I’m not so sure that 2008 will be the “bottom” but after basically the last 2 years of constant bombardment from news articles about how the “boom is a bust” and what not, I fully expect that by 2008ish (give or take a few) these same prognosticators will be dumbfounded by the drop in prices and claiming they can’t go any lower.
Presuming we are at or near the “peak” in my market, I suspect that sometime between 2008-2012 will be the “bottom”. Of course, individual markets will vary and segments of the market may defy the norm. For example, commercial and multi-family may do well during a period of relative bleakness for SFR properties. As usual, you monitor the market and adjust accordingly.
Well, I believe it goes like this. High gas prices - inflationary. War - inflationary, Katrina - inflationary. And then, when rates go up, something will have to give. Prices typically. Just for the record, however, we have not seen fixed rates go up like the adjustables so I can’t say this market will pop immediately but probably sooner than later.
What do you think will be the effect of the Katrina on the
RE market in places like texas, where thausands had
“relocated” and will have to find some form of housing?
Hey,
Those relocated to Texas just got moved to Arkansas because of Rita. What we have seen in the wake of Katrina just may be the tip of the iceberg when Rita rolls through. The feds seem intent on taking the steam out of things even though Mother Nature has her own way of doing that. If Rita lives up to its billing we are going to see more displaced people and $5 gasoline prices. The price of materials will shut down the new home market, the increase in the price of everything because of increased shipping cost coupled with the rise in the cost of individual transportation will increase foreclosures. Property taxes will have to rise adding to the homeowner’s burden. It will be a buyers market, rental needs will increase and if one has played his cards well he will prosper (not a time to fold 'em). Rita is the wild card, boys.
Peace,
Richard
Wallace,
I know for fact that JBolar was in NO when Katrina hit. And I have never heard from him sense. If anyone hears from him let him know I am looking for him! And have a house open if he needs it…
You all might remember he was looking into buying the four plexes with owner finance we had a long chat in the chat room hurricane Katrina hit and I have not heard from him sense…
JBolar,
You are missed hope you are doing well and hope to hear from you soon… Best of luck to you and hope all is well. If you need anything please e-mail me direct.
Robb
Wallace,
I know for fact that JBolar was in NO when Katrina hit. And I have never heard from him sense. If anyone hears from him let him know I am looking for him! And have a house open if he needs it…
You all might remember he was looking into buying the four plexes with owner finance we had a long chat in the chat room hurricane Katrina hit and I have not heard from him sense…
JBolar,
You are missed hope you are doing well and hope to hear from you soon… Best of luck to you and hope all is well. If you need anything please e-mail me direct.
Robb
At least in my area, the sale sign for 4 different houses have been up for 4+ weeks. I’m in Kenmore, Washington.
It was never like this during this summer. The sign would go up and sold sign would go up in less than a week. Kenmore/Lake Forest area have been going up pretty high for last 2 years.
I don’t know if this is a sign of real estate market levelling off a bit or not. It may just be that time of the year. Things slow down during Oct-Dec.
there are areas in california that are still doing well, such as orange county, especially south orange county. for the past several years during this time of the year the price appriciation slowed down or even went negative just after summer until before christmas, then resumed its climb. the job market is a big factor. to put it simply, with well paying jobs in a well diversified local economy that is consistently growing in population there shouldn’t be a “bust” after a “boom”. orange county california does not rely on just one, two or even three sectors for its economy and therefore job market, unlike some other cities/counties, eg. las vagas. there are other factors that must be considered such as lack of land to build more houses as in orange county.
Thanks to Carlittle for bringing this thread back to life (via ‘The Housing Bubble’ thread).
My region (Western WA) is SLOWLY coming out of the winter doldrums.
We’ve a low supply-high demand scenario here, and as more people move to our region…things are beginning to pick up a little steam again.
Competitively priced properties can still expect to see multiple offer scenarios, and prices are moving up again.
The state’s Chief Demographer has indicated she expects nearly a million people moving here over the coming decade.
At the other end of the spectrum…I’ve two Calif clients who’ve had to lower their asking prices significantly…$80,000 for one, and $90,000 for the other. A third is “worried.”
It’ll be harder & harder for novice investors to make a buck in this environment. I think we’ve seen an end to amateur speculation for awhile. In my opinion…from this point on…it’ll take real talent & superior knowledge to make money investing in real estate.
As I’ve said before, IT’S ALL ABOUT INTEREST RATES…wages WILL NOT keep pace with rising rates & higher home prices…IT’S ALL ABOUT AFFORDABILITY.
In my area, (Virginia Beach, Virginia) things are practically dead. From summer 2003 to the summer of '05, if a listing hit the MLS on a Monday morning, by Monday afternoon there would be 15 or 20 competing contracts with all of them 20k to 50k guaranteed over asking price. People were submitting personal letters with their offers begging the sellers to take their offer. If you were a buyer, you were screwed.
Now, the market has completely shifted. It’s great to be a buyer. Listings are on the market longer, sellers are including closing cost assistance, and prices are dropping.
That’s what I don’t understand about the “bubble bursting”. If you’re a flipper, things wouldn’t be good, that’s pretty obvious. But if you’re an investor looking to buy and hold, then now would appear to be the perfect time to start making offers.
For every dark cloud, there’s a silver lining, right?
The cycling down is great for real estate investors!
Why?
Because it flushes out all the d@%n fools! Say you want to buy a rental property of a flip and your biding against some freak who thinks negative cash flow or a marginal equity position is OK because 10, 15, 20% appreciation is going to continue until the end of time and financing is sooo cheap and easy.
The sooner the green horns get spooked and leave the better.
I live in great state of Texas. the thing is really looking up here. all the cities in Texas is seeing quicker appeciation last two years then the past decade.
I live in San Antonio. I started invest real estate two years ago. I can really see the price difference from two years ago. I am a buy and hold investor, and have 11 rentals currentlly. I had purchased 7 properties last year. and this year I had made offers and none of them got accpected. Too many investor come in the town I guess. I think the market value went up least 15% since Jan 2005. good time to sell but not buy. any Texas investor share the same view?
[i][b]“I live in great state of Texas. the thing is really looking up here. all the cities in Texas is seeing quicker appeciation last two years then the past decade.”
“I live in San Antonio.”[/b][/i]
I wish I could recall where I was reading it–think it was Forbes, but I do so much research…I can’t recall offhand–could’a been this site for all I can muster; San Antonio was predicted to be one of the fastest appreciating markets this year.
It’s been a long…gray winter…maybe I’ll book a flight. How’s the cash flow?
-Infowell
P.S. We just got a call from Cali. That formerly ‘worried’ client just sold their home for $970k ($5k under asking) a little over a week. Built circa ‘50’s,’ extensive updating, 1600 some SF, 3bdrm/1bath - Orange County border…$970,000 :o :o :o Blows the mind!!!
I get positive cash flow $200-$300 per houses. and I can ususally get it rented less than 30 days. and I know alots of CA investor come here alreday.
You were right about Fores said San Antonio was top of list on appeciiation for the next two years. Last year I got a property for $125k and put in $8k and lease option for $165K. And now the market value for that home is $180k +. I hope they don’t exercise the option so I can resell it for more porfit.
This was on the front page of the Austin-American Statesman (the newspaper for Austin, TX):
New home starts up 63% so far this year
Central Texas builders strain to keep up with demand despite surge
You better believe the market along the I35 corridor in Texas is (and will be) booming!
