Beyond the implosion, now people need to look at the types of homes that are resetting in value. I bought my home 40min north of Detroit in late 2005 for 182k - it's a starterhome: 1400sq ft, 0.4 acre lot built in 1972 and in one of the best school systems in the state. By my research, my house is valued around 184k right now based on recent comps. During the past 7-ish years, it went from ~160 to 182k down to 169k. Wow. big bubble there. Now 30 min to the east there are tons of tract housing builds that builders wanted 350k+ for : 2000+ sq ft, some brick, 0.15 acre lots, etc. Those are not moving at all right now and they came down to 275k-300k on them with free doughtnuts and cider on saturdays... All this points to greedy builders that are left holding the bag. boo hoo. At any time did these builders stop to think anything other than "hey, 80% appreciation in 2 years is normal! I love being a builder!!!!111! H2 hummers for all my employees!!!" IMO, homeowners that used their heads will be fine. The market will take care of us, and punish the rest.
Don't worry, another 75% and you can afford your 900 sq ft dream home. These kind of blanket statements are useless. Some areas may still have a long way down to go. Others have not and will not see a penny of downturn.
if it is a bubble this is how it ultimately has to end, just like any other bubble has ended...with the mom and pop flippers going back to their regular jobs ...
Ha. Of course there are (small) areas where house prices don't go down. But the point is, on average and in most areas prices will go down a lot. You're still not getting it. $4 trillion of consumer wealth will be wiped out. Which means that a quarter of American households and the entire banking system will be bankrupt. BTW, I don't care about any "dream home". My dreams are elsewhere.
That house is definitely overpriced, but Hinsdale is an insanely expensive market. A 2,000 Sq. Ft. 60 year old victorian with 3 car runs around 1M to 2M. Hinsdale is near dead center between Aurora and Chicago.
I wonder what's happening in NYC? In SF (the City, not the Bay Area) where I live, housing prices have been pretty solid, up about 5-7% from last year. however, last weekend i was at a party and talked to two real estate agents and they said (which must be taken with a grain of salt because agents are always bullish) that only in the last month hasve they seen any softening in the local market here. they also said that when sellers pull their homes off th emarket becasue thewy can't get what they want, it reduces supply and thereby props the price back up again...due to steady demand (goog has made many new local millionaires here, plus other other folks with $$ here). again, this applies to the city of SF (and specific n'hoods), not the surrounding area. i think the burbs have been hit hard. i own a home here in SF, bought it back in 99 so its suposedly "worth" double now. but i have no idea how this whole crisis will shake out. i'll leave that to the all the geniuses here on ET.
This is absolutely true. NYC is bucking the trend big time. Point is, NYC is the only overvalued market that is doing such. It is my opinion, having been through another nasty RE crunch 25 yrs ago, that we are just beginning.... Hold onto your balls gents, gonna be a ride. Jay