I don't pretend to be the smartest person about money -- truthfully, I'm probably not even in the top 60% when it comes to knowing these things. But I was just reading this article on MSN House prices slip in half of U.S. cities - MSN Money
talking about the doom and gloom of house prices falling a bit, 5.7% in Ann Harbor, Mich was one of their examples.

But isn't that normal? I took a real estate class several years ago and the teacher's comment was, prices go up, they drop a bit but rarely go back down to where they were, and then they go up again. It's a cycle.

Sometimes I think the media enjoys pointing out the bad and even this article goes on and says, "The sky isn't falling for most."

Any thoughts on the matter?

I am one of those people that couldn't be happier that real estate prices are falling across the board.

Houses are finally just now starting to become affordable again, from the highly outrageously overpriced place they have been in the past 5-10+ years.

I hope that they continue to drop and drop hard personally. When it costs $60-$100K for one acre of bare land with no improvements (no well, no spetic, no power, no access) that is an hours drive from the city something is very, very wrong.


As for your orginal question, yes the markets go up and down, that's the way of life for everything.

Wow - one acre here is $250k!

I agree with the OP. Our market in AZ just literally died in the late 80s. People were abandoning homes, builders were abandoning construction, empty houses and businesses just sat. Then when it rebounded, it was huge. Our prices escalated because people in California would sell their home, come here, see the prices and said, "I'll buy two!" or just bought bigger homes than they had. It took awhile for the downturn to hit us, but it's hit. If you can, just wait it out to sell. But it's truly a buyer's market now, if you have decent credit. Some good deals can be had.

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You're right. Economic things, including real estate prices, are all cyclical. And you're also right that the media loves to focus on the negative and shout the sky is falling every chance they get.

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Yes the media has drastically overdone this slower housing market!! They are down, maybe even for another year or so but they will go back up. Now is a GREAT time to buy!

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I am only one, but I am one. I can not do everything, but I can do something. I must not fail to do the something that I can do. -Edward Hale

Yes, from an economic standpoint, everything is cyclical. That is why when the media blames presidents for recessions it ticks me off - whether I like the president or not. They don't have as much economic power as people think. The biggest power they have is who they elect to the Chairman of the Federal Reserve.

I do feel bad for my neighbors that HAD to buy a home in 2005 and 2006. Since we live in a military town, they will never recoup what they spent on their homes. They are scheduled to PCS (aka move to a new area) in 2008 and 2009. The ones moving next year are very nervous and I do not blame them.

But, I agree, they will rebound a bit.

I'm totally annoyed by the media's doom and gloom of the housing market. It seems like it is on the nightly news every night. We couldn't expect the market to keep going up and up and up. The ride had to stop at some point. I'm happy it has slowed down a bit because my taxes went up and I'm hoping the increase will be less next year.

On another note, who are all these people with the crazy ARMs? I can't believe THAT many people didn't read the disclosure statement.

I have a total different perspective living in a state with a good performing market. The article did say half the cities declined but living in an area where we continue to see gains. No one goes into the areas that are doing well. The only thing that has really changed is that most houses are taking longer to sell which I see as good because it will help all the first timers trying to get homes. I live a half hour south of seattle. In the last few years Seattle dropped previous building hight codes and here come the high rise condos so things are growing prices are still going up and Seattle ranks 13th on the list for growth that means there is a trickle down so when you make it to my city a half hour south you have a lot of commuters who can't afford the city and things are growing all around.

People get themselves into there own messes and not always by the disclosure statement either. I worry about my SILs family because I have seen them spent around 10K this year alone on frivolus stuff and now my BIL is out of a job when that could have gone into savings instead of creating more debt. You don't know what the crazy arms people spend there money on besides there home

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Kimberly Proud Mommy to Bethany Rose April 2006