patrick.net

Two comments:

1. It would be interesting to chart this over time. It's not really surprising that a lot of people regret having bought a house given the recent collapse. Think of how many people lost their shirt in the downturn...

2. I wonder what the average financial picture was for people who regret having bought a house. Anecdotally most of the people I know who regret their purchase made what I consider a mistake on the front end. So it's not just that it didn't turn out well, it was a bad decision and could have been avoided. (A combination of too much leverage, too high DTI, or too expensive compared to rent...)

FunTime says

When Jennifer Berry, 41,  purchased a home in Grand Rapids, Mich. with her
husband in 2001, they had a simple plan: live there for 10 years or so, cash in
on the equity and upgrade. Thanks to the financial crisis, things didnt quite go
as planned. Her husbands business failed, they separated and she was forced to
sell the home at a loss.

Uh, I believe that's called, Life Happens. The best laid plans of mice and men, and all that noise. If your plans come out, even 70% of the way you figured it, you're doing pretty good. I'd say the majority of us don't do that well, we plan, we strive, we work and life still throws us curve balls. However, most of us wouldn't do real well (or be very happy) if we weren't working towards something.

mmmarvel says

Uh, I believe that's called, Life Happens. The best laid plans of mice and men, and all that noise.

Yeah, these reports tend to get anecdotal. The evidence presented, though, is compelling. Agree with swebb that there are bad decisions there, but what do we do about a situation where everyone agrees that bad decisions are the best decisions?

I also wonder about the willingness of people who make above $100k to admit regret. You're talking a lot of zeros in those cases because people spend relative their income.

FunTime says

also wonder about the willingness of people who make above $100k to admit regret. You're talking a lot of zeros in those cases because people spend relative their income.

I'd say that was a lot of it. After all, Patrick never did respond...
/?p=1213760

Some of these things aren't all that surprising and are things I've observed among friends and acquaintances, and that's not even including the Life Happens stuff being discussed above:

1) buying too small a house -- because they got suckered by real estate agents on the "starter home" concept, they bought a house that made no sense for their life. I know several people who bought tiny 2BR places and now have 2 kids in that space, and it's not going well. A few people bought 1BR condos, which was stupid. The starter home concept is just a way for realtors to increase the number of transactions they churn by putting people into houses that don't actually work for them. It only works when prices are increasing by unsustainable percentages on an annual basis, and you can get out before the bust.

2) waiving inspection -- don't understand the people who did this. They were already overpaying and stretching to buy the place, so they don't have the reserves to fix major problems that could have easily been detected.

3) overpaying -- this is an obvious one. The increasing prices in the Bay Area have helped some people locally a bit on this, but there are still people who are either underwater or effectively underwater (i.e. transaction costs would match or exceed equity). For the over $100K income group, I know people who were forced to sell (moving for a new job) who lost big money. Some of the ones who weren't forced to sell had up to a $400K drop in value.

When you use high debt leverage to acquire any asset, frequently you may regret this decision.

I learned a very long time ago, you can rent almost anywhere.

Can renting suck and is it stressful to look for a place? Of course.

clambo says

When you use high debt leverage to acquire any asset, frequently you may regret this decision.

Phantom money, phantom asset, phantom equity. It's all phantom.

mmmarvel says

However, most of us wouldn't do real well (or be very happy) if we weren't working towards something.

You can't pay me enough to do nothing and shut about it.

I've actually walked off some damn good jobs, in some excellent places.
Because I felt like what I was doing didn't matter. I was being paid to sit at a conference table, listen to a few people analyze and design. Have me start out developing those requirements. Only for it to be groundhog day the next day, and have to do it all over again. Because they kept refactoring the model as they went along.
I design out the full model or have a better idea how the data model will look, before I ever write the first class, table or sproc. The guy even realized I had a greater knack for it, because most of the changes he made. Were made after I pointed out logical dependencies. After he argued with me, and told me I was wrong the whole day.
This went on for three weeks. In the meantime I was being put up in a 5 star hotel, and had all night after 5pm to hang out and have a blast like I was on vacation. I could have literally spent the whole day perusing the bar, and gotten just as much done. Never once stepping foot in the conference room(where I would have been sequestered for a full three months).

And I would have gotten just as much done in those three weeks.

I just couldn't bring my self to spin my wheels day after day, creating classes then remaking them again the next day, and not be able to provide any input on the model. That is really where my Genius lay. The more complex it is, the clearer I see the solution.

bubblesitter says

clambo says

When you use high debt leverage to acquire any asset, frequently you may regret this decision.

Phantom money, phantom asset, phantom equity. It's all phantom.

Everyones chasing the ghost wrt housing as an investment

FunTime says

1 in 4 House Buyers Regret Buying

I'll bet 1 in 4 who purchased stocks in 2007, planning to sell in 2009, also had some regrets.

errc says

bubblesitter says

clambo says

When you use high debt leverage to acquire any asset, frequently you may regret this decision.

Phantom money, phantom asset, phantom equity. It's all phantom.

Everyones chasing the ghost wrt housing as an investment

Exactly!

JH says

I'll bet 1 in 4 who purchased stocks in 2007, planning to sell in 2009, also had some regrets.

Given that short two year window, they would have expected that general result if they'd even picked up and read the first chapter or two in any personal finance book. If you want to get rich quick, good luck.

bubblesitter says

clambo says

When you use high debt leverage to acquire any asset, frequently you may regret this decision.

Phantom money, phantom asset, phantom equity. It's all phantom.

Phantom Menace

It's all Jar Jar's fault.

Meessa gonna flip da houses now.

FunTime says

JH says

I'll bet 1 in 4 who purchased stocks in 2007, planning to sell in 2009, also had some regrets.

Given that short two year window, they would have expected that general result if they'd even picked up and read the first chapter or two in any personal finance book. If you want to get rich quick, good luck.

Ya such books didn't exist (or were ignored) in real estate when she bought her home. Hopefully lesson learned. Yet look at today's prices...

CaptainShuddup says

The more complex it is, the clearer I see the solution.

I might have to PM you at some point. I hope that's okay.

Sure absolutely, if you're not put off my left leaning bubbly personality.

CaptainShuddup says

I've actually walked off some damn good jobs, in some excellent places.

Because I felt like what I was doing didn't matter. I

I have a well paying job that I am bored shitless at, but will stick it our for 6 more months. I am working at a company that acquired mine, and are paying me handsomely, but I don't do much. You have to be really into what you are doing, or the rot sets in.

CaptainShuddup says

Sure absolutely, if you're not put off my left leaning bubbly personality.

Ha! I was raised in the San Francisco bay area. I've seen and heard it all, especially during my decade in Berkeley. Only one experience left me shaking my head. I befriended a dog loving doctor who one day came running up to me at the dog park, visibly shaken. Apparently, some boys were playing with colorful toy water pistols. That's all it took to scare the living daylights out of her. At least I knew what kind of crazy I was dealing with.

They should be regretful if they paid more than 10% of listing price.

HEY YOU says

They should be regretful if they paid more than 10% of listing price.

In my opinion, should be regretful if they paid more than 10% below listing. That is how car sales (new, used, private) work (and cheaper items, too). There is no reason home sales should not be the same. Oh, yeah, I forgot. NRA. I mean, NAR.

CaptainShuddup says

The more complex it is, the clearer I see the solution.

Right....sure.

And then you woke up.

swebb says

Think of how many people lost their shirt in the downturn...

Not enough apparently, because many more are making the same mistake now. How quickly we forget.