Realestate Prices heading Up/Steady/down? - your opinion
#1
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Realestate Prices heading Up/Steady/down? - your opinion
Hi,
Just wanted to see how everyone else felt housing prices wer headed.
Do you think prices are heading: Up, holding Steady, or going Down.
Thanks,
Uzy
VIPERMANN1@YAHOO.com
Hi,
Just wanted to see how everyone else felt housing prices wer headed.
Do you think prices are heading: Up, holding Steady, or going Down.
Thanks,
Uzy
VIPERMANN1@YAHOO.com
#2
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imo, for SoCal, it's pretty much flattening out w/ just sub-normal incremental increases to the tune of 1-2%
for some neighborhoods, it's dropped as much as 10-20%, while others continue to rise but at more modest increases of 5%
from a larger perspective, things are kind of back to normal - no more buying frenzy (creating a seller's market), houses being on the market for a few months+, not just a few days, rates are still good, most have realized that listing too high only hurts themselves in trying to sell...
for some neighborhoods, it's dropped as much as 10-20%, while others continue to rise but at more modest increases of 5%
from a larger perspective, things are kind of back to normal - no more buying frenzy (creating a seller's market), houses being on the market for a few months+, not just a few days, rates are still good, most have realized that listing too high only hurts themselves in trying to sell...
#3
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here are median sales prices for jan 05 - nov 06 for single family properties in los angeles county:
Jan-05 $418,000
Feb-05 $425,000
Mar-05 $440,000
Apr-05 $450,000
May-05 $460,000
Jun-05 $475,990
Jul-05 $490,000
Aug-05 $498,000
Sep-05 $498,000
Oct-05 $491,000
Nov-05 $499,900
Dec-05 $490,000
Jan-06 $490,000
Feb-06 $495,000
Mar-06 $510,000
Apr-06 $516,000
May-06 $519,000
Jun-06 $525,000
Jul-06 $528,000
Aug-06 $530,000
Sep-06 $525,000
Oct-06 $525,000
Nov-06 $510,000
as you can see, properties are not appreciating as fast as they used to back in like 03 n 04 when the market was on fire. i'd say the market is leveling out...
Jan-05 $418,000
Feb-05 $425,000
Mar-05 $440,000
Apr-05 $450,000
May-05 $460,000
Jun-05 $475,990
Jul-05 $490,000
Aug-05 $498,000
Sep-05 $498,000
Oct-05 $491,000
Nov-05 $499,900
Dec-05 $490,000
Jan-06 $490,000
Feb-06 $495,000
Mar-06 $510,000
Apr-06 $516,000
May-06 $519,000
Jun-06 $525,000
Jul-06 $528,000
Aug-06 $530,000
Sep-06 $525,000
Oct-06 $525,000
Nov-06 $510,000
as you can see, properties are not appreciating as fast as they used to back in like 03 n 04 when the market was on fire. i'd say the market is leveling out...
#4
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They're going to stay stable in L.A. and Orange Counties. Land is still "rare" but you're gonna see more condos and lofts that should help first-time buyers stay in the metropolitan areas. Home prices will relatively stay where they're at for a while.
The Inland Empire and Valleys and Deserts with go down slightly (if not a lot) because of overdevelopment. San Diego have gotten a lot of condos and highrises, so it is somewhat overdeveloped, but it is a beach city, which should help soften the blow.
The Inland Empire and Valleys and Deserts with go down slightly (if not a lot) because of overdevelopment. San Diego have gotten a lot of condos and highrises, so it is somewhat overdeveloped, but it is a beach city, which should help soften the blow.
#5
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I'm no expert, but being Controller of a real estate firm kinda gives me additional insight. Basically, as mentioned before, the California market overall has not and will not drop dramatically. It is indeed holding steady, and appreciation rate has decreased. This is mainly due to the simple concept of supply and demand... In areas where people want to live, work and play (i.e. Los Angeles, Orange County), the supply of housing will continue to be scarce, thus prices should remain on an upward trend.
However, there is an exception. Condos and (some townhomes) have experienced significant drops in prices, even in desireable areas. It's not necessarily because condos are less desireable or fewer are being sold. The reason for the decline in value is simply because these same condos were HUGELY OVERPRICED in 2003-2004. Natural price adjustments are inevitable. The fundamental value in real estate lies within the land itself. Since condos really have no land value, they are more vulnerable to price fluctuation. Condo prices exploded due to low interest rate, high demand, and the sudden appearance of many technically unqualified buyers. Many buyers of condos in 2003-2004 were 1st time home buyers who would not have been able to afford a home if it were not for the creative financing at the time (adjustable rate, 0% down payment, negative amortization, etc). Now these people are being foreclosed on due to interest rate changes. Also, people are beginning to realize that paying rent is no worse than owning, especially when the equity is not increasing. Hence, we will see more affordable condos in months ahead.
If you are considering a purchase of a home, these are my recommendations:
1) Put as much down payment as possible. This can get you a better loan rate and lower payments. Because your home is NOT investment property, you need not worry about leverage and cash flow. In the upcoming years when interest rate shoots up, only people with large down payments will not be hurt as bad.
2) Related to #1....Do not get an adjustable or negative amortization loan. This will kill you in the years ahead when interest rate goes up. Get a 15 year fixed loan if you can. If you can't afford the payments, get a 20 or 30 year fixed. The shorter loans force you to put more money into principal, which essentially is like your personal piggy bank....just don't get into the habit of taking money OUT!
3) DO NOT TIME THE MARKET. This is from personal experience. I sold my 1st house in 2003, and made a bundle. I wanted to wait for the prices to drop before I bought another, so I waited a year. Prices shot up even more....so I ended up paying more for my next home. That really hurt! As long as you buy in a good location, the house will appreciate in the long run. By waiting for the market, you miss some key opportunities. Just buy the best house you can afford. If you cant afford anything nice, start saving up big time!
You might have read about the above from other sources...these are my personal experience so FWIW I hope everyone can learn a little from it.
Kaius
However, there is an exception. Condos and (some townhomes) have experienced significant drops in prices, even in desireable areas. It's not necessarily because condos are less desireable or fewer are being sold. The reason for the decline in value is simply because these same condos were HUGELY OVERPRICED in 2003-2004. Natural price adjustments are inevitable. The fundamental value in real estate lies within the land itself. Since condos really have no land value, they are more vulnerable to price fluctuation. Condo prices exploded due to low interest rate, high demand, and the sudden appearance of many technically unqualified buyers. Many buyers of condos in 2003-2004 were 1st time home buyers who would not have been able to afford a home if it were not for the creative financing at the time (adjustable rate, 0% down payment, negative amortization, etc). Now these people are being foreclosed on due to interest rate changes. Also, people are beginning to realize that paying rent is no worse than owning, especially when the equity is not increasing. Hence, we will see more affordable condos in months ahead.
If you are considering a purchase of a home, these are my recommendations:
1) Put as much down payment as possible. This can get you a better loan rate and lower payments. Because your home is NOT investment property, you need not worry about leverage and cash flow. In the upcoming years when interest rate shoots up, only people with large down payments will not be hurt as bad.
2) Related to #1....Do not get an adjustable or negative amortization loan. This will kill you in the years ahead when interest rate goes up. Get a 15 year fixed loan if you can. If you can't afford the payments, get a 20 or 30 year fixed. The shorter loans force you to put more money into principal, which essentially is like your personal piggy bank....just don't get into the habit of taking money OUT!
3) DO NOT TIME THE MARKET. This is from personal experience. I sold my 1st house in 2003, and made a bundle. I wanted to wait for the prices to drop before I bought another, so I waited a year. Prices shot up even more....so I ended up paying more for my next home. That really hurt! As long as you buy in a good location, the house will appreciate in the long run. By waiting for the market, you miss some key opportunities. Just buy the best house you can afford. If you cant afford anything nice, start saving up big time!
You might have read about the above from other sources...these are my personal experience so FWIW I hope everyone can learn a little from it.
Kaius
#7
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foreclosed properties these days are probably not going to be great deals. Reason: Loan-to-value way too high on these properties. The owners borrow too much against the property, thus very little equity is in there. Because the lenders have to recoup their money, they have to sell at a price that is at or above the loan balance. Plus attorney fees and court fees and commission tacked onto sale price.... doesnt look appealing.
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