bostonbubble.com

GenXer · Joined: 20 Feb 2009 Posts: 703

The fear that we'll be 'rescued' and the housing prices will never fall is not based on reality. If we are rescued for real, then the econmy will pick up and we'll all be doing great. Will this happen in the near term? Absolutely unlikely, because of the massive porkulus bill and other future spending. If you give every homeowner $10k and 15% of them lose their jobs, this will do nothing to save those who can not pay for their mortgage on a home they can not afford. Its a double-edged sword: if we start changing the mortgage terms - we will start hurting banks, and then we will have to keep pumping money into them, which will not lead to anything good. So in short, this is more of a political 'spread the wealth' gimmic, just like lowering taxes for '95% of Americans', which is bogus, because 40% do not pay any taxes.

Do not pay attention to political rhetoric, but do pay attention to the fundamentals. While prices may never fall in Boston, the people here are just as affected as in CA, and are probably a lot more stubborn. Yes, a longer unemployment will probably keep most of those who lost their high end jobs afloat (and lets not forget hefty severance packages). This year - do not expect prices to fall significantly in places like Newton (though we may be surprised), but do keep your patience. This trip may take longer than anticipated.

JCK · Joined: 15 Feb 2007 Posts: 559

balor123 · Joined: 08 Mar 2008 Posts: 1204

The prices will fall but they will just fall much more slowly. Without government help, we may have been able to buy houses in 2 years. With government help, we're going to have to wait 5-10 years. This is no accident as the government wants to spread the losses among as many people as possible as the losses are quite large. A house may need to drop from$600k to $300k, for example. They can dump $300k on the current homeowner or they can dump $150k on the first and $150k on the second. By keeping houses off the market they give sellers more time to sell their houses and increase the likelihood that you will buy higher up on the way down. If you want to buy when housing prices finally reach bottom, you'll just have to wait longer.

Hard Rain · Guest

balor123 · Joined: 08 Mar 2008 Posts: 1204

I'd like to see the asking price for those as well.