Roubini: 'Housing Prices Can Only Move Down'

[Joanne98]

Source: CNBC

According to economist Nouriel Roubini, the housing market is in a double dip.

And negative Case-Shiller Home Price numbers out today only confirm that unpleasant truth.

"It's pretty clear the housing market has already double dipped," says Roubini. "And the rate of decline is stronger than in previous months," he said of the new housing data.

Aside from below trend economic growth, there are two factors specific to the housing market that are putting downward pressure on home prices.



Read more: http://www.cnbc.com/id/40828545

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There you have it. And we can't even do anything to stop it since the idiot voters put the criminal filth back in charge of the house!

[Roland99]

1. The coming increase of foreclosed/REO homes is going to put add'l downward pressure

and the continued anemic job market and lackluster wage "growth"


BUT, there is and will always be a market for homes priced appropriately (such as new construction, non-foreclosed existing homes, etc) that will sell. Trying to buy a foreclosed home or one on short sale can take months and months and still end up a no-sale. Not everyone is willing or capable of waiting out the entire process (perhaps even multiple times)

[Warpy]

2. Banks won't be able to hold inventory off the market in an attempt

to prop up unrealistic prices forever. Eventually, that housing will have to be dumped on the market to salvage anything, at all.

Add to that the negative appeal of signing on for 30 years of debt in the shakiest job market I've ever seen, and you've got a recipe for complete collapse, meaning the only people who will be able and willing to buy housing are wealthy people who fancy becoming real estate barons and Potteresque landlords. Cash will be the only way to go in real estate until and unless the miserable employment situation is addressed, and don't expect that over the next two years, at least.

[madrchsod]

5. my son was shopping for homes around 125 in the chicago suburbs last year

he was aced out of at least 5 homes by cash buyers. he finally found a 2 plex fixer with a government program loan for 125 and added 25 more.

where i live cash is king and every 40-50 house is being rebuilt. apt`s rents start at 500 for a semi-dump to 750-800 for new. rental homes are around 650-750. new construction is all but dead.

it`s going to take years for the market to recover with out an employment recovery

[yourout]

3. Does that mean my property taxes will also drop?.....I think not.

[rfranklin]

4. they have to go up...to cover the shortfall...

the police can't write tickets fast enough to make up the difference.

[defendandprotect]

6. Obama had TWO YEARS to do something about this ...

[BobbyBoring]

7. What

What might he have done?? I'm not a big supporter of Obama but this horse was WAY out of the barn B4 BO was a candidate.
What I can't figure out is I'm a dumb ass musician and I saw all this coming years ago. Why didn't anyone else?

[defendandprotect]

8. Obama could have stopped the foreclosures and permitted renegotiation of loans...

There's a reason why these were called "liar loans" --

Most of the borrowers could pay the rates originally set on their mortgages --

but the payments ballooned.

Many lost their jobs making paying mortgages or rent impossible --

Can Obama do anything about that?

Of course he can --

Rather Obama has provided every way possible for taxpayer money to be moved into

the hands of corporate/elites --




Rahm .... crowing about preserving "private health care industry" ... business s/b grateful!

Thursday, August 12, 2010 10:03 AM

”In a Thursday interview, White House chief of staff Rahm Emanuel argued that rather than recoiling against Obama, business leaders should be grateful for his support on at least a half-dozen counts: his advocacy of greater international trade and education reform open markets despite union skepticism his rejection of calls from some quarters to nationalize banks during the financial meltdown; the rescue of the automobile industry; the fact that the overhaul of health care

preserved the private delivery system;

the fact that billions in the stimulus package benefited business with lucrative new contracts, and that financial regulation reform will take away the uncertainty that existed with a broken, pre-crash regulatory apparatus.

http://dyn.politico.com/printstory.cfm?uui... ...

[KeepItReal]

11. Renegotiation of loans is the last thing Banks and Wall Street want

Their logic is "a contract is a contract" and it is binding.

If you revalue the home loans, then you diminish the banks' "assets" and revalue the Mortgage-backed Securities they created and then sold...

[defendandprotect]

12. Nonsense ... Courts have been barred from resetting payments on these loans ... something

that has been done repeatedly in the past --

Remember that time ... when corporations didn't dictate to government?

Whatever the banks have they have taken in a crime wave permitted by Congress and

this president --

[KeepItReal]

15. I don't know about courts being barred from helping revalue mortgages

The issue is there is no policy directive at the government or banking industry level to revalue mortgages across the board.

They need to make it easier for folks who can afford mortgages based on real world home valuations.

[defendandprotect]

16. Judges in the past were able to reset payment ... they are barred from doing that now ....

There is no government policy because Obama turned from it -- nor is it

about "revaluing" mortgages --

The first step is to STOP the foreclosures -- then to deal with the monthly payments

making them affordable again --

When first set, they were affordable -- but payments "ballooned" in ways that made

it impossible for borrowers to keep up with.

[pipoman]

24. The payments ballooned

for many because they signed up for an 'entry rate' and interest only for the first few years. Are the banks to blame for offering stupid mortgage conditions? Yep Are the buyers idiots for accepting these conditions? Yep

[fasttense]

28. It's called cram down and it failed to pass in the Senate.

The banks (despite being rescued by the same people they want to screw) fought against it tooth and nail. They bribed the required number of Senators and judges and killed it.

Cram down was used during the Great Depression, and it helped some. But of course now our bankers control our government so we are all screwed.

[DCKit]

20. I did, and begged my sister not to pay what she did for the house she bought.

Now she's refinanced with an A.R.M. that can "only" go to 8%.

It's not going to end well. Unfortunately, I'm afraid the one time I tell a family member to do the opposite of what I truly believe (reverse psychology), they'll listen, and I'll get blamed.

[xiamiam]

29. reinstate the bankruptcy bill which was dismantled in 2005

at least that would have protected personal residences..he didnt do it...it was attached to the stimulus and he gave in immediately..THAT protection was in place from the depression until 2005 and would have helped homeowners instead of the banks..he didnt fight for it..thats what he could have done...and that is within a couple months of the election..i knew at that point the direction this administration would take..i have not been surprised since

[AngryAmish]

10. Are you the only person in America not to recognize that there was a housing bubble?

If the prices are too high and built up on speculative fever then the prices must come down to a market clearing level. There is no other way, unless you want to reinflate the bubble.

[defendandprotect]

13. And are you the only one to recognize it was purposefully done ... ?

Private pensions were used to create the housing bubble --

while those doing it knew that jobs were going to be shipped out of America --

and that these "liar loans" would explode with mortgage payments too high for

the borrowers to handle -- plus many of them losing the jobs!


Keep in mind also that they used private pension funds to finance the shipping

of these jobs overseas!!

[Change Happens]

19. I know he tried to move prices up, but GOP in Congress and other big banks fought it...

He should have tried harder I think, he is the President of the United States afterall, why can't he move home prices higher?


WTF?


























































:sarcasm:

[trud]

9. possibly not

I have no idea why or how this can be happening with no jobs, but houses have actually started selling again in my area.

[defendandprotect]

14. I think you mean they are selling at deflated prices .... ???

They've lost 30% of their value in most areas --

and the losses will still keep coming because so many more homes are

under foreclosure -- 2.6 million? Not sure of the figure at the moment.

[Change Happens]

17. So, should I wait to buy the house we REALLY want?

The price has been lowered about 4 times in the past 2 years, it is sitting empty...Owners have moved on...etc. Do I make my move or wait for few more months? How much lower could prices go? 5-10% is not worth it really, will prices move 20%+ down from here?

We live in South Florida.

[PSPS]

18. They are still way too high, so this downward shift is good.

Housing prices will return to their historical norm of 2.5 - 3 times the average household income of the house's area. Many markets are still way over this.

What I've been doing lately to determine the real value of a house: Find the best comp you can in the rental market, and work backwards from the monthly rental (i.e., use the monthly rental as a PITI figure and see what the selling price should be.) That's a real eye opener.

What will bring housing prices up again? Absent any shenanigans, like NINJA loans or other infusion of money a liar can get with no down and no income to make the payments anyway, there is only one thing: higher wages. And, since that hasn't been happening for thirty years and there's no prospect for that happening anytime in the foreseeable future, you have to proceed on the assumption that housing won't be going up in value.

[Sen. Walter Sobchak]

21. Not seeing a downside...

Houses as the name suggests are HOUSING, a place where one might eat, sleep and shit and is best attainable to as many people as possible. As far as I am concerned my house isn't worth a penny over $120,000. It isn't an investment - it is shelter.

[Safetykitten]

22. But,,,but..teh econmics are good!

[unkachuck]

23. capitalism, the endless tragedy....n/t

[social_critic]

27. I suppose you want the US to copy the Soviet Union?

Why don't you tell us about your alternatives to this "tragedy"? I see lower house prices as a positive...it allows more people to buy their own homes.

[xchrom]

25. recommend

[robcon]

26. When 'everyone' thinks a market is going down, it's going up.

It's a bullish statement on housing, IMO.