patrick.net

JasonM says

Everything in that calculator is in violent contradiction with your manifesto

really? give me an example.

simply leave all their default assumptions, which are at least reasonable, and move the house price slider over to the right to $1.5M, which is about the price of a house if you insist on living in the shadow of google and apple (remember that it was and still is your personal choice to live right next to the richest people on earth)

If you can rent a similar home for less than ...
$4,847 PER MONTH
... then renting is better.

http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

Feeling chronically inferior must be a deep human craving akin to religious obsession.

Why else would so many people in the bay area decide to continue to struggle here just for the frustrating privilege of bumping elbows on the peninsula with richfucks?

Over-entitled richfucks actually improve the quality of life? All the richfucks do is go around envying the richer-fucks.

yes, i'm about done with the peninsula myself.

really? give me an example.

OK - from the manifesto:

"The only true sign of a bottom is a price low enough so that you could rent out
the house and make a profit. Then you'll know it's pretty safe to buy for
yourself because then rent could cover the mortgage and ownership expenses if
necessary, eliminating most of your risk."

Where is the bottom here

2009 Rent ($2,500) vs Buy ($2,800) = RENT
2016 Rent ($3,800) vs Buy ($4,450) = RENT
2021 Rent ($4,100) vs Buy ($4,750) = RENT
2027 Rent ($5,000) vs Buy ($5,700) = RENT (bubble)
2031 Rent ($4,800) vs Buy ($5,250) = RENT (crash)
2038 Rent ($5,200) vs Buy ($5,775) = RENT
2042 Rent ($5,350) vs Buy ($5,950) = RENT
2047 Rent ($5,625) vs Buy ($6,500) = RENT

Also from the Manifesto:

"The simple fact is that the renter - if willing and able to save his money -
can buy a house outright in half the time that a conventional buyer can
pay off a mortgage."

How the fuck can the renter save when all his savings get sucked up
in never ending rent increases like this:

2009 Rent ($2,500) vs Buy ($2,800) = RENT
2016 Rent ($3,800) vs Buy ($4,450) = RENT
2021 Rent ($4,100) vs Buy ($4,750) = RENT
2027 Rent ($5,000) vs Buy ($5,700) = RENT (bubble)
2031 Rent ($4,800) vs Buy ($5,250) = RENT (crash)
2038 Rent ($5,200) vs Buy ($5,775) = RENT
2042 Rent ($5,350) vs Buy ($5,950) = RENT
2047 Rent ($5,625) vs Buy ($6,500) = RENT

Or this from the Manifesto:

"The higher-end housing market is now set up for a huge crash in prices, since there
is no more fake paper equity from the sale of a previously overvalued property
and because the market for securitized jumbo loans is dead."

That is what I told everyone in shitsgiving 2009, when prices were STILL
higher than renting. WHERE THE FUCK IS MY HUGE CRASH???

Or this from the Manifesto, also popular in shitsgivnings 2009 - 2014

"Because there is still a massive backlog of latent foreclosures.
Millions of owners stopped paying their mortgages, and the banks
are still not forclosing on all of them, letting the owner live in the house for free. If a
bank forecloses and takes possession of a house, that means the bank is
responsible for property taxes and maintenance. Banks don't like those costs. If
a bank then sells the foreclosure at current prices, the bank has to admit a
loss on the loan. Banks like that cost even less. So there is a tsunami of
foreclosures on the way that the banks are ignoring, for now. To prevent a
justified foreclosure is also to prevent a deserving family from buying that
house at a low price. Right now, those foreclosures will wash over the landscape,
decimating prices, and benefitting millions of families which will be able to
buy a house without a suicidal level of debt, and maybe without any debt at
all!"

WHERE THE FUCK IS THE TSUNAMI????

Shall I go on????

Or this from the Manifesto:

"Because boomers are retiring. There are 70 million Americans born between
1945-1960. One-third have zero retirement savings. The oldest are 66. The
only money they have is equity in a house, so they must sell. This will add yet
another flood of houses to the market, driving prices down even more."

Written in 2011, reposted as true in 2015. WHERE IS THE FUCKING FLOOD DRIVING
DOWN PRICES EVEN MORE????

all that did in fact happen nationally. it just didn't happen in the place where you demand you are entitled to a house. it didn't happen here because google and because apple and because facebook.

you are a self-entitled asshole looking for someone else to blame for your own income level, for your own choices and apparently for your wife's nagging.

so something you happened to read on the internet means you have no responsibility for your own life. got it.

how much did you pay me for my personalized advice for your particular situation again? where is our contract?

all that did in fact happen nationally.

Not a single one of those things happened after 2009 - much less in 2011 when you posted it, nor 2015 when it continues to dupe people. I am not so much entitled as I am a fucking loudmouth asshole who just like most other loudmouth assholes on the internet should have shut up after 2009 when prices stopped dropping and should have opened up our eyes to the long term consequences of being bearish.

Yet like you, my ego would not let me admit how fucking wrong I was. You apparently still cannot given you show up 20 minutes later I post with your "well it worked out well for me - so fuck you and everyone else who listened" response. I fucking hate realtors and the NAR and the bullshit and the high prices as much as anyone - but I dont hate any of that as much as I hate now suffering the consequences of being so wrong for so long.

I regret just about everything I said 2010 - 2014 but the sites I posted on are all gone. A family member reminded me of this site, so I now see the bearing of my pain is the kharmic penance I must now pay.

JasonM says

Not a single one of those things happened after 2009 - much less in 2011 when you posted it, nor 2015

Bullcrap dude it happened all over nationally. And Gary FOR ONCE! is absolutley right.
Rich investors armed with all of the QE free money, bought up the housing stock around the country to keep housing prices inflated. That all started around 2009 around the time Obama first started offering that homebuyers credit, that turned out to actually be a loan due the next tax season. Then in 2010, they adjusted the FHA to ease lending standards, that only restricted what was left of the middle class even further.
Investor companies started then buying all of the ghost inventory for pennies on the dollars. Because they had the kitchen appliances removed and FHA wont loan money on a house that needs less than $3K in repairs. So they authorized a 100's of thousands in loses for the banks, cut them a check from the HAMP and TARP funds for their loses. Sanctioned houses being dumped from $10K to $70K a pop in large bulk lots at closed no bid auctions.
There are now more Single Family homes in Rental inventrory than there are rental units in Multi Family units.

Your gripe is with the wrong person, you sound like you should be voting for Trump to make this coutnry great again. And let's send all of these greedy game rigging rent seekers back to hell.

HEY YOU says

Today I imagine that Sam would have a line:" We have houses in America but you don't have to overpay ASSHOLES!"

I'm pretty sure he already has that worked into his routine in Comedy heaven.

Tenpoundbass says

Bullcrap dude it happened all over nationally

Your reading comprehension is terrible.
After 2009, prices crashed?
2009-2012 was not the bottom?
After 2009 the tsunami of inventory decimated high end prices?
Boomers retiring after 2009 drove prices lower?

I actually agree with you, after 2009, bullshit and intervetion was exactly why prices were not going to crash any further.

Patricks Manifesto: TEN REASONS ITS A TERRIBLE TIME TO BUY AN EXPENSIVE HOUSE.
should have read: BECAUSE OF BULLSHIT AND MANIPULATION THIS IS THE BEST TIME TO BUY AN EXPENSIVE HOUSE IN 2 DECADES, AND IF YOU DONT BUY, WAITING FOR BOOMERS OR "FUNDAMENTALS" TO DRIVE PRICES LOWER THAN 2009, YOU WILL BE PRICED OUT FOREVER!

What about the russian jet crash? Truth or fiction?

bgamall4 says

As much as I hate Patrick's views on Muslims (our war on ISIS is fake and he hasn't figured that out)

JasonM says

After 2009 the tsunami of inventory decimated high end prices?
There's an investor for that!
Boomers retiring after 2009 drove prices lower? And two to take them!

Jason, you are a victim of another bubble right now. No one could have predicted it, for it is artificial, but it is up to you to stop whining about it and instead figure out what you want to do with your life and how.

There's always global deflation. Then who'll be the sucker? Keep your powder dry, Jason! Also, be rich--it helps A LOT!

Jason,

Happy Thanksgiving to you and your family. Just calm down. It's unfortunate for sure. However, we have no one to blame but ourselves. Our lives are a direct result of our choices. If we don't like our lives, it's time we make better choices. Like a river, we cannot touch the same water twice. It's because the flow that has passed will never pass again. So enjoy and cherish every moment of your lives with your loved ones.

Like you, I found this site in late 2009. There's so much emotion involved when we discussed about housing. However, it's our job to screen out the noise and separate the smart ones from the dumb ones. Some people are still bitter about it until this day for different reason. That's not a good way to go through life IMO.

I found a real estate investment partner on Patnet, who has now retired in Natal, Brazil since February 2014 at the age of 40. Thanks to some good housing investments that we made between 2011 to 2013 which has enabled him and his wife to enjoy life now. He goes by the "pkennedy" handle. Let me see if I can ring him up @pkennedy. I have since moved on because the sentiment on this site is quite negative. However, Patnet will always hold a special place in my heart. This is where I met one of my investment partners and have made some friends.

While people are still yelling and screaming that housing is getting expensive, this has been my best year in terms of investment. My new partner and I picked up a total of 28 units in downtown San Jose for $4.615MM. That's about 165k/unit. Gross rents is about 451k/year while fair market rent is north of $580k. This is a direct result of "If I want something in my life that I've never had, I'll have to do something that I've never done." We all will have to do what we have to do UNTIL we can do what we want to do. What I want is to be able to spend my life in my own way.

It's sad that you and some others have realized Patrick's flawed advice too late. SF ace pointed this out many times in the past. It's unfortunate that the market has left you and them in the dust and now have to face the reality of being renters for life if you're sticking around here. Patrick's owner could uprooted him at anytime, that's when he would face the reality of cut throat rent on the Peninsula.

With that said, take it easy. Find peace within yourself. Happy Thanksgiving to all!

Any chance JasonM is a frustrated realtor or a homeowner with a stagnant for sale sign?

mell says

Btw gold is approaching $1050,

A break of 1060. downside is as low as 680.

JasonM says

Being a renter back with the extended family is fan-fucking-tastic, isn’t it Patnet! All that housing shit you gave them years ago gets shoved back in your face in spades:

- Hey Jason, still renting huh, hows that waiting for the bottom working out for ya?

- Hey remember 5 years ago when you told me to sell and rent, waiting for the crash – LOL – gawd what a fucking disaster of advice that was. Say where you living these days?

- Hey still waiting on that “tidal wave” of inventory to crash prices – LOL – keep waaaaaating!!!

- Hey your wife was telling Kate in very hushed tones about you are paying FOUR FUCKING THOUSAND in rent these days? Couldn’t you have bought a few years ago for under 3K a month? Didnt you brag about how you were saving all that cash by renting? But if you could have bought for 3K and now rent for 4K how are you still winning? Oh well, keep renting, im sure it will work out for you...

Jason, in the end you have to take responsibility for your actions. I'm sure both sides of the argument was presented on Patnet, and you decided to go with the bears. You could have purchased a home in 2010, 2011, 2012, 2013, 2014 and 2015, but did not. If you can afford $4,000 per month in rent, you can afford $4,000 per month in a mortgage.
I would say....stop crying over spilt milk and buy a home right now. The shortage of homes is very severe, unemployment is declining, the economy is slowly but surely picking up steam. This spring we will see the beginnings of one of the greatest real estate bull markets ever seen by living Americans.

Ironman says

marcus says

Jason, I'm in the same boat as you. Still renting in Los Angeles.

What's the matter, sucking off of the government's tit doesn't pay you enough to live in the area of the school system...

Get a REAL job!!

Where are the unions? Where is the living wage?

Strategist says

unemployment is declining,

Real estate purchasing unemployment is still declining. Because there's 3 HB1 Visas for every for every American looking for work.

$ going up so gold down, anyone know howto short gold? Or am i late to the party?

KgK one says

$ going up so gold down, anyone know howto short gold? Or am i late to the party?

If gold doesn't hold 1060 level ...

Downside worst case is 680

Did anyone else think that Patrick was a fortune teller?

Ironman says

The advice and information people received here on the housing market was worth exactly what they PAID for it!

ANYONE making a huge financial decision of buying a house based on information they read on an anonymous Internet forum deserves exactly what they got!

Can you point us to a place where we could have gotten better advice by paying for it? I doubt it.

"PATNET scores number one on Google for one topic and one topic only:

CANNIBAL ANARCHY!"

Goes to show that a topic as poignant and relevant as CANNIBAL ANARCHY is just not discussed enough on the internet. People just can't face that face is on the menu.

justme says

Ironman says

The advice and information people received here on the housing market was worth exactly what they PAID for it!

ANYONE making a huge financial decision of buying a house based on information they read on an anonymous Internet forum deserves exactly what they got!

Can you point us to a place where we could have gotten better advice by paying for it? I doubt it.

If you paid for advice, you would end up with the same advice that Patnet has for free.
The best advice you can ever have is.......If you need a home, can pay for a home, then get the damn home.

(Housing is the cost of shelter to your own capacity to own the debt.)

Now that all the Crap &*^% Loans are gone, it's all about capacity now. That's how it should be, poor cash flow Americans should never be allowed access to non capacity debt or unique structured debt to buy a home, it's a disease and that is how we should always look at it

Millions and millions of Americans buy homes a year regardless of what the cycle is, where the inventory levels are because they can own the capacity of the debt shelter cost.

Millions and millions of Americans rent because they can't buy.

If you have looked at people's finances like I have for 20 years, you should see the Gap between natural lifetime renters vs home owners,

Those who bought with capacity

Owners

- Incomes are higher
- liquid assets are higher
- More educated
- Debt low and cash flow very positive

Renters ( Not putting in this group wealthy people who rent)

4 groups

1. Natural young renters who are working through the process of life and in time when they get to the home buyer age of 28-37, they biy

2. Forever renters because they can't ever own a home without a 2nd income factor. Their single income factor just doesn't allow them the process time frame to buy a home where they desire to live

3. People who have be foreclosed on part of a short sale. Some will be boomerang buyers but some will never be able to own a home because they
needed a 80/20 100% stated income

4. Those who even with dual incomes, even with some liquid assets, just live in Area where it's too expensive to buy a home that meets their family lifestyle

For the most part college educated Americans or those with good trade school skills who make money when they get to that home buyer age group of 28-37 tend to buy

Years 2020-2024 are the real cruical years for housing, because this cycle wasn't going to have the capacity to own the debt of housing in a strong way

For pete sake, 2014/2015 adjusted to population are the 2 worst years ever recorded in American history with the data line and this is with 3.5%-4.5% and 5 months plus inventory in both years.

I mean come on, even if you're the most Radical housing bull ever paid by people to spin this is a daunting data line

But come years 2020-2024... then you massive supply college educated dual income Americans who are married already and should be having kids, those are the real crucial years to see if the demand curve can grow

Plus by that time you shouldn't have to much debt leverage left from the housing bubble years.

Until then, it's a very slow and steady demand curve market place. However, be mindful, for the past 34 years in America each housing cycle has 2% plus lower Mortgage rates for that to happen in the next cycle, you need 1.25% - 2.25% 30 year rates... Not saying that can't happen with the 34 year trend, but that is the X variable factor going into the next decade

Sorry to hear you had a crappy holiday.

You're always going to get an overly bearish opinion here. Take it with a grain of salt.

(FYI - /Housing+-+I+was+wrong%2C+and+I+am+sorry.)

That said, I don't think anyone (or very few) saw what rents were going to do. Frankly, I'm surprised they can get so much. You can't get blood out of a stone.

My guess (and its just that) is many in the middle class are using their credit cards to supplement their wages, which haven't gone up in real terms in something like 15 years.

I don't presume to know your situation, but if the rents too high - perhaps moving is an option?

https://www.youtube.com/embed/U_6gHZjpuXs

Bubble Boy,
Do you live here in the Bay Area?

I'm just grateful today for not throwing away money on property taxes or excessive rent.

Logan Mohtashami says

mell says

Btw gold is approaching $1050,

A break of 1060. downside is as low as 680.

Never even reached $1000, but hey - where is Logan?

JasonM says

about you are paying FOUR FUCKING THOUSAND in rent these days?

You could really benefit from learning about minimalism. One of the most important factors is that you always live within your means. For instance my wife and I recently decided to move out of a house and save $700 by moving to an apartment. We'll miss the extra bathroom, but the additional money we'll have to put into long term investments, and take more vacations will be well worth it! On the other hand if we owned the place we live in, we'd be stuck with our mortgage payment till someone bailed us out by buying our house.

Seems like you just like being unhappy.

Strategist says

Jason, in the end you have to take responsibility for your actions. I'm sure both sides of the argument was presented on Patnet, and you decided to go with the bears. You could have purchased a home in 2010, 2011, 2012, 2013, 2014 and 2015, but did not. If you can afford $4,000 per month in rent, you can afford $4,000 per month in a mortgage.

I would say....stop crying over spilt milk and buy a home right now. The shortage of homes is very severe, unemployment is declining, the economy is slowly but surely picking up steam. This spring we will see the beginnings of one of the greatest real estate bull markets ever seen by living Americans.

I wonder if Jason ended up buying 2 years ago when he went on that rant. He would have been well ahead if he purchased even 2 years ago.
Nothing has changed from2 years ago. The shortage of homes is still severe, probably even more severe. The economy continues to improve, and unemployment continues it's downtrend. Bottom line......Home prices can go only one way. Higher higher and more higher.

NuttBoxer says

You could really benefit from learning about minimalism. One of the most important factors is that you always live within your means. For instance my wife and I recently decided to move out of a house and save $700 by moving to an apartment. We'll miss the extra bathroom, but the additional money we'll have to put into long term investments, and take more vacations will be well worth it! On the other hand if we owned the place we live in, we'd be stuck with our mortgage payment till someone bailed us out by buying our house.

In reality.....Your mortgage would be what you are paying in rent right now. You would also have a lot of equity.
Hope you learn from your mistakes.

I have been doing pretty good by not buying a house and investing all on SP500, what it's historically better