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The Sky is Falling!!!!The Sky is Falling!!!! Chicken Little, please go away!!
Posted Saturday, February 9, 2008, at 3:18 PM<< Previous | Read comments | Respond | Email link | Next >>
Have you ever been out somewhere or with friends, and that one buddy ALWAYS complains about everything. Nothing is ever right and something bad is going to happen. The crazy thing is for some reason when he or she is around something bad does always happen. Is he or she a prophet??? NO!!!! They just bring negativity to everyone and alot of his or her problem is self-fulfilling. I prefer to look for the silver lining. Why am I blogging about this? Our national media...
Every time you turn on the TV there is a story about the NATIONAL real estate market and how it is awful. Things are terrible, homes are going down in value, foreclosures are up, BLAH, BLAH, BLAH!!!! What NATIONAL real estate market? I do not care about the market in California or Florida. I live in Middle Tennessee. If I want to play golf tomorrow I am not going to check the weather in Phoenix, AZ. If I want to see how the school system performs I am not going to look at the National Board of Education website. I will check out Bedford County's website. By the way, 2007 is shaping up to finish as the 5th best year in our country's history of real estate. Number 5 out of 231 is pretty good. Would Momma be proud if you finished 5th in a class of 231 on graduation day. The point I am trying to make is worry about our local market and quit watching the idiots on TV talking about how bad it is. Have you ever seen the movie Chicken Little? I pulled statistics on Bedford county from the Multiple Listing Service on residential homes sold since 2003. They are as follows: 2003- 560 units; 2004- 652 units, 2005- 717 units; 2006-776 units; 2007-680 units. So far in Jan. of 2008 there have been 41 units sold. I know 2007 did drop from 776 in '06 but every year can not be the best. Times must have been awful in '03... but I don't remember another great depression hitting our country. Yes, I do agree it has slowed a bit, and I am not trying to make light of the depression era. Just judge for yourself. If you are ready to buy a house then do it. The rates are as low as they have been since 2004/2005. These were the boom years. There is more inventory from which to choose as well. So buy a house if YOU are ready. Just make sure you get a 15 or 30 FIXED mortgage and make sure you can make the payments. If you need to sell then sell. Just price your home to sell. There is a difference between listing your home on the MLS and PRICING your home to sell. If it is priced right then it will sell in any market. Please help me find Foxy Loxy so we can put an end to Chicken Little's rants. Comments Showing comments in chronological order [Show most recent comments first] |
Kenneth Parker is a local real estate agent.
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How dare you come on this board with all your reality! You are going to really bring these negatives on here down even more if they cant complain about the housing market.
Foreclosures are up even in Middle Tennessee..sales are down even in middle Tennessee..contractors continue to build...New homes sitting empty..How can that be a good thing? The Only good thing out of this is interest rates are down so if your looking to buy there are plenty of good deals out there with low interest rates.
We look to sell in about two years, and upgrade to a bigger house, so we are hoping some of these beautiful new homes are still empty then.
We actually went riding around today looking at our favorite empty houses.
We can't wait.
Dianatn, You are correct that the foreclosures are up in middle Tennessee and we have seen a great deal of them in Bedford County. Most of those are in specific neighborhoods that were recently developed by one developer, but I am not going to get off on that subject. These foreclosures, however, are being purchased due to the low rates which gives people great positions of equity or offers an investor the opportunity to "flip" the house for a profit. In many cases the final owner occupant buyer will still have equity even if purchased from the investor.
New construction has seemed to slow quite a bit, but I am not sure if it is because the inventory swelled or the prices increased so quickly. Someone that gave $90000 for a new home 2 years ago must pay $105000 for the same home now. Most people that are ready to "move up" in home size can only afford a house that is the same size as their existing home. Why pay more for what you already have? It will take a little time for this to level off, and the days on market for a home to sell may be a little longer, but it will sell.
I am excited that house prices are coming down . . . I am hoping to buy one in the near future and this is great for me plus houses have been priced outrageously the past few years.
Kparker,
Actually with all the recent foreclosures ALL over bedford county, a house purchased 4 years ago for 89,000 is now going for 76,000 because of all the vacant houses in that subdivision. I understand that you are a realtor and want people to be happy, but for the "investor", the rich get richer and the downtrodden get more screwed.
I wonder, if the market is booming, how does a realtor even have time to blog? Or for that matter, "play golf"... Or does that only happen in other parts of the country too?
I hate the media too, but they are actually right when they talk about this economic situation... It is a trickle down effect. Job losses in some parts of the country equate to job gains in others, which has currenlty been a trend for Middle Tennessee. But eventually, the jobs will stop coming here too, or employers that have been here for years begin to leave town to offshore their manufacturing, and what do you have? An economic situation that has only been perpetuated by those who push home sales, via means of subprime loans... and other lucrative yet unethical forms of getting the sale.
Middle Tennessee, especially Bedford Co. is last in most categories, why would the housing bust be any different?
How dare you come on this board with all your reality! You are going to really bring these negatives on here down even more if they cant complain about the housing market.
-- Posted by tdc on Sat, Feb 9, 2008, at 4:13 PM
I'm sure your scope of reality is much broader than mine, but here's for some REAL reality...
"There's no doubt now, that Fed chairman Alan Greenspan's plan to pump zillions of dollars into the system via "low interest rates" has created the biggest monster-bubble of all time and set the stage for a deep economic retrenchment. Greenspan's inflationary policies were designed to expand the "wealth gap" and create greater economic polarization between the classes. By the time the housing bubble deflates, millions of working class Americans will be left to pay off loans that are considerably higher than the current value of their home. This will inevitably create deeper societal divisions and, very likely, a permanent underclass of mortgage-slaves.
A shrewd economist and student of history like Greenspan knew exactly what the consequences of his low interest rates would be. The trap was set to lure in unsuspecting borrowers who felt they could augment their stagnant wages by joining the housing gold rush. It was a great way to mask a deteriorating economy by expanding personal debt.
The meltdown in housing will soon be felt in the stock market which appears to be lagging the real estate market by about 6 months. Soon, reality will set in on Wall Street just as it has in the housing sector and the "loose money" that Greenspan generated with his mighty printing press will flee to foreign shores."
And lastly,
"The answer is complex but, in essence, the rest of the world has loaned the US a pair of crutches to bolster the wobbly dollar while they prepare for the eventual meltdown. China and Japan are currently hold over $1.7 trillion in US currency and US-based assets and can hardly afford to have the ground cut out from below the dollar."
Being that houses are built into the ground, I think it's safe to say...
If someone is looking to the sky, then perhaps that's why their blinded by the conditions? Because, no the sky isn't falling, but the ground beneath us is definitely trembling.
Darrick_04, I actually have never played golf, but I was trying to make a point about the local market. I also did not say the market was "booming", but I have been very busy. I just enjoy the blogging when I am not working or I have a break. Again, my point is that if we all buy in to the negative news then it does become our reality. I also know the economy is going to go through cycles just as it always has, and most of the economists know much more than I do. However, we have heard the recession news over and over, now and in the past many times, but it has not happened yet.
I am also happy to see the tougher guidelines set on loans and the elimination of the sub prime loans. In my experience most of the sub prime deals fell apart at the last minute or were a nightmare to deal with. It is tough to tell your seller that the buyer was unable to get his/her loan and we were going back on the market. In the current market when I take an offer to a seller I feel much better about the transaction.
Finally, when the economy begins to shrink then we will be in a recession. I may even eat crow in 6 months if you are correct about the stock market. With todays world economy I just do not see a repeat of the great depression days. Again, I am not saying things are "booming", but I think things are better than we are hearing. Any given day the restaurants are still full and it is still packed at Wal Mart. If we keep the cycle going then we should be OK.
At any given day, of course those places are full... But the value of the dollar continually erodes away. It doesn't matter how much you spend, what matters is the value of your currency. When the Federeal Reserve and the IRS were established in 1913, the dollar was worth exactly $1.00, do you have a clue how much it is worth today? .04, no that isn't a typo, 4 PENNIES! Every major currency around the globe, excluding the yen has swamped the dollar and has more purchasing power.
The only good side to that is it can increase exports, due to a weaker dollar. Yeah, Wal Mart is still packed but when 60% of their goods sold are manufacturerd in China, whose economy are we really benefiting? We borrow $3,000,000,000, that is also not a typo, 3 BILLION dollars a day from China and Japan in order to coninue to finance our global empire. Now tell me, isn't the fall of every major empire due to the weakening of their currency!!! The housing market is just an ingredient in the overall recipe for disaster!
Parker,
I love hearing other optimist on the board.
No matter what you say, there are a select few that will tear you down on here.
Just keep up the positive outlook! I know my husband and I are.
I am an optimist too, but living in complete denial is pure ignorance...
Darrick,
Would you rather rent, purchase, or live in a box? The purchase of a home is an investment. If I'm going to spend money for a place to live I'm also going to know that some day it will be paid for. If you can purchase a house, live in it for a few years then sell that same house and make 20 to 40 thousand it would be ignorant not to! No, not everyone can do that but it does happen depending on the location. No matter what the economic situation is we still have to live somewhere. Sure people are reluctant to buy houses but they're also reluctant to buy cars. It still dont mean they wont!
I understand all of what you said, but my point is... Don't ignore the current situation and paint a glossy picture over the gloomy situation.
His point is that he's tired of hearing how horrible the housing market is, when he says sales are up this year... But you can sell a house, most of which are done through a mortgage, and in the current economic situation, it won't get paid for, because foreclosure will get to it first.
My parents just built a brand new house. It's a fairly decent size home, and I know the cost was substantial. But that doesn't mean I am ignoring the current housing crunch just because I live comfortably.
I have not said that sales are up this year. If you read my original blog I have admitted that sales are down a bit. I am not ignoring the situation either, I am simply saying that people should make their own choices and buy if they are ready. I also encourage people to buy if they can make a down payment, and ideally if they can finance for 15 years. Most of the foreclosures are the ones that financed at 100% and were getting variable rate mortgages. Very few people with equity get foreclosed on because they can sell and pay the mortgage.
I also agree that it is a shame that most of our money is going over seas, but investing in housing here keeps it in our economy. Again, I am not saying all is great with the economy, but I still believe the "horrible stories" sell papers and gets attention, but may not show the entire truth. If we listen to the media and stop spending all together then what will that do to our country.
I agree with you Kenny... I am the last person to look for as a media advocate, trust me!
I hate the way they spin things, the market will eventually fix itself, but with a little time and patience...
KParker is correct, he did not say sales are up!
My opinion on the foreclosure rate aside from losing a job, a couple may qualify for $150,000 or $250,000 loan. Reality happens to be that just because the figures say they can does not always mean they can afford the payment on that loan! This is not by fault of the realtor or even the loan company. They don't know a persons spending habits other than what they have financed that shows on their credit report.
People don't always see the big picture on the front end either. They don't think about the fact that their 250.00 electric bill for a 3 bedroom will be 500.00 for a five bedroom.
Like I said I agree with KParker... but the best part about it, the big banks and real estate companies, like Bank of America and Countrywide, are now having difficulties, because THEY have a lot of debt on their hands...
hey if you know where i can get a rate at 5.5 or better let me know im currently at 6.5 fixed. im looking to refi.
Relicdigger, the rate that you receive will depend on your credit, and I try to not be endorse any one on here. If you check with any of our local mortgage companies they can help you. If you want me to give you a couple of names then you can contact me directly. My info is on the sports page.
Darrick_04, I appreciate the comments. That is what makes this blogging enjoyable for me.
No problem :)
If the mortgage companies would work with people to start with, we wouldn't have a problem. I don't know how they're doing now, but several years ago they wouldn't give an inch even when people had legitimate reasons for having difficulty paying and were trying to work out a temporary solution with them. They just stuck to their guns and wouldn't listen.
I think that would be because of the sub prime lenders. Sub Prime lenders started popping up everywhere you looked, you saw the ads, No Credit, Bad Credit, No Problem kind of deals. The mortgage companies had to step up their attitudes in order to compete with them. They knew if they didn't start working with their customers who was having problems the sub prime lender would..thus they would be losing tons of money in interest. Sub prime lenders didn't mind that you were running behind a little in your payments or if your income was sufficient to make payments, some didn't even care if you had a job..all they wanted was your signature on the dotted line.
Amen Diana!