Is the housing market going to get any worst?
February pending home sales fell 1.9% month over month
Best Answer
951 points
Grudun answered one year ago …
I would say that the housing market is definately going to get worse. In March the total value of ARMs adjusting for the first time peaked(and April isn't far behind). Most of those homes will not complete the forclosure process for at least 3-6 months(assuming the payments were being made at the teaser rates). So this wave of homes on the market will flood the summer home buying market drawfing the number of new buyers on the market. So expect a slow summer season followed by a significant drop in the fall when there are traditionally fewer buyers(parents don't want to move their kids during the school year) and an influx of supply.
The EARLIEST I believe we could see the recovery start in earnest is spring 2009.
Answers
676 points
RobSmith answered one year ago …
Some people are saying we're at the bottom, but it's been my experience that NOBODY can call a bottom or a top. What I will say is we still have A LOT of homes that will go into foreclosure over the next 2 years and if the employment situation gets worse on top of that, then this market (real estate and stocks) can go MUCH lower still.
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3943 points
MNSL answered one year ago …
I think RobSmith has given good answer. It is common all over the world now. I think it is going to get worst. I hope somebody who expert in real estate will give you better answer.
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4075 points
EthanR answered one year ago …
ShoeMan, I am a licensed Realtor in Florida, and will tell you that the deputy chief economist at Freddie Mac just predicted that houses will drop another 10% before they bottom. I am seeing stabilization in the number of monthly closings in my area, but it is deceptive. In other words, March was similar to February, but it should have been much higher, given the seasonal bias of the spring. And so far the first week of April is running behind the first week of March. So the numbers aren't great.
There are still many difficulties in the market, including tighter mortgage standards that today's consumer is too undisciplined to meet. Soon we will see a mass number of people taking out FHA loans, with the predictable result that in 2-3 years, there will be a huge number of FHA foreclosures. Why? Because FHA has lower standards, and a higher default rate than conventional loans. But those FHA loans will prop up the numbers and Wall Street and Main Street will think the worst is over. This game could go on indefinitely!
