Remember when all we heard was "soft landing, soft landing, soft landing". Well, those days of innocence may now be lost, as panic spreads across the land. And in the end, like all Ponzi schemes, it's the change in herd mentality and psychology that deflates the bubble, even more than any economic factor.
Now that houses are seen as money losers, as declining assets, as financial death traps if you buy today, well, all that matters now is that housing gets back to the historical mean, and to a place where the fundamentals make sense - where rental income equals or surpasses ownership costs.
Market by market, that number is different. Phoenix I'd say is looking at a 30% to 40% crash, just to wash away the 52% 2005 flipper head-fake. Kalamazoo, Michigan, since it never went up, is likely looking to remain flat forever.
But let's take a stab for the drop in price for the top bubble markets (aka flipper infestation victims), and the US. Here's my bubble hit list. Add ones I missed, or local markets, and take a guess for any city you'd like:
* Phoenix
* Tucson
* Naples
* Tampa
* Miami
* Orlando
* DC
* Boston
* LA
* SD
* Sacramento
* SF / Marin
* Honolulu
* Las Vegas
* Reno
* Denver
* Boise
* The United States
* The UK
For now, guess drop in reported used home median sales price, from peak to bottom.
Go by the official reported used home median price, from peak to valley, even though we all know that no entity reports the true number (with incentives and kick-backs included). New homes are probably seeing 10% to 25% overstatement, but I'd imagine used homes is in the single digits. Thoughts there on how we can guestimate best?
October 02, 2006
Guess the housing bubble crash % decline
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Home prices will go down to allow for a 8% ROI (in rental income), or where the price is no more than 4 times the annual income of the household that has bought the home.
In other words if you clear $50,000 a year, then you should not buy a house worth more than $200,000, so that you won't need more than 15 years to pay off your mortgage.
In other words the way I see it.....there will be a 40% price drop.
Here's a guy in Australia that is predicting just what this blog is about:
www.depression2007.com
It's all about the herd mentality. Remember when unprotected sex was all the rage!! Reminds me of the mortgages floating around today, even in Australia. There will come a time when people realise they are like a horrific STD...
Without inflation adjustments the numbers are meaningless. Then you are stuck with the silly CPI and then we are already hearing about CPI changing to not reflect OER. Everybody in the US is facing a 40% reduction in equivalent purchasing power as just a reversion to norm. Any overshoot is a function of policy and truth in reporting.
without an accurate way to see what the peak price was, and what the crash price will be, you are correct robert
plus add in the effects of inflation, even if houses held price for 5 years, you'd lose 20% or so
but still, it's fun to guess
I'll take three:
Phoenix: Down 42% from peak
US: Down 20% from peak
UK: Down 50% from peak
NE Florida needs a 50% drop to correct the price increases in the last two years and a 50% drop to bring the average price of a home down to 3 times the average family income (average home is 6 times family income right now).
NE Florida = 50%
Agreed. I'll make up my own criteria.
1 $/sq ft as reported by DataQuick or equiv.
2 Inflation Pre-Clinton CPI or if you need something easier but almost identical 10yr+2%
PHX 60% 5yrs
LV 45% 4 yrs
BOS 50% 7yrs
MIA Naples, Orlando 35% 4yrs
SacraFresnoBakersfield 35% 5yrs
In Bubble areas (you know where they are, CA, FL, NV, AZ, DC) I predict a 40% drop in last two years run up gains.
The non bubble areas flat to -10%.
DC: 40% drop over 4 years
DC condos: 55% drop for condos over 4 years
Well, I guess there are a lot of optimists around here. Remember, folks, this is a BUBBLE. 30-40% is not a bubble crashing. That's just for starters...maybe the first wave down. When it's all over, you'll see some markets down 80-90%, other 'lucky' ones only down 60-70%. The housing bubble is not a thing unto itself, it's part of the larger credit bubble and public/private debt bubble, which has grown to incredible size. We're looking at a 20-30 year 'correction', or depression. Worse than the 1930s, by a long shot. When you see the Dow back in triple digits, you'll know you've seen the worst of it. Me, I'll probably be gone by then, thank God.
Oh my, John.....you are taking it one step further.
Don't know if it will all that bad. Maybe it will, maybe it won't. If you are correct, then farming is probably the best profession one can get into right now.
I worked in the REO Marketing department for the RTC in 1992 and sold apartment units for 20-30% of what they previously sold for. Prices will decline more than you think. When you discuss how much the markets will decline you have to make a distinction. Saying what someone's house will be worth when they have no intention of selling to disprove you, is meaningless. Just look at the coming sales of REOs and short-sales. That which is actually selling, despite the underlying circumstances, will determine what the market is.
Cleveland (metropolitan area), OH. No, seriously. Home sales are down 28% yoy in NE Ohio.
A 30% crash, when massive leverage is applied, combined with widespread leverage usage, is a collapse as never before seen in human history
Buy a $500,000 condo with no down, drops 30% or $150,000, add selling fees and negative carrying costs, and you're bankrupt fella.
Personally I have said that property is the best investment....if you know what you are doing.
I have a number of commercial real estate investements which I bought during the 90's. I will not be getting rid of these no matter what.
However I think people who 'discovered ' property in the last 3 years are going to get seriously burnt.
I am rooting for a crash.....buying time !!!!
Keith....where do you think commercial property will go in the next few years (mainly retail property).....I think there will also be a crash there....but not in the same degree as residential.
Whatever the case....cash up....
There are markets within the market that will be treated differently.I can see the high end coming down 50% in some areas in phoenix. I just cannot see the low end coming down too much, 10-15% maybe. By low end I'm talking low 200k.I think there is a lot more safety in the low end.
A 50% haircut is in the works. That will bring us about back to the historical mean. BUT, I believe the correction will be LARGER at first in a psychological over-correction. Look for 55% - 60% (or more) in the highest markets. When real estate is sh*t, that is the time to buy.
60% in Los Angeles and surrounding areas.
Some neighborhoods have 3.5X ed since 1995.
50% return to median, 10% overshoot.
Sellers will chase the crashing prices.
They'll lower 5% when the houses that sell will have had 10% slashed.
They drop prices 10% when 15% reduction is what is selling.
All the way down they will not compromise with the truth until the value of the house becomes its value as scrap material.
60% loss.
I might agree with some of the more dire predictions if RE were the only asset class in jeopardy. The leveraged nature of current financial systems means that a 50% decline in RE would be a disaster with worldwide effects.
The powers that be and financial elites cannot and will not allow that kind of collapse to happen because the resulting chaos will put them out of power.
I vote for a 80% drop in prices in areas of Florida, So Cal, parts of Arizona. Only a 40-50% drop in DC, NYC and cities like Atlanta.
The rest of the country can expect 5-10% declines in median priced homes and 20-35% declines in mcmansion type homes.
Sorry! The truth hurts sometimes.
When will it happen? The day after the Fed REDUCES interest rates, 1st quarter 07.
Concerned asked Keith....where do you think commercial property will go in the next few years
Our company owns commercial buildings in Florida and Georgia. I'm not sure where you are, but there is A LOT of empty retail space in Florida and some in Georgia. It's hard to estimate how much retail space will drop because, unlike houses, retail space generally sits empty for years before prices start to drop as people continue to build new retail space and the empty spaces keep on sitting. We think Florida commercial space will only moderately decline in price, but that the percentage of empty space will continue to rise. The only reason that we think prices will only moderately decrease is because a lot of the property will not sell at any price. It will just sit. No sales, no recorded price decreases (kind of like houses right now).
By the way, this isn't a good thing. We would rather have less valuable commercial space than empty commercial space any day. I'm not rooting for price increases, I'd rather prices come down and be full then prices stay the same and be empty.
60% in Los Angeles and surrounding areas.
Some neighborhoods have 3.5X ed since 1995.
50% return to median, 10% overshoot.
Damn skippy! i live in the LA suburbs and I am sick of the false impression that we're all rich! $55,000 is about the median FAMILY income. The GREAT entertainment industry only employs a few and the shipping that flows through Long Beach still does not justify current prices. Market fundamentals will have their revenge!
"The powers that be and financial elites cannot and will not allow that kind of collapse to happen because the resulting chaos will put them out of power."
-----------------------------------
The powers that be already did this 5 yrs ago, now the resulting chaos will put them out of power.
The financial elites have run out of ideas and now their heading for the hills. Remember all the fed board members quiting recently?
there's a strong possiblity that commercial real estate will tank, following the residential bust, since local retail shops thrives in local economy. if consumer spending is reduced or worse, if people are leaving the are and moving somewhere else, chances are that small retail businesses will suffer.
Hey borka.......
don't get me wrong, i cannot stand the REIC scum. i cannot imagine a more self-serving group of parasites that make money by creating NOTHING. that being said, prices will fall due to inventory and absorption rates, but not in the area of 60%. that just won't happen because most people won't sell at those discounts. in places like phoenix and orlando with huge inventories, i think prices will drop 20-30 %. larger areas like LA and DC, 10-20 %. middle america, which no one really cares about is already stagnant and does not have far to drop. middle of nowhere places like kansas, iowa and colorado will drop 5-10 %. oh, and denver is toast, up there with phoenix and orlando for overrated, bloated and insane fake-appreciation. but the grand-pooba winner for the falling knife will be san diego. people just don't earn enough to support the prices. my two cents.
30% price RISE in motorhome and trailer prices due to ARM casualties needing a place to live. Jim
50% in Orange County, Calif. (Irvine and surrounding areas), , back to 2001-2002 levels.
In Reston, Virginia a thirty percent decline from the top will occur in Zip code 20194
Anyone know how this is going to spin?
"Manufacturers hit the brakes, housing holds up"
article from Reuters today
I can only speak for Los Angeles and the general area. We are looking at a 50% to 66% drop (not cut in prices) I say drop because none of these fools I share my lovely city with are going to just come to their senses and say "Oh, well, they are right, I guess I am going to have to come to terms about true value..." NO, what is going to have to happen is those with ARMs (more people than anyone thinks are willing to admit have them. Remember this is LA, image is everything so they pulled cash out and bought cars and lifestyle things to go with their new multi-million dollar 2 bedroom home)is that their payments are now going to jump up to 4 to 6 grand a month. Which will make them place a home they can not sell on the market, and will lead sooner or later to foreclosure. Then for those poor people who have fixed rate loans but also took out cash from their homes to also buy lifestyle items will see that because of falling prices and homes in their neighborhood due to foreclosure going for a lot less than what they owe on their fixed rate home, saying "Oh hell no, why am I paying $X,XXX per month on a home where someone who has bought after the bubble is paying $XXX...I'm out"
Things are going to get very very very very bad in LA...So bad that I think that when it does, the whole country will look at LA, and see the true gravity of the Nations RE problem...
PS..I rent for 3,000 a month in LA. In 2003 I sold my homes in Valenica for a HUGE profit and stuck it in the bank. I knew this day would come, so I wanted to wait and not buy back in LA (left in 2000 and moved to valencia) My "landlord" (poor bastard) has 800,000 in ARMs(pulled cash out to by his "new" home..lol) for this property which reset in June (the month my lease is up). He is in a panic because property values have fallen 20% in this area already, and rents down 500 to 700. When all is said and done, this home will only be worth no more than $220,000... Ahhhh, greed....
One of the curious things about human beings is that we can usually only imagine that which fits our framework of reality. A good example is the Native American who stood and watched the European sailing ship coming toward shore but couldn't actually see it. He had no frame of reference for a ship of that size and that type, so his brain simply discarded the image his eyes conveyed. This same phenomenon is currently at work in real estate. For most of us, we have never known a RE market that was not moving up. RE has been a sure thing for almost 60 years now. However, during the Great Depression, RE prices fell by 70, 80, even 90%, and no area was spared. Urban, rural, 'country' (pre-suburban suburbs), Midwest, West, Eastern Seaboard--everywhere. Of course, the Depression was a cataclysmic event, and the measures put in place back then were supposed to safeguard us from it ever happening again. Actually, as has been noted here, those mechanisms have simply delayed the next downturn, making the coming crash ever greater in severity relative to the time it's been put off. Mainly because the excesses needed to stave it off just make the underlying structural problems worse. And there are plenty of 'experts' who will tell you the underlying problems aren't really problems at all, that people who say the national debt and lack of citizen savings and the trade imbalance and all of that stuff is meaningless in the brave new economy. This is precisely the argument made when the Nasdaq was approaching 5000. 'It's different this time' is the death knell. The only thing different is that the crash is going to be deeper, longer and more socially, economically and emotionally shattering than anything even the oldest of us has experienced. And this is, unfortunately, only logical, since the bubbles and excesses leadign up to it have been beyond imagination and historical precedent.
Since Keith is all about Doom & Gloom, those who care, should read this, after all we want to save our money not give it away IE: BUY GOLD!!
Why Today is Signaling Sell
http://tinyurl.com/fljxo
What NYC not on the list?
i stopped reading john's post when he claimed "...and no area was spared".
i remember asking my father what the great depression was like for my grandmother in rural mississippi.
he said "what depression?, my mothers whole life was a depression living as a sharecroppers wife in rural mississippi".
what will be the end of the world for some is everyday life for others.
everything is relative.
Portland, OR... 15%
Bend, OR... 25-30%
Home construction jobs are just going to shift over to commercial construction during this downturn. Somebody nailed me when I said this the other day, but here's proof: http://money.cnn.com/2006/10/02/news/economy/construction.reut/index.htm?postversion=2006100210
This bust isn't going to be nearly as bad as you guys predict. Even a 50% decline in the coastal markets that saw over a 100% increase previously is still a 50% gain...provided you bought at the right time...
Salt Lake Real Estate Blog
When California is cheaper than Utah. Load up on California Real Estate.
I haven't seen many declines in New Jersey or New York. Yes, there are small price reductions, but the homes are over priced by hundreds of thousands. Don't see it happening anytime soon.
It won't come down at all.
Congress will pass a law to stop forclosures, so that people are not thrown onto the street.
The government can solve this problem, and it will.
As an educator, I teach my students (high school) that predatory capitalism is dangerous, and the housing market is an example. The government must, and will, take over these things.
We're all in this together. Watching out just for "yourself" is not the right thing to do. This housing bubble will wake the people up to the fact that wealth must be shared with everyone, and that free enterprise is just the freedom to rob people.
The new generation agrees. 90 percent of my students agree that capitalism should be abolished. It's about time!
"My landlord (poor bastard) has 800,000 in ARMS...for property which reset in June..."
Hmm, I can smell discount here. If I were you, I would talk to your landlord and see if he can lower your rent by 20%, otherwise, you're going somewhere else and if he can't find a new tenant, his house will be foreclosed. Hey, it's shrewed but that's the name of the game. Have they thought of that when 5 years ago, they where proud and mighty? Hell no!
WOW, your teaching highschool students that capitalism should be abolished?
"The government can solve this problem, and it will."
Cool - now I can go back to sleep
A few posts back someone said a 50% decline after a 100% runup means prices are still up 50%. Actually, its means they're right back where they started: a house that started at $500k and increased 100% would be at $1 million, a 50% cut would take it back down to $500k.
Which is why a lot of the % figures being thrown about seem a bit high, at least in markets outside places like the SW and Florida. If prices increased by 100% between 1999 and 2005 in a given market, well nominal GDP must have increased by about 50% during that same time frame (once compounding is taken into account). Maybe housing prices deflate so that the growth in housing prices equals the growth in nominal incomes, but that would only mean about a 25% decline.
Which still sucks, of course.
Its also possible that prices could come down about 10% and wait a few years for nominal GDP to catch up. Not everyone is going to sell in a crap market, and inventory will start to come down, presumably.
Japan, hopefully, is different because they had both a stagnant economy and deflation, plus a shrinking, graying population. God bless the USA, we actually have kids and immigration keeps new potential homeowners coming in, plus we don't have deflation or a stagnant economy. A housing slowdown will take a bite out of economic growth (obviously), but the other factors mean we won't be Japan.
Please visit this site and vote for "Housing Bust will lead to second depression in 2007"
http://www.twocrowds.com/popular.php
This is a social mood predictor site. Maybe if enough people vote for this one, we can get some attention.
* Phoenix -42%
* Tucson -40%
* Naples -31%
* Tampa -27%
* Miami -31%
* Orlando 19%
* DC -22%
* Boston -21%
* LA -31%
* SD -39%
* Sacramento -29%
* SF / Marin -34%
* Honolulu -30%
* Las Vegas -8%
* Reno -19%
* Denver 0%
* Boise 0%
* The United States -16%
* The UK ?
* The OC -40%
>> The new generation agrees. 90 percent of my students agree that capitalism should be abolished. It's about time!
That's just great ie. teaching them that it's better to be a poor slave rather than a rich slave.
Boston will need about a 40% haircut for prices to be in line with incomes and rental rates.
So they ARE teaching communism in schools!
Bout time someone admitted it!
see this topic is starting to go to the far left...keep it on target...
Now...There will be on gov. bailout...
And yes, all over Los Angeles and even more so...the WESTSIDE will have this 50 to 66% hit...Property values will retern to what they were in 2000/2001...Just watch...
And come June, my landlord can sink when his 800K loan resets, I have been waiting for this with what I made on the two homes I sold in Valenica...Cold hard cash in someone face (including the Banks REO department) will buy twice of what it by today come summer of 2007...
Now...There will be *NO gov. bailout...
Salt Lake is an idiot... Even a 50% decline in the coastal markets that saw over a 100% increase previously is still a 50% gain...provided you bought at the right time...
$100k + 100% = 200k. 200k - 50% = 100k all gains wiped out!!! Typical realtor math.
Go out to Realtor.com and look at the condos on Michelson in Irvine, CA that cost $1.6 mill and rent for $2,800 a month. I think those will be the biggest drop. As for a geographic area Port St.Lucie, Fl takes a 60% haircut because there is just too much supply and Port. St Lucie is not Naples, Miami or Tampa.
Shakster said...
"In reality we are a nation of debtors,followers,and surfs who have lost the very concept that"
I didn't know we had blue people in this country. Oh, wait, little blue people are Smurfs, not surfs.
Hey check this out great audio Mish posted tonight.
Scroll down to the 12:00 NOON hour and click the audio play button.
http://tinyurl.com/faye7
And a very nice site here to I might add.
http://tinyurl.com/k3n2v
The Janitor.
Portland, OR... 15%
Bend, OR... 25-30%
++++++++++++++++++
Are you kidding? My two cents below:
What about the tons of condos flippers bought in the Pearl District in Portland?
My guess is Portland = -40%
As for Bend, OR: that town has no economy to speak of and the locals have no where they can afford to live.
My guess for Bend = -60%
Also, Seattle = -40%
(
"Salt Lake is an idiot... Even a 50% decline in the coastal markets that saw over a 100% increase previously is still a 50% gain...provided you bought at the right time...
$100k + 100% = 200k. 200k - 50% = 100k all gains wiped out!!! Typical realtor math."
--------------------------------
Depending on what the original poster "meant" by his example you could infer two meanings:
1.) The 100%gain and then the 50% loss of the gain would give you a 50% gain.
(($100+($100*100%))=$200
Then $200-(($100*50%)=$150
Thus loss of 50% on the gain so you would end up with $150
**************OR*******************
2.)(($100+($100*100%))=$200
Then $200-($200*50%)=$100
-----------------------------------
Charles Roberts Air conditioning , the largest in Phoenix by far, has just announced big layoffs coming.
It's slowing down alright. These are all very well paying jobs .
Joey said 'Places like the westside of LA will not come down 60%. That is ridiculous for many reasons. '
I lived in Santa Monica 90405 during the last downcycle. Santa Monica dropped 50% from 1989 to 1994 and stayed there for three years before shooting back up to the absurd prices we see there now. That (1989) was a much SMALLER bubble with a higher affordibility index at its peak, less funny money involved, and fewer absurdly leveraged FBs. People who grew up in more stable parts of the country (like me) underestimate the propensity of people in LA to walk once they're underwater. While people in Kansas City might sit tight for years waiting to recover, people in LA don't have such a long outlook; they are more dynamic and more likely to experience career/life changes during the next few years. The vast majority of them are not even living where they'll want to be in 20 years and they will start to walk away once they are upside down for a year or so, which should be coming up around next spring as the flood of ARM resets really starts.
Seattle down 50-60%.
Frankly, I think that's on the "lite" side.
50-60% would take us back to '02 or so and I'm guessing we may end up back at '99 or '00 in fact.
Because of our extraordinary high rate of toxic loans (5th or 6th in the US).
I'am hoping for 50% down from the 2005 peak in SF Bay Area.
Why do people like to use the past to say...back in such and such, it did this when everyone has been saying...THIS WILL BE LIKE NOTHING SEEN BEFORE... The Los Angeles market is DOOMED...Yes there will be huge FMV reductions on the westside...It is a shame how many owners do not understand the concept behind Fair Market Value. If you do not have buyers "Buying" within a certain period of time, you have no real justification for comparables. If you have people trying for a quicksale so they do not end up in foreclosure, along with people just trying to get out of the market...this is going to drive down the price in the area. Take a real look now and the westside LA market, you see this everyday...Prices are already down 20%...and nothing is selling...come on...open your eyes so you can prepare for the coming wave....
To the crazy teacher:
I don't suppose you've ever tried this before: but instead of spouting well meaning platitudes and similar drivel, instead stop for a minute and think about the actual implications what you are saying.
If congress stops foreclosures (which is doubtful owing to a whole bunch of technical reasons involving the US constitution; a document which contents of you are no doubt blissfully ignorant), then no-one will ever be able to get a mortgage again. Ever. (Not to mention that what you are suggesting is little more than wholesale theft).
From that point on people will only be able to buy houses with folding cashy-money. (Or, more likely at that point, gold bricks and such). People who do happen to own a house will see its price plunge to 5-10% of what they paid for it; and no more houses will be built except by the ultra rich plutocrats who will no doubt be running your socialist utopia at that juncture.
You call yourself an 'educator'. To be an 'educator' one must 'educate'. And frankly this feel-good prattle which is informed by an elementary school level of moral philosophy doesn't count - especially at the high school level. (Doubly so, since you are no doubt a math or history teacher).
No wonder this once great nation is in so much trouble. Moreover teachers like you are no doubt in large part responsible for the waves of buyers who are so ignorant, and lacking in basic literacy and numeracy, they believe that they can, indeed, afford a $850k house on a $50k income.
I've said it before, and I will say it again. Teachers in this country are massively overpaid, underworked, and underqualified.
"90 percent of my students agree that capitalism should be abolished."
That's about right. The higher I.Q.s would be the other 10%...
Give the teacher a break. I know he’s wrong, you know he’s wrong, but he’s entitled to his opinion… even if he is educating the masses.
I wish the government COULD fix his mess, but I’m afraid not.
Maybe the teacher should take note of the very fine job the government has been doing keeping gasoline prices in line.
I’m a middle-of-the-roader, with both feet firmly planted on both sides; half Liberal and half Conservative. Although, I'm leaning more and more to the right, as I get older.
"No Bubble...Congress will pass a law"... "Capitalism is bad"
Where did you come from. Alan Green and the Fed created this monster with a 1% ptime rate, designed to mitigate the damage from the dot come implosion. It's unitended consequence was the train wreck in the real estate market.
Yea, lets have congress pass a law so we can basically protect the idiot speculators and "flippers"
Not gonna happen. the Gov't needs to stay out of this. The market will pubish the foolish and reward the wise (or he lucky).
John, you said "For most of us, we have never known a RE market that was not moving up. RE has been a sure thing for almost 60 years now."
Not so. I am 55, been investing in Real Estate since I was 19 and this is the 4th "bubble". This however is the worst. I agree with Devestment's numbers, more or less for each market.
...again "Congress will pass a law"? You actually teach kids this crap?
The home prices here in Reno do not come close to the salaries paid for most jobs. IMO, prices need to come drop 55%-65%.
In general, this country needs to go back to the basics that houses are just to live in, and folks should never pay more than 3 times one's salary.
I live in the DC area and I estimated my house to be about 25% overpriced. One thing to keep in mind is real estate did poorly in the 1990's, so the recent runup was off a base of low values.
My gut feeling is things will over correct and the drop from the top will be around 35%. Prices have already dropped about 10% from the peak, so there's another 25% or so to go.
I don't see price drops of 60% or more in LA. There would either have to be massive unemployment or a large drop in population. I don't see either happening. If the auto industry collapses, I could see Detroit with large drops in value.
I live in the eastern outskirts of Southern California. A wasteland know as the Inland EMpire. Riverside to be exact. I bought at the rise in 2003 at a pre-bubble price. I just 'zillowed' my home and it says it actually went up about 35k in 3 months. Go figure. I think this area still has some juice left. But when it drops it will crash bad. For now I will take advantage and extract some more equity to add a home office and a new paint job. CHeers.
Zillow...lol...Does not take into consideration any and all new factors which have sprung up over the last new months/weeks regarding the pop. They are using sales data from months and even years ago to create an average of price valuation.
For example, there is a home located a few blocks away from where I am renting which had a foreclosure sale for an ARM of 480,000 that no one bid on and went back to the bank. According to Zillow, the home I am renting is worth 583K and went up this week 13,000. Every home within a 50 foot radius of me is going from 780K to 900K. Zillow says that there is atleast 100K worth of equity based on my homes value, and close to 400K based on other properties
...So why did no one pick it up at the auction...I tell you why..because right now, these homes are only worth 350K and falling by 10 to 15K per month...
Zillow is a JOKE!!!!
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