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Welcome back.

Thanks mate, that sure was a typo however “of” would be applicable in parts of Florida and Michigan I guess.

Anyways, you are right… I just dont understand how prices are still so high even if the seller is desperate (Short Sale) situation etc. Being in the market , I notice situations where the seller wants to get out and take whatever he can but its the realtor who likes playing the waiting game for a better offer until the property goes into foreclosure. Couldn’t you atleast accept the low ball and begin negotiations with the lender rather than allowing it to go to the banks who would just sit on it anyways for like …….

Wonder if its only me who feels this way!!

Bb

I’m assuming it’s just a typo and you meant to type “OFF”, as in 10-20% OFF the listing price. I’m always keeping my eye out in some of the nicer parts of LA, primarily west LA, and 10-20% off the asking prices would be a massive ripoff, since the current asking prices are absurdly high. Just waiting and watching the NODs add up, watching the amounts owed add up into the 10’s and even 100’s of thousands, and waiting for the inevitable flood of foreclosures.

These sellers and their agents are nuts if they think their McMansions, “valued” at 1.5-2.5 mil at the peak, are a “steal” at discounts of only 20-30%. Nothing like walking into a dead open house, with a nervous, desperate and suicidal seller and agent, and giving them a verbal offer at 50% of their asking price. If they get angry, it’s even funner to follow that up with “well, you can take that now, or I can get it for 25% of your asking price in a few months when the bank takes it back…”

Heres my logic…if I like a home and know this is good, will throw a low ball of 10-20% of the listing price. If I get it, am happy about getting what I wanted at a good interest rate etc etc else I’m happy cos there are many more to arrive.No attachment to any property and an open mind that there is more hitting the market. However, critical to know that…at the lower end the cheaper it gets the more the competition. I threw a low ball of 300k for a 330k property and was beaten with a 300k ALL CASH offer. ROYAL FLUSH I’d say mate!!

So the golden question… ideal time + price+ interest rate. Mr.Mortgage would be nice to hear your thoughts.

Bb

Can you shed any insight to this predicament, Mr. Mortage? New home + low interest rates + 18k in Fed/State tax credit versus waiting another 1-2 years when things change (more money saved up for downpayment, higher interest rates, no tax credits, etc.).

-Randy

And just as the bubble was such an extreme fluctuation of historic trends, median home price to median income ratios etc., markets will overcorrect to the negative.

It’s that happy medium, that norm, that stability that we should all be hopeful for. But I doubt we will see it any time soon – it really does look like the Fed, government etc. are following the Japanese lost decade bubble/super recession playbook here – and if you look at that scenario, after the hyper run up until ‘89 and ‘90, R.E. values plummeted to 10-25% (depending on city/urban versus suburban/countryside) of what they were at the peak, over a 15+ year period. They only just started to bottom out from a multi-year flatline a couple of years ago, and once again the Japanese are in another recession.

Unemployment numbers keep climbing. The mid and upper end markets haven’t even really begun to pop yet. I can definitely see nothing but countless reasons to remain extremely pessimistic for the foreseeable future.

Look at the stock market, it’s not hard to find a stock that was $30+ not long ago and had crashed to $2. Then in recent weeks had gone from $2 back up to $10. One can make a reasonable argument that the stock has performed well recently. It would be outright stupid for anyone to say, “you might think $10 is good, but it is not anywhere near the $30 range that it once was…” Well, duhhhhhhhhh!!

I have a question: How will inflation affect home values? I am still a little unclear whether inflation will drive values up or down. I have read conflicting articles and analysis.