We are seeing 5 to 10% drops now, and they are not really helping to move inventory.

For instance a 500K POS Cape, 10% drop makes the POS 450K. Now same POS Cape with with a 20% drop makes it 400K, much more doable.

If this amrket is going to get moving again, you need price cuts in big chunks, of 100k or more, simple as that.

Wow you are an optimistic one aren’t you??

I’d say calling 20-30% drop is a bit much. 5%-10% – may be.

I’m a long-term bull…just bearish for the near-term.

The facts speak for themselves. If the subprime CDO thing turns into a 120 BIL bust (an entirely plausible scenario, given that the entire subprime CDO market is around 550 BIL), that puts it at the same level as the S&L bailout in the early ’90s.

More important, those CDOs are backed by tens of thousands of individual loans…and possibly 25% of them are going to go belly-up. The homes- which will eventually be exposed for sale at deep discount- behind those loans are going to be tomorrow’s comps. This year, September will not mark the beginning of the usual seasonal decline in inventory, because for many sellers, time’s up. They cannot, for whatever reason, come off the market again and wait until Spring ’08. The herd-think amongst sellers is about to turn on a dime; by the time the subprime meltdown becomes daily news (again, think September), everyone out there will know that the big swoon is upon us. There will be a rush for the exits…but as BC has stated before, the doors will be shut. Game over.

I see Sept. 1 as the beginning of a quick, nasty next leg down that will shave another 20-30% off today’s prices. I also see (this isn’t my call, it’s Bill Gross’), the beginning of a series of “insurance” rate cuts by the Fed, as part and parcel of a massive flight to safety as the CDO contagion spreads to corporate bonds in general and the economy slides into a deep recession.

http://abcnews.go.com/Video/playerIndex?id=3363431

A flipper is underwater, like Donald, about $100K.

Getting stabbed to death is the same in Harlem as in Newark.

The problem isn’t “urban” vs “suburban’, it’s the crime.

Good luck in either place after dark…

Show those greedy sellers who’s boss!

Sellers will then know you’ll sit on the house another 8 months, until they meet your 2005 purchase price.

Market conditions are irrelevant, you deserve your 2005 price! Demand it!

http://graphics.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif

bad example. harlem these days is no newark and you’re talking about an urban area versus a suburb different rules.

NEW YORK — The foundation of the Wall Street bull market showed some cracks Tuesday amid fresh signals that real estate woes on Main Street are inflicting a bigger-than-expected toll on consumers and lenders.
Mimicking the weak state of the real estate market, Wall Street saw its inventory of stocks “for sale” swell and its prices contract. The weakness was sparked by a stream of bad news that cast a spotlight on the mushrooming economic and financial fallout caused by rising foreclosures, loans gone sour and a growing glut of unsold homes.

Home Depot (HD), the world’s biggest home-improvement retailer, lowered its profit forecast for 2007 and warned of “continued headwinds” next year. Sears Holdings (SHLD), citing a sharp drop in sales of home appliances, said it would fall short of profit projections. Home builder D.R. Horton (DHI) said second-quarter orders dropped 40%, and nearly four in 10 orders were canceled.

Perhaps the biggest scare came from Standard & Poor’s. The bond-rating firm said it expects to cut, or lower, the investment rating on $12.1 billion in mortgage-related debt — 2.1% of the $565.3 billion subprime loan market. Subprime lenders cater to people with poor credit ratings. S&P fears that more people will have trouble making their mortgage payments amid the double-whammy of falling home prices and rising borrowing costs.

Moody’s Investors Service also lowered its rating Tuesday on 399 residential mortgage-backed securities issued in 2006.

The ratings downgrades follow the recent implosion of two hedge funds managed by Bear Stearns that got in trouble investing in risky mortgage-related bonds.

All the gloomy news crushed the Dow Jones industrials, which fell 148 points, or 1.1%, to 13,502.

The ripple effect should not come as a surprise, says Peter Schiff, president of Euro Pacific Capital.

“It amazes me how oblivious people are to how important the housing market was to keeping the economy going,” Schiff says.

He says the force behind consumers’ spending binge in recent years — the use of homes as ATMs and mortgages with low “teaser” rates that put more money in people’s pockets temporarily — are now reversing.

The ratings downgrades are worrisome because they could force Wall Street firms that own the debt to write down the value of the investments, says Henry Herrmann, CEO at Waddell & Reed. “The issue of credit exposure is a murky one and could touch off a whole new level of anxiety,” he says. That’s why shares of banks and brokerages fell sharply Tuesday.

Chris Johnson, CEO of Johnson Research Group, offers this warning: No investor is “insulated from the subprime mess.”

I can only say HeHeHe and you think your pulling the strings……wrong! That my dear man is a classic. Might I suggest, because I have some sympathy for you, don’t have an open house this weekend, if they come too see your home this wednesday, and find out you are having an open house on sunday, you will not sniff an offer till at least next tuesday, even without an open house -that will probaly be the timetable. If their agent is worth his/her weight,they will also send them to the openhouse or go themselves toward the very end too see how many names are on your sign on sheet.
KL

There just might be a new phrase to replace ‘toxic waste’ soon.

S&P and Moody’s announced a wave of downgrades on bonds backed by subprime mortgages, a tacit admission that they had misjudged the risk of the securities. The Dow industrials dropped 148.27 points on the news to close at 13501.70. 10:32 p.m.

They also added a special section to their website “Realty Check”:
http://abcnews.go.com/Nightline/