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House Buyer Strike: Do not participate in a rigged market


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2011 Nov 20, 8:57am   48,192 views  109 comments

by Patrick   ➕follow (55)   💰tip   ignore  

To protest government debt-mongering and the resulting enslavement of the 99% to employers and to banks, not to mention the giant Fannie/Freddie/FHA hole the federal budget, let us declare a general house buyer strike.

Let us not buy any house until the government eliminates all subsidies and guarantees for mortgage loans. This means the complete elimination of the FHA, Fannie, Freddie, and any other program that subsidizes or guarantees mortgage debt, including the purchases of mortgage-backed bonds by the Federal Reserve.

Congress and President Obama's hiking of the jumbo loan limit to $729,000 today is a sneak attack on your financial freedom. Their evil goal is to get you to sign away your whole working life for the benefit of the 1%.

Buying with cash won't help. You would then be bidding your hard-earned money against someone who is enslaving themselves with huge loans subsidized by and guaranteed by taxpayers -- taxpayers like you yourself!

If buyers all band together nationally and refuse to buy, then we will all win with much lower house prices when these programs are eliminated.

Sellers who want to move upscale would also win, because they'd get a bigger discount on their next house than they would lose on their current house.

Anyone got a catchy slogan?

Any graphic designers want to make some compelling posters for free distribution?

#housing

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1   anonymous   2011 Nov 20, 9:02am  

Yeah! Finally!

And young families and renters who are saving will have a better chance of owning a home with less or no debt.

2   EastCoastBubbleBoy   2011 Nov 20, 9:28am  

If Uncle Sam has his hand in the pie, we won't buy.

3   EastCoastBubbleBoy   2011 Nov 20, 9:30am  

Sounds good to me. Where do I sign up?

4   Patrick   2011 Nov 20, 9:30am  

Maybe I should start keeping a giant list of names, cities, and email addresses of striking buyers, and send those people notes on how their Congressmen voted re FHA/Fannie/Freddie.

I could also inform the Congressmen that X number of voters in their districts (and here are their names) are very angry about their vote to enslave their constituents to employers and banks.

Sound good?

5   futuresmc   2011 Nov 20, 9:42am  

While I agree with the sentiment, we already know that the government is trying to rook larger rental investors into buying properties at fire sale prices to further commodify the housing market. What happens when more than half of the housing in the US is rental? Then the rental owners become price setters not price takers and they can jack up rents as high as they like. I doubt the 30% of monthly income recommendation would be their guide. No, sometimes it's better to buy than rent, and in those markets, those that can buy should. If it goes the other way, then rent.

6   Patrick   2011 Nov 20, 9:51am  

futuresmc says

While I agree with the sentiment, we already know that the government is trying to rook larger rental investors into buying properties at fire sale prices to further commodify the housing market. What happens when more than half of the housing in the US is rental? Then the rental owners become price setters not price takers and they can jack up rents as high as they like. I doubt the 30% of monthly income recommendation would be their guide. No, sometimes it's better to buy than rent, and in those markets, those that can buy should. If it goes the other way, then rent.

The rental market is at least a real market. You can't get a loan to pay your rent, so rents are limited to what you can actually pay, unlike purchases.

The landlords are not at all unified, and do undercut each other to get your business. If the rental market were an oligopoly like the US cellular market (which has only 4 real options), then it would be a different story.

If renting costs more than the total cost of owning the same thing for 6 years (the median length of ownership in the US) then I can't blame you for not joining our strike, but still, I hope you'll do it out of solidarity.

7   TMAC54   2011 Nov 20, 10:33am  

Sign Me Up !
But what is the expiration date of the strike, or what events need to transpire before we know when gubmint no longer benefits ?
A SLOGAN ? How about
"WAG THE GATOR ?

8   futuresmc   2011 Nov 20, 10:35am  


The landlords are not at all unified, and do undercut each other to get your business. If the rental market were an oligopoly like the US cellular market (which has only 4 real options), then it would be a different story.

Right now, because more than half of Americans at least nominally own their homes, an oligopoly can't form in housing. However, if a buyer's strike were to succeed, that would drive down prices to a point that it could. At a rational price, housing in its various forms is still a big ticket item and ranks high in Maslow's hierarchy of needs. As with energy or food, consumer demand is far less elastic than most other markets, and this makes it a relatively safe investment for the right price. Those that could buy up the quality housing in large enough volume would control the markets and then lobby locally to drive out the smaller owners through burdensome regulation and taxation that targets smaller owners.

In my darker moments, I begin to ponder whether this was the plan for the US housing market all through the bubble, setting up the next bubble in rental property, and getting a nice chunk of taxpayer change in the process. What caught them unawares was the global interconnectedness of the housing market and the domino effect of their derivatives.

9   anonymous   2011 Nov 20, 11:18am  


Maybe I should start keeping a giant list of names, cities, and email addresses of striking buyers, and send those people notes on how their Congressmen voted re FHA/Fannie/Freddie.

I could also inform the Congressmen that X number of voters in their districts (and here are their names) are very angry about their vote to enslave their constituents to employers and banks.

Sound good?

Online petition scripts or plugins might be useful.

10   anonymous   2011 Nov 20, 11:23am  

It will be a great tagline for pnet:
"Do Not Participate in a Rigged Market"

11   REpro   2011 Nov 20, 11:24am  


The rental market is at least a real market. You can't get a loan to pay your rent, so rents are limited to what you can actually pay, unlike purchases.

Not necessary. Recent hike in rental prices in BA push many tenants to the limit. Why do you think rent control was created?
Strake can temporarily shake market in high priced coastal areas. In Middle America there is no such problem.
Nothing better control prices like high supply from competitive builders. When supply exceed demands prices will drop to the bottom.

12   B.A.C.A.H.   2011 Nov 20, 11:47am  


The rental market is at least a real market.

Except where there's section-8's. And rent controls.

13   Bap33   2011 Nov 20, 11:53am  


Let us not buy any house until the government eliminates all subsidies and guarantees for mortgage loans.

Love the point, just add the words "and welfare" right after the word "guarantees", and then remove the words "for motagage loans", and you will have my vote.

14   Bap33   2011 Nov 20, 11:53am  

B.A.C.A.H. says




The rental market is at least a real market.


Except where there's section-8's. And rent controls.

any welfare destroys the market system

15   REpro   2011 Nov 20, 11:54am  

B.A.C.A.H. says

Except where there's section-8's. And rent controls.

Let’s remove section 8 taxpayer subsidy too.

16   Patrick   2011 Nov 20, 12:10pm  

TMAC54 says

what events need to transpire before we know when gubmint no longer benefits ?

Elimination of FHA, Fannie, Freddie, and of the Federal Reserve buying up bad mortgages.

futuresmc says

Those that could buy up the quality housing in large enough volume would control the markets

No one is that big.

futuresmc says

and then lobby locally to drive out the smaller owners through burdensome regulation and taxation that targets smaller owners

THAT, however, could indeed happen, since our government seems to exist mainly to protect big owners and big businesses from the free market.

Bap33 says

Love the point, just add the words "and welfare" right after the word "guarantees", and then remove the words "for motagage loans", and you will have my vote.

Welfare for the rich is something like 1000 times larger than welfare for the poor. First things first. Section 8 is a landlord subsidy, so that's a different battle too.

I want to keep it very clean and simple: No buying until mortgage debt subsidies and guarantees are eliminated.

17   HydroCabron   2011 Nov 20, 12:30pm  

I like the proposal, particularly the part about "bidding your hard-earned money against someone who is enslaving themselves with huge loans subsidized by and guaranteed by taxpayers", but is the mortgage-interest tax deduction not worth including here? Or would this make it too hard to generate support?

Though the mortgage interest deduction is consistent with deductions given to corporate entities on interest expenses, is it not also a subsidy of owners at the expense of renters, and an artificial prop to prices?

18   Patrick   2011 Nov 20, 12:36pm  

True, the mortgage interest deduction is indeed a government subsidy of debt, mostly for high-income people. The poor don't own, and the middle class often finds their standard deduction is higher than the mortgage deduction anyway. So that just leaves fairly rich people getting most of the benefit.

It probably would make it harder to generate support, but as a matter of principle, it should be included in the ban. OK, here are the demands:

* No government mortgage guarantees. So no FHA, Fannie, or Freddie.
* No Federal Reserve printing up money to buy bad mortgages or mortgage bonds.
* No mortgage interest deduction. Canada, Australia, England, etc, all live without it.

19   futuresmc   2011 Nov 20, 12:44pm  


futuresmc says
Those that could buy up the quality housing in large enough volume would control the markets

No one is that big.

Not at the moment, but think back to 1980. Did anyone think that Bank of America, Citigroup, or JP Morgan Chase would exist in their current form? Ofcourse not. These banks merged and ate up smaller competition globally over three decades to get to be the TBTF banks. From the tiny acorn grows the mighty oak. All they need to do is dominate a small city or geographic region, then another and another, merging with one another, lobbying corrupt politicians to kill of competitors they can't absorb at the price they want. If the federal government actually does get this thing going with well healed rental investors buying up massive inventory, by 2050 you could very well see rental firms akin to today's big banks that have the ability to compel the majority of Americans to part with at least half their incomes for housing alone and have transfered maintenance and other rental externalities onto the renter via bought and paid for legislation. What extent these firms could globalize is hard to say, but the interstate commerce clause would allow them to take over the American housing market.

20   clambo   2011 Nov 20, 1:05pm  

It's a fine idea, except that people are ALREADY on strike, except for some suckers, rich (who can afford it) and foreign buyers.
I agree with your points.
* No government mortgage guarantees. So no FHA, Fannie, or Freddie.
* No Federal Reserve printing up money to buy bad mortgages or mortgage bonds.
* No mortgage interest deduction. Canada, Australia, England, etc, all live without it.

21   HydroCabron   2011 Nov 20, 1:14pm  

The idea of a buyer's strike really represents something which many buyers are already doing without organization: not buying, thereby causing prices to fall.

If such a concept as a semi-formal "House Buyer Strike" gains enough traction to do good, it will do so by changing the terms of the debate: what's going on here is unfair, and anyone feeling screwed by the ridiculous prices is right to feel that way. "Strike" is a loaded word, and the right one here.

There is total silence in the media and from Washington as to how unfair this situation is to renters, prospective buyers, and even many owners. The only group getting any love is the poor owner whose "investment" turned out not to be so; for some reason, this particular group is entitled to sympathy when their bad investments fail.

22   Â¥   2011 Nov 20, 2:01pm  

problem with a "buyer's strike" is that you still gotta pay rent.

unless you can handle the standard of living of stone age life.

buying has always been insane, but it's the rent ratchet that has made it pay off in the past.

I don't know where rents are going this decade, it all depends on disposable incomes, plus even larger macro things like energy costs.

23   Â¥   2011 Nov 20, 2:02pm  

futuresmc says

Did anyone think that Bank of America, Citigroup, or JP Morgan Chase would exist in their current form? Ofcourse not. These banks merged and ate up smaller competition globally over three decades to get to be the TBTF banks.

http://motherjones.com/politics/2010/01/bank-merger-history

by 2050 you could very well see rental firms akin to today's big banks that have the ability to compel the majority of Americans to part with at least half their incomes for housing alone and have transfered maintenance and other rental externalities onto the renter via bought and paid for legislation

good point. There was some Japanese investor that was buying up Sacramento SFHs some time ago.

Came to a sticky end, but mebbe the Chinese will try. They can't buy oil, but they can buy rentals. I suspect the apartment complex I was living in this year was purchased by the Chinese, dunno tho, the company on the title was in Boston.

About the Japanese guy:

http://articles.latimes.com/2002/feb/22/local/me-sell22

24   REpro   2011 Nov 20, 2:04pm  


Those that could buy up the quality housing in large enough volume would control the markets

No one is that big.

I think we have some and trend is keep growing.
http://money.cnn.com/galleries/2011/real_estate/1111/gallery.investors/index.html

25   Â¥   2011 Nov 20, 2:07pm  


OK, here are the demands:

* No government mortgage guarantees. So no FHA, Fannie, or Freddie.
* No Federal Reserve printing up money to buy bad mortgages or mortgage bonds.
* No mortgage interest deduction. Canada, Australia, England, etc, all live without it.

* NO RENT-SEEKING PARASITE INVESTORS IN SFHs -- tax the ABSOLUTE SHIT out of SFH rents.

26   Â¥   2011 Nov 20, 2:09pm  

HydroCabron says

Though the mortgage interest deduction is consistent with deductions given to corporate entities on interest expenses

The fix for that is to lose it for SFH investment properties, too.

27   REpro   2011 Nov 20, 2:12pm  

It is possible that behind those vulture investors a banks as a major shareholders. Practically sales foreclosed houses cheap to themselves.

28   Â¥   2011 Nov 20, 2:12pm  

REpro says

Recent hike in rental prices in BA push many tenants to the limit.

http://en.wikipedia.org/wiki/Progress_and_Poverty

29   REpro   2011 Nov 20, 2:20pm  

Bellingham Bill says

Theoretically. But owners enjoy location monopolies, some more than others.

Agree.

30   REpro   2011 Nov 20, 2:34pm  

In a past I found very nice property. Excellent for flip. When I ask one banker about financing, he said, “Form a Corp. and we can join as a partner. There is no restriction for us to join Corp.”

31   Patriot   2011 Nov 20, 2:56pm  

Catchy slogans... Real Estate Revolt!! Real Estate Revolution!! Real Estate Rebellion!!

32   bmwman91   2011 Nov 20, 3:42pm  

I am on board with this. Bellingham Bob has a good point about rent-seekers, and if we were to organize, it would be good to have a demand that includes verbiage that makes it difficult for wealthy folks to become SFH slumlords.

I had started a thread a while back trying to come up with ideas that were actionable. This is a good one, and I am willing to to help out. It would be good to have a professional looking website with a list of demands that most working-class people could find reasonable. So, look at Occupy Oakland's demands, take note of how kooky many of them are, and make sure that this group's demands don't come-off like that. Really, something like this only accomplishes anything if it can amass a huge number of members / petition signers. We would need to gain participation from a significant number of people in the areas with $725k limits to try to make elected scumbags feel anything.

Group name: BADBUY (?)
"Bay Area Dwellings Being Unfairly (appropriate word starting with "Y")"
If someone can think of an appropriate synonym for "inflated" or "manipulated" that starts with a "Y", that would be sweet.

33   Dell   2011 Nov 20, 8:01pm  

Ive been preaching about a buyers strike to all my friends for the past few years. Not only should this happen. It needs to be cast into the media spotlight.

34   ArtimusMaxtor   2011 Nov 20, 8:52pm  

ArtimusMaxtor says

Difference between me and most. I'm not fooled, paper is asswipe. It's the assets that make you rich and they are out there now in a big way. PAPER DETACHES YOU FROM ASSETS. See I can go to the grocery store with a fucking cow asking to trade it for a box of hamburger helper. They won't do it. See my asset has no value theirs does. They have very successfully established the means of trade. They have warehouses full of paper they can print more freely and take anything and everything they want. They take labor and material. With credit and paper. Thats the game.

Do you realize you have only property? That you have nothing that is legal for trade? That you can only trade paper for ANYTHING? That you can't legally publicly trade your property for anything but paper?

Don't site coins thats in the constitution and the US Government coins.

Tender:
the act of tendering; an offer of something for acceptance.
something tendered or offered

That word tender has official, LEGAL, defintion. Sneaky fucking word in my opinion. Why didn't they just use the word TRADE.

Some people know this. They always apply gold as being something that should be traded. However what this means is your property is only this: PROPERTY. Nothing of value to be traded. THATS FUCKED. So anything you obtain, immediatly obtains the status of property with no value. Unless you use the indicated of the Privately owned corporation the Federal Reserve.

To put it clearly the paper, devalues YOUR property to nothing. Your property has no status. Is worth nothing for trade. I guess there are some really clever pricks in this world. Devaluing what you own too nothing, LEGALLY. Means you will probably never really own anything. Working the rest of your life for someone.

35   rubyrae   2011 Nov 20, 9:53pm  

futuresmc says

In my darker moments, I begin to ponder whether this was the plan for the US housing market all through the bubble, setting up the next bubble in rental property, and getting a nice chunk of taxpayer change in the process. What caught them unawares was the global interconnectedness of the housing market and the domino effect of their derivatives.

I'm a bit of a conspiracy buff (by the way conspiracy is no longer theory) In my circles it has been common knowledge for years that one of the major goals of the NWO (New World Order) is to do away with Private Property. It's interesting because in the past 5 years there were quite a lot of eminant domain abuses that have occurred where the Govt has taken choice property from citizens, to give to the private sector (developers) using higher taxation as the reason that they have the right to do so. This is a blatent abuse of that law. They in turn have not given the owners market value. People should have been paying attention back then but that was during the boom when everyone was fat and stupid.

I do believe this entire bubble was staged to accomplish this goal, along with the endless attempts to keep the market prices over inflated, the refusal to lend money and the illegal back door deals.

36   ArtimusMaxtor   2011 Nov 20, 10:02pm  

Look I am addressing the subject of property in general. Not homeowners. There is no such thing as a homeowner. Ask anyone living in a fucking tent.

37   Superjet   2011 Nov 20, 10:38pm  

While I like the idea of not participating in a rigged market,
the reality is that I need shelter. My sister is due in December
and I need to move before I get suckered into changing that
first dirty diaper (I share a rental with my two sisters
and brother in law)
I have already made 3 offers since September and I'm going
to go look at a house today at 10:00.

38   Ignatius Pugg   2011 Nov 20, 10:39pm  

REAL ESTATE IS RIGGED. FREE THE HOUSING MARKET!

39   ArtimusMaxtor   2011 Nov 20, 10:50pm  

They count on the prepetual need for food and shelter. Hey live on. I like occupy. I suspect right now even as we speak. They are devising ways of dividing their movement. Establishing leadership for one part of the division. You ask my opinion. Honestly. It's to no avail.

The bullshit of of them owning everything practically either by outright ownership.

Or as the only ones able to place value on your property. Meaning they benefit from EVERY fucking transaction. Getting much, much more out of ANY transaction than you. Even the transactions you make with your OWN property. Is over.

If you ask me. In my opinion. The deal is done. All thats left to do is watch them as they fall apart as we, laugh, party, sing and dance while it happens. Goodbye greedy

40   Soozy   2011 Nov 20, 11:48pm  

I'm with you, Patrick. The only slogan that comes to mind is Global Jubilee, 2012!

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