6 Reasons the Housing Market Hasn't Recovered

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The article says that houses were overly inflated and yet gives the perception that house prices should "recover" to the overly inflated value. House prices will return to the same dollar amounts, once we devalue the dollar, i.e. reduce the value of everyone's savings to compensate those that lost in the housing market - although there will be no compensation for anyone that lost money in any other market.
Home mortgage rates are at a historic low, and thus rates can only rise. As interest rates rise, the sales price will be forced to drop. It's all about the monthly payment, nothing more. If we don't raise rates, the dollar will lose value quickly (it has lost 10% against the Euro in the past few weeks).
It has taken, and will continue to take, a long time to dig ourselves out of the bad fiscal and monetary decisions of the 2000's. Remember the dancing pumpkins on web pages, advertising giant mortgages? Maybe that was a sign that sanity had left the market...

John H of CA 3:02PM August 03, 2010

The article claims "To get the best rates, today's borrowers will need a FICO score of 720 or higher, a down payment of around 10 percent"...which is nonsense...you will need more than 25% for the best rates...anyhting less than 20% and the Borrower is paying some version of Mortgage Insurance...either FHA MI or PMI...either way, that's not the "BEST" is it?
If you are not putting down 20% there is no difference in an FHA rate with as low as 3.5% down-payment...and as long as the borrower has a credit score over the lender's minimum (usually 620-660) on an FHA mortgage, the rate remains the same...there is no break at 720 on an FHA mortgage...since the article is making reference to mortgages with 10% down, the FHA mortgage is the ONLY one that the author could possibly be referring to.
It's just inaccurate information...someone might want to check it before printing it.

Bob S of MO 9:36PM July 26, 2010

I am not one of those who feels that the free market is the answer to every problem, but I feel that is the case for this issue. I think that the various interventions, including the tax credit, have only prolonged the agony. The market should have been left alone, so that prices dropped so low that the excess inventory was mopped up. People are afraid to move because they cannot see a clear bottom to this deflation. It will be painful for sure, but we should let the market seek it's own level.

Glenn Phillips of FL 7:22PM July 20, 2010

That's great! Yea legalize the illegal immigrants. No problem. Let's also give them some tax breaks/incentives and more jobs and just start the free flow across our borders. This nation came with no price. Right. Our families blood and sweat meant nothing. Get real. I agree with some of the points made in this article but the last one is a joke.

Texas 21 of TX 4:00PM July 20, 2010

The regulations for a mortgage broker to put a reasonably qualified applicant into a loan are so arduous now that even with excellent credit 90% of Americans could never successfully achieve the lowest rates without at least 50% down. And in California..you better have a quarter of a million dollars to start your quest...
The pendulum has swung way to far the other way...and until common sense once again prevails...housing is toast...

Tom in San Diego of CA 2:58PM July 20, 2010

Home prices nearly tripled in many big cities across the country from 2000 to 2010.
A drop of 30% only brings a house worth 100k in 2000 and 300k in 2010 down to 210k -- still an amazing appreciation of over 100% in just ten years.
Since real estate prices have historically increased on average about 2% a year, there's no reason prices can't drop another 30% to bring prices back to where they should historically be.

Lars of FL 3:23AM July 20, 2010

The main reason the housing market hasn't recovered is because of lack of demand. Increase the demand and it will recover quickly. How? By legalizing the 12 million illegal immigrants. The fines they will be required to pay will be used specifically to create more jobs. Many immigrants would like to start their own business, hence creating more jobs and generating more tax revenues. And if 10% of them would buy a house in the first year, that's 1.2 million houses being sold right away. Another10% would endeavor to become homeowners in the second year, and the next year, and so on and so forth. Because, for most immigrants, owning a house is an American dream. That's how to restart the road to real recovery. Think about it.

Nolito DelaCruz Yu of CA 8:52PM July 19, 2010

People are looking at the low cost of housing as a bad thing, but one of the reasons there is no "recovery" as it is being called is because that includes houses that are too expensive for the average person to afford. Over-expensive houses are not a good thing and should not be a measure of economic health.
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http://www.cubecheck.com

Scott of CA 7:18PM July 19, 2010

Another reason why I feel that our economy is teetering back and forth, mostly grim, is because a lot of people are trying to stay in their homes thru refinancing but, banks are being very tight and are not budging to these homeowners who are trying their best to stay afloat. What's up with that? Soon these homeowners will have no alternative but to foreclose. This is ludacrist and stupid. If the banks or loan companies don't change their ways, our housing market will get worse. Think About It!!!!!!

Keal of HI 6:21PM July 19, 2010

Because of high real estate taxes in states like NJ, affording a home becomes an issue. In states that have low real estate taxes, the chances of a housing recovery is greater than those states with high real estate taxes. Some low real estate taxed states have hardly felt the housing sales downturn, that the US is presently experiencing. The average real estate taxes for a one family home in NJ,
annually is $10,000. Thats a big bite out of anyones budget, before they even get to paying, principle and interest to their lending institution.

Robert Bernesser of NJ 10:36AM July 17, 2010