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So long, David!


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2007 May 15, 8:31am   26,506 views  241 comments

by HARM   ➕follow (0)   💰tip   ignore  

Mission Accomplished!

A Farewell to (option-)ARMs

David Lereah has officially vacated his post as chief shill, propagandist, economist for the NAR. Needless to say, we're really going to miss him here at Patrick.net. Over the many months we have been following him, we have come to revile, detest, loathe, appreciate him as a reliable bald-faced liar, shameless industry whore, source of real estate market information, as well as the public face of the NAR.

David will most likely be replaced by well known NAR lackey, toady, devil spawn, senior economist Lawrence Yun, as he moves on to pursue other interests. He reportedly left his post at the NAR due to being universally reviled, having zero credibility, the repeated death threats, wanting more time to spend with his family and to accept a new position as Chairman of Move, Inc.

So long, David! We all wish you the best!
HARM & the gang

#housing

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161   HARM   2007 May 17, 10:01am  

Interesting Slate article; one particular statement caught my eye:

Think Negative!
Oprah, it's time to come clean about The Secret.

"Cerulo argues we have a lot to learn from two groups of people who have emancipated themselves from the pressure to think positively. She points out that medical workers and computer technicians—the professional troubleshooters of the world—keep our bodies and mainframes running by being paragons of pessimism. When doctors and IT workers take up a case, they begin by dispassionately assuming the worst and then move up from there. Their protocols demand precise and evolving definitions of the most severe maladies and malfunctions, while they tend to have fuzzy and almost absentminded definitions of health, well-being, and normal function. That's the opposite of The Secret. While this may sometimes make doctors and techies a drag, it also helped them avert worldwide disasters like the SARS outbreak and the Y2K bug."

Many people have pointed out that this blog's readership tends to be skewed heavily in favor of IT and medical professionals. Perhaps this has something to do with this blog having a strongly contrarian/skeptical POV.

162   danville woman   2007 May 17, 10:10am  

Today's Headlines:

San Jose Mercury News
PRICIER HOMES HOTTEST SELLERS

San Francisco Chronicle
BAY AREA HOUSING PRICES BUCK NATIONAL TREND

Contra Costa Times Business Section
EAST BAY HOMES HIT 12 YEAR LOW
In small print, it says "median price is up 4.3 %, but
that's because there are fewer starter homes sold"

The realtors need to boycott the Contra Costa Times until it understands how to lie.

163   Peter P   2007 May 17, 10:11am  

Honestly, a dose of skepticism is always healthy, but it is hard to be successful without being a positive thinker.

164   DennisN   2007 May 17, 10:11am  

Ah yes, "Alameda de las Pulgas", which translates into "Avenue of the fleas".

There can't be any development west of 280 since that's a government preserve for watershed. You can't even hike or boat on Crystal Springs Reservoirs - people are banned.

165   HARM   2007 May 17, 10:18am  

Honestly, a dose of skepticism is always healthy, but it is hard to be successful without being a positive thinker.

True. I suppose it's better to be Pollyanna than Cassandra.

166   Peter P   2007 May 17, 10:22am  

BTW, doctors are positive thinkers. They believe they can cure people.

167   e   2007 May 17, 10:38am  

San Carlos, of course, lives up to its reputation.

Um, what reputation would that be?

168   e   2007 May 17, 10:46am  

It seems to me that our local economy is doing pretty well. A friend of mine just got his current employer to match a 20% better offer from a competitor.

Around me, in my circle of friends and associates, who are all in tech, I don't see much fear or doom/gloom. The salary range seems to be from 70k-150k. Most are getting raises and bonuses too.

Now, I don't want to get all WealthyWoman/MP/etc, but it strikes me that our local economy is doing pretty darn well.

Fortress Mountain View 4eva?

169   Brand165   2007 May 17, 10:47am  

astrid Says: I think GC is far more interested in provoking/trolling than in sexual perversions. He may indeed have genuine issues, but I suspect they have little to do with his interest in sex. If he was interested in sex, there would be millions of websites that would offer better picking for sexual perversion.

Yeah, that was pretty much my thought as well. Notice that GC is rather polite in the tail end of the conflict (like now), mostly because he's getting the attention he craves. We can speculate on the cause all we like, but the kid is very predictable.

btw, there are plenty of people on the Net who are looking to be a little "badass", especially if their real life is totally boring. "Badass" must be a tension in relation to normal people.

Randy: You're definitely not an island in your distaste for these subjects. You and many others (including myself) seem to trigger on about the same wavelength. Anytime you think the kid is getting carried away, you may assume that my support for deletion is implicit.

170   Brand165   2007 May 17, 12:08pm  

GC: Fair enough. I will not offer any more observations on your behavior whilst you are prevented from debating them.

171   Malcolm   2007 May 17, 12:09pm  

GC is a woman Says:
May 17th, 2007 at 5:56 pm
"Peter,
In order to succeed, one cannot have any doubts. That’s why fools become millionaires. "

This philosophy is a sure path to the poor house. Some of the worst ideas are the ones that seem certain. This statement reminds me of the opening line in a typical multilevel marketing pitch. No offense, you are entitled to your beliefs, I just happen to disagree.

172   OO   2007 May 17, 12:38pm  

The only good thing that happened to this presidency is the new immigration policy, which is eventually going to put a stop to this mindless parent migration, hopefully.

If you look at any immigrant-friendly country (Canada, Australia, NZ, not to mention the old world Europe) in the world, no one welcomes old immigrants, especially those who have not made one single contribution to the local community and the entire purpose of migration was to munch on the local social benefits.

I am a first generation immigrant, and I fully support putting a stop entirely to old parent migration. No more old folks, thank you very much, but of course if you are old and rich and can fund your own retirement/ medicare entirely, we welcome you.

173   skibum   2007 May 17, 1:12pm  

Anybody read today’s front page of the SF Chronicle today?

DAiryQUeen,

If you insist on coming here and trolling, at least have the decency to read the rest of the posts. We've talked about SF Chronicle's spin job front page article already earlier in this thread.

All you do is come off like a trolling fool.

174   skibum   2007 May 17, 1:31pm  

Ah, Sorry skibum! Let me go check it out. I don’t surf the net during work hours!

Anyway, looks like prices are ROCKING AND ROLLING to new record highs! That coupled with low employment, and record high stock market is making me GIDDY! This is going to be a great summer vacation!

Sorry dude,
You just "outed" yourself as MP/FR/CR - more of the same exact phrases, writing style, and tone.

Thanks for revealing yourself to be the troll that you are! It's making me GIDDY!

175   Peter P   2007 May 17, 1:39pm  

DAiryQUeen, I have yet to try out the avocado pasta recipe.

176   Randy H   2007 May 17, 2:02pm  

FAB

You speak a very important truth. We were in just such an area in Belmont, on the rim of SJ Canyon. We had a pool, from which one might imagine lounging atop the magnificent view sipping a long drink. It was kind of a sick joke. It would cost us about $120 to heat the pool just for a nice Saturday BBQ, since you'd have to start it heating a day and a half earlier.

177   Peter P   2007 May 17, 2:08pm  

It would cost us about $120 to heat the pool just for a nice Saturday BBQ, since you’d have to start it heating a day and a half earlier.

Ouch. Perhaps a large jetting tub is more practical then. :)

178   skibum   2007 May 17, 2:44pm  

DAiryQUeen/MarinaPrime/FaceReality/ConfusedRenter,

Your complete ignorance of statistics makes me conclude only one thing, yet again: you must be a REALTOR (TM). YiIIIPEEE!

179   surfer-x   2007 May 17, 2:58pm  

on youre down payment

On you are down payment, telling isn't it?

180   surfer-x   2007 May 17, 3:04pm  

dude roll threw $B and count the for sale signs. Why is everyone selling? What if they can't sell, or won't take the market value and have enough to make it. How much can prices go down if nothing is being sold? If the dollar inflates, which means interest goes up, right guys? Then a low interest rate is good, but housing might drop.

Fuck it, I'm having a beer. and those in the area 7/7/07 in midtown ventura, cote etal., and if Randal H Esq, would make it down, plus DinOR, Peter P, LLILLL, and any others. Blog Party SCV (So cal version) III.

181   Eliza   2007 May 17, 3:05pm  

@obnoxious dairyqueen thing:
Antioch is Bay Area, absolutely. The Bay Area is big, if you haven't heard. It turns out that there are a *few* people living outside of the Marina and the Castro. It's an unfashionable lot, almost certainly, not the sort of people you'd want to talk to or anything, but the help has to live somewhere, I suppose.

The BART line is heading out to Antioch. Admittedly, it will be about an hour to SF by BART, but I know tons of people who travel an hour to get to work. And out that way, you can actually stretch out a bit. So, yeah, in anticipation of mass transit, they have been putting up some housing and shops and the like.

182   skibum   2007 May 17, 3:23pm  

L, L, L. It’s all about San Francisco.

San Francisco is PRIME!

(notice how this fuc%tard DAiryQUeen fails to deny that he/she is indeed MP/FR/CR etc)

183   Peter P   2007 May 17, 3:31pm  

It almost makes me nostalgic to see MP back. Almost.

It almost makes me dance in joy to see you back. Almost.

184   skibum   2007 May 17, 3:37pm  

I guess that SF Chronicle article really got our dear little friend MP/FR/CR/DQ all fired up and ready for another round of abuse on this board.

Well, now we know the spin job by the Chron worked on at least one person...

185   tsusiat   2007 May 17, 3:43pm  

Randy,

you have pegged G's modus operandi perfectly, he's a troll, I would suggest throwing him in the penalty box.

All the ignorant ethnic posturings and made up histories make a mockery of whatever authenticity seeps through on this anonymous board, if you get my drift.

186   OO   2007 May 17, 4:33pm  

Guys,

propertyshark just started posting loan info on all properties in the Bay Area (previously only on properties in SF).

Man, I maxed out my 15 daily free report right away, had such a great time getting to know how many acquaintances are totally living beyond their means with a $800K-1.2M loan on VARIABLE rate.

Go check it out, this is the best entertainment ever.

187   OO   2007 May 17, 4:39pm  

I will have to side with MarinaPrime on the fortress area, not a lot of for-sale signs yet. I am a bit disappointed, but for all the areas that I personally care for, the price is still climbing - asking price that is.

However, after checking out propertyshark, I am convinced that when the housing ATM completely stops in these prime fortresses, things will get very very interesting, since I always presumed that these high flyers are just paying 20-40% down locking down a fixed rate, oh no, variable, and the loan amount is way larger than it should be given how much these people make. I am not talking about the extremely financially savvy crowd making multimillion-dollar bonuses, I am talking about $250K households who have to resort to $1M loan on a variable rate buying from 2004-now.

188   SP   2007 May 17, 6:35pm  

OO said:
However, after checking out propertyshark, I am convinced that when the housing ATM completely stops in these prime fortresses, things will get very very interesting, since I always presumed that these high flyers are just paying 20-40% down locking down a fixed rate, oh no, variable, and the loan amount is way larger than it should be given how much these people make.

Keep one caveat in mind - I logged on to the shark and checked a few properties for which I know the loan data (including my own) - the loan details are outdated because they show the original purchase loan. If the loanowner refinanced to a fixed rate, it does not seem to update that info.

SP

189   Claire   2007 May 17, 6:40pm  

Yeah - PropertyShark was letting me test their Beta for Bay Area over the last couple of weeks, it was quite interesting although a little hard to navigate unless you had an exact address. And of course I used up my free 15 reports very quickly.

Seems a lot in my vicinity are not in too much trouble, but of course, most are long time residents. I should check out some of the houses that sold in the last couple of years and see if that is more illuminating.

Also, I noticed for the rental I'm in the landlord kept transfering the deed to himself and then a trust and then back again, but there was no mortgage information available - anyone got an idea of what he's up to?

190   DinOR   2007 May 17, 11:49pm  

@HARM,

Firstly, Karen Cerulo must be a godess! I'm such a believer in the power of "negative thinking" you could say I've dedicated my life to it!

While I am getting the book this weekend (after reading the reviews and excellent Slate article) I fear she will have left out a huge demographic and real contributor. The aviation crowd. We were taught from boot camp on that planes crash. It's part of the game. Every part and piece of that airplane is just waiting there to betray you. To show you that you are messing with the laws of God and only birds were truly meant to fly.

Even with the best design, most highly trained aircrew and a dedicated maintenance team can the best aircraft remain aloft long enough to complete it's mission. Many will be shot down with so much as a "golden bb" while others will crash and burn (except over the water where they just crash).

From DL (as noted earlier) on down this entire bubble was built on the power of wishful thinking, strapping a board to your @ss, closing your eyes and taking the plunge. Although I've recently been forced to buy I want to go on record as saying I would never willingly jump out of a perfectly good airplane! (I was pushed!)

DinOR

191   DinOR   2007 May 18, 12:00am  

@skibum,

I fear sir that you have perhaps rushed to judgment. I don't believe that "DAiryQUeen is CR/FR/TOS/MP at all.

After seeing first hand the awesome power of bear housing blogs and their effect on DL, Marshall Prentice and John Karevoll have launched a "pre-emptive strike" in blogsphere to counter all that "negative thinking".

My evidence? DAiryQUeen=DAtaQUick! :)

192   DinOR   2007 May 18, 2:37am  

OT... but interesting.

www.katu.com Headliner Video-link

Is your Hummer more energy efficient than a Hybrid?

One man thinks so! (What's really weird is the guy is an Oregonian!)

You gotta see it for yourself. :)

193   DinOR   2007 May 18, 3:14am  

@LosGatosRenter,

Firstly, I spent the first 2 years of my life in a lowly rental and "I" turned out "o.k" (for the most part!) Funny I don't remember a thing about the place?

No, seriously... I DO hear ya' and it IS a drag (especially for your wife) but if you've been following the "Chronic" coverage here (and elsewhere) those stats are being seriously challenged! With the supply of ever greater fools being cut off (subprime meltdown) and the skewed median being exposed, patience WILL pay off! :)

194   lunarpark   2007 May 18, 3:15am  

I'm excited to move away from California, but we are waiting three years. I'm more concerned about rents at this point. I want to maximize our savings. It seems like rental asking prices are moving up.

Btw, my FB friend sold her condo (for $509k) in MV ($16k under asking), as-is sale. The buyer was a young tech guy with a girlfriend who doesn't work because she is pursuing her masters. I don't know anything about the financing (hoping to find out about that part).

Condos in my building are selling more quickly than in the previous two years. However, according to my numbers SC County inventory is at the highest point since I started tracking it in 2005. San Jose looks pretty soft to me, while the other "prime" areas still look okay (for now).

195   Peter P   2007 May 18, 3:15am  

I’ve been following this website for 2 years hoping prices will drop so I can buy a house. With a child on the way, I’m not sure how much longer I can fend my wife off on a house purchase.

Is that why most people are here?

196   Peter P   2007 May 18, 4:03am  

I propose a tax law change to allow write off of rent for primary residence.

I think deductions (not tax credit) should be feasible. Most renters use standard deductions anyway. The impact on tax revenue should be minimal.

197   Peter P   2007 May 18, 4:07am  

We’ve gotta be close to the point where people just can’t afford to buy these homes around here.

If by "homes" you mean "houses" then you are right. A dual-income young couple should be able to comfortably afford a new-ish 2/2 condo or even a townhouse.

198   Jimbo   2007 May 18, 4:09am  

I know you guys hate to hear things like this, but home prices in the neighborhoods I closely track, which is Noe Valley and Forest Hill in San Francisco, are staying firm. I think prices in Noe Valley are even going up, but it is hard to tell for sure, since so many people are buying up older homes, fixing them up, and slapping $2M price tags on the big Noe Valley victorians, that it is hard to tell what an apples to apples comparison would look like. Price per square foot is definitely going up.

I have started looking at East Bay again, only in Claremont and Elmwood (in Berkeley), since "good schools" is now a requirement so my wife is uninterested in Oakland. Berkeley homes prices are staying steady, as far as I can tell and the stuff we are looking at ($1-$1.5M) sells quickly. I have started looking at $1.5-$2M homes, mostly just for kicks, and they seem to sell quickly as well.

On the flip side, home prices in Rockridge are clearly going down. They seem like they are down 20% from the peak now. At one point, homes on both sides of the border were going for about the same price, but now there is clearly a premium on Berkeley homes again.

199   Peter P   2007 May 18, 4:11am  

I am not saying that affordability is not an issue; it is, albeit a secondary one. However, the price/rent ratio is, and has always been, the main problem throughout the bubble period. If rent goes up, prices will not have to "crash" as much.

200   skibum   2007 May 18, 4:12am  

Los Gatos Renter,

I can empathize with you. Watching this whole real estate/credit cycle unfold can be like watching paint dry. But on the other hand, the rate of change seems to be in-line, if not faster than historical data for previous boom/bust cycles. The big difference is obviously the rapid unwinding of the loose lending standards. You and many others have observational data of people financially maxed out to the hilt in order to get into a home in the Bay Area. Even if they are not serial equity extractors, ARM resets are going to hurt many of them. And this we do know - the data shows that the Bay Area has an extrodinarily high percentage of recent loans as ARMs and/or neg-am and/or no-down and/or no/low doc.

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