I like Detroit, @broadway.
Re: Appraisals
Broadway
4/22/2012 5:09:05 PM
Noreen, could this confidence be coming from a stabilized job market. It hasnt gotten much better but it hasn't fallen apart worse.
And as for appraisers in Detroit I think that clearly represents local sentiments ... As in, Detroit is the third world.
Something has to give, There are expectations that both rental rates and housing prices will increase during the next year, according to Fannie Mae's March 2012 consumer attitudinal National Housing Survey.
The survey found nearly half of consumers expect higher rental prices, the highest number recorded since monthly tracking began in June 2010. Thirty-three percent expect home prices to increase, up five percentage points since last month, and the highest percentage recorded in more than a year.
In addition, confidence in consumers' views of their own finances is stabilizing—for three straight months—44 percent believe their personal finances will get better over the next year.
Not sure what is spurring that optimism (or how Fannie Mae has money to conduct surveys) but it is interesting nonetheless.
Appraisals
AskAsa
4/22/2012 11:03:59 AM
Nice perspective on appraisals in this piece in the Detroit Free Press. It discusses how some appraisers are valuing homes at even less than it would cost to replace the house itself in metro Detroit.
"The appraisers seem to be hedging for continued decline," said Paul Traub, business economist for the Federal Reserve Bank of Chicago's Detroit branch. "At some point, we have to start saying the land is worth something."
And I could not agree more.
And the rich will get richer
cat tail
4/22/2012 10:48:07 AM
we've established how hard it is for average people to get mortgages. At the same time rental rates are soaring. I read in NYC they increased 6% year over year. So clearly there is a need for more rental units. The foreclosure inventory is being increasingly purchased not by people who want to live in the properties, but by large investors.
While I'm glad to see the foreclosures selling, and more rental units potentially coming in the market, it is distressing to me to see that we are essentially precluding the average person from taking advantage of relatively low housing prices and low mortgage rates, and allowing institutions and large investors to grow wealthier.
That sounds like a miserable job.
Re: Foreclosured homes
Broadway
4/20/2012 10:25:30 PM
There is a lot of anger out there, and whether it's right or not to take out that anger on an abandoned house, of course it's not right. I'd argue it's mostly stupid kids doing the damage. Back in the day, I used to "turn" homes and apartments ... meaning I'd go in between owners/renters and repaint, clean, do minor repairs, etc. Anytime a house was empty in between residents for any stretch of time, you could expect a "kegger" to have taken place, with all the resultant damage -- pizzas thrown into ceiling fans, walls kicked in, millions of cockroaches moving in, etc. It was a fun job.
banks have little interest in taking on mortgage risk when they can borrow from the Fed at basically 0% and turn around and buy Treasuries.
@Scott - you expect fair, accurate appraisals from the banks. If they really wanted to loan money for us to buy homes, they'd probably have to do that to compete for business.
Silly us, they're only here to get the next government bailout - much more lucrative, and lower risk than loaning money to you or me.
The quote is from Lenore's post today on Gold. This is why banks are looking for an appraisal that is ridiculously safe from their side.
PC
And sometimes the house is still in decent shape when the bank takes over, but you sure wouldn't know if you saw it from the inside 6 months later.
Whoever trashes a home - previous owners or vandals - I agree with Noreen that it's disgusting behavior.
Re: No money, no improvement
John Jordan
4/20/2012 4:47:18 PM
I think sometimes it is just human nature. For some people they have invested all of their savings into their home and then have to endure a long process that eventually leads to the foreclosure of their home. While I am sure some trash the house out of anger over the process, I think others get overwhelmed with depression and hopelessness and give up doing the normal upkeep of the home. After a while, conditions deteriorate as if they did trash the house.
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