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By thankshousingbubble   Follow   Sun, 18 Nov 2012, 11:44pm PST   4,835 views   45 comments
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RentingForHalfTheCost   Mon, 19 Nov 2012, 12:54am PST   Share   Quote   Permalink   Like (2)   Dislike     Comment 1

Interesting quote from article.

"Also, the National Association of Realtors said last week that the median down payment has sunk to 9% for home buyers this year, its lowest level since 2009. "

We are in for a good ass kicking in our future. You can bet on it. The average buyer this year has only 3% equity after you take away the 6% realtor fees. That can be whipped out pretty quick in this market and make them unable to sell like the other half of mortgage owners. Greed kills markets. We are not done the stupidity yet folks. As the quote above attests, we are back at it.

bmwman91   Mon, 19 Nov 2012, 4:46am PST   Share   Quote   Permalink   Like (1)   Dislike     Comment 2

Only the children of rape victims grow up in rentals. You can't build a white picket fence around an apartment, so there is no security from depraved rapists.

RentingForHalfTheCost   Mon, 19 Nov 2012, 11:06pm PST   Share   Quote   Permalink   Like (1)   Dislike     Comment 3

Mark D says

besides, if the possibility of losing your job is the reason for not buying a house then there will never be a good time to buy a house. unless you pay all cash. how many years will that take?

Yes. Now you get it. It will take about 10-15 years of saving. Remember that word? Somehow in American culture over the years, we have lost the whole idea of saving for something. Give it to me now and I will pay you for my whole life for it. Save, save, save. Invest in yourself and grow your income and savings. Buy a house when you don't need to ruin your future earning power. Oh well, it is a pipe dream. Once greed becomes the norm, fiscal crisis is always around us. Silly

Kevin   Tue, 20 Nov 2012, 2:42am PST   Share   Quote   Permalink   Like (1)   Dislike     Comment 4

I earn 15% royalties on my bullshit farm.

Goran_K   Mon, 19 Nov 2012, 2:28am PST   Share   Quote   Permalink   Like   Dislike     Comment 5

RentingForHalfTheCost says

We are in for a good ass kicking in our future. You can bet on it. The average buyer this year has only 3% equity after you take away the 6% realtor fees. That can be whipped out pretty quick in this market and make them unable to sell like the other half of mortgage owners. Greed kills markets. We are not done the stupidity yet folks. As the quote above attests, we are back at it.

Couple that with the fact that the amount of jumbos being taken out are now back to 2007 levels, a big ass kicking indeed.

dunnross   Mon, 19 Nov 2012, 2:38am PST   Share   Quote   Permalink   Like   Dislike     Comment 6

robertoaribas says

the sarcasm was so obvious my dog caught it!

That's because your dog is smarter than you are, although less cute (or at least that's what all my gay friends in San Francisco, think).

bmwman91   Mon, 19 Nov 2012, 2:51am PST   Share   Quote   Permalink   Like   Dislike     Comment 7

RFHTC and Goran,

While rational thought does agree with your commentary on unsustainable consumer behavior, reality may well dictate otherwise. The old adage, "markets can stay irrational longer than you can stay solvent" is sort of an ugly fact of life. There should be no question in your minds that the government and Fed have gone full retard and WILL see to it that house prices go up, no matter what headwinds there are to fight. The Fed has already chased hordes of investors out of bonds and into RE. Many have also abandoned equities for RE too since the stock market is insanely volatile and being dominated by HFT bots.

Also, more than half of the people in the US are house owners, or part of a family that is run by house owners, so it is accurate to say that "most" Americans want house prices to go up. These people vote, and our esteemed leaders generally try to make their largest constituency happy so that they can get re-elected.

dunnross   Mon, 19 Nov 2012, 2:56am PST   Share   Quote   Permalink   Like   Dislike     Comment 8

If they drive the prices up any more, then, their children won't be house owners, so, eventually, it will be less than 1/2. Also, with investors buying up all the properties (like iwog & roberto say), and renting them out, most people will not be house owners.

Goran_K   Mon, 19 Nov 2012, 3:06am PST   Share   Quote   Permalink   Like   Dislike     Comment 9

bmwman91 says

These people vote, and our esteemed leaders generally try to make their largest constituency happy so that they can get re-elected.

I understand this aspect. One would hope that they realize paying less for a house leaves more money for other things...

bmwman91   Mon, 19 Nov 2012, 3:19am PST   Share   Quote   Permalink   Like   Dislike     Comment 10

Goran_K says

I understand this aspect. One would hope that they realize paying less for a house leaves more money for other things...

Bro, what's the point in anything if you can't HAVE YOUR OWN PLACE. I mean fuck, ice cream doesn't even taste good if it comes from a rental fridge. Vacation...what, so I can come "home" to an apartment? If I don't own a home, how will I EVER retire?!

A strikingly small number of people actually possess the mental fortitude to do a rational cost-benefit analysis of their own life. Or even if they do have the mental fortitude, they have a big ego, personal biases or social pressures blocking the way.

mell   Mon, 19 Nov 2012, 3:59am PST   Share   Quote   Permalink   Like   Dislike     Comment 11

bmwman91 says

Goran_K says

I understand this aspect. One would hope that they realize paying less for a house leaves more money for other things...

Bro, what's the point in anything if you can't HAVE YOUR OWN PLACE. I mean fuck, ice cream doesn't even taste good if it comes from a rental fridge. Vacation...what, so I can come "home" to an apartment? If I don't own a home, how will I EVER retire?!

A strikingly small number of people actually possess the mental fortitude to do a rational cost-benefit analysis of their own life. Or even if they do have the mental fortitude, they have a big ego, personal biases or social pressures blocking the way.

You forgot that kids have no self-esteem unless they grow up in an "OWNED" house and that house-owners are selfless community builders!

dunnross   Mon, 19 Nov 2012, 4:01am PST   Share   Quote   Permalink   Like   Dislike     Comment 12

Take places like NYC, where most residents are renters. That's why they have rent control in NYC, because, these people vote it in.

Nobody   Mon, 19 Nov 2012, 5:10am PST   Share   Quote   Permalink   Like   Dislike     Comment 13

dunnross says

If they drive the prices up any more, then, their children won't be house owners

Ah, don't forget the people from China for the housing market that is skyrocketing like Silicon Valley.

Goran_K   Mon, 19 Nov 2012, 5:20am PST   Share   Quote   Permalink   Like   Dislike     Comment 14

bmwman91 says

Only the children of rape victims grow up in rentals. You can't build a white picket fence around an apartment, so there is no security from depraved rapists.

Your memories will suck if you're living in a rental. You won't remember good times, just the times you shoveled coal for your landlord master.

RentingForHalfTheCost   Mon, 19 Nov 2012, 6:38am PST   Share   Quote   Permalink   Like   Dislike     Comment 15

bmwman91 says

The old adage, "markets can stay irrational longer than you can stay solvent" is sort of an ugly fact of life. There should be no question in your minds that the government and Fed have gone full retard and WILL see to it that house prices go up, no matter what headwinds there are to fight.

I agree they will try everything possible. But even the gov't has its hands tied now. In fact, they are the ones that tied them. That ugly debt ceiling and fiscal cliff thingy is a product of the free money train. Markets always become accountable, it is just a question of the time window. I agree that it will not happen tomorrow, but it will happen. When it does, you can bet your bottom dollar that everyone will then be saying they saw it coming. This board will be filled with the now bulls, who will suddenly be oracles. Patrick's new source of revenue will be users paying to delete all the posts from the past. No one likes being proven wrong. ;)

RentingForHalfTheCost   Mon, 19 Nov 2012, 6:40am PST   Share   Quote   Permalink   Like   Dislike     Comment 16

LiarWatch says

Nobody says

Ah, don't forget the people from China for the housing market

And there are no buyers there.... just like here.

Yah, we all know how well Chinese real estate has been doing. Do you think when they suddenly cross the pond, they become different buyers. They are as picky as the rest of us. Hence, no sales. Get used to it.

Mark D   Mon, 19 Nov 2012, 6:40am PST   Share   Quote   Permalink   Like   Dislike     Comment 17

the real reason people are buying:

http://www.redfin.com/CA/Valencia/28630-Pietro-Dr-91354/unit-33/home/17232164

with 20% down, the monthly payment is $2225 including property tax, homeowner insurance and HOA.

estimated rent is $2275 plus you get $3.5K in tax refund at the end of the year. why wouldn't you buy?

RentingForHalfTheCost   Mon, 19 Nov 2012, 7:33am PST   Share   Quote   Permalink   Like   Dislike     Comment 18

Mark D says

wouldn't you buy?

Because there are much safer and better places to put your 20% to work. The only reason the prices have imploded worst is because the rates have dropped almost in half in the last 5 years. Try running a business where you give people 30 years to pay off the purchase of a questionable valued asset. That is at a 3% rate for your trouble. Good luck staying from getting deeper into a hole with that model. Instead of climbing out, you just keep digging, and digging, and digging. It floors me that people don't see the craziness and keep buying into the ponzi scheme that is being run. Oh well...

Mark D   Mon, 19 Nov 2012, 7:46am PST   Share   Quote   Permalink   Like   Dislike     Comment 19

RentingForHalfTheCost says

Mark D says

wouldn't you buy?

Because there are much safer and better places to put your 20% to work. The only reason the prices have imploded worst is because the rates have dropped almost in half in the last 5 years.

the only safer place you can put that 20% is bond which yields well below inflation. everything else is just as risky if not riskier.

there is no opportunity cost when your housing expenses are the same as your monthly rent.

paying rents for another 30 years and you would still be paying rents (which will go up with inflation). buying with the same monthly amount and you own the house in 30 years, not to mention that your principal and interest are not affected by inflation.

it's not questionable asset value when the monthly housing expenses are the same as your monthly rent.

Mick Russom   Mon, 19 Nov 2012, 7:48am PST   Share   Quote   Permalink   Like   Dislike     Comment 20

robertoaribas says

It takes more than one month to make a trend, but clearly positive data for housing.

Yes, a housing bubble is just what a struggling consumer economy with high unemployment needs, a frenzy that causes the cost of living to go up.

That coupled with inflation on food, rent, tuition, commuting, gasoline, services, insurance, healthcare with stagnant salaries.

Yes, looking good. Proceed as before and expect a different outcome. But this time, do it Japan style.

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