I just saw this quote in the Press Democrat. It is in reference to the Sonoma housing market, the fact that prices have dropped a little, and lending has tightened:A family earning the median income can qualify only for a home priced 50 percent below the median price of a home.This state of affairs is criminal. This is what happens when we allow self-interest and greed free reign, to get out of control. This pathetically shameful situation exists across much of California and certainly across the whole of the Bay Area.
It didn't have to be so. No one said you had to pay stupid prices just because someone else did.
This is not a healthy situation to be in. It must not be encouraged to continue. The only way out of this horrible situation is if house prices drop a good 30-40% from where they are now or if incomes double. I seriously doubt it will be the latter.
Fortunately, the main stream media (MSM) is finally beginning to talk about the fact that cheaper prices are a good thing for our economy and our communities. As is always the case with the MSM, it's too little too late. But I still hope the message catches on in a big way:
Whenever the housing market takes a turn, how you feel depends on where you stand. There are buyer’s markets and seller’s markets; what’s good news for buyers is bad news for sellers, and vice-versa.
So a slow housing market is framed in hand-wringing headlines, like this one from Friday’s Boston Globe: ‘Housing slump may rival late ’80s.’
“If you are struggling to buy a home, that sounds like good news, not bad. It’s also good news if you consider the long-term needs of the state economy.
Lower home prices ‘are healthy for the economy,’ said Alan Clayton-Matthews, the UMass professor who authored the study.
3 comments:
The Chronicle ran this "Letters to Real Estate" this morning, I was shocked they included it, right on Page 2.
"Fallout from bad loans will reset market"
A few excerpts...
"I've spent the last several years watching people take preposterous loans to purchase homes well beyond their means...These people knew what they were doing...They were gambling that the market would continue to rise...If the government wanted to act, it should have acted years ago to provide better lending regulation...To come in now, after the damage has been done, and prop up the market can only forestall and worsen the necessary correction...In the meantime, responsible buyers will continue to be shut out of the market.
Wow. To see that this morning was a dream come true.
There was a huge editorial this morning also about the damage done to public schools in SF, as more & more families leave every year because of housing prices.
Yes, the MSM may just be catching on.
Excellent. That is exactly right and puts the bulk of the blame where it should be...on the shoulders of the fools who thought it would be a good idea to pay stuped (err, "preposterous") prices for houses.
Do you have the link? This quote deserves its own post.
Yes, the thing with schools has been happening for a couple of years at least. It's one of the reasons why I started blogging and I've spent more than one post on the subject in the past. It is really sad.
Maybe people (the most of which are "owners") will finally agree that ratifying so much legistlation that was ultimately intended to protect house values and to increase the liklihood of home prices to increase, will finally see that it went too far.
Here's the link:
http://tinyurl.com/3b3yxg
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