patrick.net

I’m sorry but I really don’t understand what you are trying to say? Perhaps you could think a bit more clearly without the pointy white hat obscuring your view. If I’ve offened you in any way Mr. Duke, I apoligize. It’s just that my landlord will confiscate my deposit if another cross gets burned in my front yard.

:lol: :lol: :lol:

Also keep in mind that many of those who say that using a large down payment is “foolish” are: (a) RE industry cheerleaders or (b) convinced that their investments will always return more than they are/will be paying in mortgage interest.

They will probably say, if you can put 60% down for a house, why not put 10% down each for 6 houses?

Seattledude Says:

"With things going up 50, 100k a year in places with no end in sight, are your kids ever going to be able to afford a house someday?"

Yes. Since housing goes up $100K a year forever, it doesn't matter where you get on board or when. You will be rich beyond belief and be able to afford those 72 virgins in no time.

For instance, zero income, 400 FICO score? You can still get a hundred grand loan and buy ten houses with 10k down on each. After a year, you can sell 'em. You WILL make a million and pocket $700k in equity after commissions, taxes, etc.

Here's the math. It's simple: 10 houses X $100k per year equity = $1M
Pay beck the 100k loan & taxes, etc. & pocket 700K.

Next year with the $700k buy 70 houses X $100K appreciation each? Well, you do the math.

You will be a retired billionaire in five years! It's that easy.

The new world order has arrived and we are all financial genius gods!

It's a new miraculous economy that's making the dotcom economy look like child's play.

Nirvana/Utopia/the great buffalo range in the sky/streets paved with gold, etc. is here now!

This is heaven on earth and everyone will be rich rich rich from housing.

Thank God we've found it! Praise the lord...Helleluia!

God bless you all and God bless Tiny Tim. We will all be megamillionaires!

What are your guys thoughts?

Thank God we’ve found it! Praise the lord…Helleluia!

Which God?

Which God you ask? Ha!

THE God: $$$

The one that will liberate us and give us everything we want beyond our wildest imagination as the TRILLIONS roll into your fat bank account.

I plan on retiring a billionaire in five years from housing!

Amazing! Sweet! What a great market!

What in the f are you waiting for Surfer-X? Christmas?

Get out there and buy 20 houses. NOW, damn it!

@taken a mental Holliday,

Dude, I already own 40 houses, shit I just bought Mr. UPs compound (go Voodoo), but I had to fire Pinar as she was stealing tortillas.

Bwahahahaaaaa!

So what's another 20? Shit, just do it!

New thread: Conspiracy Theories

"I am not so sure what will happen if this turns out to be a grand-supercycle top."

We already had that tangent. It started in 1865 ;)

Wow, skip a few days to work, and I missed religion and the cancer of liberalism.

As for Santa Cruz, I miss living there. It's a great place. Too bad the couple that "double downed" by renting out their house and buying mine are gonna go bust. I sure miss Santa Cruz though.

And for Gold Bulls: What a week!

--Deo Vindice

P.S. If Ben drops rates in 2H2006 or 1H2007, Gold is to the moon! (IMNSHO)

Wow, skip a few days to work, and I missed religion and the cancer of liberalism.

DeoVindice, fear not. You'll love the new thread --TRUST ME :mrgreen:

"Would you rather put a large amount down 50- 75% on a home or invest it...I think that it is wise to put a large amount down because you will save a ton of money in interest and you will pay off your house sooner." -- Margie

Margie,
If you ever put down a large downpayment or pre-pay on your mortgage, the simplest way to think of it is that you are essentially locking in an investment of whatever the interest rate is on your mortgage. If you've got a 6.5% 30-year fixed and you pre-pay, each pre-payment is essentially being put into an investment that gives you 6.5% return because otherwise you would be paying 6.5% interest on that amount that you did NOT pre-pay.

So the consideration comes to your own confidence in your own investing accumen or that of your Advisor should you be lucky enough to have found a good one that you trust. You need to be earning returns in excess of 6.5% in the above example or you are losing money to interest expense.

Me personally, I would hedge my bets. I work in financial services so I follow the markets rather closely and am therefore fairly confident in my investing skills. Still, if I had the means I would put down 1/3 on any home purchase. Lock in a decent ROR on that chunk of change and forego some interest expense. I would never put down more than 1/3 because I'd rather be investing that money in other asset classes than just my house. My 2 cents for ya, hope that helps.

Btw, here's a story that came to me about the flooding and Marin home sales:

"I heard from a friend in San Anselmo who is just about to close escrow on her house that a lot of houses in San Anselmo (and I would also guess Fairfax) have fallen out of contract. Buyers just said no way after the flood damage. Can't be good, when volume is clearly down to begin with. I can't imagine Spring will be an easy time to sell around here. "

Good advice SF Renter. That is exactly how I think of it.

Here is an interesting article about how housing has gotten cheaper in most of the nation:

http://tinyurl.com/9pav8

NYT, subscription required.

There is a fascinating herd mentality surrounding the housing market. Does anyone know of any recent, good articles or books on it?

Irrational Exuberance, 2nd Ed. by Robert Shiller has a chapter on it, but most of the book deals with the Dot.com stock bubble. For zillions of links to good bubble articles, check out Patrick's links: http://patrick.net/housing/crash.html#links

You Seattle guys are legendary for talking about how bad Seattle is to Californians.

It rains 400 days out of 365, I have heard it before.

Looks like Seattle home prices about half of what Bay Area prices are:

http://www.dqnews.com/ZIPWA.shtm

The toniest neighborhood is $436/sq ft, less than half Telegraph Hill and the average appears to be about $300, about half of SF prices.

Linda, it would be helpful if you post this in the latest thread. Most people here do not check older threads.

I cannot give financial advice. However, let's look at some numbers:

You owe 300K with a 5.25% mortgage, your monthly interest is only around $1300. You have also locked-in a low property tax rate, thanks to Prop 13. Can you rent a comparable home that costs less than your current total housing expenses?

I would seriously try to look past the equity gain and stay in the house. However, it is a good idea to consult a financial professional before any decision.

Also, do not forget that commission alone is 6% of 700K, which is 42K.

It also really depends on what you are going to do with the 350K - 400K proceeds.

San Francisco’s Housing Market Is Cooling Faster Than Rest of the Region
Written by Kevin Truong
Published Oct. 13, 2022

As home prices across the Bay Area continue to fall from the peaks seen a few months ago, San Francisco’s real estate market has been hit harder than most.

Although median home prices in the Bay Area writ large ticked down in the third quarter, San Francisco saw the single steepest decline of any county at 9%, according to a report from real estate agency Compass. That compared with a 1-2% decline over the same period for the entire region, according to Patrick Carlisle, the Bay Area chief market analyst for Compass.