Daunting Math for Homeowners Down ≥ 30% One of the most powerful psychological barriers to selling a home these days is owners’ insistence on breaking even. Unfortunately, after a 30% drop in prices nationally since 2006 (more in some locales), the math for many homeowners who bought near the market peak is daunting. So, even if you assume...Read More
Ancillary Fees (& Taxes) Loom Larger If you have to ask how much something costs . . . you can’t afford it.–Author unknown One of the anomalies of today’s housing market is more properties discounted to the point where their purchase price is suddenly very attractive — the more so with interest rates seemingly falling...Read More
Low Interest Rates — Then & Now Three (four?) years into the housing market downturn, what conclusion is it possible to draw? In retrospect, it seems obvious (at least to me) that it was a liquidity-driven phenomenon. Add a tsunami of cash, subtract any vestige of underwriting standards, and real estate will go up. Subtract...Read More
Stuck in Place A healthy housing market functions like a gigantic escalator. The bottom rungs are occupied by first-time Buyers. As they purchase entry-level homes, the Sellers of those homes (“Move-up Buyers”) typically buy larger homes, enabling Sellers of those homes to buy even bigger homes. And so on, and so on. One of the...Read More
Did the Late Bird Get the Worm?? Although I take issue with some of the math underlying the analysis, there’s no denying that the drop in interest rates since April 30 — thanks to the Eurozone crisis — has at least partially offset the benefit(s) associated with now-expired home buyer tax credits. Missing the tax...Read More
“Botttom’s Up” Real Estate Recovery You don’t know who’s swimming naked until the tides goes out.–Warren Buffett 3,500 FSF is the new 5,000 FSF.–Ross Kaplan The housing recovery is happening from the bottom up. As any active Realtor can readily report, the lower the price bracket, the stronger the housing market; the higher, the weaker....Read More
