If housing "recovered" tomorrow...

[Pops]

I've seen some rosy fluff lately regarding the recovering RE market, most seem to be ignoring the huge shadow inventory, but never mind that. Lets imagine that the overhanging inventory and foreclosures and underwater mortgages are a thing of the past and you could sell your existing home, what would you do?

Move closer to "stuff"?
Cash out?
Borrow to the hilt and build a big drywall edifice with intercoms and central vac?

[ritter]

I'd continue with my plan to refinance to 3.5% 30-year fixed and take out sufficient funds (yes, some of us do still have equity) to put on a metal roof. No plans to move. I like my little house in my little town.

[dinopello]

Like politics, all real estate is local. Aggregate national numbers are pretty meaningless. All that matters is what is happening in your market that you are selling and market you are buying. I am tempted to cash out and move to a depressed area with a giant wad of cash, but I just like it here too much and I'm not really clear on what to do with the cash anyway. If I were to move, it would either be to an area where I grew up (coastal VA) or where I have relatives (Mid-Illinois - although its been too damn hot there) or someplace I've always thought would be cool (Hudson Valley). I'm currently in the middle of 'stuff'. There is nowhere to built out in this market area, only up.

Local market stats

@ritter - I have a 100+ year old metal roof on my house and love it.

[truecougarblue]

I just got hit with a 3 year retention bonus program due to the sale of my company so I'm stuck forthe next 3 years. It is my hope that we will actually see a mini economic crest that will coincide with the end of that and I can sell out to move to an area of higher sustainability.

[Duende]

If housing recovered tomorrow...

It would pretty much guarantee I wouldn't be able to afford a home in my area... ever. Well, at least not until the FedGov stops spending (if ever). When that happens, a few units might open up. But as it stands, housing costs in DC are absolutely crushing. Rent is so high that it's tough to save up to buy. Unless of course I want to buy in Anacostia which might have deleterious implications for my life expectancy.

Dino is right - all real estate is local. And I see from the link that he/she is right over the river from me, so he/she knows what I'm talking about.

But this brings up an interesting conundrum (at least in my mind). See, I wouldn't cry a single tear if housing prices crashed to the floor. In that instance I as a renter might actually be able to afford something. It's kinda funny how biased the media is in thinking that the inflated housing market is a good thing - it is only if you currently own. If you rent, it's pricing you out. I can't see how all renters wouldn't hope for a crash.

But I have some news for boomers - many in my generation are not willing (or able to qualify) for the type of jumbo mortgage it would take to buy your over-inflated house from you. Just something to think about.

[AdTheNad]

If housing recovered tomorrow...
It's kinda funny how biased the media is in thinking that the inflated housing market is a good thing - it is only if you currently own. If you rent, it's pricing you out. I can't see how all renters wouldn't hope for a crash.

It's not just house price increases that are treated as a good thing. It's also share prices, land prices and others.

This is a great thing for those with lots of assets (rich people), but bad for people without assets (poor people). Just another wealth transfer from poor people to rich, and another reason the wealth disparity keeps increasing.

Imagine if house prices were $1 when you turn 18, then imagine they are $1M. Obviously cheaper houses is a good thing, unless you have a mortgage, or you enjoy enslaving others through being a rent seeking scum bag.

And if you have a mortgage, you should hope for a house price crash, followed by a loan write down with the bank taking the hit. Lets face it, the odds are quite firmly against everyone who currently has a mortgage being able to make all the payments over the next 20 to 30 years.

[dinopello]

If housing recovered tomorrow...
It's kinda funny how biased the media is in thinking that the inflated housing market is a good thing - it is only if you currently own. If you rent, it's pricing you out. I can't see how all renters wouldn't hope for a crash.

It's not just house price increases that are treated as a good thing. It's also share prices, land prices and others.

This is a great thing for those with lots of assets (rich people), but bad for people without assets (poor people). Just another wealth transfer from poor people to rich, and another reason the wealth disparity keeps increasing.

Imagine if house prices were $1 when you turn 18, then imagine they are $1M. Obviously cheaper houses is a good thing, unless you have a mortgage, or you enjoy enslaving others through being a rent seeking scum bag.

And if you have a mortgage, you should hope for a house price crash, followed by a loan write down with the bank taking the hit. Lets face it, the odds are quite firmly against everyone who currently has a mortgage being able to make all the payments over the next 20 to 30 years.

It's a complex issue. Most of us who have seen a large increase in the value of our homes and plan to stay forever aren't really making out - just paying more taxes - so a lower assessment would be not so bad in my mind.

Land and houses has (or at least holds) its value mostly because of where it is and more specifically what is proximate and what is desireable. In recent years, the idea of living in an area where you can walk to everything has grown in appeal to wealthy people. A CEO of a 1500 person company just moved onto my street because he wanted to be able to walk to hs company building - I could be wrong but I thing many people don't think of CEOs as thinking that way. This new demographic who desires this type of living has driven up prices because there is a limited amount of this type of living in the US.

The north part of the city I live in is more expensive than the south, mostly due to the fact that we have had high quality, rail mass transit in the north and around this transit has grown up intensive development full of things the people can walk to. The government and people have been working a plan to bring streetcar rail to the south for a number of years. We are just about to approve the money. There is opposition in two camps - those that feel it will negatively effect their driving experience (above ground rail on street, not in dedicated lane) and those that feel that it will make housing less affordable. This second argument described by a government council member here:

However the Arlington County Board vice chair is less convinced of the plans for "transit-oriented development" along the Pike where a large percentage of the county's affordable housing remains. Transit oriented development aims to bring retail, office and residential development along major transit lines such as the Rosslyn-Ballston and Route 1 corridors.

"Transit-oriented development has been cruel" to low income people in Arlington, Tejada said in an interview this morning. The county's track record at saving affordable housing while pursuing development along the major transit lines has been weak, he said.

is basically saying that improving the community with high quality facilities - be it rail, schools, parks or whatever is bad because it will make the area desireable so that prices go up. I would argue that the problem really is that not enough communities are providing the facilities that are in demand. Those less desireable communities have plenty of affordable housing.

[Loki]

See, I wouldn't cry a single tear if housing prices crashed to the floor.

Ditto. The overinflated price of housing in this country is an obscenity. I was quite pleased to see it crash somewhat in '08, and would be even happier to see it crash some more, never to recover.

I think it's the height of irresponsibility to try to reinflate the housing bubble, I shake my head whenever I hear the media crow about some minor uptick in new starts. But I guess the housing Ponzi scheme is about all we have left of our 'economy,' that and money shuffling on Wall Street.

[The Practician]

See, I wouldn't cry a single tear if housing prices crashed to the floor.

Ditto. The overinflated price of housing in this country is an obscenity. I was quite pleased to see it crash somewhat in '08, and would be even happier to see it crash some more, never to recover.

I think it's the height of irresponsibility to try to reinflate the housing bubble, I shake my head whenever I hear the media crow about some minor uptick in new starts. But I guess the housing Ponzi scheme is about all we have left of our 'economy,' that and money shuffling on Wall Street.

Yep. housing is way way overpriced. Like most of the other poor but peak aware people here I just want to giggle while the middle class burns.