[stoney]

i get the feeling we've been here before...yet this version for financial stability [such that it would be] won't cause a windfall of personal responsibility, to include making -- and following -- a budget. but like angry black guy in stevew's post said (OWS thread), why should we if our gubment don't?

maybe living social should get involved here

What is more important? A hard lesson in financial responsibility or solving the problems that we as a country are experiencing?

The way to make this "fair" for those of us who were financially responsible would be to offer an equivalent treasury rate + bps (15yr = 15 yr treasury +X bps) that is maybe .5% lower than the re-structured/re-fi.That would get revenues coming back to the govt (vs banks) and provide a stable default structure.

Also as noted, have a 2-tier structure.

How would this not be beneficial as a whole?

 

[$tinkle]

How would this not be beneficial as a whole?

what would be the benefit for those who own outright? perhaps their [ok, my] property is more market-viable?

where did you finally settle? jeffco?

 

[syadasti]

what would be the benefit for those who own outright? perhaps their [ok, my] property is more market-viable?

A primary focus of OWS too. Other than preventing collapse the same can be said of allowing massive unpunished corporate fraud and corporate welfare programs.

 

[Pesqueeb]

Home prices rose in half of major U.S. cities, survey says

Compare to how Zerhedge spins it

No Housing Bottom As Case-Shiller Declines For 4th Consecutive Month; Misses YoY Expectations | ZeroHedge


My inclination is to go with Zerohedge on this one.

 

[dante]

My biggest concern is that prices are this low (falling/steady/whatever) while interest rates are at almost historic lows... Mortgage rates are ~4-4.25%, and we're still barely treading water at the best case scenario. If rates start rising we are fvcked.

 

[JetTeach]

My biggest concern is that prices are this low (falling/steady/whatever) while interest rates are at almost historic lows... Mortgage rates are ~4-4.25%, and we're still barely treading water at the best case scenario. If rates start rising we are fvcked.

This I have to agree with. Fortunately for us we bought our house just over a year ago and got a great rate and a good deal. This is our "forever" house so I am not too worried about my personal situation.

 

[Pesqueeb]

This I have to agree with. Fortunately for us we bought our house just over a year ago and got a great rate and a good deal. This is our "forever" house so I am not too worried about my personal situation.

I think our house has become our forever house because of it.

 

[dante]

This I have to agree with. Fortunately for us we bought our house just over a year ago and got a great rate and a good deal. This is our "forever" house so I am not too worried about my personal situation.

Same here, although we bought at the end of '07, refinanced into a 5% fixed, and our housing value has either fallen by 5% (bank estimate) or 11% (Zillow estimate, probably on the low side from what we've seen). The only thing that's annoying is that we put down 20% and so avoided PMI and are able to escrow our own taxes/insurance. If the value of our house has fallen enough that we're suddenly outside of the 80% LTV ratio, any savings for a lower rate get eaten up by PMI. Our lender offers a no-appraisal refi, but so far that will only save us about .5% so we're going to wait and see what happens with rates going forward...

 

[JetTeach]

Same here, although we bought at the end of '07, refinanced into a 5% fixed, and our housing value has either fallen by 5% (bank estimate) or 11% (Zillow estimate, probably on the low side from what we've seen). The only thing that's annoying is that we put down 20% and so avoided PMI and are able to escrow our own taxes/insurance. If the value of our house has fallen enough that we're suddenly outside of the 80% LTV ratio, any savings for a lower rate get eaten up by PMI. Our lender offers a no-appraisal refi, but so far that will only save us about .5% so we're going to wait and see what happens with rates going forward...

To me, any savings more than that would be tempting, assuming you are on a 30 yr fixed. You could end up saving a huge bundle over time.

What part of the country are you in? Did the housing market get hit hard where you are? Ours didn't get hit bad here, if at all. We were fortunate to get our house for about 10% below the appraised market value. The seller was in a bad spot and needed to get out of it. Lost his job due to his own stupidity and can't really get another since he is now a convicted felon.

We were fortunate in that we were able to get a zero down, no PMI loan.

 

[dante]

To me, any savings more than that would be tempting, assuming you are on a 30 yr fixed. You could end up saving a huge bundle over time.

What part of the country are you in? Did the housing market get hit hard where you are? Ours didn't get hit bad here, if at all. We were fortunate to get our house for about 10% below the appraised market value. The seller was in a bad spot and needed to get out of it. Lost his job due to his own stupidity and can't really get another since he is now a convicted felon.

We were fortunate in that we were able to get a zero down, no PMI loan.

Wisconsin, and we bought a house that was off about 20% from it's highest appraised value (and closer to 35% off it's Zillow theoretical high). There wasn't a major Cali/Arizona/Florida spike in home values here, so things never got out of hand in the first place. As such there isn't anywhere near as much room to fall as places like Cali.

We'll probably jump on a refi if it goes down at all, as it'll be an extra $60 or so per month saved on interest (and another $25/month or so on extending the loan back out to 30 years).

 

[JetTeach]

Wisconsin, and we bought a house that was off about 20% from it's highest appraised value (and closer to 35% off it's Zillow theoretical high). There wasn't a major Cali/Arizona/Florida spike in home values here, so things never got out of hand in the first place. As such there isn't anywhere near as much room to fall as places like Cali.

We'll probably jump on a refi if it goes down at all, as it'll be an extra $60 or so per month saved on interest (and another $25/month or so on extending the loan back out to 30 years).

Sounds like you guys played it smart just like we feel like we did. I did get a good enough rate (4.25%) that a refi wouldn't make sense for us for quite some time. Since ours is a VA loan our taxes and insurance are escrowed as well.

 

[Pesqueeb]

Sounds like you guys played it smart just like we feel like we did. I did get a good enough rate (4.25%) that a refi wouldn't make sense for us for quite some time. Since ours is a VA loan our taxes and insurance are escrowed as well.

Have you looked into a 15 year? We had a stupid low (4.375) on a 30 year and were paying extra on top of it. We re-fied to a 15year @ 3.5 and were actually paying less than we were before. Course I don't know your financial situation, but if we'd only been making the minimum payment on our 30 year, switching to a 15 cost us just over $200 bucks more a month and saves us over 16000 over the life of the loan.

 

[JetTeach]

Have you looked into a 15 year? We had a stupid low (4.375) on a 30 year and were paying extra on top of it. We re-fied to a 15year @ 3.5 and were actually paying less than we were before. Course I don't know your financial situation, but if we'd only been making the minimum payment on our 30 year, switching to a 15 cost us just over $200 bucks more a month and saves us over 16000 over the life of the loan.

I have actually. NOW is not the best time for us to do it but I am thinking sometime in the next year. That has kind of been our plan all along as the timing fits perfectly with the whole retirement plan.

 

[dante]

Have you looked into a 15 year? We had a stupid low (4.375) on a 30 year and were paying extra on top of it. We re-fied to a 15year @ 3.5 and were actually paying less than we were before. Course I don't know your financial situation, but if we'd only been making the minimum payment on our 30 year, switching to a 15 cost us just over $200 bucks more a month and saves us over 16000 over the life of the loan.

What I'd *like* to do is switch over to a 5y ARM (currently at 2.5%) and try to pay the whole thing off in the next 6-7 years (it can only rise 1%/year after the 5 year fixed period, so even at year 7 or so it'd still only be 4.5%). Unfortunately starting a company and living off of one income makes us a little more cautious about things like that.

 

[Pesqueeb]

What I'd *like* to do is switch over to a 5y ARM (currently at 2.5%) and try to pay the whole thing off in the next 6-7 years (it can only rise 1%/year after the 5 year fixed period, so even at year 7 or so it'd still only be 4.5%). Unfortunately starting a company and living off of one income makes us a little more cautious about things like that.

Yea, we looked into that but it was simply out of our budget.

 

[$tinkle]

Springs No. 7 on list of healthiest housing markets for 2012 - Colorado Springs Gazette, CO

 

[SkaredShtles]

Springs No. 7 on list of healthiest housing markets for 2012 - Colorado Springs Gazette, CO

 

[Pesqueeb]

Springs No. 7 on list of healthiest housing markets for 2012 - Colorado Springs Gazette, CO

Oh man.......Where is that opening in PDX?






*Edit: I'm also saving that article for the next time some local Randian nut job claims that the Springs is a perfect example of how small government works.

 

[Toshi]

Springs No. 7 on list of healthiest housing markets for 2012 - Colorado Springs Gazette, CO

Teh springs didn't make the 2011 list, fwiw: Healthiest Housing Markets for 2011 - Local Markets, Business, Economic Conditions - Builder Magazine

20. Boston-Cambridge-Quincy, MA-NH
19. Omaha-Council Bluffs, NE-IA
18. Boise-Nampa, ID
17. Richmond, VA
16. Wilmington, NC
15. El Paso, TX
14. Nashville-Davidson-Murfreesboro-Franklin, TN
13. Birmingham-Hoover, Ala.
12. Dallas-Ft. Worth-Arlington, TX
11. Washington-Arlington-Alexandria, DC-VA-MD-WV
10. San Antonio, TX
9. Naples-Marco Island, FL
8. Charlotte-Gastonia-Concord, NC-SC
7. Houston-Sugar Land-Baytown, TX
6. Minneapolis-St. Paul-Bloomington, MN-WI
5. Gulfport-Biloxi, MS
4. Huntsville, AL
3. Durham-Chapel Hill, NC
2. Austin-Round Rock, TX
1. Raleigh-Cary, NC

 

[$tinkle]

*Edit: I'm also saving that article for the next time some local Randian nut job claims that the Springs is a perfect example of how small government works.

i think you'd be more effective if you printed it off, soaked it in brine, froze it, and then slapped them with it

 

[Pesqueeb]

i think you'd be more effective if you printed it off, soaked it in brine, froze it, and then slapped them with it

Tempt me not Satan!

 

[KavuRider]

Housing market still pretty rough here in Phoenix.
I haven't taken any steps yet.

Value has decreased another 10%. Sigh...

 

[dante]

Holy crap!! The mortgage refi saga goes on, and here's a bit of info for anyone looking to refinance.

So after talking with Wells Fargo about an easy-refinance (apparently something that Fannie Mae allows lenders to do which is roll over your old loan into a new one with an appraisal "wavier". They figure that since they're already on the hook for your loan, at least they should make it easier on you...), they never really budged between 4.25 and 4.5% (the rate they were quoting us was fluctuating between those two numbers). Local banks and Credit Unions were offering a 3.875% briefly last week/early this week, so just for comparison I submitted an application at a local bank as well as a Credit Union that we're a member of. My biggest fear was that any new lender would require an appraisal, and we could be anywhere from right at 80/20 (which is where we started 4 years ago) LTV ratio to being $10-20k under that 20% number. The local bank and I chatted a bit but didn't really go anywhere since I was waiting on Wells Fargo (and still worried about the appraisal).

This week, however, I received an email from the Credit Union saying "You're approved, let's sign the paperwork for the refi!". I let him know the situation (how we were still not sure because we didn't want to go through an appraisal process, etc), and he wrote back almost immediately to let me know that:

1) Apparently he as the same access to my loan (for an "easy refi") as Wells Fargo! That means that he can refinance my loan for just the cost of origination and title insurance (along with a few other small dollar amounts, including $75 for the appraisal waiver from Fannie Mae)! Basically it's like refinancing with the same entity who's backing your loan, even though we went from one bank to a different Credit Union.

2) NO APPRAISAL. Fannie Mae has an internal gauge of what they think your property is worth, and so we saved ~$500 and avoided the possibility that our house has dropped further in value.

3) He could still give me the 3.875% rate that he'd quoted me the day before, even though rates had gone back up to 4%!

So we're now (fingers crossed) locked in at 3.875% for 30y, no appraisal, no escrow, no PMI, and we're going to be saving ~$150/month over our old payment, and almost a full $270/month over our original. Fawk. Granted, we will have pushed the loan out by an additional 4 years over what we had originally, so we'll be paying for a total of 34 years instead of 30 (that's part of the reduced monthly payments), but I never imagined that interest rates for a loan for the next 30 years is below 4%.

No clue what program we lucked into, but it might be worth it for other s to look at? Even the guy at WF was surprised to hear that Fannie was allowing other banks to refi without an appraisal. There's some info at various government websites (HARP), and so there might be some stipulations like Fannie had to have underwritten your loan prior to April '09, but it's worth checking with your lender, or other lenders in town.

 

[Toshi]

Strong work, dante. Just hope we stay out of prolonged deflation and you'll be set.

 

[dante]

Strong work, dante. Just hope we stay out of prolonged deflation and you'll be set.

In a prolonged period of deflation I'm fvcked anyway since I already own the asset. That just means I'll refi again when rates hit 2.5%.

We'll probably look at taking the money saved each month and socking it away into something stable that generates a decent return. FSICX is returning ~4.7% (ttm), which means we'll be borrowing from the US taxpayer at 3.875, and investing it at 4.7 just like the big banks do!!

 

[Pesqueeb]

SON OF A BITCH I wish I had known that. The only reason were still with US Bank is because I was under the impression we had to stay with them for the exact same reason Dante stated about Wells Fargo. DAMNIT.

 

[Pesqueeb]

Back on topic....

At this time five years ago, the white-hot U.S. housing market was starting to cool. Before long, it would slip into a deep freeze.

The thaw still hasn't come. The latest statistics show residential real estate prices are continuing to drop — a trend that could have a long-lasting impact on the net wealth of younger homeowners who bought property during the housing bubble.

The problem is that today's prices — already down by about a third from the peak -– are still dropping. They fell in nearly three quarters of metropolitan areas during July, August and September, according to the latest report from the National Association of Realtors.

The national median price of a previously occupied house declined 4.7 percent just for the three-month period, the trade group reported.

"Home sales need to recover first, only then can prices stabilize," Lawrence Yun, the Realtors' chief economist, said in a statement.

But few economists expect home sales to recover any time soon, given the continuing foreclosure crisis. A new report from RealtyTrac Inc., a foreclosure listing firm, shows foreclosures are shooting up again.

There had been a brief lull a year ago, but only because lenders needed time to straighten out the flood of foreclosure paperwork. Now that backlog has been reduced, so 77,733 properties received an initial default notice last month, up 10 percent from September, RealtyTrac said.

The dismal foreclosure and pricing outlook is depressing both construction and sales of existing homes.

"This is shaping out to be the worst year on record for the single-family housing market," IHS Global Insight U.S. economist Patrick Newport wrote in an assessment of the housing market.

For millions of younger Americans, this long price slump will have a lasting financial impact. Economists are finding the slump is disproportionately hurting the so-called Generation X — people born between 1965 and 1982. Here's why they are being hurt more than Baby Boomers, born between 1946 and 1964:

Consider the financial fate of a boomer who was 30 years old in 1991. If he purchased a typical house that year, the median price was about $100,000. Today, the median selling price is around $170,000.

Today's price is well below what it would have been five years ago. But still, even after adjusting for inflation, a person who sells a house purchased 20 years ago will make a profit today. And that profit can help make for a much more comfortable retirement.

The story is quite different for a Gen-Xer who was 30 years old in 2006. If she bought the typical house that year during the housing bubble, she paid about $250,000.

Today, that home owner would be 35 years old, and her property's value would have declined by about a third, dimming her prospects for an affluent retirement.

Thus, The Generation Gap Grows

Last week, the Pew Research Center released a study showing the profound impact of these dynamics. It showed that older Americans are now a wealthier demographic group, compared with people who were in that group in the 1980s.

But in contrast, households headed by people 35 or younger have gotten poorer. The difference in wealth largely reflects the divergence in home equity.

The Pew study concluded: "People generally accumulate wealth as they age, so it is not unusual to find large age-based gaps on this measure. However, the current gap is unprecedented. In 1984, the age-based wealth gap had been 10:1. By 2009, it had ballooned to 47:1."

The timing of a home purchase was a key difference, the study found. "Most older homeowners purchased their homes long ago – at 'pre-bubble' prices," the report said. As a result, those older people "are still ahead over the long haul."

Unfortunately for them, many Gen-Xers "purchased their homes at "bubble" prices, and –- with the bursting of the bubble -– now have less equity in their homes than when they purchased them," the study concluded.
Gen X Takes The Housing Hit; Boomers Only Grazed : NPR

 

[dante]

That's pretty interesting, but I guess it's not that surprising. I mean, Gen Xers will have proportionally more money tied up in real estate vs IRAs/401(k)s, and I'd guess that they (we) were also proportionally more likely to have purchased a first home during that period and subsequently lost money on it.

What's sad is that it really all comes down to luck and timing. Boomers have been *incredibly* irresponsible, pulling money out of their homes in cash-out refinancing, buying big opulent homes and SUVs, etc, but because they got lucky on the timing of their home purchases it doesn't hurt them as much. All Boomers had to do was "not fvck it up" and they're ok. Granted, many didn't take that advice and did cash-out refinances, aren't saving enough for retirement, etc, but the default is for them to make it through this unscathed. My parents bought their house in 1977 for $38k, modified it through the years and paid it off ~5 years ago. I wouldn't call them frugal/financially astute/etc, but they're doing ok just because they didn't colossally screw it up (unlike many of their friends/coworkers, apparently).

Gen Xers on the other hand mostly bought their first home in the past 10 years or so and so are almost guaranteed to have lost money in the housing market. On the other hand, every one of my friends/family/coworkers who bought in the last 10 years has probably lost money on the purchase (aside from my sister who got REALLY lucky). I'm betting that just like the Great Depression affected people for the rest of their lives (my grandparents are still really frugal people), Gen Xers are probably going to be affected by this as well.

 

[Pesqueeb]

It was pointed out when I posted that article on face book, and something I had thought as well, that the article assumes that the boomers stayed in their homes. I would say anecdotaly Dante that your parents might be the exception and not the rule. I can think of very few people in that generation that I know who have actually been in their houses more than 10 years.

 

[Toshi]

My parents have been in and out of a ton of homes the past two decades. Of course, they've also been in and out of a ton of cities. I think they've been lucky enough to not lose any money on the purchases, although they didn't gain anything, either.

Their big folly is to build a mansion of their own extravagant (but tasteful) design up in the hills on the Oregon coast. It's a great house and a nice view, but absolutely no one else in that town will be able to afford to buy it off them even if they wanted to dump it. It'll end up being paid off and then transferred down to me in time, when it'll become my problem/quiet vacation getaway. I think they actually planned it this way, perversely: they have a goldbug streak and keep on waiting for the hyperinflation that just isn't coming.

 

[valve bouncer]

Their big folly is to build a mansion of their own extravagant (but tasteful) design up in the hills on the Oregon coast. It's a great house and a nice view, but absolutely no one else in that town will be able to afford to buy it off them even if they wanted to dump it. It'll end up being paid off and then transferred down to me in time, when it'll become my problem/quiet vacation getaway.

Tagged #haafuwhitepeoplesproblems#
Conversely, it seems that your upsizing folks are doing us all a favour. I thought this interesting and I'm sure it applies in the US just as much.

The retirement of the baby boomer generation over coming decades will be a major influence on prices

Read more: Grey cloud gathers over housing market

 

[Pesqueeb]

Son of a ........

WASHINGTON – The average rate on the 30-year fixed mortgage hovered above its record low for a fourth straight week. But cheap mortgage rates have done little to boost home sales or refinancing. Freddie Mac says the rate on the 30-year fixed loan fell to 3.98% percent from 4% the previous week. Seven weeks ago, it dropped to a record low of 3.94%, according to the National Bureau of Economic Research.
The average rate on the 15-year fixed mortgage edged down to 3.3 percent from 3.31%. Seven weeks ago, it too hit a record low of 3.26%.
Rates have been below 5% for all but two weeks this year. Yet this year could be the worst for home sales in 14 years.

Rate on 30-year mortgage falls to 3.98%

 

[Pesqueeb]

Most depressing headline yet.

'Every Day Is Black Friday' In Housing As Prices Tank, Case-Shiller Shows - Forbes

 

[stoney]

This makes me want to keep holding out on buying a house.

 

[KavuRider]

Most depressing headline yet.

'Every Day Is Black Friday' In Housing As Prices Tank, Case-Shiller Shows - Forbes

Damn...that sucks.
Not surprised though...lots of empty houses in Phoenix still.

 

[dante]

Meh, real estate is still all local. Around here rentals are in high demand, so rent is still as high as it ever was even though housing prices have fallen. A similar house to ours is up for rent for ~$400 more per month than we are going to be paying for our mortgage/property taxes/insurance. If we'd been paying rent instead of buying 4 years ago, we would've poured a total of $67,200 in to rent, all to have avoided a $20k (Zillow estimate) drop in home price. Granted if Zillow's (suspiciously low) estimate is correct we're probably in the hole by ~$8k once everything is calculated (mortgage interest, taxes, income tax deduction, refi costs, upkeep, etc), but since the stock market is still down ~8% from where we cashed in to buy a house, we're probably just about a wash.

If I were in a position to buy now I'd do it again in a heartbeat (here in Madison, anyway). Mortgage interest rates are stupidly low, and with all of the foreclosures/short sales available there would have to be one that would accept a lowball offer. Housing prices really can't fall much lower here since they're bumping up against (or have fallen below) the cost to build a similar construction. With a limited supply of homes and a growing population, home prices have stabilized here. YMMV, of course.

 

[Pesqueeb]

Meh, real estate is still all local. Around here rentals are in high demand, so rent is still as high as it ever was even though housing prices have fallen.

Were still up on our purchase price according to Zillow. Latest Case-schiller shows P-town up .1% which is NOT what I'd like to see since were hoping to get back, but still down significantly from when we left 7 years ago.

Real Estate in teh news.

Tracy Lawrence, the notary public who blew the whistle on a massive foreclosure fraud scheme, was found dead in her Las Vegas home on Nov. 28, MSNBC reported.

Cause of death has not yet been determined, but Officer Jacinto Rivera, a Las Vegas Metropolitan Police Department spokesman, said the case was not being investigated as homicide. She was 43.

Earlier this month, Lawrence came forward and admitted to the Nevada Attorney General's Office that she notarized 25,000 fraudulent documents for Lender Processing Services, a Florida company used by most major banks to process home repossessions. The documents were filed with the Clark County Recorder's Office between 2005 and 2008, The Los Angeles Times reported.

Lawrence also accused two loan officers of allegedly running the massive robo-signing scheme, saying they forged signatures on tens of thousands of default notices. Nevada now alleges that Gary Trafford, 49, of Irvine, Calif., and Gerri Sheppard, 62, of Santa Ana, Calif., directed their employees to forge foreclosure documents, notarize the signatures on the documents they had forged and file the fraudulent paperwork in order to begin foreclosures on homes throughout the county.

Trafford and Sheppard have been indicted on more than 600 counts of offering false instruments for recording, false certification on certain instruments and notarization of the signature of a person not in the presence of a notary public. Authorities are currently negotiating the terms of their surrender, KSNV MyNews 3 reported.

Earlier this month, Lawrence pleaded guilty to one count of notarizing the signature of a person not in her presence, The Associated Press reported. Had Lawrence shown up at her sentencing hearing on Monday, she could have faced a potential sentence of up to one year in jail and a fine of up to $2,000.

On Nov. 17, Lender Processing Services issued a statement acknowledging that the signing procedures on some of documents were flawed. The company also agreed to fully cooperate with the attorney general's investigation.

"I am deeply committed to ensuring that LPS meets rigorous standards of professional conduct and operating excellence," newly appointed LPS President and CEO Hugh Harris stated. "I have full confidence in the ability of our leadership team and over 8,000 dedicated employees to deliver on that commitment."

According to RealtyTrac, Nevada has had the highest foreclosure rate in the nation for 56 straight months.
Tracy Lawrence, Notary Public Who Blew The Whistle On Massive Foreclosure Fraud, Found Dead

 

[Serial Midget]

I'm about to lose 20 to 25K on a $123K house... I'll get 50% loss on sale from my employer who also paid closing costs and commission on the home prior to that. Meh - sounds bad but its actually a wash.

 

[Pesqueeb]

Time for your monthly good news:

The widely followed S&P/Case-Shiller Home Price index continues to deliver bad news. October data, released on Tuesday, showed both the 10 and 20 city indices down on a monthly and yearly basis, with markets still hitting new lows. High foreclosure rates and a weak labor market, coupled with inherent real estate market weakness, will remain a drag on economic growth going forward.
On a monthly basis, the 10-city composite fell 1.1%, while the 20-city slid 1.2% from September to October. Annual numbers were even more troubling, with the 10-city down 3% and the 20-city tanking 3.4%. Fourteen of the twenty cities surveyed showed price declines.

The data doesn’t look good at all. Four markets show prices that remain below their January 2000 levels (Atlanta, Cleveland, Detroit, Las Vegas), while two of those posted new lows (Atlanta and Las Vegas), more than three years since the demise of Lehman Brothers. Atlanta was down 11.7% on an annual basis.

One of the major problems in the sector is the extremely high rate of foreclosures in some markets. Barclays’ capital research team noted that markets that exhibit high concentrations of foreclosures are down 4.9% on an annual basis, compared with a 2.5% decline for the remaining cities.

Those foreclosure rates, keeping home prices depressed, are conspiring to slow, and even stall, any sort of economic recovery. As Fed Chairman Ben Bernanke has made clear, a housing recovery is a prerequisite to any sort of self-sustaining economic cycle. Beyond construction jobs, rising home prices will ease a load off major banks’ balance sheets. Institutions like Bank of America, JPMorgan, and Citi have been saddled with thousands of foreclosed properties which, given irregularities such as robo-signing, they have been slow to sell. This, in turn, has forced them to put aside more capital, tying up what could be used for loans.

“Even though some of the annual rates are improving,” explained David Blitzer, chairman of the index, “18 cities and both composites are still negative.” Blitzer also highlighted that both indices are barely off their all-time lows, with the 10-city only 2.4% off its April 2009 trough and the 20-city 1.9% above the fateful mark.

From their peaks, the 10-city remains down 31.9% and the 20-city is still off by 32.1%.
http://www.forbes.com/sites/afontevecchia/2011/12/27/nasty-case-shiller-shows-home-prices-barely-off-their-crisis-lows/

Pilot friend of mine was in town last night and was over for dinner and beer. He lives in Vancouver WA, in a house owned by his cousin who bought the place pretty much at the peak. The home is currently worth 52% of what he paid for it according to Rich. Ouch.

 

[Toshi]

I've put my home-buying plans even further off into the future. I was planning on jumping into the market when I finish fellowship and get a real job (ie, 2014), but now upon advice from my parents and my own scanning of the still-dark news I'm planning on waiting two more years yet to make sure the job (and the market!) hold up.