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Dinor,
Yesterday, I was going to lunch and a co worker had to stop in a US bank to get some cash. Anyhow, inside the bank was a pretty impressive model of a small house. We're talking complete with a real door, door knob, roof tiles, and siding. Looked like a full scale playhouse for kids. On the outside were lots of pamplets discussing the wonders of all the loans you can choose from so you can get into the "home of your dreams!"
Anyhow, on the chalkboard was written what the loan on a 200k house would be. This in downtown SF. What in the hell does that info do for someone thinking of buying in an area where the cheapest thing is around 800k?
Needless to say, I was impressed with their marketing skills.

WW2,

Seriously? In 2006 what is 200K going to buy you anywhere in this country! Btw, I was at Borders last night (Mrs. DinOR shopping) and they had a "anti coffee table" book. I think it was called "Worst Cities USA" or something like that? Anyway it was a great concept, instead of having flattering (and frankly questionable photos) of "dream places" to live this was a tribute to the LAST places you would want to live! For CA I think Modesto and Visalia made the list. These are places with NO entertainment, high crime, pollution and absolutely NO view! While I think it was creative idea and a great spin they MISSED so many dumps and just settled on the "un-remarkable". Still, good stuff!

LILLL,

Yeah we all worked fast food in school it seems and the real drag comes after you realize that you've tried everything on the menu and can smell that 5 gallon bucket of lard from the parking lot. My favorite part is when your hands are so water logged they feel wet even after you've toweled them off.

Never Mind the Bollocks, Here's the Big One:

The southern end of the San Andreas fault near Los Angeles, which has not had a major rupture for more than 300 years, is under immense stress and could produce a massive earthquake, a new study said today.

http://tinyurl.com/lwmx6

might take some of the stickiness out of prices...

Resturaunt talk... Oh man.. I worked in this hole in the wall truck stop diner when I was in High school and early college. The place got to well over 100 degrees in the kitchen. I ran the meat slicer, which would cut your hand off if you wern'r careful. My worst experiences involved having to drag out a large wet vac, unbolt the top of this monsterous grease trap, and vaccum out a month's worth of grease. Disgusting!
To top it off, the people there were crazy. I would have to go up on a large ladder, place new letters on the sign outside, and the guys would sit there throwing leftover baked potatoes at me.

T Lynch,

Now that you mention it I think Natomas did get an "honorable mention". They covered a lot of Great Plains states with dead or near dead towns that had NOTHING to offer! Suprisingly there were no entries for Oregon. Huh? Trust me we have our share of dead end dumps. My brother got pulled over for a DUI in Molalla, OR and actually told the cop "If you can't get away with something in Molalla, where CAN you get away with it"!?

>>Seriously? In 2006 what is 200K going to buy you anywhere in this country!

It's easy to say that on the west coast, but this country is pretty big, and there are a lot of places where $200,000 can buy a nice house on a nice lot. You may not want to live in those places. Maybe too rural, too slow, lame night life, not your kinda job, etc. I've lived in Ohio, North Carolina, and Oregon and I'm one of those crazy people who actually like all those places.

Oregon is overpriced as hell (California impact, mostly). North Carolina is reasonable. Ohio is (mostly) cheap. All three states are beautiful (if you go to the right place). If you care about pizza, Ohio and North Carolina have good pizza with genuine Italians in the kitchens. Oregon has shitty pizza.

---

CNBC continues to have a lot of real estate pieces, probably for the sake of promoting their real estate survival guide tonight. Of note: Mention that KB Homes is cutting up to 20% off some new homes to move the inventory. I wonder if it'll be enough.

Michael,
We were referring to california. My brother bought his own place last year in TN for 38k, so yes- there's tons of homes for next to nothing- some in some decent areas to boot.

I skipped the whole fast-food/waiter jobs right of passage. After a few summers working farm jobs I discovered that knowing how to operate and program computers allowed me a chair and air conditioning at work. I went from pulling thistle out of raspberry rows to setting up computerized stuff at the local library and never looked back.

>>My brother bought his own place last year in TN for 38k,

Wow. It's nice that there are still places where people can buy a house without an option-ARM.

LILLL Says:

"I worked at Togos too! Only it was in Chico…and it was the only way I could eat while in college. One sandwich a day!."

Exactly! If you bought a large...I think it was #26...It was like baloney, ham cheese or whatever...then you could get two meals out of it for like $3.59.

Micheal,
Welll. His place certainly isn't paradise. Tiny little place with 3 little bedrooms. The house is made out of painted cinderblocks and old shingles. But the 80 year old neighbor comes over all the time and mows his yard because it gives him something to do.

Michael Anderson,

True, I may have worded that awkwardly. There are still plenty of areas where 200K means something, and you're right! Oregonians have always believed that OR is at least as pretty as CA so why not charge CA prices? Well......... b/c we get paid about 1/3 to 1/2 as much? Ya think?

Aside from that, yesterday was the first official day of summer. And guess what? We had our first nice day! Last nice day (from start to finish)? Early September, that's worth paying CA prices isn't it?

DinOR,

I don't see how, in the long term, Oregon can maintain the prices of the last two years. I buy that Californians will continue to come, but I don't buy that Bend, Ashland, Medford, Redmond, etc. can get away with prices anywhere near California prices.

I think a lot of growth in those cities was predicated on them being bargains. If they aren't bargains, they'll draw a much smaller stream.

What say you?

Wendy's in the house!

Mayonaisse
Ketchup
Pickle
Onion
Tomato
Lettuce
Mustard

(the ingredients on a Single with Cheese)

Who else here, after working fast-food as a teen, won't trust kids to make their food anymore? I won't touch hamburgers now unless they're made in a restaurant. Yeah, it's a rite of passage. Then you wash off all that grease and move on.

Scott,

You had the good fortune to be here on Mother's Day (and one day in March)! We took Mrs. DinOR to Lincoln City and yes it was quite nice that day I recall. We also always have at least one nice day in Feb. as well. Now that both kids are out of HS we no longer have to schedule our breaks around their's and believe I won't.

Who else here, after working fast-food as a teen, won’t trust kids to make their food anymore??

I do not trust kids to do anything. I made it a rule that I do not look inside restaurant kitchens. What I do not see is not happening.

I won’t touch hamburgers now unless they’re made in a restaurant.

It is difficult to have a good hamburger. It should be medium to medium-well, but you can have it less than well-done only if it is _freshly_ grinded from a piece of steak in a clean grinder.

Hamburgers should be held to the same standard as steak tartar.

Michael Anderson,

Your knowledge of our geography (and markets) is pretty impressive! To answer your question in a word, no. We can not continue on this path regardless of what transpires in CA. In addition to no longer being a bargain many of our city councils have already "run amok". In Bend NIMBYism is already banning alcohol (in all forms) on the river as it passes through town. This has been a long time trad. in Bend for young adults on floats and inner tubes. Only one councilman stood up. The rest appeased the wealthy homeowners on along the river. My guess is that they figured by banning alcohol the tradition would die and they would have the river to themselves. As far as I know, it's working.

>>Your knowledge of our geography (and markets) is pretty impressive!

I'll tell you why. After owning in Eugene for 14 years, I sold in November. Felt very "toppy" to me. Since then I have been paying very close attention to the Oregon RE markets. I now rent in Bend. For about 1/3 what a reasonable mortgage would be. Situation seems unsustainable.

All of the sudden we have an explosion of inventory, but no one seems to want to notice.

SP,

The only point that I was trying to make was with the LEGACY of lawlessness Molalla, OR enjoys who would know and who would care! It's a defunct logging town that died in the late 70's whose primary "export" is now drugs. Hell, people came out from Portland to score dope! It's getting better but for years it struggled with a real negative image. I do not advocate drinking and driving b/c it gives drinking a bad name.

In Bend NIMBYism is already banning alcohol (in all forms) on the river as it passes through town. The rest appeased the wealthy homeowners on along the river.

I'm guessing the next step are "quiet zones," forcing river-goers to whisper as they pass by properties--as they've done in CA gold country.

Alcohol was not banned until we had a drinking death on the river. But you're probably right; I'm sure the homeowners saw that as an opportunity to shut down the fun.

Michael Anderson,

"but no one seems to want to notice" LOL!

Renting for just 1/3rd! Outrageous! I simply must speak with your landlord. I hear ya. I can't blame anyone for wanting to depart Lane County but I'd heard that Bend is filled with realtors, builders. contractors, appraisers, mortgage brokers etc! Virtually ALL of their employment is based on RE for crissakes. Unsustainable? I think it's unbelievable.

Kurt S,

Would accidentally farting be considered an infraction in these "quiet zones" then?

I'm not trying to make light of someone's death on the river Michael but when we look at the stats there are several deaths on OR rivers and lakes every year. Can this ALWAYS be attributable to drinking? In most cases I've heard not.

My landlords are out-of-towners. They probably bought what is now a 700k property two years ago for 400k.

Here's the problem, to whom do they sell? They can't very well sell to another investor, can they? The rent would not be sufficient. (OK, they could sell to someone who believed the appreciation would continue.)

So, what does that mean, exactly? As I see it, all these 3,000 square feet houses that were bought by investors at a bargain now have to be sold to owner-occupiers, at a premium rate. That's right. Bend needs even more Californians than we've been getting so far. And they have to be wealthier.

Still, that's what we have to do. Bend now advertises for rich people in California. They simple MUST move here now--buying our houses isn't enough.

It's almost comical, if so many naive people weren't about to get slammed. I swear it's going to be a surprise. 9/10 people here think next year will be just like last year--we don't see what Florida or San Diego or Arizona has to do with us. Only if you have one of those thousands of houses on the market now are you sweating.

Soon we'll have over 200 of the $million+ houses. We've got to really ramp up to sell those too, because that's almost 3 years of inventory at last year's rate.

If some of you Bay Area people could move up here ASAP, we'd really appreciate it!

>>Can this ALWAYS be attributable to drinking?

Of course not. This one was. A strong young minor league baseball player, drunk off his ass, floating with friends. How this happened is beyond me. If you've ever been on the Deschutes in downtown Bend, well, it's no Willamette. I was in the Willamette in Euegen a few times and it frankly scared me silly. Two or three people die every year there.

The Deschutes is mostly slow and shallow. On warm days there's almost more people than water. There's kids and dogs and old folks floating. I can only assume that his friends were so trashed they didn't even know what was going on.

>>I’d heard that Bend is filled with realtors, builders. contractors, appraisers, mortgage brokers etc!

You can imagine how cocksure they are, too.

Man,

SF is my limit for cold and rain. Oregon is just a little too gray and rainy for me. But it is beatiful when it's not raining.

Anyone seen this from the washington post?

http://tinyurl.com/qnbd8

"Over the last six months, the biggest negative contributor to the leading index's drop has been declining housing permits."

So who says the economy will continue on an upward trend without housing? I think not!

>>For those claiming Oregon has CA-prices, that is laughable. I can still buy a good 2000sft house with a decent yard, great schools for low $300Ks.

Depends on the city. Remember that Central Oregon prices have been among the fastest appreciating in the country. Million-dollar houses are over 12% of the total for sale on MLS in Bend. Over $500k is about 40% of all houses for sale.

Heck, the duplexes overlooking the Old Mill are over $500k (per side). OK, not California prices, but closer than they should be.

CNBC...Camden Property CEO says that fewer apartment dwellers are moving out to buy houses. Sees rents going up as much as 10%.

Michael Anderson,

"Here's the problem, to whom do they sell"

That pretty much sums up my assesment of what's gone on in Bend (and neighboring areas) for the last several years! Yep, we need more CA's and not just the "nickel millionaire" variety too! These folks got to have have some serious cash to keep this thing going.

>>Yep, we need more CA’s and not just the “nickel millionaire” variety too!

Haha! Good way to put it.

I think our EXTREMELY rich developments will do fine. We have movie stars buying in Pronghorn, I've heard.

I think if the "nickel millionaires" keep buying in Central Oregon, it'll be in Prineville, Sisters, and LaPine, not Bend, Sunriver, and Redmond.

---

OK. Question. When do the masses switch from "loving" RE to "hating" RE? If ever?

Scott J,

"so who says the economy will continue on an upward trend without housing"?

Honestly I can't answer that, I wish I could. This much I do know. We will try to move forward with or without it. That's one of the things that has bothered me most about the bubble. An economic recovery based almost solely on housing. It's 2006! You'd think we'd have this whole "shelter" thing figured out by now! Why don't we just go back to cattle ranching? Why don't we base CA's economy on gold prospecting? Buggy whips anyone? It's just been such a total regression.

By the time Apollo 13 had launched American's were already taking space travel for granted (so few watched). How is it possible that we are still so "snake fascinated" with freaking real estate? Maybe when we're taking up collections for FB's and McMansions sit rotting we can move forward.

"nickel millionaire" was one of "mom's" favorites. We were from Cicero, IL (solid lower middle class) and anytime we drove through Chicago's more "posh" suburbs the folks would make sure to point out the bedsheets hung where curtains should be!

You know? It still applies today. That's why most McMansions have the windows up high and all of the furniture is "built ins". This way we can flip 'em to one another and move out by piling our sh@t into the SUV!

I just compared San Diego to Bend OR at realtor.com. About the same percentage of $1million+ houses in both (~12%).

San Diego has a 52% $500k+. Bend 44% $500k+.

Is it just me or is that crazy? I think Bend could fall a lot harder than San Diego.

"It’s 2006! You’d think we’d have this whole “shelter” thing figured out by now! ... It’s just been such a total regression."

Agreed. We're trying to relive an illusory American "golden age" through smarmy Kinkade paintings and malignanty swelling McMansions; expansive consumption without the historical American temperance. If home ownership is the defining American identity, g-d help us.

DinOR,

Well, I don't mean to presume either, although my post said otherwise. But no one really does know. Speaking to your point about American's facination with RE, it is INGRAINED into us that "owning" a home (at this point becoming an FB) is what separates us from the rest of the world and makes us better. We're taught this dream in elementary schools. All of us are taught that the structure of American society is to create a huge and unstoppable middle class and the foundation of that is for people to own their own home.

It feels like the middle class is shrinking, I see news about this in sfgate.com, nytimes.com and on TV. Why is the middle class disappearing? Are we NOT as hard working as we used to be? I know I've spent more than a few hours at work reading the news articles and info in this blog, but I don't claim to work any less hours than my father. In fact, I think I put more hours into my job. Has the middle class attained a peak regarding our standard of living that is so high that it can't break through to another level? Is "down" the only place left to go?

Out of curiosity what can America do to move forward? Create a society devoted to philanthropy? Considering that for the past 200+ years America has been the place to be for anyone who wants to strive for something when they have nothing, are we no longer the place to be? We're still a stronger economy than other countries even with our supposed transparency. We see weaknesses when they are made public and there are "corrections" that occur. I really hope the next correction isn't like the great depression.

Ok, this was sort of a rant...

>>Agreed. We’re trying to relive an illusory American “golden age” through smarmy Kinkade paintings and malignanty swelling McMansions...

I have a theory about that. I've read that American homes are 40% larger than they were.

Have you ever gone back to your elementary school? When you were a student there you were only maybe three feet tall. As an adult, the place looks as if it shrunk. The hallways are narrow, the chalkboards are lower, it's like a small reproduction of itself.

Of course what happened is you grew up.

I think we've built these huge houses out of nostalgia. We remember houses as huge because we were so little.

I'm always reminding myself that my kids must see this house we live in as a lot bigger than I see it. It's probably twice as big as the house I grew up in, and that seemed big enough to me.

So what's a guy to do to protect himself and his family from a shrinking middle class and less buying power for his dollar?

1) Put money in the bank?
2) Buy RE? (I just had to put that one in) lol
3) Invest in stocks? I don't even know where to begin on that...
4) Bonds/CDs?