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Fitch Warns Of Housing Bubble, Says Houses Overvalued


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2014 Mar 12, 5:35am   11,170 views  26 comments

by jojo   ➕follow (2)   💰tip   ignore  

http://www.zerohedge.com/news/2013-11-06/fitch-warns-housing-bubble-says-unsustainable-jump-leaves-home-prices-17-overvalued

Since the peak in early 2007, risk has been declining for newly originated loans as the bubble unwound and prices reverted towards historic averages. On the back of the abrupt price rises across the country and interest rate rises which are expected to limit prepayment speeds for the next several years, the NRI has now increased.

#housing

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1   ttsmyf   2014 Mar 12, 7:31am  

Here's my latest, for 2013 Q4. A 20% drop ...
http://www.showrealhist.com/RD_RJShomes_PSav.html

2   Smallblock57   2014 Mar 12, 8:30am  

APOCALYPSEFUCKisShostikovitch says

Fitch?

There's irony - and then there's hannibal lector shouting down jeffry dahmer for bad table manners.

LOL!!

3   Zakrajshek   2014 Mar 14, 12:46am  

Humans, supposedly the smartest animal, are the only species that I know of who must pay rent or purchase land on which to live. For most if not all people, they will pay someone for every night they sleep on this earth. And if you don't or can't, you are scorned and considered a bum, homeless, a hobo. Yet the earth was given to us all, for free, like the air and water. It would be funny if it wasn't such a total rip-off. How'd that middleman get in there? Oh, they always seem to find a way to fleece people for anything they need. The whole rent or own land thing is nothing but another scam, and it maybe the biggest scam of all.

4   John Bailo   2014 Mar 14, 1:11am  

ttsmyf says

A 20% drop ..

Agree

5   New Renter   2014 Mar 14, 2:50am  

Call it Crazy says

Zakrajshek says

How'd that middleman get in there? Oh, they always seem to find a way to fleece people for anything they need.

When they start charging you for the air you're breathing, watch out!!!!

6   New Renter   2014 Mar 14, 2:57am  

Zakrajshek says

Humans, supposedly the smartest animal, are the only species that I know of who must pay rent or purchase land on which to live. For most if not all people, they will pay someone for every night they sleep on this earth. And if you don't or can't, you are scorned and considered a bum, homeless, a hobo. Yet the earth was given to us all, for free, like the air and water. It would be funny if it wasn't such a total rip-off. How'd that middleman get in there? Oh, they always seem to find a way to fleece people for anything they need. The whole rent or own land thing is nothing but another scam, and it maybe the biggest scam of all.

Most non-human creatures live in constant fear of being eaten. What you are paying for is peace of mind.

Don't believe me? Try living as a wild man in Alaska, the Amazon, Australian outback, places like that. You can make all the shelter you want for free, get free food, free water, free everything at least as far as money; however, that lifestyle will be a LOT more expensive in time and stress than paying for modest housing.

You will also most likely die in short order.

7   Indiana Jones   2014 Mar 14, 4:02am  

New Renter says

Don't believe me? Try living as a wild man in Alaska, the Amazon, Australian outback, places like that. You can make all the shelter you want for free, get free food, free water, free everything at least as far as money; however, that lifestyle will be a LOT more expensive in time and stress than paying for modest housing.

You will also most likely die in short order.

One doesn't live out in the wilderness alone. One lives in small, intentional and cooperative communities. Animals will stay away, for the most part, and you can live a long and healthy life.

For example: Native Americans (at least in California), spent WAY less time "working" everyday than we do. They had a simple lifestyle, yes, but they were healthy and connected to their community. And they understood NO ONE OWNED THE LAND.

Why is there a need for these large, dirty, dehumanizing and dangerous cities where you spend your days working hard to pay your rent or mortgage, and for basic necessities, while the ownership class has the option to live the life of pleasure and leisure? Although I am sure there is a somewhat natural inclination for people to come together in locales, it seems like the modern city has been semi-orchestrated to benefit the Owner class to use the Masses for cheap labor and for control purposes, ultimately.

8   Strategist   2014 Mar 14, 4:06am  

New Renter says

Most non-human creatures live in constant fear of being eaten. What you are paying for is peace of mind.

Don't believe me? Try living as a wild man in Alaska, the Amazon, Australian outback, places like that. You can make all the shelter you want for free, get free food, free water, free everything at least as far as money; however, that lifestyle will be a LOT more expensive in time and stress than paying for modest housing.

You will also most likely die in short order.

And no Patrick.net.
That's would be real torture.

9   New Renter   2014 Mar 14, 7:48am  

Regarding the paradise that was the pre-Columbian americas:

The average lifespan in the healthiest societies was about 35 years with very few living past 50. Most societies likely suffered from malnutrition, high infant mortality and warfare

http://www.nytimes.com/2002/10/29/science/don-t-blame-columbus-for-all-the-indians-ills.html

http://www.hist.umn.edu/~rmccaa/laphb/27fall97/laphb272.htm

Most of the evidence for this is based on analysis of pre columbian skeletal remains which does not cataloug a wide range of diseases which the native population likely suffered from.

Slavery was also a domestic industry in the precolumbian americas:

Indigenous enslavement of indigenous peoples

In Pre-Columbian Mesoamerica the most common forms of slavery were those of prisoners of war and debtors. People unable to pay back a debt could be sentenced to work as a slave to the person owed until the debt was worked off. [citation needed] Slavery was not usually hereditary; children of slaves were born free.

Most victims of human sacrifice were prisoners of war or slaves.

http://www.wikipedia.org/wiki/Slavery_among_the_indigenous_peoples_of_the_Americas

10   Indiana Jones   2014 Mar 14, 9:00am  

"1500 - 1800 A.D. From the 1500s to around the year 1800, life expectancy throughout Europe hovered between the ages of 30 and 40. "

http://longevity.about.com/od/longevitystatsandnumbers/a/Longevity-Throughout-History.htm

The Native American slavery was very different than European-style slavery of Africans.
From: http://en.wikipedia.org/wiki/Slavery_among_Native_Americans_in_the_United_States

"Many Native American tribes practiced some form of slavery before the European introduction of African slavery into North America; but none exploited slave labor on a large scale.[2]

Native American groups often enslaved war captives whom they primarily used for small-scale labor.[2] Some, however, were used in ritual sacrifice.[2] While little is known, there is little evidence that the slaveholders considered the slaves as racially inferior; they came from other Native American tribes and were casualties of war.[2] Native Americans did not buy and sell captives in the pre-colonial era, although they sometimes exchanged enslaved individuals with other tribes in peace gestures or in exchange for redeeming their own members.[2] The word "slave" may not accurately apply to such captive people.[2] Most of these so-called Native American slaves tended to live on the fringes of Native American society and were slowly integrated into the tribe.[2]

In many cases, new tribes adopted captives to replace warriors killed during a raid.[2] Warrior captives were sometimes made to undergo ritual mutilation or torture that could end in death as part of a grief ritual for relatives slain in battle.[2] Some Native Americans would cut off one foot of captives to keep them from running away. Others allowed enslaved male captives to marry the widows of slain husbands.[2] The Creek, who engaged in this practice and had a matrilineal system, treated children born of slaves and Creek women as full members of their mothers' clans and of the tribe, as property and hereditary leadership passed through the maternal line. The children did not have slave status.[2] More typically, tribes took women and children for captives for adoption, as they tended to adapt more easily into new ways.

Several tribes held captives as hostages for payment.[2] Various tribes also practiced debt slavery or imposed slavery on tribal members who had committed crimes; full tribal status would be restored as the enslaved worked off their obligations to the tribal society.[2] Other slave-owning tribes of North America included Comanche of Texas, the Creek of Georgia; the fishing societies, such as the Yurok, who lived in Northern California; the Pawnee, and the Klamath.[3]"

11   New Renter   2014 Mar 14, 9:15am  

Yep, life everywhere else in the world sucked too, that is unless you were a member of the aristocracy. Even then you had to worry about war and rebellion, as well as heavy metal poisoning from the fashions of the day:

http://www.nbcnews.com/id/22546056/ns/health/t/suffering-beauty-has-ancient-roots/

http://corrosion-doctors.org/Elements-Toxic/Mercury-mad-hatter.htm

12   Indiana Jones   2014 Mar 14, 9:46am  

New Renter says

Yep, life everywhere else in the world sucked too, that is unless you were a member of the aristocracy. Even

So then it wasn't because the Natives were living out in the wilderness that they had shorter lifespans; it was generally the expected lifespan of people throughout the world during those times.

Living in smaller, intentional and cooperative communities close to nature in our current day and age does not mean we will all die a mid-life death. We now have widespread knowledge of health, hygiene, nutrition and importantly, antibiotics. We have vaccines and knowledge of modern surgical techniques, as well as herbal and traditional medicinal knowledge from around the world.

Our large cities could be decentralized and smaller neighborhoods/communities/villages could be created where work is close. It'd be the end of commuting!

All people in the community have vital function as they are contributing on some level to the good of the whole community. Trade can be through barter, new monetary system, electronic, or??

Technology welcomed! But used for the betterment of all humans, not enslavement.

See:
http://www.pcworld.com/article/2108320/california-police-criticized-for-stingray-cellphone-trackers.html

There is so much space in this beautiful country, why do we need to be packed like sardines into these metro areas, competing for resources, when our living situations could be constructed so differently?

13   New Renter   2014 Mar 15, 2:58am  

I agree with this.

Still I would have grave concerns regarding the long term prospects of some extreme types of small communities.

Anecdotal Hollywood example - I watched Easy Rider for the first time a year or so ago. I was struck by the scene where Peter Fonda and Denis Hopper visit the hippie commune and are impressed with the free love and communal lifestyle. As the riders leave Fonda looks over the valley at sunrise and states" They're gonna make it".

All I could think was:

Oh Hell no!

One harsh winter, one epidemic, one person who realizes they are doing more work than anyone else or worse one charismatic leader turned brutal dictator is all it would take to turn that little paradise to a living hell.

As a real world example there is a documentary Happy People about a tiny isolated community living in Siberia.

http://documentaries.about.com/od/revie2/fr/Happy-People-A-Year-In-The-Taiga-Movie-Review.htm

These people are snowed in for most of the year and have almost no contact with the rest of the world. They are on their own. Throughout the winter they travel hundreds of miles along their territory setting and checking traps, fishing, fighting off marauding bears and extreme cold, repairing their tiny hunting cabins as necessary, it's not an easy life. At least the people get to ride snowmobiles, their hunting dogs have to RUN those distances through the fallen snow

The community pays for what little they need from the outside (medicine, gas, snowmobile parts, etc) with furs but the exchange rate gets worse every year. That way of life is very hard and is slowly dying. Yet they are "happy". I doubt most westerners who have not grown up with that kind of lifestyle would be so happy.

These are extreme cases, not the norm. Still it can be illustrative to look at the other end of the spectrum to find the middle ground.

I think what you are proposing is for large companies, especially large companies like banks, software producers, insurance companies etc. to delocalize - set up satellite locations networked into the company but physically located in outer lying areas. Why do Oracle, Facebook, LinkedIn, Yahoo, Google, EBay and all those companies even have giant headquarters? Unless your employees job requires a physical presence there is no pressing need for them to squander up to four hours a day commuting. Set up a satellite facility in a lower COLA and let your employees spend their commuting time at home instead. Even better revisit working from home. As long as your employees meet their goals who cares if they do it in only 4 hrs a day?

14   Zakrajshek   2014 Mar 16, 1:49am  

Face it folks. Probably a good half to three quarters of the work we do goes to the elites. They throw you a quarter of your productivity to scrape by on. "Renter" loves to pay his rent for his peace of mind. He believes we'd all be killed by lions if we don't pay that landlord at least $2k per month. What you're really paying for is your landlord's peace of mind. We don't have to return to caveman days to get rid of the landlord barons. Just kick them out of business and take back our earth. Renting and owning land on the earth that was given to all of us for free is a scam.

15   New Renter   2014 Mar 16, 2:31am  

Zakrajshek says

He believes we'd all be killed by lions if we don't pay that landlord at least $2k per month.

Bears, not lions. There's a reason we have a bear on our state flag. Its a reminder to pay the rent.

16   Reality   2014 Mar 16, 4:07am  

Zakrajshek says

Face it folks. Probably a good half to three quarters of the work we do goes to the elites. They throw you a quarter of your productivity to scrape by on. "Renter" loves to pay his rent for his peace of mind. He believes we'd all be killed by lions if we don't pay that landlord at least $2k per month. What you're really paying for is your landlord's peace of mind. We don't have to return to caveman days to get rid of the landlord barons. Just kick them out of business and take back our earth. Renting and owning land on the earth that was given to all of us for free is a scam.

Do you then go into the grocery store or restaurants, and eat their food then refuse to pay for it? After all, most foods are nothing more than plants incorporating solar energy while taking water and mineral from the land (and animals transforming that energy up the food chain).

If you fancy sleeping on raw land, you can help yourself to national parks, the part away from the beaten trail and roads so you are not using improvements there either and the ranger patrols can't even find you. In almost all houses, most of what you enjoy is not raw land, but improvements, convenience and security.

Of course people are free to find housing in areas away from expensive urban areas. There are plenty housing stock of all stripes, especially away from urban areas. People who decide to live in expensive areas, just like people who decide to sit down at expensive gourmet restaurants, are choosing to consume expensive service at their own volition. Live with the consequences of your own choices.

17   Indiana Jones   2014 Mar 16, 9:30am  

This is not about wanting to live in a rural vs. urban area. This is not about jobs. This is not about satellite offices. It isn't even about how efficient it is for us to live in the urban jungle like a can of anchovies. (Efficient for whom?) This is about changing the fundamentals of how our society is based on the corporation based superstructure of population densities, locations and practices.

New Renter, I agree that if an individual goes off into the wilderness and tries to make it alone, it is extremely difficult. Even those tribes in the Taiga have it hard, as they are attempting to exist within and trade with a society that operates on a completely different system. Why would people in our technologically savvy world want the Taiga fur when we can order a fur coat on Ebay for much less?

I agree that modern technological communication renders it unnecessary in many instances for us to be physically present to get our work done, to corroborate or work on a team.

An analogy: Let's take what we humans do with wild animals. We put them on "sanctuaries", in confined spaces -- think Africa. These animals used to be able to roam anywhere they pleased. Now, if they do, either there is an electric fence to stop them or they will get hunted or poached. Sure, they can leave, but what happens when they do? Life gets dangerous and risky. Also, the "owners" get to make $$ when Safari tours come through by the busload.

We are also being encouraged into "sanctuaries". For humans, we call them cities. Like animals, we are much easier to control in these confined areas. This creates convenience for the corporations to have workers housed nearby. It also creates scarcity in the population, because the closer one gets to the jobs, the more competition there is for resources. When one is in the belief system of scarcity, control is easy. And who "owns" the resources of the cities? Hmnn... Oh yes, the corporate class! The elite rich! Not only do they have us fighting each other for jobs and resources, they also make money off of us by owning the land (shelter) and the company store (food, clothing).

18   Indiana Jones   2014 Mar 16, 10:12am  

New Renter says

Still I would have grave concerns regarding the long term prospects of some extreme types of small communities.

Anecdotal Hollywood example - I watched Easy Rider for the first time a year or so ago. I was struck by the scene where Peter Fonda and Denis Hopper visit the hippie commune and are impressed with the free love and communal lifestyle. As the riders leave Fonda looks over the valley at sunrise and states" They're gonna make it".

All I could think was:

Oh Hell no!

One harsh winter, one epidemic, one person who realizes they are doing more work than anyone else or worse one charismatic leader turned brutal dictator is all it would take to turn that little paradise to a living hell.

What I am talking about is intentional living based on human needs vs corporate needs. Community needs vs. Elite needs. Living in smaller communities, technologically capable, organized for productivity to benefit the community and individuals, not to benefit a corporation. This is a major change in thinking. Much of what benefits and is useful in the corporate structure would become obsolete, eg. advertising. This is not communism. Don't look up intentional community on wikipedia, because this is not what I mean. No hippie-dippy, no spiritualism, no cult leader.

The community is organized in a structure where no one single person is in charge, and there is a series of checks and balances so it is impossible for one charismatic individual or group to take power. This presents the largest hurdle, which is eliminating the threat of the psychopaths/sociopaths and even narcissists that are now roaming freely in our world. Currently, a huge percentage of the non-local government (as well as the corporate elites) are full of sociopaths and narcissists. Power, selfishness and greed define these beings. The use of fear, control, violence, manipulation, usury, and enslavement are merely tools to get them what they want. Once these people are safely tucked away and out of the picture, the people who actually care about themselves, about their families, about their grandchildren, and about the future of humankind can get about the business of leading a life based on the needs and wants of humans.

Your "job" will be what you can do to contribute to the community. Why? Because you care about yourself and want the best for yourself and by extension, for others. What are your talents and gifts? Everyone can contribute and do what they enjoy. Men and women are different, yet equal in power and contribution, whether spending their days taking care of children, running a restaurant or creating computer software.

We have all taken a mega-dose of the corporate kool-aid about what is possible for humans and our world. I don't have all the intricate answers for all steps of this -- how people are compensated, how the economy is structured, etc. but this is food for thought about how THINGS CAN BE DIFFERENT.

19   Indiana Jones   2014 Mar 16, 10:14am  

jojo says

@indiana

Im not on board with your thesis. Have a look here:

http://en.m.wikipedia.org/wiki/740_Park_Avenue

How does this fit with what you are saying?

Please explain your questioning in relation to this building.

Okay, I think I get it. These billionaires have many residences. You don't honestly think this is their only home? I am sure this building is convenient for these elites when they need to be in the city to ensure their "own and control" paradigm. They can spend time soaking up the city vibe, eating at lavish restaurants, getting driven around by their limo driver and when they are done ensuring their power and money they are off of their private jet to their favorite villa in Spain or carribean island.

20   Indiana Jones   2014 Mar 16, 10:35am  

bgamall4 says

Well, Indiana Jones is a Utopian.

Thanks for getting that out there straight away. We are headed for a dystopia unless we switch gears and start to head for an utopia.

Please don't group me with Zionist. Zionist are not utopians. They call themselves that to make themselves feel better. They are akin to Emperor Palpatine talking to Anakin Skywalker:

"Once more, the Sith will rule the galaxy. And, we shall have peace".

21   New Renter   2014 Mar 16, 10:38am  

Indiana Jones says

What I am talking about is intentional living based on human needs vs corporate needs. Community needs vs. Elite needs. Living in smaller communities, technologically capable, organized for productivity to benefit the community and individuals, not to benefit a corporation. This is a major change in thinking. Much of what benefits and is useful in the corporate structure would become obsolete, eg. advertising. This is not communism. Don't look up intentional community on wikipedia, because this is not what I mean. No hippie-dippy, no spiritualism, no cult leader.

It sounds like you are describing a - bgmall4 - cover your ears - Kibbutz:

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

I met someone who had grown up on one in Israel. He had good things to say about it.

22   FortWayne   2014 Mar 16, 10:39am  

I just read another article about "Adjustable Mortgages" popping up. It's a sign that affordably is gone, and banks know it. Surprisingly it's still easy to sucker people into "adjustable" rates... so I guess "you can't teach stupid".

23   turtledove   2014 Mar 16, 11:02am  

New Renter says

life everywhere else in the world sucked too, that is unless you were a member of the aristocracy.

And a man.

24   Indiana Jones   2014 Mar 16, 11:03am  

From wikipedia:

"With time, the kibbutz members' sense of identification with the kibbutz and its goals decreased. This process originated both from personal frustrations among the kibbutz members as a result of internal processes and from the growing stratification and inequality due to the growth of capitalistic practices.[13] Over the years, some kibbutz members established professional careers outside the kibbutz, accumulating power, privileges and prestige.[14] The balance between individual values and values of the kibbutz began to tip, and work motivation was affected. An emphasis was placed on social compensation to encourage productivity."

Basically, the kibbutz was destroyed because capitalism still exists. Like the example of the Tiaga above, a utopian concept implemented within the larger context of a capitalistic society is doomed for failure.

25   New Renter   2014 Mar 16, 12:18pm  

turtledove says

New Renter says

life everywhere else in the world sucked too, that is unless you were a member of the aristocracy.

And a man.

There were a few exceptions:

26   New Renter   2014 Mar 16, 12:20pm  

Indiana Jones says

From wikipedia:

"With time, the kibbutz members' sense of identification with the kibbutz and its goals decreased. This process originated both from personal frustrations among the kibbutz members as a result of internal processes and from the growing stratification and inequality due to the growth of capitalistic practices.[13] Over the years, some kibbutz members established professional careers outside the kibbutz, accumulating power, privileges and prestige.[14] The balance between individual values and values of the kibbutz began to tip, and work motivation was affected. An emphasis was placed on social compensation to encourage productivity."

Basically, the kibbutz was destroyed because capitalism still exists. Like the example of the Tiaga above, a utopian concept implemented within the larger context of a capitalistic society is doomed for failure.

An imperfect model - learn from what happened there and try to improve on it.

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