The Housing crisis is over
Article in the Wichita Eagle on Saturday discussed how Home Values had risen 2.59% over the last year. I had a problem with this quote:
(the Realtor quoted)“credited a concerted effort from the local housing industry to control new and existing inventories” is the reason our homes were still appreciating.
How did the industry do that? Appraisers finding higher prices for homes? Realtors convincing clients to sell for more? Builders raising prices on new homes to raise profit? Suppliers raising prices to builders for more profit (not to cover gasoline prices…)? Local bankers lowering interest rates so loans are more affordable (without regards to National Rates)?
My opinion is we’ve had a steady market in Wichita for some time. I think the national trends (seen below) indicate that we’ve reached bottom, and the mortgage industry has made housing affordable again because of monthly payments.
Quick study I did this morning shows me that 51% of WAAR agents closed more dollars worth of homes in the last 12 months than they did in the previous 12 months, and on average they sold the same number of homes during the same 24 month period per year.* Active Realtors are still selling homes about the same numbers, and for a little more money. We’re getting more money because the public is willing to pay more. Pretty simple stuff.
The Wallstreet Jounal ran a Great Article by:
By CYRIL MOULLE-BERTEAUX
May 6, 2008; Page A23
Titled: “The Housing Crisis is Over”. I suggest everyone read it. I won’t put the article here (since I don’t have permission….), but an brief excerpt:
“So what’s going to stop the housing decline? Very simply, the same thing that caused the bust: affordability. The boom made housing unaffordable for many American families, especially first-time home buyers. During the 1990s and early 2000s, it took 19% of average monthly income to service a conforming mortgage on the average home purchased. By 2005 and 2006, it was absorbing 25% of monthly income. For first time buyers, it went from 29% of income to 37%.”
I’ll say 2 things here - 1st, this article made more sense to me than anything else I’ve heard about the housing industry history.
2nd - Do Realtors REALLY believe we control the market?