patrick.net

This is why Patrick is "the man"!

I'd mentioned over at Ben's that the holidays can be a particularly difficult time for bubble sitters (even with their spouses initial blessing!). I've had to weather dour and unpleasant comments like "this is the last Christmas I'll spend in a rental". Typically I dread the holidays anyway but now on our 3rd season in a "rented hovel" and with our in-laws knife catching a half a million dollar "manse" the pressure is acute. Rather than getting support one individual at Ben's described Mrs. DinOR as a "ninny" and implied that our marriage was based on her "other talents". What a classless pig.

Further, one poster implied that he had 'tinkered' with the notion of selling in the summer of 2005 but the expense and hassle just wouldn't be worth it so he's comfortable that his area is "only" down 5%. I guess we'll find out if those that contemplated selling are quite as smarmy as 2007 unfolds.

Thanks for all the great work Patrick!

Ain't that the pits. If we so choose, we could drown ourselves in an oceanic whirlpool of debt. I last owned a California home in the pre bubble days of July '95. The home I sold at 220 now gets listed in the high 700's, but at what price would it get sold for? It comes with sound effects as it is only about 18 blocks north of LAX runways. I can remember my days of packing a carry on bag then walking down and boarding flights. On return I would just walk on home.

I lived in California most all of my life. I've been other places but California is home to me. I don't know if I will ever own a California home of my own again. My timing has not been good and it is difficult for me to feel as if time is on my side.

DinOR,

Sounds like something TxChick would say......he/she has absolutely no class and little intelligence. I've followed his/her comments on the blogs and he/she has:

1) Lived EVERYWHERE
2) Knows EVERYTHING
3) Resents EVERYBODY

You gotta feel sorry for her/him......

Hey DinOR,

Nothing wrong with a wife having "other talents!"

Especially if one of those talents is that she can cook. An attractive women who can provide good home cooked dinners and packed lunches is worth marrying. Nowadays (as for the last 2 decades) if you are dating, I would say it is easier to get a woman to sleep with you that it is to get her to cook you a meal.

I envy no man, who at the end of his work day, heads home to Chez Microwave.

Headset,

It wasn't so much the "other talents" comment that torqued me off but the whole notion that as Randy H says *not* EVERYTHING is really just THAT simple! It's not. In fact that's one of the things that keeps myself and others coming back to the housing blogs! It's infinitely complex and the economic backdrop is constantly changing. The other thing that bent me out of shape is that anyone stooped to a pretty personal level to "out bear" me? That was kind of weird.

Again, just saying "Yeah, I thought my local RE market was overvalued and due for a correction but I decided to stay put b/c of the transaction expense and starting over with a new 30 yr. loan" is pretty simplistic too! For me there were a TON of personal/real life issues that guided our decision to sell also. Making the transition has not been without inconveniences but in the end for anyone to say "I'll just tough it out" (like this has been a "garden variety" bubble) in cases may just be downright ignorant! For anyone that bought "way back" in 2001 to be lecturing ME about the virtues of home ownership is really peeing up a rope.

I just had Christmas dinner w/some dear friends of ours and due to "some" health issues, personal debt and some much needed home maint. they are starting a brand spanking new 30 yr. mortgage! She's in her 50's, he's in his early 60's. Woo-hah! (Trust me, they didn't see themselves in this position either).

Test.

Congratulations Patrick.

May this article be widely copied, quoted, and referenced.

Happy holidays.

George,

Well folks certainly seem to TREAT it like a gub'ment entitlement! Due in large part that areas like FL, LV and SD are well ahead of the rest of the country I'm sure we can expect to see more of this in a neighborhood near you!

Can't sell? No probalo! Just go see Senoir Cardage at Senoir Mortgage and "get a leg up on the pile"!

Owning and Renting,

Sorry to hear about your dad. However welcome back to the NW! (Having a Vancouver residence may be more valuable than you know). Recent changes would allow you to deduct your sales tax against your Fed return.

I recently had a conversation with a friend based on one of Peter P's comments. Peter said (in effect) "ideally you should NEVER sell a home! (Emphasis mine). My friend and I really had a chuckle about some of the starters and fixers we'd owned over the years and found ourselves wondering if hanging on to them wouldn't have been such a bad idea? In a sense it's a form of "dollar cost averaging" b/c they would've been bought in very different years! Where the analogy of course falls apart is when you can't "buy less house" when prices are high!

CB,

Well isn't that interesting! Here in the U.S it doesn't even raise an eyebrow. How can any sane person obligating to a HUGE mortgage in their 40's (let alone their 50's) yet consider themselves on a path to retirement?

How can any sane person obligating to a HUGE mortgage in their 40’s (let alone their 50’s) yet consider themselves on a path to retirement?

Dear Hater,

The path to retirement is paved with 35% y.o.y returns. It only goes up.

Sincerely,

The Center of All Glowing Love

Surfer X,

Pffft! What was I thinking? Of COURSE you're right! Your home IS your retirement! It just keeps giving and giving.

Yes George it is Westchester were 600k won't buy squat. LA's not the place to buy a CA home these days, and southern Florida seems more compelling. So does Atlanta, but that involves facing a significant climatic change. If I am destined to be hot and sticky I might find even better pickings in Thailand or India where state of the art health care is quite accessible to those with USD.

I love the way the WSJ article was so fair and balanced (not).

--Bubble critics are "Renters" (there couldn't be any housing bubble critics out there who own, now could there?).
--Renters "gloat" (pure schadenfreude vs. being right early on and feeling vindicated for it).
--"hard-core renters" Ummm.... I knew I was currently a renter, but I wasn't aware I was of the "hard core" variety. What is that anyhow?
--Portrays home"ownership" as inherently superior to renting: "Of course, as even many hard-core renters acknowledge, homeownership has some big advantages, including tax deductions on mortgage interest, the possibility of gaining value over the long term and the security of knowing you won't be evicted by a capricious landlord." Right, home"owners" can never be evicted for non-payment of mortgage, property taxes, etc.
--Portrays bubble awareness advocates as extremists: "Since last year, Mr. Jackson has maintained a blog (davidlereahwatch.blogspot.com) devoted entirely to vilifying Mr. Lereah." Hmmm... is pointing out that someone is a villain really "vilifying" him, or is it just stating the facts?

But, what can one expect from the WSJ? They are, after all, the flagship of industry cheerleaders and pimps of all stripes.

Interesting foreclosure videos on:

http://www.forsakencraft.com/mainframe.html

Regardless of the circumstances, you gotta feel bad for the kids who have to endure the process.

Among the worst performing markets were Detroit, Boston, Cleveland, San Diego and San Francisco. Seattle and Portland, meanwhile, posted strong annual returns.

For the curious, SF Bay Area is -.4% from Sept./Oct. 2006 (-.1% year to year) according to Case-Shiller index. Bear in mind that that the San Francisco index includes Contra Costa County.

Would the admin kindly delete the troll, it would be happier back over on Craigslist with all its other friend.

As stated over and over again, I will enter into a formal legally binding contract with any troll. Here are the terms, I take out the loan, the troll covers the monthly nut, if after 2 years the "property" goes up, troll gets the cash, if "property" cannot be sold for a profit, troll buys out note and I come out even. Pick your prime SF property asshole.

What say troll? Yeah, as I thought, back to craigslist for you asshole.

George,

Though I'd hate to see one of our blog's most valuable "insiders" leave the biz, it might be in your best interest. Whichever way you decide, I wish you the best of luck and success.

SFWoman Says:

> WSJ always does that or misquotes (my husband
> avoids being interviewed by it and so do a few
> others I know- all have been misquoted and some
> point).

The WSJ is better than most, but it seems like every paper misquotes people (I try and avoid quotes on the record for anyone).

My sister had some friends over for Christmas dinner that grew up in TX. They both moved to Foster City in the late 90’s after grad school and bought crappy condos for about $250K each.

When they got married a few years ago they sold one of the condos and bought a house in Foster City for about $1mm.

Last year they sold the other condo for over $1mm and bought two “investment homes” on the Peninsula for well over a million each.

I just nodded when they said they have noting to worry about since they put 25% down on both homes and Bay Area real estate can’t drop more than 10%...

P.S. None of my posts in the last thread (other than a test) made it through…

Oh, whoops, and troll pays me the current CD yield.

I just nodded when they said they have noting to worry about since they put 25% down on both homes and Bay Area real estate can’t drop more than 10%…

SFWoman, sorry, I am not a finance guy, but isn't that a 10% loss?

I just noticed something. They are building large condo complexes and mid rises all over Orange County. We will have more rental choices in no time! Good luck Donald Trump, king of the condos. The writing is on the wall. When you read about it in the WSJ -- well, you know what they say about that! It's official -- the housing boom is over.

BTW, Patrick, I owned from 99-04, and basically I stashed my payments, so when I sold, got almost the exact amount back. (Not the tax, insurance, repairs, improvements etc.) It was a nice house, but I was constantly broke (house poor) and owed credit cards. I think I would have been better off with money in the bank the whole time. Houses are a money pit. Mine is a sucess story.

George Says:

> I am still looking to buy at the end of the year once
> we are done renting (assuming that the time is right),
> so MLS access and my license would probably be
> worth all the money I would have to shell out until then.
> I may have to take my license to another broker.
> The receptionist tells me the most common call she
> got last week weren’t floor calls about our listings,
> but rather bill collectors wanting to know how why
> the company is past due on several invoices.

I don’t know the laws in FL, but in CA any real estate “agent” (with some experience or a bachelors degree) can take a few (easy) correspondence courses to qualify to sit for the (easy) brokers exam to become a real estate “broker” and do deals on their own (I’ve kept my CA brokers license current since I “retired” from full time brokerage years ago).

HARM wrote:

–Bubble critics are “Renters” (there couldn’t be any housing bubble critics out there who own, now could there?).

Of course I am a bubble critic who owns. We used the "gimmicks" that were available at the peak of the last bubble (1989) and were under water for a long time, with no other options but to ride it out. Only able ride it out because we had to be very frugal for a very long time and also had to be very lucky (like, no income disruptions, no major illnesses, etc.) I didn't know there was a housing bubble when I bought in 1989, didn't know anything about economics then. It was very stupid, and I congratulate you in educating people out of repeating my mistake.

Thanks to the evidence you've made available in your links, I was able to provide ample documentation to a relative who was considering "investing" in real estate in 2005 (for flipping). After he did a lot of reading on his own, starting with your website, he concluded that maybe it wasn't such a good idea. Now, like an ex-smoker or twice born Christian, he's "sharing" what he learned with anyone who will listen.

@CapitalistPig

Yeah, we’re all a bunch of losers for not buying at or near the peak or selling before the peak. Many others were so f*king clever for profiting off of subsidized loans. However, nothing you said changes the fact that the tide is just beginning to reverse and anyone who buys now stands a tremendous chance of being done in. Laugh all you want asshole, but we all know you are here out of fear of losing your money. So thanks for the advice, but no thanks.

@CapitalistPig

Yeah, we’re all a bunch of losers for not buying at or near the peak or selling before the peak. Many others were so f*king clever for profiting off of subsidized loans. However, nothing you said changes the fact that the tide is just beginning to reverse and anyone who buys now stands a tremendous chance of being done in. Laugh all you want asshole, but we all know you are here out of fear of losing your money. So thanks for the advice, but no thanks.

@CapitalistPig

Yeah, we’re all a bunch of losers for not buying at or near the peak or selling before the peak. Many others were so f*king clever for profiting off of subsidized loans. However, nothing you said changes the fact that the tide is just beginning to reverse and anyone who buys now stands a tremendous chance of being done in. Laugh all you want asshole, but we all know you are here out of fear of losing your money. So thanks for the advice, but no thanks.

duh, I meant buying at or near the bottom. Note to self - "never post while angry."

frank,

That aside (for the moment) CP manages to gloss over huge chunks of reality. In re-reading the article I couldn't find much of anything for bulls to celebrate? Rich Toscano moved back to SD in early 2003, welcome to the bottom of the 8th. inning. His buddy, escaped with his life (and some tax free money). If RE is all good, all the time he should have been able to sell at any time of his choosing. That's simply not the case in Sand Dog right now!

What Mr. Smarmy further misinterprets is that for a guy that operates from a small pine table, Patrick sure has built ONE HELL of an audience! Especially when compared to the marketing juggernaut NAR operates. What a doofus.

Again CP (like so many other RE perma-bulls) fails to recognize is that for many years in this country a sharp businessman that stayed at the top of his game longer than even his staunchest supporters thought possible 'might' be lucky to sell the business for 500K when he retires after 30+ years!

(Yet they fail to see any thing out of the ordinary with someone that is late to work twice a week and doesn't own a ladder, walking away w/500K after 2 years?)

Dude, you're not an "investor". You're somebody that could fog a mirror so you got the loan. You're a "homeowner" (for now) and you damn sure ain't no businessman.

SQT,

Always good to hear from you! Sorry to hear about the folks. Especially considering that in order to continue to feed this "boom" we've pretty much rendered our currency worthless. In reviewing my P.I fall back position the scenario has changed quite a bit. The dollar has gone from 55 pesos to the dollar to 48? I'm starting to wonder if there'll be any real currency arb. to take advatage of by the time I'm ready to retire?

Ha Ha Says:

I make 160K per year … my net worth (401K) is 300K …

Jesus H. Christ, here we go again... :roll:
Oh, and speaking of, Merry Christmas everyone!

Ha Ha Says:

I make 160K per year … my net worth (401K) is 300K …
_____

Yawn...

Just go "all in" for godsakes! You can afford it!

;-)

C Pig,

I don't even know what to say. You're a total idiot. Obviously you're new to the game and perhaps reality for that matter. The 20% you claim to have put down in your 1,400 "unit" cookie cutter development is.......gone. You're wiped out. It's over for you. Start liking it.

No dipshit. It's been widely known among those that bother to do their own research that 2006 would only be the start of the re-set. A mere .5 trillion. 2007 with it's 1.5 trillion in ARM/Neg. Am. toxic loans hasn't even started yet. You've just now figured out that there are those among us that aren't mindlessly buying into the hype so this is a recent discovery for you.

In the stock market, we have bulls, and we have bears. In RE (up until now) there have ONLY been bulls! Now w/ Schiller's CME housing futures we'll have a more level playing field. Oh, and you're an idiot.

Oh btw, over at Ben's C Pig claims to have been invested in tech stocks during the tech bubble (but managed to sell out before he sustained any real damage!)

Yet he fails to see ANY similarities here? What C Pig also fails to grasp is that we get clowns just like him from time to time and they ALWAYS deny being a realtwhore. Only once they've been totally demoralized do they own up to it. Start count down in 5 4 3 2 1.......

DinOR,

Stop bothering with our friend CPig. His last post literally sounds like the rantings of a paranoid schizophrenic. There's no arguing with that $hit!

Happy Holidays.

I just came back from a holiday down under, man, it is hard to get back to the cold rainy weather from the sunshine and beaches.

Congrats Patrick for your work, hopefully you are not going to catch a falling knife in the next 3 years. We are just at the beginning of this tide, it will get more and more interesting towards 2009.

PS. the WSJ article is quite biased, perhaps the reporter himself just bought a few investment properties? The reporter could have easily dug out less extreme examples about people who DID manage to sell at the top (2005/2006), and Patrick is not portrayed in a very positive light, if I didn't come to this site regularly and I didn't hold a very negative view of the US economy and the housing market initially, I would have thought of Patrick as a semi-lunatic who is just out for his personal vindication.

Btw, I don't read WSJ any more because I find it offering less insight and less integrity. I consider the Economist a more trustworthy source of information.