Busted: Bankers and The Global Economy

December 2, 2008

Housing Pressure On: Drop of 40%

Filed under: economy, investment, money — Tags: , , , , — digitaleconomy @ 10:02 am

value crisis

value crisis

Selling a home is this recessionary market is challenge enough, but considering that the average homeowner that needs to sell real estate is competing with more than a million bank-owned homes fresh out of foreclosure at low ball reductions of 40%, the downward economic pressure in the housing market persists.

Even in California, the former mecca of high home prices, prices are facing the same downward pressure, forcing home sellers to take huge losses in order to relieve themselves of their property.

As far as home foreclosures are concerned, lenders left holding the bag have already been deluged with expenses in administrative costs, property taxes, insurance, maintenance coupled with the loss of missed payments. As home prices continue to freefall, these bank-owned foreclosures continue to depreciate in a dwindling market as more foreclosures are added to the barrel of distressed properties.

shooting-foot1Once the strength and fire of the U.S. economy, the housing market is facing a correction of unprecedented proportions, further impacting those that have managed to maintain their lifestyles and employment in the face of the progressing recession.  The relunctance and inability to stop foreclosures is bringing about an economic defeat of colossal proportions. An antiquated and inadequate system is shooting itself in the foot. Remember that all of this has stemmed from the unending greed of bankers and investors. Neither education or the lack of it has meant a thing. So much for the economic brain trust. ~ E. Manning


1 Comment

  1. I think it is interesting to think of the price of homes in terms of foreclosures like this: While everyone may perceive these prices as being low, the true value of a home (or any product) is not the price tag, it’s the price someone is willing to pay for it.

    Real estate agents must be having fits because all of what they know has been thrown out the window. Their comparitive pricing system is bunk because demand has dropped so. There is no comparison.

    Comment by trahantheman — December 2, 2008 @ 10:28 am

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