patrick.net

Peter P Says:

But I do not want a McMansion. I only need a 2/2.5 + Den.

There's an outside chance that McMansions will become so cheap that if you wanted to, you could buy one, rip out a room or two, and "downsize" that way. They're pretty much disposable anyway.

There’s an outside chance that McMansions will become so cheap that if you wanted to, you could buy one, rip out a room or two, and “downsize” that way. They’re pretty much disposable anyway.

True. But if a McMansion is cheap, I would rather buy a cheaper 2/2.5 + Den. ;)

skibum,

Kudos! When we sold our over-sized place the options were slim.

OH, you want to downsize, O.K I got it. How about looking at a two story 2,750 sq. ft. home on a 4,000 sq. ft. lot! I mean being as you're coming off of 3+ acres this is downsizing right?

This is how we wound up with so many McMansions to begin with! You don't think builders/lenders (which really sleep in the same bed) were going to let anyone walk away from their "child rearing home" and KEEP that money did you? OH, you want a LUXURY condo! NO! We just........ you know what, just forget it.

Not only that, the upfront costs of furnishing all the rooms in a 4000sf home can be significant.

I know the story of a couple who called in a high-tone decorator that provided a ~$400k estimate for furnishing their 4BR home. Even by high-income standards, they were floored and said no thanks. Even a minimalist minion like myself doesn't like the idea of sparsely furnishing a home over 2500 sqft. I don't want an echo chamber as I slowly add furniture over years.

Sure are a lot of pessimistic MSM bubble bust articles out there all of a sudden. It's making the contrarian in me very confused.

Anyone else feeling uncomfortable at all the pessimistic stories? I expected this to take longer.

T Lynch Says:

The middle class is shrinking, to sustain our unprecedented economic growth..corporations have outsources most of our highest paying manufacturing jobs to pay the dirt cheap labor in China and India.

We have completely stripped our nation of all it’s manufacturing base and sent it to other countries where it’s cheap to do.

What is a factory worker going to do if they can no longer get a good paying job? You’ll probably find them at the Togo’s and Staples’ around the country.

_____

Ha, ha! Yeah...Ahh...I'm laughing hysterically at the truth of those sentences, but not in a good way: I'm laughing in an insanely maniacle way like I want to reach out and strangle a f-cking Boomer!

Can you imagine the ad for a Togo's job: "Come join the most educated workforce in Silicon Valley, can you guess who we are?"

So, out of curiousity, you read on expecting an ad for IBM, or Intel, or Applied Materials as you think to yourself, "Hmm...the company with the most educated work force, just who is it?"

Then you are shocked to find out that not only is it TOGOS, but it's fricken'
true.

And you read the resumes: Surfer-X, Phd, Meat Slicer, Bob Smith, JD Sammich Maker; Michael Holliday, MBA, Janitor/Table Cleaner; Cindy Joker, BS (Double Major: Accounting and Finance); Sally Goofball, MS Computer Engineering.

Come joing the winning Togos team!

Yay!

I subscribe to the WSJ. Is it worth getting the FT as well? Jeez, I wonder if I can even get it delivered to me at home where I live.

I subscribe to the WSJ. Is it worth getting the FT as well?

FT is all you need. How could you resist pink?

Michael Anderson,

Uncomfortable? No I do not feel uncomfortable. It feels like walking across the Mojave expecting to find a glass of water and instead getting a drink from a fire hose though. I think of all the posters here I am the most hard landing/crash person here, but even I didn't expect this.

Just what about residential or commercial density has resulted in superior outcomes. I’m not being restrictive in any way. Pick the standard, do the math.

I much rather stack homes together and have more open space.

You want math?

Instead of have 2000 sqft homes on 1/8 acre lots, we can put 8 spacious condos (3000 sqft whole-floor condos) on one 1/2 acre lot and still much open space.

Here, we have 16 families per acre (versus 8 in SFH configuration). Each family has more interior space and there will be more open space. Magic!

I think I've (re)discovered the answer to all our housing problems!

80's, Boomer cheese psychology redux: Rediscover your "Inner-Child."

So we had a car loan, through a credit union, and we were able to ask for a rate reduction, and they gave it to us.....maybe something to try next time.

Robert Cote'

I saw my least favorite word uttered. Density. Can anyone give me an enumerable criteria that favors density? Really. Any mesurable metric. I’m open. No limits. Just what about residential or commercial density has resulted in superior outcomes. I’m not being restrictive in any way. Pick the standard, do the math. Pardon me as I go crack the 2003 Cakebreak Chardonay and don’t hold my breath. I’ve done this same “challenge” for a decade with no refutation.

We'll run a thread on this later, or we can do it on my blog if this isn't the right forum. I can provide the data and math to prove an "economy of density", based purely on energy transmission, distribution and consumption per capita.

But for now, enjoy your Chardonnay.

I much rather stack homes together and have more open space

I'm split as to whether dense urbanization is the solution to preserving open space. After all, high housing density results in a pretty sterile human environment. Tongue-in-cheek, I could support that if my home bordered the open space! ;)

After recently taking a class on green building / planning, I'm inclined to a newer model that maintains some environmental integrity, while keeping housing density closely managed. Nothing's perfect; this is just one idea of balancing human and environmental needs. Someday, preserving the environment/managing land on the micro scale will be a hot topic.

After recently taking a class on green building / planning, I’m inclined to a newer model that maintains some environmental integrity, while keeping housing density closely managed.

I am a proponent of population control. If we have zero population growth, we will not have growth-related issues.

I do not think this is feasible at this point, we still need productivity growth to finance the BB retirement.

"Pardon me as I go crack the 2003 Cakebreak Chardonay"

Cakebreak...Cakebread?
I'll take a 2003 Marcassin

Michael Anderson Says:

Anyone else feeling uncomfortable at all the pessimistic stories? I expected this to take longer.

The conspiracy theory take on this is that now the RE industry is pushing the MSM to give doom-and-gloom stories to try and convince these stubborn sellers to start lowering prices, thereby bringing sales volumes back from the dead.

there is so much personal debt in america right now, these people are desperate, and they are willing to vote in anyone who can get them out of this hot water.

Logic suggests that they may win.

The voters may want a way out, but the wealthy and corps who run the big show have a hard time with a dollar in steep decline

You think they still have large USD cash positions to protect? The rich WILL have the upper hand no matter what. They have earned it.

What option are available to Ben

If there is a will there is a way. At least there will be attempts.

Will a loaf of bread go up or down if the dollar crashes? How will we all survive then? These questions bother me more than any question I might have regarding real estate.

Who cares. We will deal with that when we get there. If we cannot afford bread we can always have cakes.

Robert Coté Says:

I saw my least favorite word uttered. Density.

"I AM YOUR DENSITY." - George McFly

"...and they are willing to vote in anyone who can get them out of this hot water"

If things get really bad for the American mid-section, is there any limit to what people would do for a "return to prosperity"? What we need is a strong leader that can take what America needs. The mideast has oil, but they can't stand our infidel control. Canada has resources, and it's next door... :twisted:

Okay, so where do we put our money - what little we have to protect it from inflation - stocks?

As long as your “dollars” are still worth something….

Hopefully, both will be since they're so interrelated.
Btw, we used to spend $CAD in Seattle back when it was 1:1

Lived in Japan, been to Tokyo, Osaka and Kyoto, and they’re nice enough. But it’s still not my cup o’ tea.

Downtown Vancouver is quite dense. But I do not mind living in a good-sized condo unit.

Actually, what is so bad about the possible N. Korea missle test? It is just a test, right?

I am not saying that they are entitled to one, but what is the big deal?

On Density,

Anyone who reads Asimov or played SimCity: the ultimate density planned environment is known as an Arcology. The idea isn't so far-fetched as it sounds, and is essentially where human society is headed if we are to sustain population in excess of what the planet would naturally support without dramaticly engineered density efficiencies.

Basically, an Archology is just a megacity structure which is engineered and planned as one harmonious design. It is quite foreseeable that future generations will place a premium on living out there entire lives entirely within such structures because they would provide the best protection against a rapidly deteriorating environment, scarcity of food and resources, shortage of energy and threat of lawlessness. Essentially, the Arcology is the response to encroaching Distopia (Dystopia). Kind of like a big spaceship only without the being in space part.

In all seriousness, the main thing that will accelerate migration to arcologies aside from the variables above will be the eventual balance of power shifting away from offensive weapons of mass destruction to reliable defenses to those weapons.

I am very frustrated with the current Real Estate now because it’s the f**king people don’t have money make money. Because they have nothing to loose and don’t care about if they have to go bankcrupt.

If you think they have nothing to lose why didn't you do the same? Don't fight them, join them.

There is really nothing to be frustrated over. The market will correct one way when the psychology changes, which is happening as we speak.

In all seriousness, the main thing that will accelerate migration to arcologies aside from the variables above will be the eventual balance of power shifting away from offensive weapons of mass destruction to reliable defenses to those weapons.

What defense is better than MAD?

Actually, what is so bad about the possible N. Korea missle test? It is just a test, right?

I am not saying that they are entitled to one, but what is the big deal?

Any tests or drills carry very significant military game-theory signalling value. If N Korea fired a missile accurately at a target demonstrating the ability to target cities in, say California, then later they can make a credible threat to actually use such weapons. Without the test, those threats are cheap talk. Preventing the tests keeps them one-step further from nuclear diplomacy.

And while we save money for a deposit, inflation devalues it, but the housing becomes cheaper for those who have already bought! Or so it seems to me.

Not fair, but then life seldom is and I should just get used to it, I just hope there'll be a break for us sometime soon and houses will be a dime a dozen - then I'll buy three! One for us and one for each kid so they don't have the same troubles in 20 years time.......well I can dream!

Any tests or drills carry very significant military game-theory signalling value.

The damage is probably larger if the attempt to shoot it down fails.

What defense is better than MAD?

The only limitations to defenses for ballistic, or even non-ballistic, missiles (besides lots of $'s) is computing power. With enough calculations per second, any projectile can theoretically be intercepted. The smaller area you need to defend, the cheaper the cost and more accurate the defense.

In game theory, such defenses invalidate MAD, which is why everyone got PO'd at Reagan's SDI. A population significantly protected by defenses has strategic offense as a real, credible option. Add to that sustainability even if the surrounding area is decimated, and a nation is incredibly powerful (and dangerous).

The damage is probably larger if the attempt to shoot it down fails.

This is why anti-missile defensive tests are run in secret while offensive tests are made quite public.

Randy H Says:

It is quite foreseeable that future generations will place a premium on living out there entire lives entirely within such structures because they would provide the best protection against a rapidly deteriorating environment, scarcity of food and resources, shortage of energy and threat of lawlessness. Essentially, the Arcology is the response to encroaching Distopia (Dystopia). Kind of like a big spaceship only without the being in space part.

We keep coming back to this: we're headed straight for a "Logan's Run" civilization. I suppose Biosphere was the first stab at this?

Speaking of Biosphere, and here's a segue back to the topic at hand, did anyone else read the WSJ article a few weeks back? Biosphere was built in what was at the time the middle of nowhere in AZ. It seems now the mega-sprawl there is reaching Biosphere. The owner of the land there has been made an offer to purchase by, you guessed it, a developer!

But, in all the stories, everyone pretty much rebels against enclosed communities, because most people do not want to conform completely.

The only limitations to defenses for ballistic, or even non-ballistic, missiles (besides lots of $’s) is computing power. With enough calculations per second, any projectile can theoretically be intercepted. The smaller area you need to defend, the cheaper the cost and more accurate the defense.

Also, the accuracy of the sensors must be near perfect. I still have more faith in MAD.

"It is quite foreseeable that future generations will place a premium on living out their entire lives entirely within such structures because they would provide the best protection against a rapidly deteriorating environment"

-Leading to the Arcondo boom of 2200, when people will use key organs for downpayment. Let's just hope it has a better plan than Biosphere II.

Imo: if the ecosystem ever gets that bad, we'll have a population reset; time for the remaining humans to start over. That is, if we're not forced back into a stone age.

If thrift was good enough for our great grandparents who survived the depression, it’s good enough for us.

If Stone Age was good enough for cavemen, it is good enough for us.

Here's an article surfer-x and other anti-boomers might get a kick out of. It's a bit sad, actually. Titled, ""Age 50 ... and little saved. When you hit that milestone, you've got to act fast. Here's a catch-up plan to follow"

http://tinyurl.com/fquax