
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  5. #5
    ABW Founder Haiko de Poel, Jr.'s Avatar
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    Whatcha kidding?

    We haven't even seen the beginning of the downfall!!!

    Over the next 3-5 years cash will be KING, you'll be able to pick up some major RE deals.
    Continued Success,

    Haiko
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  6. #6
    ABW Ambassador Daniel M. Clark's Avatar
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    Bummer for people that are trying to sell and get a good value for their home - like my parents. Dad's got a new position in Houston, and they're trying to sell their home in Florida to make the move... and it looks like they're going to be lucky to break even on their investment.

  7. #7
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    Quote Originally Posted by Haiko de Poel, Jr
    Over the next 3-5 years cash will be KING, you'll be able to pick up some [B
    major [/B]RE deals.
    Ditto. When it is time, get RE deals at low prices to stay LOOOOOOOONG

  8. #8
    affiliate emeritus missdonna's Avatar
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    A couple of years ago I saw how the prices were getting too high too fast and I seriously considered selling my house at the top. But I love my house more than I'd love the money, and I'd have to find somewhere else to live.

    So I'm still here, still loving my little house. It's still worth many times what I paid for it (a very long time ago).

    Anyone who needs a house now should probably rent for a few years and save their money until the prices level out or even start up again.
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  9. #9
    Prince of Content Vinny O'Hare's Avatar
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    Actually it isn't the subprime that scares me it is all the people that cant pay off their credit cards. That is when the real crisis is gonna happen. We will be at 18% interest again and cash will be king.

    If people are losing their houses now what is happening to their credit cards, do you think they are being paid off?
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  10. #10
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    Quote Originally Posted by missdonna
    .. But I love my house more than I'd love the money, and I'd have to find somewhere else to live.
    That is the beauty of a home .. Everyone needs a home or rental to live. The demand is there one way or the other. And that will generally limit the downside to major economic crises such as this sub-prime crisis .. We shall all ride through this in the long term IMO

  11. #11
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    >>>Over the next 3-5 years cash will be KING

    Those that took STUPID loans will loose. That is Biz.

  12. #12
    Beachy Bill's Avatar
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    Quote Originally Posted by Merchant Consultant Team
    ...Those that took STUPID loans will loose. That is Biz...
    But, unfortunately, many of our tax dollars will be used to help "bail out" those institutions who made those loans and to those individuals that got suckered into them.
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  13. #13
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    Quote Originally Posted by Beachy
    But, unfortunately, many of our tax dollars will be used to help "bail out" those institutions who made those loans and to those individuals that got suckered into them.
    That is life .. top 10% foots over 70 to 90% of taxes paid. I may be wrong on the percentages. But very few in the top foots a major share of govt. provided services / amenities / roads / or whatever govt. spends on .... If you analyze that it is always rich funding the poor to get the society smoothly going without civil wars or whatever ugly stuff that otherwise will find a way.

  14. #14
    ABW Ambassador Daniel M. Clark's Avatar
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    If tax dollars go to bailing out the institutions that were making the loans, that's not the poor being funded by the rich. It's the government funding the rich - the banks and moneylenders. I'm also unclear on how the rich don't use roads, but maybe that's for another thread

  15. #15
    Affiliate/AM Moonlighter dflsports's Avatar
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    I am wondering why "cash will be king"? The dollar is dropping as fast as the housing prices in the international market. That dude that's always pushing Goldline on the radio is starting to make sense and he annoys the heck out of me I'm no financial expert but I have sure been reading and hearing a lot of doom and gloom about our economy.

  16. #16
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    Quote Originally Posted by HecticDMC
    If tax dollars go to bailing out the institutions that were making the loans, that's not the poor being funded by the rich. It's the government funding the rich - the banks and moneylenders. I'm also unclear on how the rich don't use roads, but maybe that's for another thread
    Think why the govt. had to bail off .. It is because of loans defaulted by those who bailed on loans .. who are those folks .. indirectly govt. bail off is due to folks who could not pay their loans. And who are those folks?. Not the top 10% who foots the govt. with majority of taxes collected. Any way, all that is off the topic. So, let us not digress.

    And revert back to original topic of Geno .. US Home Prices.

  17. #17
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    Quote Originally Posted by dflsports
    ... The dollar is dropping as fast as the housing prices in the international market...
    Cash may be king .. but not the USD. It fell over 20% in a year against some currencies. Indirectly that leads to inflation (imported goods costs a lot more). The rising inflation is controlled by tightening the access to money (a.k.a higher interest rates). Higher interest rates leads to more sub-prime, loan defaults and credit card loan crises etc. As I see this, it is a vicious circle.

    What gets us out of this .. Serious changes on govt. spending, increasing productivity, lowered taxes, etc. I'm no expert on economics but hey my 2 cents of analysis.

  18. #18
    ABW Ambassador Snib's Avatar
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    Good news for me since I'm planning to buy my first home within the next 2 years

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  19. #19
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    Quote Originally Posted by HecticDMC
    I'm also unclear on how the rich don't use roads, but maybe that's for another thread
    Hectic, you made me smile. I enjoy your sense of humor.

    I'd also add that Redtagdeals is right about the tax burden being carried disproportionately by the wealthy in America.

    The rich obviously do use the roads, as do many others. But the point Redtagdeals was making isn't about use, but who pays for those roads. Regardless of whether it's fair or not, if you look at the numbers, it's very obvious that the rich are paying for the roads that everyone gets to use. So I'd certainly hope they could use them as well.

    See myth #10 here:
    http://www.heritage.org/Research/Taxes/bg2001.cfm

    I know it's common for the poor to resent the rich and to believe stories about how the rich aren't taxed and think that the little guy's getting screwed by big brother and big business, but the reality is, in our country, the poor are heavily subsidized by taxing the rich. Just because they don't believe it, or don't want to accept the truth (it's easier to believe you're being held down), doesn't mean it ain't so.

    I'm not passing judgment on the poor or the rich here, I've been both. But I will say if you personally want to live out your financial dreams and find success in business, it's best done by first understanding the reality of the world around you.

  20. #20
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    Quote Originally Posted by Snib
    Good news for me since I'm planning to buy my first home within the next 2 years
    I think your timing should turn out to be excellent!

  21. #21
    ABW Ambassador Daniel M. Clark's Avatar
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    What can I say, I'm a funny guy

    I don't want to debate the whole rich vs. poor thing because I know it's an area fraught with pitfalls and landmines. I probably shouldn't have opened that can o' worms. There's a lot of conflicting information out there. The Heritage Foundation is a conservative think tank - not exactly the most non-partisan folks in the world. I don't trust their analysis on most issues. I will concede that not being an economist, I am not an expert in this area lol

  22. #22
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    Your skepticism is healthy and smart Hectic, I share it in many ways.

    I'll research their numbers and find the source(s) for you, if you'd like. My gut tells me the trail will lead to the IRS or GAO, both US government organizations. If I research it and show their data and then you happen to say that you don't trust the US government, I will have wasted my time, perhaps a considerable amount of it.

    So let me know how your trust meter points when it comes to stats provided from the IRS or GAO or other similarly recognized branch of our federal government. If those orgs are trusted by you, I'll make attempts to track it down further for us both, if you'd like.

  23. #23
    ABW Ambassador Daniel M. Clark's Avatar
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    It's okay, Donuts. I wouldn't want to you spend your time on it, it's just an offhand conversation on a message board... it's of no consequence, really They may very well be correct, and that's okay with me, too. I'm a skeptic of partisan organizations (on both sides) but I'm a realist in that I know that just because an organization is partisan doesn't mean they're always wrong. Thanks for the offer, though

  24. #24
    ABW Ambassador Ron Bechdolt's Avatar
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    My wife's mother recently passed away and her estate includes three houses, her residence and two rentals. The four kids, who get to share things equally, are trying to decide if they should try to sell the rentals or, for fear they won't sell, continue to rent them. All we keep hearing about is the poor housing market. Does make it hard to make decisions.
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  25. #25
    ABW Ambassador JudiMoore's Avatar
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    I would keep anything I already had invested rented out. The rental market will be as OK as anything - all those poor foreclosed people will have to rent somewhere. It will be four or five years before they all start buying again.

    The other source of income is to wait a bit and then be prepared to sell homes "on contract". The mortgage market is tightening up to exclude people with little or no downpayment and so "renting to own" will be attractive again where it has fallen out of favor in the last few years of easy money.

    The home values in Middle America will only fall back to whatever a steady 4% return over these past few years would have been. That and whatever a mild recession does. It's the "hot" markets where prices were going up while you were waiting to speak to the builder that are crashing the hardest and bringing the average WAY down.

    (sorry, I got started and couldn't stop)

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