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August 9, 2007

Today's Housing Bubble Post - For Sale Signs Everywhere

-- by Dave Johnson

I am on vacation, driving around Michigan. There are For Sale signs everywhere. Three per block in many areas. It is very unusual to pass two blocks without seeing a For Sale sign. And the real problem hasn't even started to hit yet. The "resetting" of adjustable mortgages has only just started, and the credit crunch - making it harder to get a mortgage - is only a few weeks old. And, of course, prices have not even barely started to fall to where the average person can afford to buy an average house. They will, because they have to. The next couple of years will be very hard for many people.

Some of the stories in the news: Slowdown Restricts Access to Home Loans,

The dream of owning a home is fading away for many Americans with less than stellar credit.
Mortgage seekers caught in squeeze,
A growing credit crisis is prompting lenders across Massachusetts to cut back suddenly on new loans, making it difficult for even creditworthy borrowers to get mortgages and causing some home sales to fall through at a time when the housing market is already slumping.
Major bank stops approving home equity loans, credit lines
Ripples from the subprime mortgage meltdown are spreading, affecting even borrowers with stellar credit and making popular home equity loans tougher to find.

The latest example: A major national lender stopped approving new home equity loans Monday.

More and more lenders are yanking away loan programs and changing borrowing guidelines as they struggle to please bond market investors, who indirectly provide financing for the nation's mortgages.

Posted by Dave Johnson at August 9, 2007 6:25 AM

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Comments

You are also missing another important ingredient to this whole mess: PROPERTY TAXES.

Posted by: Konnie [TypeKey Profile Page] at August 9, 2007 1:10 PM

You are also missing another important ingredient to this whole mess: PROPERTY TAXES.

Posted by: Konnie [TypeKey Profile Page] at August 9, 2007 1:11 PM

That's really sad and I'm sorry to hear it. It's a very bad sign, because Michigan usually starts suffering and gets hit hard before everybody else.

Posted by: MJ [TypeKey Profile Page] at August 9, 2007 3:24 PM

You called it way back when, and I'm just waiting for my conservative friends to break down and admit that, yes I am a genius.

Posted by: grannyinsanity [TypeKey Profile Page] at August 9, 2007 10:15 PM

(A bit late chiming in here, but........)
You know, I'd be willing to bet that despite the banks' worries about making home loans to people with "poor" or "risky" credit histories that those same credit "risks" will continue getting inundated with unsecured credit card offers and think that the offers are some "proof" that their credit rating is better than it really is.

Posted by: JosephW [TypeKey Profile Page] at August 12, 2007 11:56 AM

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