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Started By
Message
re: Fed to buy $750 billion more of mortgage backed securities
Posted on 3/18/09 at 10:42 pm to Tiger n Miami AU83
Posted on 3/18/09 at 10:42 pm to Tiger n Miami AU83
quote:
This is what is needed to put the floor in the housing market. It has been needed. The economy cannot recovery until home prices stop declining. This is what was needed 6 months ago.
this wont put a floor on housing prices. in fact, i would argue that home prices need to decline much more before we can have any sort of recovery.
and ill say it again. in this economic enviroment, if you are a qualified borrower, why would you buy an asset that is still depreciating in value?
the fed can manipulate mortgage rates all it wants, i wouldnt buy a house now at ANY interest rate.
1
Posted on 3/18/09 at 10:43 pm to Colonel Hapablap
quote:
ETA: HOUSING PRICES NEED TO BOTTOM, THEY DON'T NEED AN ARTIFICIAL FLOOR PUT UNDER THEM.
You can't call it an artificial floor. Ultimately housing prices cannot outpace personal household income over the long term. That happened, housing market crashed. Right now with high unemployment, you are getting the opposite effect, but that will change as the economy recovers. At this point home prices are getting artificially low due to the spiral effect of foreclosures and short sells (in some areas). This will change and there actually is pent up demand from those who want to buy and have wanted to but do not want to buy until the market DOES have a floor.
This post was edited on 3/18/09 at 10:44 pm
Posted on 3/18/09 at 10:44 pm to Tiger n Miami AU83
'Mark it down.'
I have marked it down. Will a job be required for a low interest, 30 yr fixed rate mortgage?...Or, is the central planning committee going to wave that requirement?
Florida slipped to #2 in mortgage fraud in 2008 but overall mortgage fraud was up 26% over 2007...How much fraud will be overlooked to get the housing bubble inflating again in S Florida?
The BEST thing that could happen to the economy is EXACTLY nothing. Mellon was right. Mr Market will prevail, regardless of what games the gov plays to hide asset values.
I have marked it down. Will a job be required for a low interest, 30 yr fixed rate mortgage?...Or, is the central planning committee going to wave that requirement?
Florida slipped to #2 in mortgage fraud in 2008 but overall mortgage fraud was up 26% over 2007...How much fraud will be overlooked to get the housing bubble inflating again in S Florida?
The BEST thing that could happen to the economy is EXACTLY nothing. Mellon was right. Mr Market will prevail, regardless of what games the gov plays to hide asset values.
Posted on 3/18/09 at 10:46 pm to simonizer
quote:
the fed can manipulate mortgage rates all it wants, i wouldnt buy a house now at ANY interest rate.
I SURE as hell would. There are rental beach front condos in Miami now that rent for $1400 a month on long term leases that are being short sold by banks at less than $150k. Even with $495 in HOA fees, you are talking positive cash flow at 4.00 percent and 10-20% down with great upside. These same condos were selling in the $450k range at the peak of the market.
Posted on 3/18/09 at 10:47 pm to Tiger n Miami AU83
quote:
At this point home prices are getting artificially low due to the spiral effect of foreclosures and short sells (in some areas)
nothing artificial about it. there is way too much supply, and little demand.
Posted on 3/18/09 at 10:47 pm to Tiger n Miami AU83
quote:
At this point home prices are getting artificially low due to the spiral effect of foreclosures and short sells (in some areas). This will change and there actually is pent up demand from those who want to buy and have wanted to but do not want to buy until the market DOES have a floor.
Based on what measurement are housing prices artificially low? How on earth do you even begin to suggest that foreclosures and short sales are resulting in anything put pure price discovery and an equilibrium shift.
Posted on 3/18/09 at 10:48 pm to Tiger n Miami AU83
quote:
I SURE as hell would. There are rental beach front condos in Miami now that rent for $1400 a month on long term leases that are being short sold by banks at less than $150k. Even with $495 in HOA fees, you are talking positive cash flow at 4.00 percent and 10-20% down with great upside. These same condos were selling in the $450k range at the peak of the market.
so now we are discussing commercial property?
Posted on 3/18/09 at 10:51 pm to simonizer
quote:
see, i don't get it. i can understand that the refi market will be booming. but, i still can't understand why anyone would be willing to buy an asset that is declining in value, at ANY interest rate.
most people can't do math.
The thing is this won't put a bottom in house prices. The market is stronger than the fed. And there is a shite ton of inventory sitting out there. What we are going to do is frick up our currency, get a minor blip in home sales, then pay for it over the next 50 years.
Posted on 3/18/09 at 10:55 pm to kfizzle85
quote:
How on earth do you even begin to suggest that foreclosures and short sales are resulting in anything put pure price discovery and an equilibrium shift.
Ok, I will answer that. Friend in a city with one of the strongest local economies in the country bought a home recently and has seen it's value decline even though income levels support higher home prices as the local market never spiked. He is down 20% on the home in the last few months soley due to a recent foreclosure of a development and a lack of comparable sales in the last 6 months.
Posted on 3/18/09 at 10:56 pm to Tiger n Miami AU83
ETA: Just curious, what is your profession?
This post was edited on 3/18/09 at 10:58 pm
Posted on 3/18/09 at 10:57 pm to Tiger n Miami AU83
'These same condos were selling in the $450k range at the peak of the market.'
The fools that were paying $450K for caves in the sky belonged to a pool that ran dry.
The fools that were paying $450K for caves in the sky belonged to a pool that ran dry.
Posted on 3/18/09 at 10:58 pm to Tiger n Miami AU83
quote:
Ok, I will answer that. Friend in a city with one of the strongest local economies in the country bought a home recently and has seen it's value decline even though income levels support higher home prices as the local market never spiked. He is down 20% on the home in the last few months soley due to a recent foreclosure of a development and a lack of comparable sales in the last 6 months.
you are right that we will overshoot to the downside. Recognizing that will result in some nice gains in a short period of time. I don't think we are there yet. Effect of layoffs are still rippling through the economy. And summer is selling season. We will see lots of inventory appear in the next 12 weeks which will depress prices.
Posted on 3/18/09 at 10:58 pm to Tiger n Miami AU83
you need a bigger sample imo.
Posted on 3/18/09 at 11:00 pm to kfizzle85
Nah. Never come over here. Not trying to flame. I am giving my opinion on what I believe though and am about done. Just got home and heading to bed soon.
Posted on 3/18/09 at 11:00 pm to MileHigh
Oh we will absolutely overshoot, I don't think anyone would deny that or is suggesting that won't be the case.
Posted on 3/18/09 at 11:01 pm to Tiger n Miami AU83
Its all good man. 
Posted on 3/18/09 at 11:01 pm to simonizer
quote:
you need a bigger sample imo.
Well obviously, but it is a legit example of how foreclosures and short sells can lead to a downward (and possibly artificial after a point) spiral.
Posted on 3/18/09 at 11:01 pm to kfizzle85
quote:
Oh we will absolutely overshoot, I don't think anyone would deny that or is suggesting that won't be the case.
calling tops or bottoms is pretty rough. I would rather preserve gains and minimize losses than hitting it perfect.
So I will always sell early and buy late. But nothing wrong with that.
Posted on 3/18/09 at 11:02 pm to MileHigh
Not only that job losses are increasing, not decreasing. People are frightened and it isn't easy to unfrighten them. It will take time. Fundamentals have not changed. The Fed has turned it's balance sheet into a pile of shite and this is supposed to inspire confidence? Get real.
Posted on 3/18/09 at 11:03 pm to Rivers
quote:
Not only that job losses are increasing, not decreasing. People are frightened and it isn't easy to unfrighten them. It will take time. Fundamentals have not changed.
I agree.
quote:
The Fed has turned it's balance sheet into a pile of shite and this is supposed to inspire confidence? Get real.
most people don't know what the fed is, or a balance sheet. My perception, and let's be clear, I avoid contact with stupid people at all costs, is that most people believe everything is going ok if they have a job. And there are no layoff rumors.
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