patrick.net

dodgerfanjohn says

Thing is, I have a decent place to live. And if I CHOOSE to move(obv no ones forcing me...thats a REALLY stupid notion), I'll still have a decent place to live.

Chasing cheaper rentals is all well and good when you are young and childless. I did it for almost 20 years, no problem. Lived in some great places, too.

But finding a decent rental when you have kids and dogs, not so much. Throw in the piano and furniture for a family of 4, it's more than just getting a bunch of boxes on craigslist.

I enjoyed my 20's and 30's lifestyle and really love the way my life is now. What I don't love is the landlord "inspecting" (imperious nosybodying), the rent increases, and the fact that very long-term renting in an expensive area (renter in SF for 22 years now) eventually means a whole lot of money .

I'd rather rent money from the bank than rent my home from a landlord. Either way, I'm paying for housing, but with owning it's possible (not a sure bet, I know) that after 10-20 years there may be some return other than just a roof over my head. If not, then no biggie, I had to pay for housing either way.

It's like the difference between people who like working for themselves and being their own boss and people that prefer a regular paycheck that comes with having a job and a boss.

Individual preference.

I'd still rather be surfing.

So, just out of curiosity, the comments here seem to indicate either investors or folks looking for homes in the sub-400k range. I'd say that our range is at a max of 550k or so. We don't seem to be finding that much of a flurry of activity in that price range. So when people say there's " No supply", are we talking about the extreme bottom level of the market?

edvard2 says

So, just out of curiosity, the comments here seem to indicate either investors or folks looking for homes in the sub-400k range.

Depends on where you are looking. We are looking in the high 500's and it's a zoo here in SF. Put an offer an a house yesterday for 18K over 599K asking. Doubtful we'll get it.

1sfrenter says

Going to open houses on weekends even though you don't plan on buying?! Maybe you need a hobby?

I do it while I am doing my hobby. ;) That is how I get there. Sometimes I am actually on my way to another hobby also. Call be crazy, but talking to realtards gives me the best indication of the market vibe. Sometimes it is not the lies they say, but what they don't say that is interesting. Each year in the BA the climate changes. I do plan to buy at some point, but this purchase is large, so I will take my time. If it takes 2,3, 4 or more years then that is what it is. If I never buy in the BA (doubt that), then I'll take the cash and go buy something without a mortgage in the other 99% of the country. Easy solution to a touch BA issue.

RentingForHalfTheCost says

Each year in the BA the climate changes.

It's global warming.

1sfrenter says

Depends on where you are looking. We are looking in the high 500's and it's a zoo here in SF. Put an offer an a house yesterday for 18K over 599K asking. Doubtful we'll get it.

600K in SF was unheard of back in 2007, so everything is relative. You would be lucky to get a double wide garage for 600K in 2007. It probably wouldn't have heating either, just a broken up garage with a view of nothing. You are talking about SF, one of the most expensive with the most liability of damage, price depreciation, etc. If you play in that space then make sure you where an adult size diaper.

We are putting in an offer for 615K on a 1800 sq. ft SFH on 120 ft. lot with double garage.

Still too expensive, but when all is said and done, roughly equivalent to renting the same house.

6 months ago, I think this house would have sold for 615. But the way it's been going this spring, I'm not so sure.

SFH in this nabe sold for 800K at the peak. Most back down to about 500-600K or less. Not sure how much lower SF proper will go..

1sfrenter says

We are putting in an offer for 615K on a 1800 sq. ft SFH on 120 ft. lot with double garage.

SF and the Peninsula aren't even on our radar. Those places are hopelessly overpriced, always have been, and thus there's no reason even trying. We're looking exclusively in the east bay.

dodgerfanjohn says

Simply put, theres not enough homes for sale.

That's only because banks are actively manipulating supply in a last gasp attempt to reflate a bubble in order to hide their losses and collect fees -- a strategy that is temporarily working for them. IOW it has nothing to do with real inventory or supply and demand.

Again, one should try to avoid the saucer-eyed, froth-soaked market tips from all the backyard "investors" on here. If they really had a good thing going, do you think they'd be sharing it anonymously and for free? (No.)

BayArea says

"Counter Offer - Need Highest and Best, there are 10 offers at this time.
Please submit by email your client's best offer. Please send details. It might be price, contingencies, earnest amount, etc… The bank will require the price on the contract even if property doesn't appraise.

Nope this practice hasnt stopped.. even though prices have fallen..

Fact is, prices over couple years have fallen and that provides some proof, that multiple offers really arent there.

robertoaribas says

So, you want to balance your pure speculation, versus observable market supply and demand?

Who's speculating? Market manipulation is most readily observable. That you would argue what we are seeing in the marketplace is anything approaching organic supply and demand is seriously unbelievable to me. I mean to say, I just don't believe you're being serious. I'm actually giving you some credit here.

Also, who cares, if prices go up 20% in the next year while we wait for this tsunami of foreclosures,

What would be the engine for a 20% rise? A new and growing clutch of nosepickers on the courthouse steps outbidding one another for another positive cash flow property, before gradually undercutting one another's profits in the process? Yeah...ok.

what is to say they don't leak them out for 5 years and the economy improves?

This assumes that there's some kind of elaborate methodology which has been developed for metering the release of the properties at a Goldilocks rate so as to best avoid saturation. That's much more far fetched than the tsunami idea.

Then prices might never drop, or only drop a small amount...

Or they might continue their slow motion drop and overshoot in certain markets, as all previous asset bubbles have done. Or they might straddle the bottom for a generation or more.

http://reut.rs/JnCC5q

I'm a data guy, you go do all of your guessing you like.

Actually, I find the ratio of bluster to substance from you highly in favor of the former.

robertoaribas says

what is to say they don't leak them out for 5 years and the economy improves?

Because 1 out of 5 in this country doesn't work? Because real inflation is not 2%. Because 23% of home owners with mortgages are underwater. Because at the current rate of absorption the existing shadow inventory (not including the future foreclosures) would take 7 years. Because even if the gov't stopped paying all the public workers and services (no spending) we would still not even come close to paying down the debt in our lifetime. We actually wouldn't even get ahead of it! Because because because.

That is speculation? Huh?

"what is to say they don't leak them out for 5 years and the economy improves?"

Yep. The last FASB bulletin I saw on the subject said MTM rules will be suspended until "at least" 2016. So for sure we have 4 more years of leakage ahead...

Austinhousingbubble says

I'm a data guy, you go do all of your guessing you like.

Actually, I find the ratio of bluster to substance from you highly in favor of the former.

Couldn't agree more here. People think they are all data, when they are just throwing out wild speculations. We have been in a down market, nothing and I repeat nothing indicates that this train is turning around. I challenge anyone to show me some good data on housing. The only thing that happen over the last 5 years that was good, was a big portion of our tax money going to bail out the owners in trouble. I didn't sign up for that.

gregpfielding says

Yep. As frustrating as it is for buyers, it's efficient for the sellers, and they are the ones calling the shots

I don't think you are right, the one with the money is the one always calling the shots. Not the guy selling a product. You make it sound like the seller is the one who is in charge, while it's really the buyer who is holding all the Aces.

My advice to the buyer is to walk away in this situation.

RentingForHalfTheCost says

People think they are all data, when they are just throwing out wild speculations. We have been in a down market, nothing and I repeat nothing indicates that this train is turning around.

My nephew almost got suckered into a house last year by a Realtor who kept on telling him and his wife that it's time to buy. This year that same house is still for sale about a $100,000 less. I guess his dad and his uncle saved him a few bucks by sharing some wisdom.

robertoaribas says

Austinhousingbubble says

That's only because banks are actively manipulating supply in a last gasp attempt to reflate a bubble in order to hide their losses and collect fees -- a strategy that is temporarily working for them. IOW it has nothing to do with real inventory or supply and demand.

So, you want to balance your pure speculation, versus observable market supply and demand? Also, who cares, if prices go up 20% in the next year while we wait for this tsunami of foreclosures, what is to say they don't leak them out for 5 years and the economy improves? Then prices might never drop, or only drop a small amount...

I'm a data guy, you go do all of your guessing you like.

I think you're right about prices dropping a small amount or just staying flat over the next decade. The 20% increase may happen in certain areas where prices have bottomed and jobs are returning.

Since you're a data guy take a look at the demographics on the income and debt of the next wave of home buyers. Not promising for prices rising - especially when you consider that this group is outnumbered by the baby boomers they will be buying from.

RentingForHalfTheCost says

Because 1 out of 5 in this country doesn't work? Because real inflation is not 2%. Because 23% of home owners with mortgages are underwater. Because at the current rate of absorption the existing shadow inventory (not including the future foreclosures) would take 7 years. Because even if the gov't stopped paying all the public workers and services (no spending) we would still not even come close to paying down the debt in our lifetime. We actually wouldn't even get ahead of it! Because because because.

That is speculation? Huh?

Everything is so shitty. That must be the reason why Apple keeps selling more and more iphones and ipads, after all ...those are an absolute necessity for life...NOT. That's why restaurants are packed to the tooth. That's why the roads are full of new cars. That's why the traffic in LA has not changed a bit even though gas is at $4.50 at the pump!! ...

Hm...What you say is true, I am not arguing that but what I see is different. I wonder if its all skewed due to political reasons. Republicans want you to vote for them in Nov so they have to promote a "economy is a disaster" mentality because that would justify you voting for them...after all, they can fix it, right?
Democrats have the opposite approach...everything is better and improving by the minute, all because of them...so you gotta vote for them again.

One stupid game.

Glad we bought the end of February in Danville! Got the loan easily and a 3.75% rate. It was a fixer which we basically gutted (cheaply) and remodeled before moving in over Easter. We probably already have 20% equity and are happy! There were no games with this deal for which I am very thankful! Glad we will not have to worry about playing this Bay Area real estate game any longer!! Plus the payment is cheaper than rent and a much nicer/larger home! It all depends on the deal and your personal needs...

edvard2 says

So, just out of curiosity, the comments here seem to indicate either investors or folks looking for homes in the sub-400k range. I'd say that our range is at a max of 550k or so. We don't seem to be finding that much of a flurry of activity in that price range. So when people say there's " No supply", are we talking about the extreme bottom level of the market

We are in the city (SF) and looking for SFH under 615K.

Nothing.

sheltielover1 says

We probably already have 20% equity and are happy!

I'd think that one would know if they had 20% equity, given that you should be making sure that you are no longer charged PMI if that is the case. Glad you found something you like though.

1sfrenter says

We are in the city (SF) and looking for SFH under 615K.

Nothing.

You are far more familiar with SF RE than I am, considering you have lived there for a long time and have been watching it closely. Based on my limited knowledge of the place I have to ask: when was $615k ever going to get a decent SFH in a decent area of SF? 1990's?

I guess nowhere if you are hoity toity.

But there are places (decent SFHs) for that price in the Sunset, the Richmond, Sunnyside, Ingleside, Outer Mission, and Excelsior.

We've been holding out for something larger than 1200 sq. ft., but are considering some of the 2/1 we've seen (usually about 950 sq. ft, yard and garage) for under 500K.

Just do a redfin search - not every house in SF costs a million bucks. There are still regular people living here.

1sfrenter says

Just do a redfin search - not every house in SF costs a million bucks. There are still regular people living here.

Yeah, I'll take a look. I have never bothered to look up in SF since I have never had an interest in living there (mostly related to job locations). Some friends have rented out in Sunset & Richmond districts and they seemed like areas I wouldn't mind living in if I had the interest.

SubOink says

Everything is so shitty. That must be the reason why Apple keeps selling more and more iphones and ipads, after all ...those are an absolute necessity for life...NOT. That's why restaurants are packed to the tooth. That's why the roads are full of new cars. That's why the traffic in LA has not changed a bit even though gas is at $4.50 at the pump!! ...

Think about all the cash the underwater mortgage holders are saving by not paying the mortgage. I bet if you tracked the flow of money you would see it being spent on things like iPad, iPhones, autos, etc. These people are not stupid, they are getting a free ride in a screwed up housing market. The Ponzi scheme stopped and the difference here is the last ones holding are not necessarily doing that bad. The real victims are the ones that didn't over-leverage and lost their downpayment. The people who bought with nothing or hardly nothing down (and there were many) are laughing at the rest.

Also, Apple is not doing as well as it should in the US, iPhone/iPad/iPod sales didn't meet expectations here, it was the growth elsewhere that is impressive. 35 million iPhones! Wow.

Real Estate is local, I work primarily western Sonoma County and inventory is low right now. That will change at some point. I tell my buyers to get their finances in order and wait for the right place at a good price. A good price? 1998 price in nominal dollars. I do see multiple offers for some properties and I also see a lot of properties with no offers at all, those listings go stale quickly and you can sometimes get them for less than a comparable new listing after a few months. It's a lot like shopping at thrift stores, lots of crap but you never know what will turn up tomorrow. And anyone who treats the Bay Area economy as singular or any city as a unified market is a fool. I have met Greg Fielding and I will be sending any East Bay buyers I get his way because he will treat them right.

RentingForHalfTheCost says

Think about all the cash the underwater mortgage holders are saving by not paying the mortgage. I bet if you tracked the flow of money you would see it being spent on things like iPad, iPhones, autos, etc.

I know two couples - both relatives who are doing this right now. I must admit it makes me angry but I try not to show it because they are otherwise nice people.

In both of these cases they have just begun the short sale process. One couple stopped paying their mortgage - on advice from counsel -- in November 2010. The other couple followed their advice in June 2011. Both couples have been saving every penny. The lawyer told them that the short sale process, which is just starting for couple #1, will include a provision from the bank to reclaim some of the unpaid mortgage. If they are comfortable with the amount the bank asks for they will only have 2 years of bad credit. But if the bank asks for too much (i.e. more than the unpaid mortgage) they are going into foreclosure and live with the 7 years of bad credit.

RentingForHalfTheCost says

Also, Apple is not doing as well as it should in the US, iPhone/iPad/iPod sales didn't meet expectations here, it was the growth elsewhere that is impressive. 35 million iPhones! Wow.

Traditionally this is the worse quarter for Apple but because Apple's business is more global now, it is doing well because of Asia Pacific.

BayArea says

Home #3 (REO): This one is a fixer upper that needs a solid $30K to be move-in ready. It was priced way too high and I offer $30K below asking. I get this in the mail from the listing agent:
"Counter Offer - Need Highest and Best, there are 10 offers at this time.
Please submit by email your client's best offer. Please send details. It might be price, contingencies, earnest amount, etc… The bank will require the price on the contract even if property doesn't appraise.
NEED YOUR CLIENTS RESPONSE BY TOMORROW THE 25th OF April, at Noon."
NOT AGAIN! Rat bastards toying with people's emotions. I did raise my offer by $11K however. Let's see what happens.

Guess, what. I am eagerly anticipating an update on this house when I get the following notice from the listing agent:

Counter Offer - Need Highest and Best

Please submit by email your clients best offer. There are 10 offers in at this point. If no changes please email that, if you are making changes please send details it might be price, contingencies, earnest amount, etc… The bank will require the price on the contract even if property doesn't appraise.

NEED YOUR CLIENTS RESPONSE BY TOMORROW THE AT 2:00 PM – if you are increasing purchase price, make sure you include proof of funds, pre-approval, etc..

ARE YOU KIDDING ME! They did not accept an offer during the first set of offers, they did not accept an offer during the second set of offers, and now they are asking for third round of offers?!!!!!!?!!?!!!?

This is a great way to reallllly piss someone off.

You should have offered to feed the squirrels.

Ok, it's official.

I have not gotten an offer accepted in all of 2012.

Between taking the time to research properties, going to see them, writing offers, and chasing the listing agent only to find out that my $20K above asking price offers are getting laughed at, it's getting quite discouraging.

BayArea says

Ok, it's official.

I have not gotten an offer accepted in all of 2012.

Between taking the time to research properties, going to see them, writing offers, and chasing the listing agent only to find out that my $20K above asking price offers are getting laughed at, it's getting quite discouraging.

5 months of trying is not a lot (and never has been) if you want the right house for the right price - start complaining again after having tried for 2 years ;) Our culture in general has moved to expectations of instant gratification and that play into the hands of the sellers/realtors ..

E-man says

I'm afraid we will get another recession next year.

I thought we never got out of the last one. :)

BayArea says

Are you kidding me? 25 offers and instead of taking the highest/best offer, the bank scraps all offers and requests that everyone resubmit a higher offer? Really, this is actually legal?

They are under no legal obligation to accept any offers, or they could accept the lowest offer, or pick one at random. There's nothing to say they have to pick the highest offer. They only thing you could do is sue if they are picking offer for only white people and rejecting all offer from black people, this would be discrimination, but it's tough to prove. Unless there is some kind of confidentiality clause in the offer, they could send everyone a list of what they bid and tell them you need to do better. Or say they current highest offer is 502k, you need to do better.

E-man says

Either you thought wrong or you personally never got out of it. I definitely did. We are in a much better shape financially compared to 2006 and 2009. Choose your poison. :)

You realize that individual success does not automatically translate to national?

E-man says

However, millions of people are better off now compared to 2008 & 2009.

Yeah sure. They are better off after dumping their over expensive shacks and were forced to live within their means. That's how I see it - you wear yellow glasses so you see everything yellow - not your fault. :)

E-man says

Or was it because no one is willing to overpay for your skills anymore? :)

Haha. I have my stock investments that brings in the returns that you get collecting rent. :) I am like you - an exception. Millions are not better off but I do - hence the economy is doing soooooo gooooood.

thomas.wong1986 says

BayArea says

"Counter Offer - Need Highest and Best, there are 10 offers at this time.

Please submit by email your client's best offer. Please send details. It might be price, contingencies, earnest amount, etc… The bank will require the price on the contract even if property doesn't appraise.

Nope this practice hasnt stopped.. even though prices have fallen..

Fact is, prices over couple years have fallen and that provides some proof, that multiple offers really arent there.

You still get counter offers? Of all the 20 offers I've submitted not once did I get asked to submit a counter offer. It's usually submit your best offer. The highest I've gone was offering 15k over asking and still told it wasn't high enough.

supersunken says

thomas.wong1986 says

BayArea says

"Counter Offer - Need Highest and Best, there are 10 offers at this time.

Please submit by email your client's best offer. Please send details. It might be price, contingencies, earnest amount, etc… The bank will require the price on the contract even if property doesn't appraise.

Nope this practice hasnt stopped.. even though prices have fallen..

Fact is, prices over couple years have fallen and that provides some proof, that multiple offers really arent there.

You still get counter offers? Of all the 20 offers I've submitted not once did I get asked to submit a counter offer. It's usually submit your best offer. The highest I've gone was offering 15k over asking and still told it wasn't high enough.

I dunno why people keep posting this stuff as if its sufficient to assume such info is contained in a vacumn.

List price means NOTHING.

Comps are all that matters.

If you are near comps, then fine. As long as some mindless bozo doesn't come along with a stupifying bid, then you are at least in the running assuming the realtor isn't shady(I know, a long shot) and the owner isn't delusional.

But if the listing agent put the property at $250K when nearby comps are $350K, its an attempt to initiate a bidding war and your paltry bid of $15K over list will likely be ignored and mocked.

BayArea, and everybody else dealing with English-speaking real estate agents: does everybody write this badly? I realize that e-mail is more casual than paper correspondence, but BayArea's agent sent a message with so much botched and missing punctuation that it's hard to believe that it was written by a professional.

Please submit by email your client's best offer. There are 10 offers in at this point. If no changes, please email that; if you are making changes please send details: it might be price, contingencies, earnest amount, etc.

And the letter was asking for more money, to boot!
Come on, agents and sellers: start treating your customers with some basic respect.