The Housing Bubble

It’s Friday desk clearing time for this blogger. “Median condo prices dropped 24 percent, from $218,000 to $166,500, according to statistics released Thursday by the Coastal Carolinas Association of Realtors. Realtors said the price declines stem from the vast oversupply of homes on the market that’s forcing some sellers to slash prices to make their homes competitive.”

“‘Builders have cut back, but there are still so many [condos],’ said Brian Cook, a Realtor in Myrtle Beach.”

“The flagellation of Nashville’s urban market for condominiums has become a sport over the past few months. There are developers, even those with urban projects, who want to declare the market dead, except of course, their development, which happens to be the finest quality and better than all the others.”

“Realtor Jon Sheridon has seen a few condo cycles and he said this one is nowhere close to the early 1990s when the real estate market collapsed in the wake of tax law changes. ‘You couldn’t hardly give a condo away,’ he said. ‘The word condo even got a bad name.’”

“Sheridon said he wishes the builders had gone a little slower during this run. ‘Of course, builders will build,’ he said.”

“Bankruptcies in the Danish construction industry rose to the highest level in at least 15 years in January, indicating the economy is in the grips of a slowdown led by declines in the real-estate market.”

“Bankruptcies in the construction industry jumped 60 percent from December to 59, Statistics Denmark said yesterday. That’s the highest since the office started collecting data in January 1993.”

“‘The golden years in Danish construction are over and there are signs that not all companies are prepared for the cyclical shift we’re seeing,’ said Steen Bocian, head of global economic research at Danske Bank A/S, the country’s biggest lender.”

“New single-family residential permits in Lubbock fell 21 percent for the year and by 24 percent in the fourth quarter. Gary Lawrence, CEO of the Lubbock Economic Development Alliance, expected to see those numbers continue to struggle for the next 10 months.”

“Lubbock’s housing market is saturated, Lawrence said, and consumers needed time to assure themselves the city was protected from housing problems roiling other markets around the country.”

“‘They’re a little intimidated about going out and buying a new house right now,’ Lawrence said.”

“The recent surge in foreclosures apparently drew a larger than normal crowd at the monthly auction. By late morning, about 30 people gathered in front of the Bell County Courthouse Annex on East 2nd Street.”

“Expecting a long wait, Temple attorney Ed Laughlin unfolded a lawn chair and newspaper in front of the annex. ‘I’ve been doing bankruptcy law for 26 years, and I’ve been following foreclosures closely for nearly 20 years here in Bell County,’ Laughlin said. ‘This is the most we’ve ever had on a single day in 20 years at least.’”

“Contrary to obituaries being written for the real estate industry, mortgage bankers are getting along quite well these days in Grand Junction.”

“Housing prices are appreciating more slowly in the Grand Valley than previously, the mortgage bankers said. ‘Those values were going up exponentially,’ Fidelity Mortgage VP James Pulsipher said. ‘It was a lot like buying Yahoo stock in the ’90s — there was nothing to back it up.’”

“The business prospects appear to be strong, despite doomsaying nationwide, said Dennis Edson, Unifirst Mortgage chairman.. ‘This doesn’t smell like a bubble to me,’ he said. ‘We had a great year, the best in five years. And we’ve had a pretty good January.’”

“A developer plans to build worker housing, stores, restaurants and offices on a strip of town-owned land near Vail Village’s Covered Bridge.”

“The one-, two- and three-bedroom condos would range in price from $500,000 to $1 million, said Steve Virostek, a partner in Triumph Development, adding that free-market units would perhaps sell for five times as much. Professionals, such as doctors, are now priced out of Vail, he said.”

“‘Affordable is a relative term,’ he said.”

“More Fond du Lac residents could lose their homes to foreclosure this year than ever before. ‘In 2008, we’ll see more foreclosures than any time in history, probably even surpassing the number we saw during the Great Depression,’ said Len Bacon, owner of Century 21 Fox Valley in Fond du Lac.”

“In December 2007, Wisconsin accounted for about 1 percent of the 215,749 foreclosure filings reported that month nationwide. California accounted for 25 percent of the nation’s foreclosures that month, according to RealtyTrac.”

“‘It’s not all doom and gloom, said Steve Klapperich, an associate broker in Fond du Lac. ‘This isn’t California.’”

“While lower mortgage interest rates might help some Americans refinance their home loans, Northern San Joaquin Valley homeowners are finding it more difficult because house values have plummeted.”

“‘If your current home value is less than your outstanding loan, you’re dead meat,’ warned Paul Carroll, president of Carrollton Mortgage Co. in Modesto.”

“‘There are lots of people with excellent credit who cannot refinance because they are upside-down on their mortgage,’ agreed George Erbele, branch manager for Affiliated Mortgage Partners in Modesto.”

“Erbele’s example: A northeast Modesto house appraised for $585,000 about 20 months ago, and the homeowner took out a $414,000 adjustable-rate loan based on that value.”

“‘Now, the home’s appraisal is coming in at $375,000,’ Erbele said. That $210,000 drop was about 36 percent of the value. Since the home is worth less than what is owed on it, Erbele said there are few ways to refinance the loan.”

“The partygoers traveled to Sin City this week for an event that before the current credit squeeze might have been called the Predators’ Ball of this era. This time, with mortgage securities replacing the junk bonds of the 1980s, the gathering felt more like group therapy.”

“The occasion was, officially, the 5th annual conference of the American Securitization Forum, a celebration of the financial wizardry that supposedly turns risky mortgages and other loans into gilt-edged securities.”

“At times, the unease here was palpable. During one panel discussion, a money manager stood up and denounced credit ratings agencies, which many investors have criticized for underestimating the risks posed by securities backed by subprime loans. In the last 12 months, the ratings firms have downgraded many securities they had awarded high marks to only a year or two earlier.”

“‘In my 38 years this has been the worst capital destruction and the worst rating decline in history,’ Robert L. Rodriguez, the CEO of a mutual fund company based in Los Angeles, said to a panel of four executives from ratings firms. ‘All of you should be ashamed of yourself.’”

“Back in the great 1980s real estate crash, lenders and federal financial regulators wound up owning billions of dollars of North Texas property. Indeed, the Oil Patch property foreclosures were called the biggest land transaction around these parts since the Louisiana Purchase.”

“One lesson learned back then we might well consider with the current wave of loan defaults. It became obvious in the late ’80s and early ’90s that the real estate downturn here was greatly prolonged by efforts to put off the foreclosure and eventual resale of troubled properties, both commercial and residential.”

“Rather than get the bad loans wiped out and the properties in new, stable owners’ hands, years of financial industry and federal finagling added to the timeline of this painful process.”

“So what to do now, when thousands and thousands of homeowners are faced with losing their houses to a dicey mortgage mess? Do you go ahead and get the foreclosures over with so the market can heal? Or do you try to delay the often inevitable home loan defaults and hope for the best?”

“It’s a difficult question. My instinct is to get the foreclosures done with ASAP. But not a week goes by that I don’t hear about the heartbreak suffered by folks dealing with pending foreclosure.”

“All I know is the longer it takes to fix, the bigger the impact the foreclosure bubble will have on the entire property market.”

“Another thing I’m certain of – there’s no political solution to this huge financial problem.”

The Hungry Horse News reports from Montana. “Flathead County could be edging its way towards a larger surplus in the housing market. That was the message presented by appraiser Jim Kelley at the sixth annual Economic Forecast. According to Kelley the supply of land and housing being created is already higher than the demand. He said based on historical trends for housing demands and population increases there has been a surplus of homes constructed in the county since 2004.”

“Last year there was an estimated need for 992 homes while about 1,093 were actually constructed. ‘The demand goes up and down. There’s been a drop in demand, but we still build homes,’ Kelley said. ‘In nine of 11 years we’ve built more than the demand.’”

“‘It’s my personal opinion that the…Whitefish market will be like the 2001 .com bubble,’ he said.”

“In Whitefish, he said, about one in every 19 houses is currently for sale. On average a home in the Whitefish city limits will spend about 15.5 months on the market.”

“The average price for a home in 2007 in Whitefish was at $503,707. Kelley said that foreclosures and declining markets in other areas of the country are affecting the Flathead Valley market as well.”

“Kelley said that was because many of the people who buy those homes here are from out of state, but because the housing market has fallen more dramatically in other states folks won’t be purchasing homes here.”

“Since 2001, the number of lots created in the county has continued to outpace construction rates. Through 2007, Kelley estimates there an excess of about 2,800 lots. He said that without any new subdivisions created there is about a four-year supply of lots.”

The Idaho Mountain Express. “What may have looked like an attractive option during the real estate boom may now have lost some of its luster. Falling real estate values in Hailey are resulting in free-market home prices low enough to compete with deed-restricted homes set aside by the Blaine County Housing Authority as affordable housing.”

“‘If you had the choice of buying a home which was deed restricted and one which was not, and they were both the same price, which one would you choose?’ said Jim Fackrell, executive director of the Blaine County Housing Authority.”

“The asking prices for three three-bedroom, two-car garage homes designated as deed-restricted, affordable housing in the Woodside subdivision of Hailey have been reduced $20,000 each from $244,000 to $220,000. The homes have been on the market since 2006 and were recently listed by real estate agent Kris Halle.”

“Halle says his listing of the homes marks the first time a real estate agent has been used to market affordable housing in Blaine County. ‘The falling market has caused buyers to scrutinize these units more closely. There are similar homes on the same street with asking prices at $279,000,’ he said.”

“He also said buyers know they can take more time to make a decision in today’s market. ‘There has been some aggressive price-cutting after 10 years in which the seller was king,’ he said. ‘Now they have to be more flexible in order to sell their homes.’”

“Many who urgently need to sell their homes are finding no buyers and resorting to foreclosure proceedings instead. Sun Valley Title Co. President Manager Cassie Jones reported a ‘dramatic increase’ in foreclosure notices in the valley compared to last year.”

“‘In April of 2007, we listed three homes in foreclosure. This week we have fifty,’ she said. ‘These homes may sell, but the owner will lose any equity they may have in the home.’”

The Mail Tribune from Oregon. “Local housing is continuing its downward slide in prices with a saturated market further influenced by foreclosure sales. Overall, about 2,200 homes are on the market, in the mix with those repossessed properties.”

“‘That’s driving the market right now,’ said Ron Galbreath, an agent in Medford. ‘That’s where we are getting the most activity from homeowners and investors.”

“During the past three months, Jackson County real estate prices — both new and existing — continued their broad decline with pockets of resilience. The inventory of available homes grew by 5 percent. Southern Oregon MLS figures showed a 9.1 percent year-over-year decline to $230,000 in the median sales price of existing homes for the quarter ending Jan. 31. New home sales fell 12.2 percent to a median of $267,000.”

“In a separate report, prepared by local appraiser Roy Wright, focusing on January activity, the median price for all single-family residence sales in January declined 3.7 percent to $247,500. The sales pace dropped 29 percent in January.”

“‘Our slowdown is not as big as it is in some areas, but the interesting thing is that we tend to draw (buyers) from some of those markets,’ said Colin Mullane of REMAX Realty group in Ashland. ‘California is a relatively well-to-do market. Even though things have slowed, there is still independent wealth there. We really do feed off the California market.’”

“‘Right now buyers are looking for the best value, getting the most home they can afford for their dollar, whether it’s Medford, Eagle Point or Central Point,’ Galbreath said. ‘I’ve shown one couple 20-something houses in the $200,000 range in Central Point, Eagle Point and east Medford. They’re taking their time to see if there’s a better one than we looked at the last time.’”

The Bellingham Herald from Washington. “January is typically a slow time of year for residential real estate, but last month was especially quiet.”

“According to data released by the Northwest MLS, real estate agents sold 122 homes and 43 condominiums in Whatcom County, down 15.8 percent compared to the same period last year. The drop was even more significant in the Northwest MLS coverage area, which includes most of Western Washington: 3,622 homes and condos sold in January, down a whopping 35.7 percent from January 2007.”

“Also dropping slightly was the median price for residential homes in Whatcom County.”

“March numbers should show a clearer picture of this year’s housing trend, because spring tends to be a peak time for home buying and selling, said Peter Roberts, an agent for John L. Scott.”

“‘I think it will be a little busier than last year, because I get the sense that many think we’re approaching the bottom of this cycle, and we’ll see more investors coming back into the market, looking for buying opportunities,’ Roberts said.”

“Other nearby counties saw some big drops in home and condominium sales in January. Skagit County saw a 38 percent drop year-over-year, while Snohomish was down 33 percent. King County recorded 1,403 homes and condo sales, down 36 percent from January 2007.”

The Olympian from Washington. “For the second consecutive month, Thurston County home sales fell 30 percent in the year-over-year period, the Northwest MLS reported. The combined house and condo data for Thurston County in January also show that inventory increased 12 percent to 1,880 units from 1,673 units.”

“Broker Phil Harlan said an influx of buyers from Pierce County also continues to prop up home prices. ‘Residents can’t afford a home in one county so they go to the next county,’ Harlan said.”

“Still, Harlan acknowledged that the Thurston County housing market has slowed for homes listed at $300,000 or higher. Homes priced at $300,000 to $400,000 likely could see a 5 percent drop in values, while those $400,000 or higher could reach a 10 percent drop in price, he said.”

“‘The housing market has gone back to pre-2002 levels,’ Harlan said. ‘It has leveled off with normal appreciation.’”

The Seattle PI from Washington. “Seattle-area home prices are manageable for typical workers, according to the chief economist for the National Association of Realtors.”

“‘You may even say Seattle is underpriced if you believe Seattle is becoming a superstar city,’ Lawrence Yun told area brokers in Bellevue on Thursday. ‘Seattle is underpriced in relation to other West Coast markets.’”

“The fact that home prices rose much faster than incomes in recent years in Seattle and elsewhere has led some market observers to predict prices will drop to bring the relationship back to historic norms.”

“Down from a recent high of $481,000 in July, the median King County house sold last month fetched $435,000, up from $429,495 in January 2006, according to the Northwest MLS. January’s house sales volume was off nearly 31 percent from a year earlier, whereas the number of houses on the market jumped almost 56 percent.”

“The founder of the Four Seasons Hotels and Resorts said Seattle has become a ‘World Class’ city. ‘This city is really on the cutting edge of what most cities are hoping to achieve,’ Isadore ‘Izzy’ Sharp said in an interview after speaking to the Downtown Seattle Association.”

“Developer Seattle Hotel Group is building a 149-room Four Seasons Hotel topped by 36 condos on First Avenue, just south of Pike Place Market. The developer has sold 24 of the 36 condos, whose prices range from $2 million to more than $10 million, and expects to finish the project in late summer or early fall.”

“The Four Seasons has its own niche among the slew of condo, hotel and hotel-condo projects under development downtown, because it’s small and high-end, Sharp said. But he also said so many people were building because they saw an opportunity and dismissed the idea that downtown might be approaching saturation.”

“‘I think when a city starts growing, it keeps doing that, particularly when the political support is there,’ he said.”

“Housing sales have scaled back to normal levels from the ‘excessive boom’ of 2003 through 2006 and have stabilized, Yun said. ‘We are probably scratching the bottom in terms of home sales activity.’”

“But Yun noted that the market depends on fence-sitting potential buyers who are afraid of jumping into a market in which prices might continue to fall. ‘It’s hard to predict that psychology factor,’ he said.”

The Seattle Times from Washington. “Laurie Harlan of Lake Stevens found out the hard way just how much the region’s housing market has slowed. In August, after Harlan and her husband decided to divorce, they put their four-bedroom, 2,100-square-foot rambler on the market.”

“Having bought the house 8-½ years ago for $179,000, they figured it would sell within a month or two for the $395,000 asking price. It didn’t. And didn’t. In fact, the sale didn’t close until Friday, when the house fetched $333,000.”

“‘We were obligated to sell it,’ said Harlan, who’s staying temporarily in her husband’s new house in Marysville while she looks for a new home for herself and her three children. ‘Were we happy with the price we got? No.’”

“New listings have continued to pour onto the market, adding to already swollen inventories of homes and condos. There were 28,215 active listings in the region, 46.3 percent above the level a year earlier.”

“Though sales prices have slipped, Bob Melvey, associate broker at Windermere’s Ballard office, said he didn’t sense would-be buyers are holding off to see if they can get a better deal. ‘They do have the luxury of spending a couple of months comparing this house to that one,’ he said. ‘The way the market was before, you could spend less time picking a house than picking out a sweater.’”

The Boston Globe reports from Massachusetts. “Foreclosures in the region more than doubled between 2006 and last year, when 1,211 homes were taken. The hardest-hit community in the region, and among the worst hit in the state, is Brockton. Last year, 363 homes were foreclosed there, far more than any other community south of Boston, according to Banker & Tradesman.”

“Lisa and Eric Jacobs are trying to sell their condo in Madrid Square in Brockton before it is foreclosed on. They paid $82,000 for their home in 2000 and believe it is worth about $185,000 now. But they owe about $180,000 on first and second mortgages.”

“They got into financial problems using equity to pay off credit card debt and spending on home improvements. Lisa also was laid off and unemployed for 1 1/2 years, so they fell behind on both mortgages.”

“‘We want to refinance with a company that will give us a second chance,’ said Lisa Jacobs. If forced to sell, she says the couple will have to move in with her mother-in-law.”.

The Hudson Sun from Massachusetts. “In upscale as well as downtrodden neighborhoods around Marlborough and Hudson, foreclosures have been on the rise.”

“‘The problem is not just in French Hill,’ said Code Enforcement Officer Pam Wilderman. ‘It’s hitting all over the city. More and more people are just walking away from their homes when they’re foreclosed.’”

“Banker and Tradesman reports that foreclosures nearly quadrupled in Marlborough between 2005 and 2007, to 59 last year. In Hudson, the number of foreclosures went from 1 in 2005 to 23 last year.”

“Marlborough Savings Bank VP Jeff Dale said some recent immigrants have sought refinancing help from his bank after they secured risky mortgages from other sources. The bank has a loan officer dedicated to helping Spanish-speaking people who are burdened with now-unmanageable mortgages.”

“‘A lot of people got into sub-prime mortgage situations where they financed 95 or 100 percent of their properties,’ Dale said. ‘Now, what they owe is equivalent to 105 or 120 percent of what their property is worth, and there’s very little we can do in cases like that.’”

“‘We help as much as we can,’ said Dale. ‘But if people are ‘upside down’ in a loan – owing more than a home is worth – we can’t do very much.’”

“Dale blames unscrupulous lenders who prey on lower-income people. ‘You can’t sell a $300,000 loan to someone who’s making $15,000 a year,’ he said.”

“Vince Valvo of The Warren Group, which publishes Banker and Tradesman, said that foreclosure trends in Marlborough and Hudson mirror that around the state and the country. But he added that people of all income levels have lost homes that they could not afford in the first place.”

“‘People who decided to really stretch and buy the biggest house they could afford with as little down as possible are also in trouble,’ Valvo said. ‘It could be the guy down the street driving the Lexus. He’s got a pool and a car but he’s in debt up to his ears.’”

“‘It’s all part of the culture we have…that it’s our right to be living not just in a home, but a home with granite countertops, three bathrooms and tons of garage space,’ Valvo said.”

“Wilderman said she…took a complaint a year ago about a crowded home on Ridge Road, which she described as a ’solid, middle class Cape Cod type neighborhood where everybody keeps up their yard.’”

“After the home changed hands, ‘there was suddenly a lot of traffic going in and out of it,’ Wilderman said.”

“‘I found out that the owner of the home had been able to purchase a $340,000 home with no money down,’ she said. ‘The very next day he closed on another house on Barnard Road for $500,000, again with no money down. Now tell me that person didn’t know what he was doing. Both of those homes ended up in foreclosure within 18 months.’”

The Connecticut Post. “The first new downtown construction in decades — a five-story condominium building rising off Fairfield Avenue — is in financial trouble. Developer Phillip Kuchma has lost his main lender, who cited a weak economy and subprime loan losses as the reason.”

“In an effort to attract new lenders, Kuchma is asking the City Council to help reduce projected cost of the condos, estimated between $220,000 and $350,000 per-unit, by approving a seven-year payment in lieu of taxes program.”

“Although initially pledging to build the complex without state or city assistance, Kuchma said lenders now will not provide money necessary to complete the development unless sale prices are mitigated by a tax break.”

“‘We wanted to do it without asking for a tax break. If the market was not what it is, we would not have to ask. It’s now make or break with the lender. He won’t lend without it,’ Kuchma said.”

“The project is already being built, with three floors of the structure erected. There was no visible activity at the site Wednesday.”

“Kuchma said he cannot reduce unit prices given the cost of construction. ‘Our lender, who sees the market tightening, doesn’t think they will sell. And the cost of the building is too high to rent.’”

“City Council member Robert Walsh, who has opposed other tax breaks sought by developers, said the Kuchma deal would amount to ‘corporate welfare at its worst.’ ‘None of the numbers make any sense. I want to see written documentation,’ he said.”

The East Hampton Star from New York. “Although it may not be apparent amid the giddy headlines of record-breaking rentals and multimillion-dollar sales, a parallel foreclosure crisis on the South Fork might be more imminent than previously thought. With banks waiting longer to take action on their delinquencies, some longstanding problems may just be emerging.”

“‘People are calling me who are not only behind two or three months but a whole year or year and a half,’ said Ann Nowak, a Water Mill lawyer with a specialty practice in bankruptcy. ‘Foreclosures are not happening as quickly. It appears the banks don’t want the houses back, maybe because they don’t want to have to unload them.’”

“Ms. Nowak offers free consultations to those who might be facing bankruptcy and foreclosure. She said that the number of calls she has been receiving is climbing. ‘I can’t quantify it for you, but we’re getting a lot more calls over the past few months. All of a sudden there’s a lot of activity.’”

“A bank now owns a 2,200-square-foot house in Southampton Village on a third of an acre with more than $1 million on loan and a market value of only $990,000.”

“That illustrates how the amount borrowed often exceeded the value of the house at the time of purchase. In some cases, borrowers who invested no equity in a property were getting loans of up to 110 to 125 percent of a house’s market value to make improvements or just to have extra money at a favorable interest rate.”

“The rationale was that home values would keep increasing, so that either the borrower could refinance later at better market conditions or the higher price could be fetched in a later sale.”

“Then, the market slowed, the two or three-year grace period expired, the required monthly payment mushroomed at a new higher interest rate, and no bank was interested in refinancing.”

“In East Hampton and Southampton Towns, recently there has been even more rapid growth in activity in preforeclosures, in which a notice of default and then impending litigation are filed on a property, but the bank has not yet taken possession of it or attempted to sell it at auction. Much of that activity in East Hampton Town occurred in the second half of 2007 in parts of Springs and Montauk.”

“John Kern, a private-practice lawyer based in Southampton Village, has been representing sellers in ’short sale’ transactions. He said…he has seen an upswing in the short sale market. Since November, ‘I’ve closed four of them,’ he said. ‘That’s a significant increase. I saw them very rarely before that.’”

“A new tax law that forgives the tax on the amount received in a real estate transaction that is owed to a bank may be contributing to the trend, he said. The law expires in 2010. In addition to the short sales that have closed, he is representing three more listings in contract and has ‘a lot in the pipeline.’”

“Ms. Nowak said…three-quarters of the calls she receives are from those too far gone for that protection, many of whom waited because they wanted to avoid the stigma of bankruptcy. Ms. Nowak said one person who called her had monthly payments of $3,500 and was at least a year in arrears.”

“Then, ‘there are people who bought their homes almost with mirrors. They have one or more mortgage — one adjustable rate and an interest-only.’ Before they defaulted, they ran up their credit cards with cash advances. Now, there is truly nothing left.”

“‘I spend 20 minutes with them on a consultation and I can’t help them. It’s in my interest to help them out, but they can’t afford to do it. I have to tell them there’s no hope.’ In this environment, where her call volume has grown steadily over the past three months, she said, ’sadly, I think there will be a lot more foreclosures.’”

The Ambler Gazette from Pennsylvania. “Location, location, location - the mantra of the real estate market - is being given a new emphasis by some local Realtors wishing to dispel the notion that all is bad in the housing market.”

“Sales in the Philadelphia region, by comparison, were down 11.1 percent in 2007, with the median sales price up 1.8 percent, according to the Prudential Fox & Roach HomExpert Market Report.”

“The average sales price in the eight-county Philadelphia region has increased 60 percent over the last five years, said Joan Docktor, Prudential Fox & Roach executive VP of sales. ‘Buyers are buying and sellers are selling because of life circumstances. Our market is not depressed.”

“In addition, ‘our housing is relatively affordable compared to other markets,’ Docktor said.”

“Housing prices in Pennsylvania did not rise the way they did in states like California, Nevada and Florida - where housing is being particularly hard hit - ’so the prices won’t deteriorate like theirs did,’ she said.”

“The five-county Philadelphia region ‘has not had out-of-hand appreciation, it’s had steady growth, so [the downturn] didn’t affect us like some other areas,’ said Harry Caparo, chairman and CEO of Coldwell Banker Preferred. ‘I think we’ve reached the bottom in the price and unit decline in the Philadelphia area.’”

“‘We’re in a slowdown,’ Docktor said. ‘The bottom is not falling out in our area. People are watching what they spend, but if someone is thinking of buying, now is a good time. Prices aren’t going to drop.’”

“‘Anybody who doesn’t buy today is nuts,’ agreed Art Herling, manager of Long & Foster Real Estate’s Philadelphia/New Jersey region. ‘Interest rates are 5.5 percent or lower; sellers understand they have to do what they have to do to sell.’”

“‘It’s all about price,’ he said. It’s a buyers’ market, Herling said; there are 55,000 houses on the market in the region today compared to 35,000 four years ago.”

“‘Houses with negatives will get slaughtered,’ he said, adding three years ago ‘nobody cared,’ because they just wanted to get into a particular neighborhood.”

“2008 will remain a buyers market, Herling said. Personally, ‘I’m going to buy investment properties, I’m going to sell and I’m going to refinance.’”

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