Do you think home prices in the United States will fall gently and stabilize, or crash in the next 6 months?

Question

All answers welcomed, especially those with strong economics backgrounds. I would love to hear evidence to support your answers if possible. Thanks!

Answer 1

We are at the endgame for housing. Until recently our national motto has been "In real estate we trust." Just last week the Census Bureau reported that median home prices after inflation rose 32 percent from 2000 to 2005.

In some places, the gains were huge: 127 percent in San Diego, 110 percent in Los Angeles and 79 percent in New York. But real estate -- which has acted as a national piggy bank, with homeowners borrowing and spending against rising house prices -- no longer looks so trustworthy. On this, more than on falling oil prices or a record Dow, hangs the economy's immediate fate.

The boom sowed its own destruction. Coupled with modestly higher interest rates, rising home values have priced more potential buyers out of the market. With fewer buyers, home construction, sales and prices have weakened. To service their loans, some consumers will curb their shopping.

For a while, there was a buyers' panic. By one survey, about 40 percent of houses bought in 2005 were second homes (28 percent for "investment," 12 percent for "vacation"). Dubious new mortgages -- interest-only or less -- aimed to maximize what a buyer could afford.

There's the endgame's true danger: If prices drop too much or too persistently, the damage to confidence and spending won't be easily neutralized.

Answer 2

Define crash?

in order for house prices to flat out crash, there has to be a huge supply and very little demand. So people would have to stop getting jobs, and others would have to start moving out of the country.
However, the market is supposed to flat line for a while and not grow because of few people are moving and wanting to buy new homes.
With the recent peak of forclosures, due to shifty loans in the past 5 years, more people are losing their homes and cannot purchase other homes because of destruction of their credit. So more homes are available and fewer people are wanting to buy.

Actually there are a lot of economic factors that influence home sales.

Answer 3

Depends on the market...In over inflated markets, you are already seeing that....We have a decent market where I live, prices didn't sky rocket, like in other markets, and here they have stabilized.....However, speaking with agents, they tell me they are having a difficult time selling most of there inventory, but prices haven't come down at all.....The future of the market mainly depends on interest rates.....Over inflated markets may see further correction.....It truly does depend on where you live....If you buy, just make sure to do your research and don't rely on RE agents.....Figure out price per sq. ft for your market and ALWAYS pay at least 10% or more, below that....Best of luck!

Answer 4

properly the subsequent 3-6 months ability summer season time. summer season continually ability a hike in gas fees and with present day tension interior the midsection east, I assume the gas fees in larger economic section including manhattan and different larger components to spike out aound $3.50 - $3.60.

Answer 5

I'm hoping they decline drastically, because they need to! Buying your own home is the American dream. It should be acquirable by the majority not the minority.

Answer 6

crash and hear is why
http://www.breakingbubble.com/index.htm