Home prices

It's not about who willingly sells their home in the future, its about who HAS to sell.

If you purchased your home lets say with and interest only mortgage, or Zero down or an ARM etc and the interest rates start to go up your mortgage will go up. If you are already stretched to the max you will have to hussle to pay the new mortgage now. Add to that if you get sick or your spouse gets sick or you have a baby and need to stay home or you get fired or laid off etc etc and then WHAT?

What if your spouse dies and he or she had no life insurance, now you have to sell. What if he or she did have life insurance, but it isnt enough to pay for the home and the loss of his or her monthly paycheck what if you have a few kids, car payments and large CC debt and now your mortgage has increased significantly?

These are all very possible situations that can happen, maybe not to you or me, but to others. It will be like a snowball running down hill.

Its not that uncommon and people need to sell quickly in those situations. IF the interest rates do start to go up by law(economics) home prices have to come down, so if you have to sell quickly for whatever reason chances are you will have to sell for less than what you purchased it for, therefore, you will have a loss. Add to that some people are taking or have taken out equity loans from their homes and that will have to be deducted(many have done it even before they move in because of the big jumps in home prices from one day to the next and have spent it! and they havent even moved in but they took out non existing equity because price inflation doesnt = equity).

Anyway these are just some scenarios of what could in the next few months or years happen to alot of people who have over extended themselves in order to buy BUY whatever they can to keep up with the Joneses because 'if so and so bought they should to' mentality. Mostly its the younger generation who have for some reason rushed into this kind of freenzy it seems from what Ive read pretty much everywhere.

Ofcourse homes are extremely and disgustingly overpriced if people out there are willing to do whatever to buy a home as a seller Im going to try to squeeze every last dime out of you! its a sellers market! and people fall for it.

My favorite is when a friend or co-worker tells me the house they want is 700K but the bank says its worth less, SO what do they do??? they come up WITH the difference! GEEZ LOUISE if the bank is saying its overpriced why the heck are you buying it and giving the greedy owner what their greedy heart wants????

Just makes me wonder?

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Posted by glenda2004

The NY Times pretty much says the same thing every Sunday. I suggest you guys read the RE section in the Times every Sunday its so interesting and informative. We read it together because its scary to think where this economy is headed:(

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I agree with a lot of the points you have made in this thread.

But they were talking about the bubble supposedly bursting this time LAST YEAR.

I still hasn't burst yet. Frankly I don't see a bubble bursting anytime soon.

Why? Because interest rates are going to stay low for a while IMO. The rates will rise a little bit... but I truly believe they will stay around 6 and 6.5% for at least the next two years.

If the rates jump over 7 and 8%... the economy will be ****ed! Greenspan and the rest of the people in charge will never let that happen.

They will want to promote rebuilding New Orleans for at least the next 3-5 years. They WONT be doing this when interest rates are 8%.

The days of 30% house appreciation per year are over. But there won't be any bubble bursting... regardless of what all the experts are saying.

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Posted by DjPiLL

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Posted by glenda2004

The NY Times pretty much says the same thing every Sunday. I suggest you guys read the RE section in the Times every Sunday its so interesting and informative. We read it together because its scary to think where this economy is headed:(

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I agree with a lot of the points you have made in this thread.

But they were talking about the bubble supposedly bursting this time LAST YEAR.

I still hasn't burst yet. Frankly I don't see a bubble bursting anytime soon.

Why? Because interest rates are going to stay low for a while IMO. The rates will rise a little bit... but I truly believe they will stay around 6 and 6.5% for at least the next two years.

If the rates jump over 7 and 8%... the economy will be ****ed! Greenspan and the rest of the people in charge will never let that happen.

They will want to promote rebuilding New Orleans for at least the next 3-5 years. They WONT be doing this when interest rates are 8%.

The days of 30% house appreciation per year are over. But there won't be any bubble bursting... regardless of what all the experts are saying.

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That makes me feel better. I hope this is true. I don't care too much about house appreciation (though I would hope by the time 10 years comes along, there'll be some increase). I just don't want the value of my house to go down.

I could have sworn they had been saying for the last few years that the prices of homes would go down, so...

The articles I read in the NYT dont necessarily say or insist there will be a bubble burst and if bubble burst it will probably be in different areas of the country. NY being one that is particularly vulnerable to that.

I know they have been saying that for a couple of years now but again its not something that happens overnight.

Think of it as when you blow a bubble from a gum you are chewing it can grow and grow and grow but eventually it might pop.

Anyway, thats how some see it anyway. Doesnt mean it will happen exactly that way but to think NOTHING will happen its kind of to naive in my humble opinion.

It just doesnt make sense that thing will stay this way for much longer. Im not saying all hell will break loose but somethings got to give soon( and I dont mean next month).

according my FH- who has been in the mortage business for 5 years and owns his own office

NOW IS NOT THE TIME TO BUY

we rent, we can more then afford to buy a house- but we don't want to over pay

waiting a year wont harm anyone, if they prices don't come down in a year- what have you lost? if anything you are able to save more money for the down payment, furniture etc.

everyone I know is waiting, and guess what ...
if everyone refuses to over pay- then people wont be able to sell a 3 bedroom piece of crap for $600K-

I would rather wait out the year and see what happens

do you know what we have to put up with for renting given my FH profession- but we aren't going to buy just to buy

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Posted by Beth1210

according my FH- who has been in the mortage business for 5 years and owns his own office

NOW IS NOT THE TIME TO BUY

we rent, we can more then afford to buy a house- but we don't want to over pay

waiting a year wont harm anyone, if they prices don't come down in a year- what have you lost? if anything you are able to save more money for the down payment, furniture etc.

everyone I know is waiting, and guess what ...
if everyone refuses to over pay- then people wont be able to sell a 3 bedroom piece of crap for $600K-

I would rather wait out the year and see what happens

do you know what we have to put up with for renting given my FH profession- but we aren't going to buy just to buy

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Who say's now is not the time to buy.
We bought and we are HAPPY. We love having our own home and we dont regret it. For us even if out house goes down by 20k that would have been 20k we threw away paying rent to a landlord. And if prices drop next year and our house price decreased by 40k that would be the same as paying rent to a landlord for 2 years..so to us it was worth it cause we plan to stay in our home :)

good for you- I am happy that you are happy!

I am was trying to help those who are feeling the pressure of the high prices

I believe I stated that I am marrying an owner of a mortage company- I was trying to give people the advice given to me by an insider-

I am entitled to give MY opnion just as you are yours- you are alittle to sensitive

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Posted by Beth1210

waiting a year wont harm anyone, if they prices don't come down in a year- what have you lost? if anything you are able to save more money for the down payment, furniture etc.

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Tell that to the people who decided to wait to buy in the last few years. They could have made a pretty hefty profit. I'm not saying I think we can make a profit now, but I don't think anyone knows what will happen.

Two years ago I thought I overpaid for my 2br co-op at 182k. I figured the prices would stabalize... but I figured if they did I had a nice place to just sit on.

Today I can now get 260k for it. My highest offer so far is 266k.

The only reason why i am able to buy a house now is because I took some chances and didn't think twice about buying a few years back.

My 20% down payment for my house is coming from pure PROFIT on both my co-op sales. I didn't have to take a dime from my savings.

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Posted by Beth1210

good for you- I am happy that you are happy!

I am was trying to help those who are feeling the pressure of the high prices

I believe I stated that I am marrying an owner of a mortage company- I was trying to give people the advice given to me by an insider-

I am entitled to give MY opnion just as you are yours- you are alittle to sensitive

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I wasnt trying to be sensitive..but sometiems its a trait many lack.

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Posted by Beth1210

according my FH- who has been in the mortage business for 5 years and owns his own office

NOW IS NOT THE TIME TO BUY

we rent, we can more then afford to buy a house- but we don't want to over pay

waiting a year wont harm anyone, if they prices don't come down in a year- what have you lost? if anything you are able to save more money for the down payment, furniture etc.

everyone I know is waiting, and guess what ...
if everyone refuses to over pay- then people wont be able to sell a 3 bedroom piece of crap for $600K-

I would rather wait out the year and see what happens

do you know what we have to put up with for renting given my FH profession- but we aren't going to buy just to buy

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I appreciate the information Beth! It is very helpful for someone like me.

Everyone has their opinions. She was just trying to tell people who are looking now, that it may not be the right time and to expect to overpay for some properties.

I wouldn't take this stuff too personally.

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Posted by CaMacho

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Posted by Beth1210

according my FH- who has been in the mortage business for 5 years and owns his own office

NOW IS NOT THE TIME TO BUY

we rent, we can more then afford to buy a house- but we don't want to over pay

waiting a year wont harm anyone, if they prices don't come down in a year- what have you lost? if anything you are able to save more money for the down payment, furniture etc.

everyone I know is waiting, and guess what ...
if everyone refuses to over pay- then people wont be able to sell a 3 bedroom piece of crap for $600K-

I would rather wait out the year and see what happens

do you know what we have to put up with for renting given my FH profession- but we aren't going to buy just to buy

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I appreciate the information Beth! It is very helpful for someone like me.

Everyone has their opinions. She was just trying to tell people who are looking now, that it may not be the right time and to expect to overpay for some properties.

I wouldn't take this stuff too personally.

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This is why FH and I also decided to wait. we too have a friend that is a mortage broker and he has already said that the prices have started to come down.

I think the best thing to do is go out and look.
There are many different scenarios.
We got our house for 20k less than asking and it was in mint condition in a great school district. So for us the deal was right.

I feel prices are going to drop eventually and we ar efine with that because to us waiting was the same as a price decreasing in value and it wasnt a big deal. To some it would bother them but its a personal decision.

Really? Whitestone in Queens has homes that go for over 700k, but you can get houses in other nicer areas in Queens in the 500s. I myself couldn't afford that though.

Even in Nassau there are houses in the 500s or so, it's just the property taxes that kill.