Housing Predictions

[Dodgergirl]

Saw this poll elsewhere & thought it would be interesting to see the opinions on this forum...

[oakhurstleaf]

As an interested, potential home buyer/investor, I've been watching the local market closely for the last few years, as well as keeping up on all the national market trends, predictions and expert analyses. Prices have not bottomed yet...there's still a way to fall. In many regional markets, which Oakhurst I'd include, homes are still being overvalued in their listing prices often 25% or more. They sit and sit at these steep prices a year (more or less) until they either take themselves off the market, put themselves up for rent, or walk away in default or foreclosure leaving the house to sit empty for several months or a year or more. Problem is a lot of sellers bought their homes at their peak between 2004-2006 or took out a home equity loan during that time period and now their house is not worth what they paid ...they cannot flex or negotiate their asking price to it's current value.

It's not a good time to sell if you want to make top dollar...you won't (unless you find a sucker, which is unlikely). If you need to sell, be realistic....your house is not worth what it was in 2005, it's worth considerably less (like 10-25% less).

Selling prices will continue to drop over the next year or two. The foreclosure mess will eventually get cleaned up. Prices will stabilize and become more in line with reality....and then there will be be more activity in the market. This could take a very long time...minimum 1 to 2 years, depending on the region.

A house is only worth what someone will pay for it.

My 20 cents.

[only1alphafemale]

A house is only worth what someone will pay for it.

My 20 cents.[/QUOTE]

A very good 20 cents too ~! A friend of mine has at homes for sale for the past year , and hasnt found anything 'worth" what the asking price is....

Owners, rely on the "expertise" of real estate agents to tell them, just what to list their house for most of time, based on a data base of previous sales or similar homes in the area over a certain time frame ~ ( with an actuall appraised value not being obtained until a purchaser contacts someone for financing and then thats at the request of the finance company )~

So far, from what I have seen in the case of my friend, is that what the "listed" price is, and what the owners will actually accept as far as an honest offer is, can be a big difference ! Tens of thousands of dollars less right now ! :eek:

Just my added 2cents... :)

[Kahlua Kid]

Waiting for the bottom - we're not there yet - too many foreclosures out there and REOs that will drive prices down when they sell and they are figured into the overall area values.

Not good if you want to sell now, but a good time to buy. Just like the stock market, up and down... there are good times to buy and bad times to sell...

[Kahlua Kid]

Oh ya - if you do own property and bought at higher prices... watch for the bottom or near bottom and then apply to the county tax assessor to reassess your home, it will reduce your property taxes if lower than when you purchased!!! I've done this once before in 1992 when prices had hit bottom. I'm going to do it again on our homes here that we bought in the last 5 years.

[only1alphafemale]

I didnt know you could do that KK ~! Thanks for info ! Very good to know !!!

[Iris]

The reassessment issue that KK refers to is mandated by CA State law. Additionally, under certain circumstances in which Prop. 60 and Prop. 90 are applicable, an individual may transfer their existing assessment tax base on "sold" property to a new property...

..."Propositions 60 and 90 are constitutional amendments passed by California voters that provides property tax relief for persons aged 55 and over. Implemented by section 69.5 of the Revenue and Taxation Code*, it allows these persons, under certain conditions, to transfer a property's factored base year value from an existing residence to a replacement residence.
Typically the property tax of a newly purchased or constructed residence is based on its current market value upon change of ownership. However, the provisions of Propositions 60 and 90 may result in substantial tax savings since it allows the property tax of the original (sold) property to be transferred to the newly purchased or constructed home if eligibility requirements are met."...


See link to the State Board of Equalization for complete info:

http://www.boe.ca.gov/proptaxes/faqs/propositions60_90.htm#1

[only1alphafemale]

"it allows these persons, under certain conditions, to transfer a property's factored base year value from an existing residence to a replacement residence."

Thanks Iris, I knew about the transfer over, that it was allowed, but I thought that was the only time it came into play ~ :) Thanks!