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New case Shiller home price numbers out this morning and prices falling again in this country's major cities they were expected to head higher.
Month over month but our next guest says while it might be slow in coming housing is finally stabilizing.
Montel here chairman CEO homes services of America one of the largest real estate brokerages in this country.
And also a unit a Warren Buffett's Berkshire Hathaway he's joining us from Minneapolis -- always terrific to see you.
Where do you see stability are you seeing stability you thank in even most major cities at this point.
Well day again I think it's.
You know it's not a surprise what came out today and I I think it really speaks to.
The product that is being sold we're seeing an awful lot of distressed for close short sales.
Non distress sales some in the homeowners have figured out that it's not a great time to sell.
Into the headwinds of a distressed real estate which carry -- major discount.
And you know we got at this has been a major problem that -- took got 67 years to build.
And it's gonna take probably -- five to six years to unwind I think we are.
You know -- -- as a bit of a silver lining our inventory.
Has dropped from up high of about four point six million homes on the market.
To about 3.3 million homes that we just really need to sell our way out of this I think -- twelve months more into.
This type of a market before we start to see.
Some slight pick up but I would call this stabilization we're just kind of hunkering around where we are rate now.
Are you saying the banks and you can start with the short sales in particular are and then maybe real estate and are you seeing the banks.
A really speed up the activity of trying to get this inventory off their own books.
That big and is is that real positive thing I think from a year ago where there was resistance.
And that the banks were holding back probably for a lot of reasons.
They have really shifted their strategy from focusing on for closure.
Two focusing on short sale where actually they are involving the homeowner.
In the process much more and and it's it's a more efficient process.
It is less costly.
Opt for the the investor at the bank and I I think it's it's up far better solution to a bad problem.
-- -- we recently had some Dick congress passing increase and FHA loan limits it really -- went back to where was north in the maximum north of 700000 dollars.
Not with Fannie Mae and Freddie Mac -- did they need to do that because.
Don't we need to get to a point where there -- an additional government and -- to figure out all warehousing.
Needs to be without even greater government intervention.
Well I think that's a good point dig and I think that government intervention needs to be a limited I think given the fact that we need.
And and the fact that.
That home prices.
In several cities that aren't identified in the case Shiller and certainly far more.
You know the average sales price in in many cities if you look at California.
If you look at new York at -- a look at the Boston.
You know the average sales price is way above what was Fannie Mae's ceiling and without.
The private sector being interest in providing.
You know funds at at a competitive rates with with.
A reasonable down payment.
I think it's the right thing for FHA to do as long as that GSCs would not.
You know move to those limits.
That that recently were reduced at the end of or in September.
So I I think it's the right thing but I think you're greater point is the government needs to.
You know be less involved in the process and the private sector needs to be more involved.
-- said -- it was great to see Ron Peltier of homes are essence of America be well.
Little bit of good news we like that Romney well thanks.
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