To get a sense of whether property prices in various parts of the country were trending up, down, or sideways, I recently turned to Morningstar.com users for their take, posting a query on the Personal Finance forum
of Morningstar.com's Discuss boards
. I also asked them to share thoughts on whether the housing market had affected their personal real estate strategies. Were they waiting for prices to rebound before selling? Had they found attractive bargains amid the wreckage? To read the complete thread featuring views from across the country, click here
."No Good News"
Judging from the downbeat sentiment of many posts in the thread, those who have been anxiously awaiting a recovery will have to keep on waiting.
summed up the case for staying depressed with this post: "I live in Skokie, Ill., and nothing but uncertainty rules the residential market. Short sales and foreclosures dominate the sales. Prices seem to have a continued downward bias. A potential market killer is increased property taxes to fund teachers' pensions. Lousy weather. Irresponsible government. No good jobs. No good news."Grasshopper
joined the doom squad with this post. "My opinion: Homes will lose value every year for at least the next 10 years. You do not live in a bank or stock portfolio in a bull market. You live in a depreciating asset that costs more and more money to upkeep. Burdensome taxes, jobs that do not pay a living wage, and so on. Oh, the weather is lousy too!"Kayaker
astutely noted that ongoing housing-market weakness has exacted an emotional toll as well as a financial one: "I live in a gated golf community in coastal South Carolina. Like everywhere else, housing prices have gone down at least 25% to 30%. Some homes here that are 15 to 20 years old have sold for incredibly low prices (40% less than original asking) because elderly owners did not keep them up to date and would not lower their price to compensate; grown kids inherited them and dumped them quickly. New owners have gotten very good bargains and these homes have gone quickly. Fallout has been a small group of people who are angry at everything and everyone in this close-knit community. Whether housing, their investments, familywide financial issues, or a combination, the financial crisis has taken a big emotional toll on a number of retired people in this community."Edit,
groused about the combination of diminished property values and higher taxes. "I view the housing market in our area as being depressed, but at the same time our assessors are increasing the property values to pay the ever increasing burden of government funding."Jpluther,
whose home market of Silicon Valley has been relatively unaffected by the housing bust, thinks a bubble could yet burst there: "Housing prices [in Silicon Valley] are still completely insane when viewed in terms of rental potential or in terms of median price versus median income. Although we have seen smallish declines, I believe we are still midbubble unless the economy and wages take off in an unexpected manner. A 30% fall from current values would not surprise me at all."The Best-Laid Plans
Several users noted that the ongoing housing bust had affected their own plans to relocate. Latitudes
wrote, "About 16 months ago, I thought I was being very smart in buying a new condo in Orlando, Fla., at what I felt was a significantly reduced price, more than 40% below the asking price and about 10% less than the original buyer had paid two years prior. My thinking was with such a good deal on the 'buy side,' I could then market my current (and much larger) single-family house for up to two years and still come out ahead.
"Well, those 24 months are quickly ticking by and despite the fact that I have priced my house competitively in relative terms (and reduced the price three times), I have only had one ridiculous lowball offer in the last year and half. Lots of showings, lots of positive feedback, but everyone still seems to be looking for a deal (that is, a steal). I don't think the Orlando real estate market (much less the rest of Florida) is seeing much recovery yet. With an overabundance of foreclosures and short sales still in inventory, I just may be watching a well-thought-out plan turn sour."DebbieTrice
is also downbeat about the Florida market, noting that Sarasota, Fla., remains hard-hit and could well stay that way, in her view: "Due to a combination of fraud and rampant speculation, more housing units were built at ever-increasing prices in Sarasota during the boom than could have been absorbed in a reasonable time frame. The bust has further increased the unsold inventory because now-unemployed construction workers have moved away. And, of course, foreclosures and short sales on the market have depressed prices even more. This is one of the worst housing markets in the United States, and I suspect it will get worse before it gets better. My guess is the local market will return to normal about two years after baby boomer retirees feel flush enough to buy second homes in Florida. I am one of those boomer retirees who had planned to downsize, but I won't put my house on the market while it has to compete with foreclosures."
Other users echoed Debbie's sentiment, noting that they'll hold off on listing their homes until they see a rebound. Poster Chamois
wrote, "I am delaying a move to a retirement community until values recover, but I am in no hurry anyway."
Ditto for wwgman,
who notes that the Phoenix market remains in bad shape. "I am holding off selling and buying another home until the market bottoms."