Click on the title above or the link below to review an article by The Washington Post and learn about Fannie, Freddie risks.
http://www.washingtonpost.com/wp-dyn/content/article/2010/03/05/AR2010030501764.html
Tuesday, March 9, 2010
Shakier than expected???
Click on the title above or the link below to review a CNBC article on how the hopes for a housing recovery anytime in the near future are NOT working out. Duh! Ouch! shared this with our clients and readers looong ago.
http://finance.yahoo.com/news/Housing-Recovery-Is-Looking-A-cnbc-1706073918.html?x=0&sec=topStories&pos=3&asset=&ccode=
http://finance.yahoo.com/news/Housing-Recovery-Is-Looking-A-cnbc-1706073918.html?x=0&sec=topStories&pos=3&asset=&ccode=
"According to Robert Shiller, real estate prices don't increase vs. inflation"
All of the forecasts here are based upon the author's assumption that real estate is a stable investment which largely tracks inflation. The follow-on assumption is that values broke out of this stable pricing pattern in a real estate bubble which started in 1990.
The basis of the primary assumption, the assumption that real estate is a stable non-appreciating asset, is taken directly from Robert Shiller. He is a leading expert on real estate prices.
"My data shows that between 1890 and 1990 real home prices actually didn't increase," Mr. Shiller wrote in Newsweek (Dec. 30, 2009), 'Why We'll Always Have More Money Than Sense.' If prices didn't appreciate for 100 years, it leads one to assume the break in that pattern is an artificial break.
If this assumption is correct, and who am I to argue with 100 years of history and Mr. Shiller, then it appears our friend Ouch! may be dead on with his prediction that nationally housing prices will return to 1996/1998 levels by around 2015, unless of course we see deflation which, again according to Ouch! may occur prior to a final burst of hyperinflation which will most likely be the proverbial straw that breaks the camel's back and leads us to what he is calling "The Former United States of America" (circa 2020)
The basis of the primary assumption, the assumption that real estate is a stable non-appreciating asset, is taken directly from Robert Shiller. He is a leading expert on real estate prices.
"My data shows that between 1890 and 1990 real home prices actually didn't increase," Mr. Shiller wrote in Newsweek (Dec. 30, 2009), 'Why We'll Always Have More Money Than Sense.' If prices didn't appreciate for 100 years, it leads one to assume the break in that pattern is an artificial break.
If this assumption is correct, and who am I to argue with 100 years of history and Mr. Shiller, then it appears our friend Ouch! may be dead on with his prediction that nationally housing prices will return to 1996/1998 levels by around 2015, unless of course we see deflation which, again according to Ouch! may occur prior to a final burst of hyperinflation which will most likely be the proverbial straw that breaks the camel's back and leads us to what he is calling "The Former United States of America" (circa 2020)
Warren Buffet comments on Housing Market.
Talking about the U.S. housing market, Buffet said there were three ways to cure the nation's oversupply.
"Blow up a lot of houses, a tactic similar to the destruction of autos that occurred with the 'cash-for-clunkers' program. Speed up household formations by, say, encouraging teenagers to cohabitate, a program not likely to suffer from a lack of volunteers, or reduce new housing starts to a number far below the rate of household formations."
"Our country has wisely selected the third option, which means that whithin a year or so residential housing problems should largely be behind us, the exceptions being only high-value houses and those in certain localities where overbuilding was particularly egregious. Prices will remain far below 'bubble' levels, of course, but for every seller [or lender] hurt by this there will be a buyer who benefits. Indeed, many families that couldn't afford to buy an appropriate home a few years ago now find it well within their means because of the bubble burst."
So it sounds like Buffet is saying it's a function of supply vs demand, so simple yet sooo few actually get it! Amazingly, he also realizes that there is no good or bad market, and that every sellers who gets hurt by dropping prices equates to exactly one buyer who is helped, therefore a net neutral! Do you suppose Buffet has been paying attention to what Ouch! has been sharing fro years and years? Or maybe, just maybe there is a bit of simple wisdom in what Ouch! and William Wallace have been sharing here?!? Hmmm
"Blow up a lot of houses, a tactic similar to the destruction of autos that occurred with the 'cash-for-clunkers' program. Speed up household formations by, say, encouraging teenagers to cohabitate, a program not likely to suffer from a lack of volunteers, or reduce new housing starts to a number far below the rate of household formations."
"Our country has wisely selected the third option, which means that whithin a year or so residential housing problems should largely be behind us, the exceptions being only high-value houses and those in certain localities where overbuilding was particularly egregious. Prices will remain far below 'bubble' levels, of course, but for every seller [or lender] hurt by this there will be a buyer who benefits. Indeed, many families that couldn't afford to buy an appropriate home a few years ago now find it well within their means because of the bubble burst."
So it sounds like Buffet is saying it's a function of supply vs demand, so simple yet sooo few actually get it! Amazingly, he also realizes that there is no good or bad market, and that every sellers who gets hurt by dropping prices equates to exactly one buyer who is helped, therefore a net neutral! Do you suppose Buffet has been paying attention to what Ouch! has been sharing fro years and years? Or maybe, just maybe there is a bit of simple wisdom in what Ouch! and William Wallace have been sharing here?!? Hmmm
Mortgage delinquencies keep on rising!
Click on the title above or the link below and review a Reuters article on mortgage delinquency rates.
http://www.reuters.com/article/idUSTRE62053E20100301
http://www.reuters.com/article/idUSTRE62053E20100301
Good basic info on short sales
Click on the title above or the link below to review The New York Times article and learn how Program Will Pay Homeowners to Sell at a Loss.
http://finance.yahoo.com/real-estate/article/109009/program-will-pay-homeowners-to-sell-at-a-loss?mod=realestate-sell&sec=topStories&pos=7&asset=&ccode=
http://finance.yahoo.com/real-estate/article/109009/program-will-pay-homeowners-to-sell-at-a-loss?mod=realestate-sell&sec=topStories&pos=7&asset=&ccode=
Friday, March 5, 2010
Listen closely to what Robert Shiller is saying and how it is being said . . .
Click on the title above or cut and paste link.
http://finance.yahoo.com/tech-ticker/housing-is-”in-a-precarious-state”-yale’s-robert-shiller-says-436306.html
Really listen to what he is saying, watch his body, hear his tones. Folks, we are in the eye of the hurricane and rapidly approaching a whole lot of pain in the housing market, on wall street, and around the globe. Bury your head in the sand if you must, there will always be a small number of people who see the silver lining and the opportunity. I see the financial pain leading people back to their families, back to their faith. When they hurt, they will return to that which is truly important. The opportunity to help good people in bad situations hasn't been greater in 75 years. What really is important to the 99% of our population who is financially worse off today than they were 1, 2, 3, 5 or even 10 years ago?
http://finance.yahoo.com/tech-ticker/housing-is-”in-a-precarious-state”-yale’s-robert-shiller-says-436306.html
Really listen to what he is saying, watch his body, hear his tones. Folks, we are in the eye of the hurricane and rapidly approaching a whole lot of pain in the housing market, on wall street, and around the globe. Bury your head in the sand if you must, there will always be a small number of people who see the silver lining and the opportunity. I see the financial pain leading people back to their families, back to their faith. When they hurt, they will return to that which is truly important. The opportunity to help good people in bad situations hasn't been greater in 75 years. What really is important to the 99% of our population who is financially worse off today than they were 1, 2, 3, 5 or even 10 years ago?
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