WatchMany participants in here, myself included, are in the "wait for the free market to return" camp. The government subsidies for housing via GSE loans, the MID, prop 13, RE agent-favoring MLS system, shadow inventory, squatters and low interest rates are all items on a (probably incomplete) list of things that us would-be buyers wish to see go away in hopes of lowering house prices. When/If some of these items go away, lots of of us probably figure that it would be OK to buy, and many of us post about how adamant we are about not buying into our current rigged-system.
OK. Obviously, we all have a pretty strong interest in buying houses, or else we wouldn't be spending time in here worrying about it. Buying a house is, for strong personal reasons, a really big aspiration for most people.
So, what if none of the things in the list above change in the next 10+ years? It isn't totally out of the realm of possibility. As far as I can tell, the groups that want to keep the game rigged like it is are also the groups that have the ability to change the rules of the game. The rest of us that are chasing some version of the American Dream can all pine away and wish for a fair, rational system, but we really do lack the means to get those with vested interests in rigging the game to un-rig it. Don't get me wrong, I have a really hard time seeing the system as it operates now lasting. Despite this, short- to mid-term economic behavior seems to be perfectly capable of doing totally irrational things. As far as I am concerned, 10 years is at the start of a "mid-term" time span when planning economic moves. Long-term, in my mind, is 30+ years, or about enough time for one generation to produce the next.
So, say that 10 years from now the game is still rigged and we all know it and hate it. How many of you would have saved & over-paid somewhere in that span? We are all waiting around for a train that we think is coming, but we aren't really sure of when. What if it doesn't come for a REALLY long time? For all of the frustration we seem to have, how many of us are really going to let it stop us? Will you eventually give-in?
Chances are that I would end up over-paying after a few more years of saving (and put down 30-50%). Despite the fact that I despise all of the crookedness in the system and live below my means, I want some personal space to run a workshop that I can walk to in 5 seconds, and to have a yard with big trees to do stupid stuff in with my climbing gear. God help me when I decide to have kids, but it would be nice to have a yard for them to run around in and provide me with manual labor when they are old enough (I knew how to use a jackhammer by the time I was 12, and spent a lot of weekends digging sprinkler line trenches and putting up drywall...it builds character, or something). The main reason I want to avoid overpaying, aside from the obvious short/mid-term issues, is the long term issue of being stuck with high property tax bills. My fiancee and I are fine with buying a $500k SFH, and in a couple more years we can put 40-50% down. We could put 25% down now, but we are, "waiting for that train." Anything over $500k is too much of a financial liability as far as we are concerned.
So, despite all of my idealism about not participating in a rigged system, I am pretty sure I'd cave in and participate at some point. I bet lots of us will. I am fairly certain that those that run this rigged system know this, and that gives them even more incentive to keep it rigged. "Look at these stupid peons...they piss & moan now, but give them a few years and they let us shoot a load in their face anyway!"
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thomas.wong1986 says
Which of my views is neo-marxist?
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All this Marxist vs Capitalist hoo-ha is so out-of-date. I love when the tea-baggers accuse someone of being socialist because they reveal that they don't know what the word means.
Marxism failed, for sure. But our current course of laissez faire capitalism is an equal failure.
So, what is working on the globe? Do we want to be Somalia (no government regulation!) or Germany (Heavily regulated).
Seems to me, that the Northern European model is the one to follow... Germany, Iceland (and the other Scandinavian countries) are in much better shape than the USA. I might point out that Canada is also in better shape than the USA... and follows the Northern European model of relatively high taxes, a strong social safety net and heavily regulated corporations (especially banks).
Oh... and for the inevitable commenter that tells me to "move there" - please spare me your pointless vitriol.
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ChrisSoCal says
Lets get back down to earth and ask.. YOU as a consumer would you Move there and over-bid, over-pay, over-borrow ?
Some how people moving to Irvine came up with silly notion that homes were really actually worth 3-4x more than 1997 prices. What kind of bank regulations will solve this notion ?
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Turn your question around, what happened that allowed such lousy underwriting? Answer: the repeal of Glass-Steagall. That allowed investment banks to get involved caused the creation of mortgage derivatives and the "off-loading" of risk. Suddenly, banks didn't give two hoots about your ability to repay and they flooded the market with money to create more loans, which they then packaged and resold. They needed an endless supply of new loans to fuel their ponzi-like compensation model that was dependent getting new debtor to take loans so banksters could "earn" commission.
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Are you going to answer me thomas? What neo-marxist views have been expressed here? By me or anyone else?
Were you just talking out of your ass?
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Because so few seem to know this, here is a definition of MARXISM/SOCIALISM: "In a socialist society private property in the means of production would be superseded by co-operative ownership. There would be no private ownership of productive capacity."
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I don't see anyone advocating that... so the word does not belong in this debate. It's become a childish insult like saying "Such-and-such is so gay" when it has nothing to do with homosexuality AT ALL.
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ChrisSoCal says
That's absolutely right which is why I asked thomas the question. I never expected a reply because he knows it's dishonest.
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iwog says
Yeah, it seems like we struck a nerve on the Reagan stuff. I would prefer that thomas actually make a substantive argument rather than starting calling people names. Thomas' superficial analysis isn't really holding water when presented with the facts. I would love for him to explain how anything I have said is neo-Marxist or any other nonsense ideological moniker he comes up with.
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Like I said..."As if its going to change your pathic little neo-marxist views".
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thomas.wong1986 says
So you're going to run away instead of explaining your point.
If you're not here to discuss anything, why are you here at all?
Thomas: "You're a Marxist!!"
Iwog: "Why am I a Marxist?"
Thomas: "I'm not telling.......neener neener!!!"
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ChrisSoCal says
If you want to talk about the Pozi "Commission" scheme you can certainly discuss that as it comes to real estate agents. Banks do no earn a commission. They generate a fee, not distributed to any one individual employee.
At what point exactly in you comments above, made the buyer think the homes like in Irvine were worth 2-3x more than a few years ago. Have you ever seen prices like in Irvine skyrocket that high in such a short period of time. Is that 200-300K home really worth 700-800K in less than 10 years ? What were these people thinking ...
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iwog says
You have a problem with Reagan anti-Marxist expansion in the western world. It kills you that he stopped and beat back the Pro-Cuban, Pro-Soviet thugs in Nicaragua, Grenada, El Salvador. Plenty fans in Poland and rest of Eastern Europe.
You should travel the world and see what it like today vs before.
It may have escaped you pathic life.. but the Poles have put up a memorial to Reagan this year.
Walesa unveils Reagan memorial in Warsaw
Posted on November 22nd, 2011
A statue in memory to former US President Ronald Reagan was unveiled in Warsaw's Ujazdowskie Avenue on Monday by former Polish President Lech Walesa, founder and first leader of the Solidarity Union which opposed and eventually overthrew the communist regime in Poland.
The three-meter high stone and bronze statue, standing opposite the US embassy, is a tribute to the 40th US president for his contribution to defeating communism and thus opening way for freedom in Poland.
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iwog says
Incompentent and Weak...simple as that! And the election of 1980 showed it.
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OK, guys. Let's not make this thread into a lame political dispute. I mean, it is sort of too late, but how about a separate thread in the politics section.
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What would I do if nothing change? I'd keep on buying & selling real estate. Keep on adding 2 rental properties to my portfolio per year for the next 10 years.
If anyone wants a guarantee 7% annual return on your money, I would love to take on that debt. Your money will be secured by a 1st Deed of Trust up to 75%-80% fair market value of the property.
Can you beat that rate of return iwog? :)
Cheers. :)
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All other things being equal, or different, I'd still take a shit on a Realtor®'s face.
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APOCALYPSEFUCK is Tony Manero says
That was implied. Really, does anyone NOT know that step #1 of buying or selling a house requires a sufficiently sloppy dump to be unloaded on a realtor's face? Some prefer to be unconventional and give them a good old Cleveland Steamer instead. It is important to be inclusive of all preferences for buying & selling styles!
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E-man says
YES buy REAL ESTATE! EMAN has the bright lights on...buy houses. any where you can fine them cheap and and rent them out. some one needs the rental so you are not hogging up the homes $$$$$$ Awesome stuff EMAN you will be rich.
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Cleveland Rocks!
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Cleveland! Had many good timesin Cleveland! Bought my first car there in fact 1956 Imperial hardtop wish i still had it.
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Yes, but did you ride a steamer? You seemed to enjoy yourself there, so I would assume so.
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no sir. not sure on the steamers. is there Ohio river steamer?
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Nevermind. Perhaps I was confused. Next time you work with a realtor though, you should ask if they will let you ride the Cleveland Steamer with them.
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ok I got it now bub goodle Cleveland steamer. desgustings .I
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i meant GOOGLE
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OK good. I was starting to feel a little guilty & was going to have to explain it. Heck, you may have gotten unlucky (or lucky, who knows these days), and the realtor might be into that sort of stuff!
Anyway...things that don't have to do with that...
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you have no idea what you have done. i can not eat my before bed snack now
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Tue, 29 Nov 2011 at 5:16 am Quote Like Flag Take It Outside Permalink Share
ArtimusMaxtor says
Food does not grow in the United States for the most part it is barren land
Are you kidding me?????? Have you ever driven through the midwest?
We actually have a competitive advantage in food. It may not be free but we grow a lot of it. We also process and export quite a bit. It is actually the only area besides the military industrial complex where we actually export more than we import.
See here:
http://www.ers.usda.gov/Data/FATUS/
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I'm not waiting, I'm watching. I'm completely convinced my lasting happiness has nothing to do with what I buy. In my pursuit of happiness, I won't buy anything impeding that pursuit.
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ArtimusMaxtor says
You appear to have thought a lot about this idea, but have you considered reading some other sources? I note that you're providing no other sources for your ideas. I think there are aspects of your idea that have not come to your mind, which is how all ideas work. A single person does not usually cover all, or even most, of the relevant information connected with an idea.
Scientific American had an article in the last year showing that the equatorial rain belt is moving North. How does that change your idea?
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MoneySheep says
I want to start hearing people who buy houses say, "I bought the house for $X + i% interest, meaning I bought the house for X(1+i)^30." And I want them to know that total! And I want them to know the interest was stuck in the early payments so they couldn't escape the interest!
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bmwman91 says
Perhaps you would like Atlantic City better? It's got a beach and boardwalk and stuff.
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JodyChunder says
I take it that you have never seen this movie
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zzyzzx says
Wherever I go must have ample rock climbing within 30 minutes. New Jersey isn't too high on that list. Surfing access is a plus, but it's gotta have ROCK! By this criteria, I probably sound like I am doomed to live along coastal CA (and I may well be).
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JodyChunder says
I take it that you have never seen this movie
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bmwman91 says
Oregon has something called the Cascades with lots of rock climbing. It's 90 minutes to surfing from Portland. Real men surf Oregon, puts hair on your chest.
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San Jose, CA
Scary times.
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We need another Reagan.
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Iron Ranger says
OH hell yes. If the last 10 years has proven anything, it's that this country needs:
1. More deficit spending
2. Deregulation
3. Tax cuts for the rich
4. Arms sold to Iran
5. Amnesty for illegal aliens
6. Wanton disregard for federal law
7. War in a dozen new nations including some that are members of the British commonwealth.
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bob2356 says
Not to mention inland, they do river surfing.