House prices seen falling 30 pct (Reuters)

[Up2Late]

(I'm not sure if this was posted in LBN, I searched and didn't find it, but even so, it seemed important enough to post again.)

House prices seen falling 30 pct

Thu Dec 6, 2007 6:41am EST

By Julie Haviv

NEW YORK (Reuters) - Housing markets from Punta Gorda, Florida, to Stockton, California, will crash and suffer price drops of more than 30 percent before the housing crisis is over, a report from Moody's Economy.com said on Thursday.

On a national level, the housing market recession will continue through early 2009, said the report, co-authored by Mark Zandi, chief economist, and Celia Chen, director of housing economics. The report paints a worsening picture of the hard-hit housing sector, which is in the midst of its worst downturn since World War II.

While activity will stabilize in 2009, it will not be until 2010 before a measurable improvement in sales, construction and pricing will emerge, the report said.

House prices are forecast to fall 13 percent from their peak through early 2009. After accounting for incentives home sellers are offering buyers, effective declines peak-to-trough will total well over 15 percent, the report said....

(more at link) <http://www.reuters.com/article/newsOne/idUSN0544897520071206>

[kurth]

1. Everyone suffers because of stupid lemmings who had no business buying a home and

greedy assholes who had no business writing mortgages based on no proof of income.

[sandnsea]

2. The housing prices never would have been that high

so no long term homeowners really lost anything anyway. Anybody who bought at the height of this obvious bubble was a fool and doesn't deserve any more sympathy than the other "stupid lemmings" who had no business buying a home. So how about that.

[MadHound]

9. Sure we lose,

Either our property taxes, based on the hyped up value of our house, gets jacked up, or the value of our house goes down, even if we bought it at a price that reflects its true value, or both.

My house was revalued upwards by our county. Thus I'm paying hyped up property taxes for a couple more years based on those gross overvaluations. Meanwhile, the value of my house has gone down, below what I originally paid for it four years ago due to the glut of properties on the market. I'm not upside down on my mortgage, but I'm glad that I'm not planning on moving again, I wouldn't be getting the value out of my house and land.

Yes, those of us who were smart, who are long term home owners are getting screwed too, all because of those stupid lemmings.

[1932]

10. A lot of people who took out second mortgages will be hurt too.

Five or six years ago there were three times more mortgages than there were properties in America. I'm sure the number is worse now. People who didn't buy during the bubble, but who took out loans against inflated equity values will be screwed too.

[AndyTiedye]

3. Speculators Flipping Properties They Had No Intention of Occupying Had More to Do With It

People looking for a place to live were having to engage in voodoo economics to bid against them.
Rent, you say? A lot of people were being evicted from rentals as the properties were converted and/or sold.

[Connonym]

11. yes, stupid lemmings should live in cardboard boxes

:eyes: How dare they try to live in an actual home? You only have a surface understanding of this issue, perhaps you should learn more before accusing others of being stupid lemmings.

From the Wall Street Journal http://online.wsj.com/article/SB119662974358911035.html?mod=hpp_us_pageone

One common assumption about the subprime mortgage crisis is that it revolves around borrowers with sketchy credit who couldn't have bought a home without paying punitively high interest rates. But it turns out that plenty of people with seemingly good credit are also caught in the subprime trap.

An analysis for The Wall Street Journal of more than $2.5 trillion in subprime loans made since 2000 shows that as the number of subprime loans mushroomed, an increasing proportion of them went to people with credit scores high enough to often qualify for conventional loans with far better terms.

In 2005, the peak year of the subprime boom, the study says that borrowers with such credit scores got more than half -- 55% -- of all subprime mortgages that were ultimately packaged into securities for sale to investors, as most subprime loans are. The study by First American LoanPerformance, a San Francisco research firm, says the proportion rose even higher by the end of 2006, to 61%. The figure was just 41% in 2000, according to the study. Even a significant number of borrowers with top-notch credit signed up for expensive subprime loans, the firm's analysis found.

[Rabrrrrrr]

4. Well, it's about time - it's a bubble that's needed a serious bursting for a few years.

Jackasses taking out loans for five times their annual income on adjustable rates to buy houses twice as big as they need just to impress their friends or because they're too impatient to slowly build up like their parents did? And irresponsible banks and other mortgage lenders that were giving those ridiculous and unethical loans? And those same jackasses maxing out their credit cards buying shit they don't need?

Well, that just couldn't last long.

I've been renting, waiting for the housing market to collapse so that I could buy in at a point that makes sense. Perhaps in a year or two, I'll buy me a nice house.

[AlphaCentauri]

5. Speculation could mess up your dream

as soon as the housing crisis settle there will be other trying to speculate in that market.

[grasswire]

6. and this...

"In addition, the housing downturn will take a large toll on the rest of the economy. During the height of the boom in 2004-05, housing contributed nearly a percentage point to annual real gross domestic product, or GDP, growth."

[Up2Late]

7. kick n/t

:kick:

[deacon]

8. bush's 'ownership society' n/t