patrick.net

I guess if it is going to be a crash, the Patrickists would believe that these values are perhaps on the high end - more like sub $500K in SF and sub $400K in Bay Area?

Why are these number unbelievable? They were even lower a few years back when there were more jobs in the area?

"I’m glad you admitted your mistake that you were off. I know a lot of people who confuse 10 basis points to mean .01, instead of .1 of 1%." --HITMAN

What are you saying? A basis point is NOT 1/10 of 1%, it IS 1/100 of 1%. That would be 0.01. Because 0.01 X 100 = 1.0. That's why a basis point is 1/100 of 1%. Documentation:

http://www.investopedia.com/terms/b/basispoint.asp

That's why I said this before:

"The yield on the 10-year bond was 4.39% last week, and closed at 4.52% yesterday:
http://finance.yahoo.com/bonds/composite_bond_rates
That’s 13 basis points in a week. If I am wrong as to the exact day of the move, oh well."

And I'm not admitting a mistake, because that is a correct statement. So what are you saying again?

"One needs a fews years of experience in finance to be granted the CFA charter though. Since I am in Tech, should I set myself up as a independent broker? Does that count? I may need that to take some series X exams anyway." --Peter P

Peter, what I currently do is work for a software company that creates and supports financial management software. A Lot of back-office management type stuff, portfolio reporting, allocation modeling, billing, etc. Finance and tech are industry sectors that are co-dependant these days. I would recommend that you leverage your tech knowledge along with your CFA studies and first make the move over to a tech company that specialized in financial software, perhaps a 401K plan administrator or some such, they all have web portals nowadays. This will begin to fulfill the finance experience you need for your Charter. If your designing or supporting financial applications, that counts.

1. Natural supply restrictions - I know that theoretically the space market has no bounds

Think Japan. Any supply restriction would have been discounted by the market long time ago. It does not explain price actions.

2. Willingness of people to (continue to) pay a disporportionately high percentage of their income toward deeded property (not renting) - call ‘the pride of homeownership’

Willingness? People base their decision only on price action. When the market stops shooting up (like now), this willingness will be gone. The sheeple effect can easily reverse. When the market is heading down, we will be talking about people's unwillingness to hold a depreciating asset despite mortgages being cheaper than rent.

3. The income is not going away here and it does trickle down. Talk to commercial realtors - it is net office absorption - these are jobs. We are long passed bottom in SF.

We are past bottom. But housing prices never adjusted back to the fundamentals after the bust because Greenspam delayed the inevitable.

Do you even understand concepts like bubbles, trends, and reflexivity?

…and it is no doubt fanciful to think about being able to buy real estate in northern California at such levels

No it is NOT fanciful. LESS people will qualify for mortgages and EVEN LESS will want to buy that those prices.

Imagine what the economy will be like.

Honestly, I much rather have income and rent catch up to those prices.

The problem (for those praying for a 30%-40% correction) is that you are in the heart of America’s economic engine.

Everybody says that.

If you say that Texas in the engine, I would probably agree. Silly Valley in the People's Republic of California !? No way.

"2. Willingness of people to (continue to) pay a disporportionately high percentage of their income toward deeded property (not renting) - call ‘the pride of homeownership’ a psychological error or model for its value..."

This one I would bet against continuing indefinitely. I fully agree that there is currently a deep-seated psychological bias toward owning in this country. But psychology has been proven to shift dramatically in the past; very evident in past historical bubbles. It is quite true that psychology and the desire to own has been fueling the increase in RE values, but this psychology will have a tipping point. It is not possible or probable that people will continue to pay a higher and higher percentage of their disposable income on housing. On the contrary, more and more of them are realizing even now how much money they can save and invest by NOT buying at current prices, as evidenced by national median home price declines and inventory increases over the past three months. A large downpayment on a future home may indeed be their pre-eminent savings goal, but now that prices are dropping it is doubtfull that the majority will be so quick to jump right in to the market. It is simply not possible for a the value of housing to continue to increase indefinitely (even if people continue to psychologically desire it), especially when real wages have been in decline.

Peter, what I currently do is work for a software company that creates and supports financial management software. A Lot of back-office management type stuff, portfolio reporting, allocation modeling, billing, etc. Finance and tech are industry sectors that are co-dependant these days. I would recommend that you leverage your tech knowledge along with your CFA studies and first make the move over to a tech company that specialized in financial software, perhaps a 401K plan administrator or some such, they all have web portals nowadays. This will begin to fulfill the finance experience you need for your Charter. If your designing or supporting financial applications, that counts.

Thanks SFRenter! :)

When did you register for the charter program? I just registered last month.

I thought you can use financial software development as experience only if you had registered before 2005 or so. I will check. Thanks!

(I used to work on some financial reporting tools, not sure if it counts)

Not that I hate the Bay Area, it is just that I am sick of people describing it as _the_ land of honey and bread.

Not that I hate the Bay Area, it is just that I am sick of people describing it as _the_ land of honey and bread.

Compared to where I started out this ride, the BA is the promised land.

Compared to where I started out this ride, the BA is the promised land.

I agree that it is a nice place with good weather (cannot stand humidity) and good opportunities. But heart of America’s economic engine? That is too much.

Also, why is California collecting state income tax AND sales tax?

Also, Bay Area has good food. I agree.

Also, one can enjoy everything the Bay Area can offering being a renter.

San Francisco RENTER Says:

“Remember, most talented individuals who work at the top banks and money management firms finish by 25.” –HITMAN

Keep it coming you motherfucker. I studied for 2 hours last night and I will study for 3 tonight after getting this motivation from you. Keep it coming.

Ha, ha, haa!
Yes! Passion! Fire up the grill!
San Fran Renter knows the American way: use anger as motivation!
Blaze a new trail!
One is never too old!

Hitman is just making San Fran train harder...

I agree that it is a nice place with good weather (cannot stand humidity) and good opportunities. But heart of America’s economic engine? That is too much.

Does America have an economic engine anymore?

seattledude Says:

January 31st, 2006 at 3:25 pm

HITMAN- you said: So now we have, no change in real estates, rising employment, and rising wages. Tell me why you think the market is going to crash again?

Dude employment is not rising and neither are wages. Wages of CEO’s maybe but not the rest of us, so i don’t know what you’re talking about.
Besides people who are already rich or CEOs that are rich, rich people in general don’t have mortgages.

11 permanent employees lost their job in my office today at Honeywell.
I'm a temp, but feel sad for them.

Other jobs have gone to Mexico and India, according to my manager.

Great economy: Honeywell's profits are over a billion and US jobs are being cut or outsourced.

This is reality!

So fuck you, fuck you, fuck you. You’re a jerk and I can swear like a sailor right along with the rest of you.

Huh?

I suffer from catatonic tourette syndrome. Only my manifestation of that disease causes me to obsessivly utter words like "uncorrelated", "in real terms" and "econometric".

Hi All,
Been a while.

I Guess one of the benefits of inventory run up will be that RE agents won't be knocking on my door to see if I want to sell...

Do miss that though as I used to have fun trying to sell the landlords property :)

It will be very hard for the RE crowd to put positive spin on data if there is no data released to the media.

I give up. Can’t anybody here understand I was just trying to inject a little humor earlier? I am getting the point that I don’t belong here, so I’ll leave.

Please visit our "Huh?" thread before you decide. ;)

I’m tired of being the big bad homeowner and getting bashed on this board for nothing. I also apologize to everyone for my uncalled for reaction earlier.

Actually, many on this broad are homeowners. In the last "blog party", I was pretty much the only renter there. :)

We certainly do not bash homeowners.

…. ummmm …… is it wrong that reading the last lines of Linda’s post turned me on a little??

Huh?

The song does not make much sense, but the words go something like ‘Don’t worry, if you were a troll I would delete your comments’ and “we just want comments that respect other commentors’.

I said these words, but...

1) I do not own this current thread, it is up to the threadmaster to decide
2) We determine who is a troll

By the way, the song does not need to make sense at all. Take it or leave it.

How many Realtors does it take to change a lightbulb?

Ans. Ten. One to put in the bulb and nine to talk about how much better things were in 2005.

if this post is not removed the hypocracy of the chronic commenters is far worse than the observed prediliction to delete comments that mock the Patrickists.

Well... I'm the threadmaster, folks.
I had thought about deleting the entire F-U / woody exchange, but frankly I was too busy laughing my ass off!

Btw, I prefer "stiffie".
Lighten up, people... :lol: :twisted: :lol:

There is a fair amount of insighful, reasonable people here, you being one of them, but you just confirmed that your notion of “we”, and the Patrickist notion of “we” deligitimizes what can sometimes be a decent exchange of ideas.

But... _we_ are borg, resistance is futile. :)

Let alone have someone who may end up with a CFA charter use the phrase “gradual crash” (half joking - see you at the next party if you will have a troll like me).

Well, if we can have a housing balloon... we can definitely have a gradual crash.

In the last "blog party", there were actually quite a few "soft landing" theorists. (Jack, Jimbo) We had a great time! :)

I apologize if I sounded harsh to you earlier. :)

What is the difference between a light bulb and a home buyer?

Ans. You can unscrew the lightbulb.

On a serious note, I generally prefer NOT to be in the business of censorship.

Just to clarify, different threadmasters have different takes on this subject. In comparison, I delete trollish comments according to my instinct.

PeterP, the same guy who a couple days ago said
The future is the only thing that matters.

I said, "I need no justification for my actions/decisions because past decisions are no longer relevant. Only the future matters."

I did not say that history does not repeat. :)

Can we get a thread of just famous predictions, contradictions and whacky comments by fanatic Patrickists?

You can do that but no one will care.

Just to clarify, different threadmasters have different takes on this subject. In comparison, I delete trollish comments according to my instinct.

Ok, just to satisfy the Puritans in the blogosphere (*cough*, Peter P, *cough*), I have gone ahead and replaced Linda's profanity above with more socially acceptable euphemisms in bold.

Happy now???

HARM and PeterP, thanks for comments, clarifications.

I am enjoying the exchange.

You are welcomed. I appreciate contrarian opinions, although sometimes I can get too excited.

I am actually learning a lot about market actions from these slow motion housing bubble dynamics. The stock market is too fast/efficient to observe. The housing market is a great learning aid.

Ok, just to satisfy the Puritans in the blogosphere (*cough*, Peter P, *cough*), I have gone ahead and replaced Linda’s profanity above with more socially acceptable euphemisms in bold.

Huh?

Speaking of which, the Huh thread is still growing. There is no such thing as a thread bubble. :)

Ditto (to Peter P's comment about contrarian views being welcome here).

Ditto (to Peter P’s last comment)

Ditto to the huh comment?

@HARM, Your substitutions in bold are hilarious.

@Peter P --You posted too quick for me. Refresh your screen.

@Unalloyed --my pleasure :mrgreen:
And thank you for all the Realt-Whore jokes. Keep 'em coming!