Comments on: Parallel Universe: Housing Still Hurting on Main Street while Wall Street Celebrates.

By: Karla Roth

Karla Roth — Sat, 29 Mar 2008 01:11:29 +0000

We live in a “starter” neighborhood in the SF East Bay, and are just now seeing auctions. A house nearby that was priced at $500k in 2006 is now going to be auctioned ($139k will be the opening bid). Our house appraised at $400k for a re-fi several months ago. If $139k becomes a comparable standard for our neighborhood’s property values, we might be stuck in our house for a long time, but we also might be able to get our property taxes lowered (we paid $280k in 2002 so $139k would be about half that).

Of course if enough people get lower assessments, the state will really be hit hard. Over the past several years, the State of California has added a lot of new programs, and has expanded greatly. Rather than cutting back in a rational manner they do all they can to preserve union jobs and perks. Does anyone out there know of an effective organization that is bringing attention to the mismanagement at the State level?

By: Expat

Expat — Wed, 26 Mar 2008 02:09:43 +0000

According to few sources, including this site, home sales are presently skewed to the high end of the market (i.e., a larger percentage of expensive homes are being sold since the rich are so far ok in this non-recession recession). That would imply that the median is skewed which means middle and lower end home prices are much lower. This interpretation is made using unfounded guesses, but what the heck.

In any case, the government is going to continue to bail out and buy out the banks and the funds. The only ones who won’t get bailed out are the home “owners”. Instead, look for new laws similar to the recent credit card laws. Soon, trust me, walking away will be impossible, or at least, illegal. Meanwhile, our taxes will continue to finance yachts and Ferraris for Wall Street.

By: Steve

Steve — Wed, 26 Mar 2008 01:12:57 +0000

Thanks Eric! That’s what I’m looking for here in the L.A. area. Once the banks realize they either dump properties and take their lumps or they become landlords of empty homes, I think we’ll see the real correction. Seems many sellers are like bad investors, riding a stock the whole way down (Bear Stearns?)…waiting for it to come back. Just my opinion.

By: DebtFree

DebtFree — Wed, 26 Mar 2008 00:06:02 +0000

Finally, I see a little bit of good news. I live in Encino, a desireable area of the San Fernando Valley.

They built this “luxury” condo complex across the street from us. The original
asking price for the units were (depending on size) from $699K to $799. They
didn’t get a single offer. They put the units up for auction. Again, not a single
offer. Then they put them up for lease with the average rent of $3,000. They
didn’t rent out a single unit. The other day when I passed it there was a large banner hanging there saying “HUGE PRICE REDUCTIONS”. I checked their
website and yes, they have have slashed prices 50%. They are now going
for a little over $400K. Let’s see if anyone buys them now.

As far as houses in this neighborhood… they are just sitting there month after month after month with the same price tag. Don’t they get it… lower the price if you want to sell.

A Realtor accuiantance of mine said that most owners refuse to lower the prices.

Read in a book how they determined loans not that long ago.
Most mortgage companies would not lend more than 2 to 2 1/2 times your annual income. So if you make $50,000 a year you should not qualify for more than $100,000 to a $125,000 loan. Wow!

So a couple lets say have a combined income of $100,000 a year, they could not afford a house more than $250,000.

By: eric in vegas

eric in vegas — Tue, 25 Mar 2008 20:23:30 +0000

“Was looking around last night and virtually all the homes listed were priced as if it was still 2006…. 50 yr old 800 sq ft shacks in working class ‘hoods for 500k +/- with NO GRANITE COUNTER TOPS!!”

Let them; they’ll just go down with the ship after the selling season is over and they’re still stuck with the house. They’ll be foreclosed on and the bank will eventually sell it. A disappointing 2008 spring selling season will be the wakeup call that the housing bubble is over. Banks in Las Vegas are finally starting to let houses go for pre-bubble prices and it’s crushing comps.