Comments on: A Tidal Wave Of Foreclosure Activity http://therealestatecoconut.com/2009/02/12/a-tidal-wave-of-foreclosure-activity/ Cracking Open the Coconut Grove Real Estate Market Thu, 02 Feb 2012 17:26:44 -0700 http://wordpress.org/?v=2.8.4 hourly 1 By: Snowball http://therealestatecoconut.com/2009/02/12/a-tidal-wave-of-foreclosure-activity/comment-page-1/#comment-1713 Snowball Mon, 16 Feb 2009 15:58:20 +0000 http://therealestatecoconut.com/?p=1975#comment-1713 Riley, Re: "As of yet, foreclosed properties have had NO BEARING on appraisels for other properties in Coconut Grove. However, I do agree that if this trend continues, and it very well may, it will start to set new prices." IMO appraisers have been behind the curve for years! The trend will most certainly continue and the "bailout" will help little, or not at all. When asset values are not supported by sufficient income only three things can restore financial health. Either incomes must increase,(unlikely), asset values must decline (likely) or a combination must occur (most likely). While lowering mortgage interest rates will be stimulative, it will not be market driven and adds additional risk to any buyer. What happens if mortgage rates rise after you've bought? Even a 1% increase means 10-15% of additional mortgage payment to the next buyer. Snowball Riley,

Re: “As of yet, foreclosed properties have had NO BEARING on appraisels for other properties in Coconut Grove. However, I do agree that if this trend continues, and it very well may, it will start to set new prices.”

IMO appraisers have been behind the curve for years! The trend will most certainly continue and the “bailout” will help little, or not at all. When asset values are not supported by sufficient income only three things can restore financial health. Either incomes must increase,(unlikely), asset values must decline (likely) or a combination must occur (most likely).
While lowering mortgage interest rates will be stimulative, it will not be market driven and adds additional risk to any buyer. What happens if mortgage rates rise after you’ve bought? Even a 1% increase means 10-15% of additional mortgage payment to the next buyer.

Snowball

]]> By: rileysmith http://therealestatecoconut.com/2009/02/12/a-tidal-wave-of-foreclosure-activity/comment-page-1/#comment-1707 rileysmith Mon, 16 Feb 2009 01:18:28 +0000 http://therealestatecoconut.com/?p=1975#comment-1707 Snowball, I was surprised to see those numbers because we have always seen buyers willing to pay a premium for move in ready homes in Coconut Grove - even in this depressed market. The homes that have gone to foreclosure are far from move in ready, and as a matter of fact, I have yet to see a house that was in foreclosure that did not need more than $100,000 of work. Not everybody is interested in renovating a home when they move in. As of yet, foreclosed properties have had NO BEARING on appraisels for other properties in Coconut Grove. However, I do agree that if this trend continues, and it very well may, it will start to set new prices. Regards, Riley Snowball,
I was surprised to see those numbers because we have always seen buyers willing to pay a premium for move in ready homes in Coconut Grove – even in this depressed market. The homes that have gone to foreclosure are far from move in ready, and as a matter of fact, I have yet to see a house that was in foreclosure that did not need more than $100,000 of work. Not everybody is interested in renovating a home when they move in.
As of yet, foreclosed properties have had NO BEARING on appraisels for other properties in Coconut Grove. However, I do agree that if this trend continues, and it very well may, it will start to set new prices.
Regards,
Riley

]]> By: Snowball http://therealestatecoconut.com/2009/02/12/a-tidal-wave-of-foreclosure-activity/comment-page-1/#comment-1683 Snowball Fri, 13 Feb 2009 17:04:22 +0000 http://therealestatecoconut.com/?p=1975#comment-1683 Re: "A very alarming trend is that 6 of the 8 of the pending sales this year have been distressed properties. 5 of them were foreclosures, and 1 was a short sale." This shouldn't be alarming at all! IMO, it's a necessary step to clearing inventory. If you believe as I do, the market rarely lies, why would anyone buy at non-foreclosure prices? It should be obvious, that many properties aren't on the market because the owners know the market will not support their price. Foreclosed properties are bringing down the entire market! When the number of foreclosures decline and finally clear we have a chance to resume some appreciation in the market. That is, if we've learned our lesson that home values and family incomes are linked! Re: “A very alarming trend is that 6 of the 8 of the pending sales this year have been distressed properties. 5 of them were foreclosures, and 1 was a short sale.”

This shouldn’t be alarming at all! IMO, it’s a necessary step to clearing inventory. If you believe as I do, the market rarely lies, why would anyone buy at non-foreclosure prices? It should be obvious, that many properties aren’t on the market because the owners know the market will not support their price. Foreclosed properties are bringing down the entire market! When the number of foreclosures decline and finally clear we have a chance to resume some appreciation in the market. That is, if we’ve learned our lesson that home values and family incomes are linked!

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