Housing Price Reductions Are Proliferating

TIME :

Nearly a quarter of the homes listed for sale in the U.S. have had at least one price reduction, with an average discount of 10% off the original asking price, according to an analysis by the listings site Trulia.com. The analysis shows that of the nation's 50 largest cities, Jacksonville, Florida, is the most marked-down market, with 39% of houses there having undergone a price chop.

Read the whole story: TIME

Comments

[sc300nc]

Imagine that! The free market does work!!!! No goverment interference, no bailouts, just the market adjusting to inflated prices. Basic economics folks, something that the Dems apparently failed to study.

[KillTheMessenger]

I believe it's the more "conservative" folks who thought that speculating with your home was the greatest idea since the invention of the ice cram cone.

:-)

[sc300nc]

Nobody speculated with my home except me.

[sandiegoconservative]

I thought it was funny that you misspelled cram for cream in light of the current economic situation. I don't know why I did, but it made me chuckle. Thanks! :-)

[texterdexter]

There is only one factor to correct for overblown real estate: real wages. And real wages are evaporating. Government entities won't because of higher property taxes; real estate agents won't: higher fees; banks won't: more interest on higher loans; householder won't: they've been told their house is their best investment. The larger economy won't: furniture, appliance, building material sales, home improvement, etc, etc, drives a large segment of the "service" economy. (How do you like your service now?) We have a national Ponzi scheme in which people use fake equity to finance real debt. There hasn't been a property in this country worth 40 cents on the dollar of its sticker price for the last 10 or 15 or more years. American real estate --from building to financing-- and banking depend on fraud for the bottom line.

[dnpvd51]

I live in the Chicagoland area and houses still are overpriced here unless people are making well over one hundred grand a year on average.

These housing affordability programs are just keeping this bubble inflated. Why is the government giving away money to those that refinanced and bought brand new SUVs, vacations and granite counter tops?

I would like to buy a house, but I cannot until the government gets the hell out of fixing the market. I sure cannot afford to flush my money down the drain.

[JoeBlough]

When prices return to pre-balloon value, then all will be peaceful. And maybe the middle-class will be able to buy a house.

[desertman]

That won't be happening for years.

[liberalbug]

The job market needs to recover before the middle class can recover and start purchasing homes again. House values can keep plummeting but people out of work or with job insecurity are not buying homes.

[swift goat pet for truth]

I would prefer that the middle class got a raise, in percentage terms, equal to that of the upper 1%.

Disposable income, and all that,

[Antifascist-08]

These homes were never worth their asking prices. Those who are waiting for housing prices to return to pre crash rates are wasting their time.

Of course that includes most of the lending industry who hold al the bad loans.

Why would anyone want to buy a house at an inflated price anyway?

[EinChicago]

You're half right. Houses will return to pre-crash prices. But it will take a long time. Those expecting them to fall much more are the ones really wasting their time, however.

[3dtrix]

Everywhere on earth, the fundamental unit of society is the family - and every family needs a place to live. Until recently (in my lifetime), a single blue-collar wage-earner could usually afford to buy a modest home in the US. Not long ago, we transitioned to a state where it took TWO middle incomes to afford an American home. Home prices, manipulated by the financial sector, continued to rise, and wages did not, putting homes beyond the ability of average two-income families to buy.

I have been in the building industry for thirty-five years - when I saw that a typical two-income family could no longer afford a modest home, I knew the whole game was over. When those same people who couldn't really afford to buy a home were told "buy now - pay any price - if you don't jump in now, you'll NEVER be able to buy a home" - and they did, by the hundreds of thousands - I knew the crash was coming, and told everyone I knew.

The present painful downward adjustment of home prices is a GOOD thing - houses are primarily HOMES, not investment vehicles or ATMs. When average working Americans can afford homes - that's when the fundamentals of the economy will be sound...

[Antifascist-08]

Amen.

[skippypicasso]

If you think it's such a good thing, you can pay the mortgage on the house I can't sell. Thanks.

[sandiegoconservative]

I doubt the drop in value of your home has anything to do with your ability to pay for it. Rather, you have experienced a loss or decrease in income or were on an ARM.

[GoodFeathers]

I like to see house prices fall to $10.99.

[Antifascist-08]

boo boo gaga

[magnetplanner]

Try to add some value with your comments. Bet your not trying to sell a home in Michigan.

[repugnicansfearme]

T. Boone Pickens should not have a blog on HuffPost. His despicable and reprehensible actions supporting the "Swift Boating" of John Kerry, among other ultra-right wing support he provides, should negate his appearing on this site.

[desertman]

The founder of this site has stated all voices are welcome.

[JoeBlough]

If you don't like him, don't read him. It's not hard to do.

[sandiegoconservative]

Some DimLibs just hate that pesky freedom of speech.

[noneIn2008]

More of those green shoots. However, wait until the people realize the shoots are actually body snatchers.

[desertman]

The green shoot myth was invented in DC and on Wall Street.

[Daly]

RE agents and the government need to start tracking owner occupied vs speculation buyers and report them seperately.

imho these are apples/oranges with gamble buyers driving up markets like FL and NV several 100% and getting the slot machine players to sign on the dotted line.

In NV for example; even sans the bust there is no way the local economy could afford the prices; they had no new companies, few jobs requiring college education which gererally equate to higher earnings so how is the card dealer going to pay for the rent on the house the RE said was a good investment for an out of state buyer?

As granny use to say, common sense ain't ....

[vagabondvet]

Even Krugnac the Magnificent has admitted the housing prices had more to do with bad laws than anything (http://www.nytimes.com/2005/08/08/opinion/08krugman.html?_r=1).

Everybody is a speculator. Attacking nebulous boogeymen really doesn't do any good.

[Lorianne]

Why would they do that?
RE agents just want a sale.
Are the taxpayers going to pay the RE commission they lost to snitch on 'speculation' buyers?

[desertman]

b.s. This a still a free market. If you want to risk your money it is your choice.

[gemzenith]

And its all about greed.I love how in every aspect of buying a home the marketing involved coddles the buyer into a false sense of security with assurances that the real estate agent,mortgage banker and insurer have nothing but the buyers state of uninterrupted homebuying bliss.yeah­.right.Its easier to believe in Santa.

[Lorianne]

And they're at it again.

Freddie Mac allows financing of 125% of home value.
http://washington.bizjournals.com/washington/stories/2009/06/29/daily58.html

[JoeBlough]

It's bad enough citizens what the government to hold their hands thoughout life, but now we want our hands held when buying a house? People didn't use to be this lazy. It's not hard to figure out what it takes to buy a house. Just turn off the TX first.

[MartynStrong]

Capital markets are unstable. In the past there was no way to make them stable. But today we have computer power that can be used to make them stable.

By using the greater computer power of today we can have a much higher turn over of capital in the capital market. This higher turnover will make the market harder to game or control and the market will no longer have the unstable run ups or declines. Who can change or control the market when say 20% of the capital is trading each day?

So now that we have the compute power to provide for all these transactions that will smooth out the market how do we force people to turn over at a rate of 20% a day? Easy, put a cap gains tax of 0% (zero) on all gains of 7 days or less and put a cap gains tax of 90% of all gains of more than 7 days.

The likes of Yahoo, Micosoft and/or Sun Micro Systems will give us the systems that will provide automated software agents to support turning over one's investments every 7 days (based on the specs you give the agent).

A system like this will make the financial markets work as smoothly as the local fruit market.

[whoknew---]

Computers will not help an unregulated market;

I believe there are a significant belief that this whole global economic crises started here in the US and we hold a significant amount of the blame regarding the use of CDOs, CDSs (& other financial tools) to offer products of questionable worth.

The US markets was running a betting parlor similar to the practices that led to the 1907 Panic. It's too bad there wasn't a JP Morgan and other banks to save us from this present day mess.

Regulations that were in place that were apparently stripped (such as "The Commodity Future Modernization Act 2000") have been instrumental in making our financial markets more vulnerable.

We need regulations, not a super computer.

[billw8017]

This may be a good idea. The speculators will lose their investments either immediately or when a friendly bubble bursts, be destroyed and vanish while others who make money off of money will be heavily taxed and, perhaps, only be able to support themselves in real day jobs.

The trouble with the profit motive is that there is quicker money in piracy than in honest commerce. Safety glass for windshields is an example. When DuPont invented safety glass, they tried to sell it to GM. The GM CEO, oddly enough, Knutson, an "auto" man, wrote them: People will only pay so much for a car. If it is more expensively made, the extra expense comes from profits. The safety glass would only be a temporary sales advantage since all the auto makers would quickly adopt it. Therefore, GM would adopt safety glass when the others did but they would not rush to cut their profits this way. The dominant auto makers had no particular interest in quality since it reduced the need to buy newer autos.

The insurance industry makes its money by denying coverage so far as possible. So we have rescission, denial for "pre existing conditions," set aside investments, profits, and self serving advertising amounting to 30% of their costs. Health care companies serving prisons advise judges to offer bail or probation to people with chronic conditions.

If roads and highways were private, they would still be made of wood.

[Antifascist-08]

Wow, you are completely illogical.

Computer power? Computers do what people tell them to do. Didn't you know that?

Maybe it would actually speed up the next bubble so it would burst before we realized it happened? is that what you are saying?

No thanks.

[desertman]

In 1971, in Investment Company Institute v. Camp, no less than the United States Supreme Court would write what stands as the most cogent summary of the reasons for Glass-Steagall:

Congress was concerned that commercial banks in general and member banks of the Federal Reserve System in particular had both aggravated and been damaged by stock market decline partly because of their direct and indirect involvement in the trading and ownership of speculative securities.

The legislative history of the Glass-Steagall Act shows that Congress also had in mind and repeatedly focused on the more subtle hazards that arise when a commercial bank goes beyond the business of acting as fiduciary or managing agent and enters the investment banking business either directly or by establishing an affiliate to hold and sell particular investments.

[aweissnet]

As long as the holy real estate market keeps going with no tremendously huge bumps (or regression), life will continue as normal. I would really like to see worse than this. The elite in charge won't be alarmed by anything less, or take any real action.