Existing Home Sales Don't Signal Market Normalization, Economists Say

RE:Existing Home Sales Don't Signal Market Normalization, Economists Say

nositedelive — Sun, 31 Aug 2008 11:00:00 GMT

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RE:Existing Home Sales Don't Signal Market Normalization, Economists Say

PurpleFlash — Thu, 28 Aug 2008 11:00:00 GMT

NO matter what anyone sasy, this downward pressure on home prices is a GOOD THING. Why? Because: 1) Home Values were SUPERHEATED and OVERINFLATED due to the ridiculous lending practices and underwriting standards ( ie bad loans being made) that allowed these prices to get so ARTIFICIALLY HIGH in the first place. (Bye th way, I am a mortgage professional who reentered the business when all this crazyness was going on and I predicted this foreclosure mess would happen) 2) Home prices will continue to decline untill they settle out so that normal people with normal wages can afford them with traditionally well underwritten (ie. good loans) can afford them. 3) The Lending market will also settle out as this process happens. It will take a little longer for that to happen, but it will. Mortgage Lending Credit is overtight right now in reaction to the Mortgage Meltdown, but it will loosen slightly (ie.e return to traditional normal) as time goes on as sanity slips back in and Lenders see opportunity while mitigaeing their risks. (Ie - we will return to true A paper borrowing (fanny & Freddie, FHA) and Sanely underwritten B, C and D credit portfolio lending (as was traditional in the past, before they evolved into the "Sub-Prime " mess.

RE:Existing Home Sales Don't Signal Market Normalization, Economists Say

Christopher Ohlsen — Mon, 25 Aug 2008 11:00:00 GMT

I am not an economist, just a mortgage professional. It is unfortunate that the housing market is in such disarray but I do see a light at the end of the tunnel. Specifically while there are less loans to go around the market has expelled unqualified "telephone sales people" who sell mortgage products that they don't really understood to unsuspecting hard working people. I hope that the market does rebound in 2009 but regardless of whether or not it does I will be here because I treat my clients right... I am here to stay. So, if the market does rebound for those of us who are left still in this business we will all experience a boom even if the market is not reflective of a traditional boom. The fact is when 5 people are eating a pie instead of ten people eating that pie the pie can afford to be s little bit smaller and still satisfy the people who are eating it.