Market exuberant, huge supply of liquidity and loose or no control on lending standards were what get us into the present housing recession. Real estate supply, demand and price are severely out of whack and can only be fixed by a significant decline in prices.
The housing market will eventually reach a bottom and a healthier housing market will emerge. The question is how long this will take. From financial reports and predictions by housing experts, the market for 2008 will continue it's decline from 2007.
IRWIN KELLNER wrote on MarketWatch from DOWJONES:
"Today, median home prices are 3.5 times the size of median annual family incomes. This may be down from the recent peak of 4.2 times incomes reached last year, but it's way above the 2.8 times that home prices averaged during 1984-2000, when lots of homes were bought, sold and built".
The market is what it is, and nothing more.
I think 2008 will be a great 2nd year for me. I did 9 settlements (as of Friday) in 2007, and 5 of them were listings sold.
You are a wealth of knowledge!
Thank you!
Our Team is still selling but in many cases, when we represent the buyers, we are buying properties at hundreds of thousand below original pricing of 2005-6. Our condo buyers are wise & careful in their selections.
We have honed our negotiating skills & articles like your help tremendously!
To Bryan and June - The good thing about being a Realtor is that we are in business whether the market is going up or coming down. There are deals to be made every week and every month. The question is whether we are the ones doing the deals. Being active and on top of the game are necessary to continue to do deals in this business. We just have to adjust ourselves and do things that work for us.
Wishing you both a good and successful 2008.
To Lane - The present US housing market problem was created over many years. It was the low interest rates policy, excess liquidity and securitization of all kinds of debts that fueled the real estate bubbles in the U.S., UK, Australia and other countries. The housing problem in the US is the worst due to huge bad mortgage loans, declining house prices, high consumer debts and huge US trade deficit. The affordability ratios reflect the price levels where housing demand can be sustained. These ratios are dynamic and are determined by market forces. It all boils down to the supply-and-demand for housing!
The US housing problem is not a interest rates problem. The December 23 report by Bob Willis at Bloomberg.com summed up the US housing situation and what can be expected for 2008. Here are 3 more links on The US Housing Market, US Housing Market Crash and a very long Wiki compilation on United States Housing Bubble.