Price Slashing Begins - Is The Housing Bubble Collapsing?
I'm still sitting on the sidelines, waiting to buy a house (and still unwilling to pull the trigger on an overpriced piece of junk). I was browsing the MLS listings today and saw a 2 family house in the city for sale for $499,000. That's when it got interesting.
This was the same 2 family that I had seen listed a few months earlier for $569,000. Before that I had seen it priced at $539,000. And it was the very same 2 family that had been listed a year earlier for $699,000.
Perhaps this one MLS listing tells the story of the housing bubble. Owners lust after the high sale price, and the house doesn't sell. They switch agents, eventually realzing that they need to slash the price to move the merchandise.
I may start tracking this kind of data - I have seen some houses on the market for months - some well over a year. Sometimes a listing disappears only to come back at a new (lower) price - even when no sale has taken place.
Just Say No - that is what I think it comes down to with loony housing prices. The Fed will keep tightening - taking away the crazy low rates for ARMs. And Fed tightening will also sqeeze the economy - driving down long rates for fixed mortgages (30 yr fixed are lower now than a year ago).
Soon a horde of speculators will be stampeding for the exits - a glut of condos will flood the market (they are sprouting up like mushrooms now). Foreclosures will soar, and housing prices will revert to their median (versus incomes).
I've waited for years - I can wait as long as I have to.
-fg
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A few weeks ago I wrote about a two family in my city that was listed for over year at varying prices (699k, 539, 569k, 499k in that order). It finally went under agreement. Read
We are in the midst of a housing boom or bubble - depending on your point of view. In the expensive coastal area where I live housing prices have soared but now seem to be topping out. I see some houses sit on the market ... Read
Curious - what state are you in?
