From:  Robert Burns 
Newsgroups: misc.invest.real-estate
Subject: Re: Real Estate Slump in the US???
Date: Fri, 06 Jul 2007 01:00:15 -0000
   posting-account=6eLknQ0AAAC3BvASp4M6KP5Qi717GgHK
Bytes: 4373

On Jul 5, 12:07 pm, "John A. Weeks III"  wrote:
> In article <1183634412.231561.237...@o11g2000prd.googlegroups.com>,
>
>  Jay  wrote:
> > I read somewhere that this is the worst slump in real estate since the
> > 30s but else where I read that home prices in May-07 were higher or
> > stable.
>
> > What does this mean - what slump are they talking about. Have the
> > average prices gone down by 30% or something? Are the referring to
> > increase in default rates or actual average house prices?
>
> The biggest effect that we are seeing is that houses are put up
> for sale, and then sit that way for a year to 18 months.  The
> vast majority of sales that happen do so only after repeated
> price cuts.  Note that this is not universal.  Some nice
> properties come up and sell right away, but this isn't common.
>
> The second effect is that prices are falling.  A few years ago,
> you would set a list price, and people would start bidding
> from there.  Today, you simply hope to get an offer within
> 20% of your list price.  Some condo projects are especially
> hard hit.  They built once they had so many commitments.
> People would put $10K or $15K down, and hope to double or
> triple that money by selling the contract before the building
> was finished.  Today, people are walking away from this money,
> and the building sits with few units sold.  There is a condo
> project in my neighborhood that went this way.  To get people
> to even visit the place, they advertised $100K off list price.
> This was for units between $200K and $350K, so $100K off is
> a huge discount.
>
> The third effect is that many projects sit unfinished.  If
> a developer was lucky, they stopped before they broke ground.
> If they were less lucky, they had buildings partly built
> or nearly finished before they pulled the plug.  Many projects
> like this have since gone bankrupt.
>
> -john-
>
> --
> ======================================================================
> John A. Weeks III           952-432-2708            j...@johnweeks.com
> Newave Communications                        http://www.johnweeks.com
> ======================================================================

I suppose the phony prices and low mortgages brought about by the
Wall Street deals will come back to halt the market this coming Fall.
That's when everyone runs out of money and stops supporting this
paper market or when those Wall Street fees find a final home.

Those fees were thrown into the market to lower cost to the consumer
but once again the greedy consumer bit off more than can be chewed.
What was considered a stable progression will turn into a progressive
screwing and guess whose on the getting screwed end of it?

The people will never learn, so why worry about them and the problems
they cause for one another?  With a flooded market, how much do you
think the cost of a home or the mortgage to back it will come down?
Well, it wont and the market will take a bath.  I did say in the Fall.