This spring will be a local top in bay area prices
invite response
2013 Jan 19, 3:16am 6,696 views 14 comments
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What evidence do you have that Obamacare is leading to higher premiums? You know that insurers now have to spend 85% of their premiums on actual care. They can't just raise their premiums in anticipation of Obamacare, right?
Maybe come January 2015, when Obamacare has been in effect for 1 year, and insurers have a year of data showing higher costs to insure the extra 30 million eligible, can you make that insinuation. Even then, they should have 30 million more subscribers' premiums to balance out any extra costs.
anotheraccount
2013 Jan 19, 3:33am
What evidence do you have that Obamacare is leading to higher premiums?
Waitingtobuy, I should have made that point clearer. We will have Obamacare taxes. Health insurance premiums are rising very fast and I am not necessarily attributing this to ObamaCare. Both developments are taking money out of people's incomes and there will be less to spend on housing.
American in Japan
2013 Jan 19, 9:34am
Can't believe so many irresponsible people (in many cases), can buy again with the backing of the Freddie Mac, FHA, etc. (I.e. the taxpayer).
bmwman91
2013 Jan 19, 10:30am
Can't believe so many irresponsible people (in many cases), can buy again with the backing of the FDA, etc. (I.e. the taxpayer).
Haha, while it would not surprise me if some new government boondoggle got the Food and Drug Administration to pay for housing, I think that you mean FHA!
RentingForHalfTheCost
2013 Jan 19, 1:12pm
Can't believe so many irresponsible people (in many cases), can buy again with the backing of the Freddie Mac, FHA, etc. (I.e. the taxpayer).
I agree. People never learn I guess. Overpay in 2007 and be eager to overpay again in 2013. Idiots that will need taxpayers help again soon enough. A house is a shelter, not an investment.
anotheraccount
2013 Jan 19, 1:49pm
I agree. People never learn I guess. Overpay in 2007 and be eager to overpay again in 2013.
That's very true. Anyone who just went through bankruptcy in 2008-2012 should learn to save 100K first before even thinking about buying a house.
REpro
2013 Jan 19, 2:20pm
If someone wishes to give a seller extra 10% or more, let him do it. He also should go to a car dealer and offer 10% above asking price because is low inventory on parking lot.
That’s like dot.com time, where people pay more and more for stocks, which had $0.00 income.
Do now more expensive houses a better in quality then 6 months ago, or maybe spontaneously they grew in sizes, or transplanted themselves to better location, or we hit sudden 10% inflation, or salary went 10% up. Current buyers should ask themselves those questions before make stupid decision.
bmwman91
2013 Jan 19, 2:37pm
Current buyers should ask themselves those questions before make stupid decision.
BUT BUT I HAVE TO BUY NOW OR BE PRICED OUT FOREVER!!!!111one
bmwman91
2013 Jan 19, 5:56pm
If they got foreclosed on, they didn't get any tax payer help
Sure they did. They didn't have to pay income tax on the difference between the government-backed debt they discharged and the market value of their house. This also applies to a similar degree to privately-backed debt that was discharged because those private entities got tens of billions of dollars in bail-outs.
With the government backing 90%+ of loans right now, you can bet that they are well on their way to shredding the tax payers' anuses once again.
RentingForHalfTheCost
2013 Jan 19, 11:33pm
Current buyers should ask themselves those questions before make stupid decision.
BUT BUT I HAVE TO BUY NOW OR BE PRICED OUT FOREVER!!!!111one
Only if your salary doesn't track to the average salary inflation. I have a strong belief in myself that I will perform better than the averages, so each day houses get cheaper to me. Sure, a bubble will make it not seem that way, but bubbles are temporary remember. Just need to bring a pin to the party. ;)
lostand confused
2013 Jan 19, 11:49pm
Sure they did. They didn't have to pay income tax on the difference between the
government-backed debt they discharged and the market value of their house.
That and the folks who lived in their house for a few years without paying a single penny.
anotheraccount
2013 Jan 20, 2:20am
I have to give it to the bulls that many of their arguments make sense. However, we just had fall/winter where prices rose instead of fallen seasonally. Plus the 5% I am putting on top of it or whatever the run up is in the spring. So I think that's significant. At that point lower interest rates will be baked into the price and demand will fizzle out.
As I said many times I am not really interested in cheap houses below 750K. So I will be paying attention to the market above that.
Sure they did. They didn't have to pay income tax on the difference between the
government-backed debt they discharged and the market value of their house.
That and the folks who lived in their house for a few years without paying a single penny.
That's not the people's fault, but it's the lenders and the laws and regulations of our government.
OH SURE...let's abdicate personal responsibility.
You have no qualms about gambling with taxpayer money so I'm not surprised you feel that way.
As I've mentioned in my posts before, I believe that the move in bay area housing has been driven primarily by interest rates and not by jobs. Tech jobs were already booming in 2010, yet we did not see a significant move in prices.
As loan interest rates are staying at August/September 2012 lows and stock market at 5 year high, I expect housing prices to rise another 5% from here and form a local top for next three to five years. By summer 2013, buyers will be out of ammunition and there are/will be headwinds that most people have not really priced in:
- Any small rise in rates would be very negative for housing activity.
- As people are buying houses, rents are starting to drop. Archstone in Dublin is now offering $750 in incentives on top of prices that are lower than last year. This reminds me of 2004-2005 where they had to provide incentives for people to just move in with $0 deposit. I believe places like Archstone are the leaders and smaller landlords will follow.
- higher California income tax on incomes above 250K
- ObamaCare taxes
- much higher health premiums that employers are starting to pass on to employees as higher co-pays or reduced compensation
- higher payroll taxes - this one is significant. For a family making 160K, it translates to an entire monthly payment on a 700K loan.
#housing