About Michael Kraus

mkraus@totalmortgage.com'

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Comments

  1. katiec@zillow.com' Katie C. says:

    Hi Michael,

    Katie from Zillow here.

    Great story. Just wanted to make one quick clarification: Our estimate of $1.7 trillion lost was for 2010, not 2011. We haven’t forecasted the total value change for 2011.

    Thanks.

  2. Thanks for the feedback and comment Katie, the article has been updated accordingly.

  3. SAntenucci79@verizon.net' Stephen says:

    Great article, even though it is terribly depressing. Wouldn’t all this pressure cause the interest rates on mortgages to come down further? To keep the supply down, wouldn’t this trend also put pressure on the mortgage companies to offer options for loan modification for those who are underwater, regardless of whether or not the government steps in w/ their incentives?

  4. It really is depressing. Generally speaking, I kind of avoid speculating on where rates will go, mostly because I have been consistently wrong (although I am not alone in that boat).

    I kind of suspect that rates will come down somewhat, and I think that will coincide with a correction in the stock market and the resultant flight to the safety of treasuries. QE2 was supposed to help bring rates down (among other things), but mortgage rates have actually risen since QE2 was announced. Somewhat positive economic news has caused the markets to rally, and that appears to be one of the reason rates are rising.

    As to whether or not lenders will engage in more loan modifications, that seems to be wrapped up in a myriad of factors, and it is complicated by servicing agreements, second mortgages, mortgage securitization, and the general confusion about who exactly owns many of these mortgages and who is able to approve a modification.

  5. SAntenucci79@verizon.net' Stephen says:

    I purchased my home in New Jersey in November 2006 (Great timing, huh). Since that date, I’ve lost 25% of my house value. I fear that by the time the supply is drained on existing homes, and the housing prices begin to climb again, the interest rates will have already climbed up back to the pre-crash level due to the market recovering faster than the housing market. I will have gained nothing on this home, being unable to benefit from a refinance at that point-basically turning my house into a giant equity savings account (that is, if the housing market recovers back to the pre-crash level). It feels like a vicious cycle

  6. sdc123@gmail.com' ST says:

    The housing market looks very bleak but the problem is that real estate agents and builders are acting like it is still 2006 and try and paint an unrealistic picture of the market. There just simply aren’t enough qualified people who can get loans from the bank.

    Residential buyers are as confused as ever. Sellers who bought during the bubble are also acting this way either refusing to realize their losses or simply can’t because they are underwater with their mortgage. The market just seems to bleed a little bit at a time. It is time to rip off the scab and recover.

  7. EmailJimDavey@Gmail.com' Jim Davey says:

    I read everything I can on this subject, and constantly see the issue of the actual value of a property discussed … but other than paying for an appraisal, is there any way to get an accurate value? I live in Clark County, NV; same county as Las Vegas where Case-Shiller says the values have gone down 57% since the peak of July 2006, the exact month I bought this home. It is on the market, but never an offer. I went to a Bk attorney, but he and CoreLogic can’t get a value on a rural property, and I am broke. I just don’t know what to do. I really need to know before deciding to go Bk.

  8. sdc123@gmail.com' ST says:

    Basic rule is that if it isn’t getting any offers then your price is probably way too high. I don’t know how they are officially trying to value properties outside of an appraisal. Appraisals are primarily for tax purposes and for mortgage purposes. They don’t always reflect what you can sell the home for. Prices are all over the place. Call your lender and make sure you have exhausted all possible options before you decide to go Bk. Banks seem to be more willing to help these days since they’ve been under investigation for foreclosure process problems.

  9. technicalarchitect2007@gmail.com' ka says:

    Are zillow and Case Shelled in agreement about 10 year appreciation in real estate being Found 27 to 40 % in nominal dollars…. this is almost zero in real terms….. What is going on … if it is close to zero appreciation in .10 years it would be very shocking ….

  10. ptemplin@yahoo.com' Col Temp says:

    ka,
    If you look at the historic average of home prices you will see that over the last 150 years or so home prices generally move about 4% a year. Which is close to the average inflation rate over the same time period.
    Traditionally a home was just that. A place to live and call your own. It wasn’t a bank account. Part of what got us into this mess is that many people considered their homes a bank account. Betting on the price increasing and then cashing out later to buy something better. History shows us that this is not the case. Yet everyone seems to think it is, hence your comment. Basically your home should be worth in real dollars basically the same as it was when you bought it. (of course ignoring the local conditions makes this comment generally void for any specific area, but as a whole it is meant to work that way.)
    See your home as a place to live and call your own, not an investment!

  11. technicalarchitect2007@gmail.com' ka says:

    Col Temp: Great response.

    Apologies for the typos in my earlier comment. I am seeing that many properties around the country have appreciated only as much as inflation- in some cases properties are being sold at lesser price than in 2000.

    I think property prices should appreciate as much as inflation from now on, or at least as much as personal income in the area.

    If affordability has been restored, why wont prices stabilize?

    If as a consultant, someone has a location flexible career, as in freedom to live anywhere in the country- where would you live? I see terrific values in Florida- but not in Bay Area.

  12. SAntenucci79@verizon.net' Stephen says:

    Ka,
    As to why prices won’t stabilize, in my personal opinion (a non professional in the real estate market), a lot of factors such as Interest rates that are dependent on a rising treasury rate, consumer confidence, foreclosures not being resolved (too much supply on the market driving prices down)has caused prices to continue it’s downward trend.

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