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REAL ESTATE: Market here is alive and thriving

Letter by Mary L. Wiley, Puyallup on Sep. 28, 2011 at 1:23 pm with 12 Comments »
September 28, 2011 2:31 pm

As a longtime Realtor here in Pierce County (36 years), I was really shocked by the provocative article, “Home sales worst in decades” (TNT, 9-27).

Although mostly factually accurate, when buyers read that article it will totally scare them away from even trying to buy a home. Buyers tend to believe what the paper says, when in reality there is plenty of funding available. FHA loans are 3.5 percent down, and VA loans can be zero down. Additionally, there are many different down payment assistance programs to help those buyers who qualify. There’s also the USDA program that is basically zero down.

This article states that most lenders require 20 percent down. That just isn’t true for owner-occupied buyers. The 20 percent is for investors in most cases.

Our market is difficult enough without the constant negative news feed in the paper and television. What about the recent CNN article that projected Tacoma to be the fastest-growing market in the U.S. in 2012? Why not mention that?

We truly need to see some positive news on our real estate market here in Pierce County. There are positive things happening locally. Real estate is local, and our market is better than most. The article you ran talked about the national market. Our market is much more stable, and your readers need to know that.

 

Leave a comment Comments → 12
  1. stetsonwalker says:

    Stable my a** I would not sell a property right now unless I had a gun to my head!

  2. ValleyTown says:

    If you can’t afford 20% down then maybe that is a good indication you should not be buying the house. There are a large number of individuals who bought homes at the height of the market with little or no down payment and are now underwater. As a result they are stuck in their homes and cannot sell or refinance. We should try and learn something from the recent real estate disaster.

  3. gerry0416 says:

    This type of false optimism by the real estate industry, in their efforts to increase their commissions through higher home prices, is largely responsible for the housing fiasco. If you don’t already own, the best idea is to rent until the excesses are washed out of the market. You listen to these fools in the real estate industry at your peril

  4. itwasntmethistime says:

    stetson — Why wouldn’t you sell a house right now? Because the value has dropped? It’s only dropped to the pre-bubble level of the mid-2000s, so really, the current value is exactly where it would have been without the bubble mess. If you’re one of the holdouts who think your house is worth more than it was in 2003, you’re part of the problem, not the solution.

    Valley — Right on. If you can’t figure out how to save a chunk of money over time, you’ll never make it as a homeowner. Houses require maintenace and repairs. People who live paycheck to paycheck without being able to save can’t afford basic home maintenance and repairs, so they charge them to their credit cards and slowly drown in debt.

  5. stetsonwalker says:

    twasntmethistime says:
    September 29, 2011 at 9:00 am
    “stetson — Why wouldn’t you sell a house right now? Because the value has dropped? It’s only dropped to the pre-bubble level of the mid-2000s, so really, the current value is exactly where it would have been without the bubble mess. If you’re one of the holdouts who think your house is worth more than it was in 2003, you’re part of the problem, not the solution.”

    Not true. Right now if I had the ready cash hanging around I would be buying properties like mad! I have not seen deals like this since the 1980’s and in today’s dollar that makes them an even better deal. There is an even better deal on fixers! No there is a glut of properties even banks are begging people to buy. This is a perfect market for a person that has some money to spare to really make a killing!

  6. commoncents says:

    What? Who says they should be worth 2003 values. Inflation alone should dictate that they houses are worth more. At any rate, most are worth less than 2003 values and are depreciating each day. Stetson is absolutely right – there is a glut of houses on the market – and there’s more being added all the time.

    What I’d like to know is what percentage of all home sales are from owner-occupied homes versus bank owned homes. THAT will dictate whether there is a true market for someone to sell their home.

  7. commoncents says:

    most homes – if the homeowners are truly honest with themselves are worth about 2001 values…and then you still have to account for taxes and fees. Even if you paid 20% down – if you bought your house after 2003 – you are likely underwater.

  8. alindasue says:

    commoncents said, “Even if you paid 20% down – if you bought your house after 2003 – you are likely underwater.”

    I was talking to someone last night who commutes to Tacoma from Yelm every day for work. When I asked him why he didn’t move closer, he said it was because he owed more on the house than he could sell it for.

    Most of the houses for sale in my neighborhood are bank owned due to foreclosures.

    We could probably sell our house as is (needing some repairs) and get more than we paid for it, but we bought our house for $58,000 back in 1991 before prices started to rise. It would be foolish for us to sell though because it would cost us more to replace the home than to stay in it. I like paying less than $600 per month for mortgage, taxes, and insurance. We didn’t buy our house as an investment. We bought it as a place to live. That’s what houses are supposed to be.

    Shortly after we bought our house, the neighborhood prices started to rise. The common advice was to buy a house and sell it less than five years later, using the profit to move up into a better house. Real estate became an “investment” akin to stocks and bonds, every investor depending on inflation to increase his invest-able “equity”. Just three years ago, houses on our block were selling for upwards of $200,000. Now many of those same houses are foreclosed houses selling for $120,000.

    I agree with itwasntmethistime that home prices are now correcting to a more normal “pre-bubble” level. That’s not necessarily a bad thing – although it has been a very expensive lesson for those who bought into the bubble.

    Bubbles may be fun for children to blow and pop, but they don’t make for sound economic practice.

  9. You know…..the deflation of real estate values is a ‘Market correction” for wildly overvalued stock. It sucks to be in the situation but…..that is the way the Invisible Hand works. The Market is doing exactly what it is supposed to do – and anyone who didn’t imagine that it could happen was just whistling past the graveyard.

    I imagine that some of the same folks who are underwater on their mortgages have sold all of their investments so they could buy into gold at its current wildly overvalued prices.

  10. We bought it as a place to live. That’s what houses are supposed to be.

    ding, ding, ding, ding – we have a winner!

  11. itwasntmethistime says:

    A huge number of people that are underwater are so because they refinanced their mortgages and took cash out. There is a website called northwesttrustee.com where you can see most of the houses in foreclosure. It shows the original sale date and price, and you can pull the deeds of trust on the house off the county website to see what loans have been taken out against the house. I’ve checked out most of the houses in my neighborhood that have been foreclosed and almost all of them were underwater from borrowing against the house well after the original purchase.

  12. I resisted the “sage advise” of various folks in the financial racket to take out a home equity loan in order to have a large nest egg in the bank – just doesn’t make sense to increase the size of my debt in order to have financial “security”

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