Do you think losing 50% of your homes value means we are in a depression?
I lost 50% in 3 years. Sorry, I asked a question yesterday about this, got some very good answers, but don’t know how to respond to my own question. Sure, people wait in line for the fanciest new things. Sure, there are Paris Hilton types, but for me and everyone I know here in Vegas (most in Real Estate), we are hurting. Probably 90% of my friends (even experienced brokers) have lost their homes this year. The gap between the haves and the have-nots has grown this year. So, it is not just me.
Yes, I understand I was part of the feeding frenzy. I got divorced, sold my large home and bought a little one, thinking I would make a profit. I’ll survive. But we are in a depression. I see a lot of desperate people here in the regular areas (not the Strip). Foreclosures are everywhere and people can’t get jobs. It’s bizarre. I lived through the recession of the early 90′s in CA, and it was nothing like this.
5 Responses
wartz
13 Feb 2010
golferwhoworks
13 Feb 2010
no we are not even in a recession. The problem is with the people who bought at the top and the bottom has hit you will need some time to even get even in the market and this will take some time even years
Mark K
13 Feb 2010
A recession is when the economy doesn’t grow for an extended period of time or has a negative growth for an extended period of time. So in my opinion we are in a recession.
Dizzy_Lizzy
13 Feb 2010
No, this does not constitue a depression.
I know many of the people who lived through the Great Depression are no longer with us, but I’m pretty sure they’d laugh in your face at trying to compare the current economic correction to the widespread unemployment & general financial woe of that earlier time.
Some regions are suffering more than others right now, and an area like yours that saw unsustainable jumps in value for several years is one of them. However, it’s not that across the board nearly everyone is in an equally bad spot. The GD was like that. It wasn’t like certain areas were still kind of ok; it was a widespread stuggle.
RM
13 Feb 2010
It all depends on the area. I live in Pittsburgh and am set to make roughly a 15% profit on the condo I purchased less than a year ago after completing some minor fix-ups.
Over history, home prices have risen approximately the same percentage as wages have increased. So the last 5-10 years was an abnormality and never should’ve happened. Houses should be bought as long-term investments, not as quick & easy money.
The prices of housing were basically created from real estate speculators- people who bought and flipped homes. Everyone saw prices going up and jumped in thinking they should buy before it gets to be too expensive, etc, creating a major shortage. Tons of builders are going out of business because the demand isn’t there anymore since it’s no longer a quick way to make money.
If you think about it, it’s almost the same scenario as oil- everyone thought it was going up to $200 a barrel and the speculators bought up all the oil in the market. Now that it’s going back down to a more typical inflation-adjusted level, everyone is losing out because of the speculators.
You got caught up in a feeding frenzy in one of the worst places to be at the top of the market.