When do you think housing prices will go back up?

I would put it at about 18 months for things to start feeling solid again. But I’m expecting it to get worse before it gets better.

IANYFA

Well, you’ll need to define what you mean by “back up”. If you mean the ridiculously inflated values given to homes during the past few years, I’m not sure if it’ll ever get that high again, well at least not for 5, 10 years when land starts becoming more scarce/the desirability of certain land goes up. They really were inflated beyond anything, in part because people bought the line of “house prices always go up”, when it’s clearly obvious now that that’s a lie.

I think house prices will start to go back up whenever consumers start feeling really secure about themselves, and the banks go back to giving big mortgages. When will this happen? No clue.

This recession is going to be very interesting, to say the least, not only for the housing market, but to see the effects in every single market that exists.

Get worse than it is already? Yikes =/

@johnpowell – Does that stand for “I Am New York Film Academy”?

My answer would be that it depends on what you mean by up.
The housing prices were out of control and not realistic. I doubt if they will ever get back to the levels they were at.

Otherwise, the latest predictions I heard were that we were halfway through a 21 month recession. So i guess that puts it at the beginning of the year for things to start looking more normalized. Which means that we have many months of uncertainty ahead.

I fully agree with jp about it getting worse before the upturn.

@fireside :: I am not your financial adviser.

But the data I have suggests that maybe the bottom will be in 8 months. And this is from models I made. Odds are good that I am completely wrong. This is a strange one and there isn’t really any historical data to base models off of.

But you won’t see the craziness again for a long while. I hope

When the banks feel like they can lend money to people with out getting screwed.

by up I meant that they would stop going down and possibly start slowly increasing…I agree they were totally over inflated and may not ever get that high again, I was just thinking in terms of normal increasing based on inflation, demand, etc.

Five years.

It still has a long way to fall. I read yesterday or the day before that banks have been slow to dump foreclosures on the market, and the number of them is bound to depress prices even more. Like anything else, price will go up when demand goes up. For demand to go up, there have to be fewer homes for sale, and people have to have the money to buy them. I’m not one to prognosticate, but I don’t think there will be any kind of recovery in home prices for at least two years, and that’s only if we have a general recovery in that span of time.

The problem will be the demand side. Demand was artificially inflated by the people who should never have been qualified to buy homes especially the mini-mansion varieties. Now if you add to that the folks who were able to survive before the recession but who will be forced to downsize or have had their credit damaged by job loss, a lot of people will be out of the market for the next 5–10 years.

As far as supply goes, that will have to change too. There will be the first wave of baby boomers looking to downsize and with their current homes worth less but still paid off or worse yet without equity due to crazy refis, there will have to be more modest homes on the market. I see a growing demand for the 1300 sf 3 bed 1.5 bath and less for the 2500+ sf 4 bed, 3 ba, office, bonus room, formal dining white elephants. Younger families will also have to live within the constraints of buying a home that costs 2,5 times their salary.

Prices will go up again as soon as the idiot bankers forget what they “learned” from this..

Wasn’t it back in 85 n 86? that we had a similar scenario, didn’t have a long term memory after that one, will they after this one?

A house is shelter. Having it be an investment is secondary.

I live in the area that was identified as the foreclosure capital when thing were going sour. Our collapse in the market preceded the rest of the country by six to nine months. Thngs are beginning to look stable in our area. Not good, but stable. Prices have risen, to a degree. But, like others have stated, I don’t think they will return to the over inflated prices that they were. Two yeas ago, most of the houses on our block were for sale, in foreclosure. Today there are only three houses for sale on the same block.

i don’t think we are even in the recovery stage. I don’t think we even reach the bottom of the worst that is expected. HELL NO. This economic downturn is gonna be slow moving and the one with the slowest recovery since the freaking great depression. I’ll say for Britain to recover, it will probably take another few years to get back where it was before the whole shyt start. The government is bound to do something with the olympics around the corner. Something will for sure around that time.

a year, year & a 1/2

The single most relevant factor regarding home prices is WAGES. In the absence of a credit bubble, folks must make money in order to be able to qualify for bigger and bigger loans, leading to higher values.

Since wages are and have been falling for most/many, home values should return to 1996 levels and then trade sideways for at least a decade before rising.

Unless jobs start paying more—if you are upside down, better to start over than wait for appreciation that may be 10 yrs off.

The Alt A loans are just beginning to foreclose (which includes MTA Option Arms and there are many billions of dollars of those) and then Prime loans will follow.

The foreclosure waves should cease by the middle of 2011, but don’t assume that will automatically lead to higher values right away…

Also do not forget the baby boomers will be sellers and not buyers, leading to more and more inventory, lower prices.

All real estate slumps usually take a decade or so to recover.

I read somewhere about an 18 year cycle in real estate, that we are at the bottom of the 18 years and it will take that long to boom again, has anyone else ever heard of that?

I hope not, but it sure could be….

Actually the bulk of the ARM loans are yet to adjust. Some 1 Trillon $ of Alt A arm loans to adjust in the next 12 months. It will make the sub-prime bust look like a tea party.