patrick.net

The people that are still holding out probably aren't much at liberty of taking the loss. That is to say, if you are living month to month and just scraping by to pay your monthly nut, thinking that peak prices are coming back (or needing a return much closer to peak levels to be solvent) you're not going to wake up tommorrow and say fuck it, just short sale the thing and be done with it. Just think of all that leverage that built up to get to the peak, do you really think we've worked thru that thus far? The boomers are oftened referred to as the "bulge in the python". The first boomers have barely begun to hit retirement age, this will be a tough pill to swallow for many. What has changed? We've used five more years worth of petroleum, piled on a ton more debt, and been lucky to have just semi-stabalized and slugged along. Now, you might anecdotally look at your own personal situation, or some of those in your sphere, and say things aren't that bad, we're doing good for ourselves. As a whole, the 315 million are still tapped, over worked, under paid, buried in debt and of negative net worth. You'd have to be insane to think that house price go up from here. Smells like a big fat trap to me.

Sorry for the tangent. I just don't believe there is this large swath of mortgage debtors watching for seasonal price spikes to escape. Then they'd be in the same shit situation and out on the street. Those people will squat it out as long as possible, return to lender, and the banks will lean on the tax payer to slowly bleed out the inventory. If they had to mark to market and realize these losses, how many are still solvent?

dunross,

The Fortress is "different". However, for the Rest of Us who are not in The Fortress, I think that the most likely outcome is not 'another down leg' but instead a very slow downward grind, year after year, etc., so slow and gradual that many will not recognize it for what is.

The next catalyst:

Well, I am working on one right now. I put a bird feeder into my apartment's back yard. The goal is to get TONS of birds to feed there. I will then work caffeine and laxatives into the feed so that they fly all over Mountain View, shitting on everything. Surely that will cause house prices to crater as all the people with expensive leased cars flee in terror from the white rain that could break the terms of their lease!

Alternatively, I could probably just gorge myself on super burritos for a week straight, overload the sewage system and drive everyone out once they cease to have functional septic infrastructure. It'll be a little messy, but worth picking up a 4/3 on a quarter acre in Mountain View for $100.

bmwman91 says

Well, I am working on one right now. I put a bird feeder into my apartment's back yard. The goal is to get TONS of birds to feed there. I will then work caffeine and laxatives into the feed so that they fly all over Mountain View, shitting on everything. Surely that will cause house prices to crater as all the people with expensive leased cars flee in terror from the white rain that could break the terms of their lease!

Alternatively, I could probably just gorge myself on super burritos for a week straight, overload the sewage system and drive everyone out once they cease to have functional septic functions. It'll be a little messy, but worth picking up a 4/3 on a quarter acre in Mountain View for $100.

MOST DESERVING UPVOTE, EVER! Five Thumbs Up!!

B.A.C.A.H. says

The Fortress is "different".

That can't be the case, that every other area, except the fortress goes back to fundamentals. If that was true, then, with each boom-bust cycle, the fortress would become more and more overpriced, relative to the other areas. History has shown, that this never happens. Quite, the contrary, with each boom-bust cycle, areas which were considered as a fortress before, evolve to become just ordinary neighborhoods, and areas which were ordinary become the fortress. Take Detroit, Cleveland, Houston and South Florida and others. All those areas were considered fortresses, in the past, and look at what happened to them, today. This is because, the govt can't inflate new bubbles in the industries which have already deflated. New industrial centers will rise out of the ashes of the bust, and they will not be the same as yesterday's fortresses.

Catalyst incubator;

http://sfbay.craigslist.org/sby/reo/3070271322.html

Banks, NAR, Government, and investors are in control of it, or so it seems to me sometimes. Time to clear inventory/carnage, as painlessly as possible for them of course. Home prices are moderating in the spring as they usually do, will we have another leg down, or are prices just north because of that. Looks like we might have to wait and see.

Rates are at record lows again, good time to try and pump the market up.

Point is they won't put inventory on the market for this reason. They want prices high. They are the ones that got them their in the first place. You owe you go: to work. The more you owe the longer you stay at work. Its not what they earn. That they have plenty of. Its your productivity + amount owed + time owed (measure of time owed = time at labor). That figures into most everything. Hey the more you get the bigger the asset you will spring for the nicer the asset they have. It sits there they either get a lot of labor to pay it off or a really nice asset to use again. See they utilize assets also in relation to labor.

If they didn't set the prices on houses realtors etc. How could they fix the time you will be at labor given the level of very measurable income as it relates to job description? So what this all adds up to is they aren't giving you any free time for yourself mush.

The bottom, bottom line you don't buy and sell uhuh your a fixed price retail kind of people that stays put and loses their houses instead. Thats the way it is. They want retail back but on their terms. Why give you an equity line? Simple. The bank has to pay the fed back thats one. Its interest multiplication going back in the other direction without offense of course. Within the qualifications that maxes you out and leaves you going through the revolving doors for a long time pumping out labor to get even. You can't leave you owe. Meanwhile you don't know what to do. So you give up your labor (which they can use you for anything they want including menial tasks) to be in debt for what they do know how to do. The difference bettween forced labor and debt not much they can make you work at anything they want in the way they want. In any way they decide. Object no one can do anything for you or about it the same thing really.

HRHMedia says

realtors should be paid $500 transactions fees on home sales upto $1500
no more

I only pay my tax accountant $200 to do my taxes, and he has a CPA. Why do realtors deserve more than that? My accountant actually works pretty hard for his money.

HRHMedia says

Valuations/Assessment & Inspections of homes should be done by the state and tied to the note!!!!!!!!!!!!!!!

I can't believe it! And, you don't see any moral hazard in that?

You guys just aren't listening. My army of caffeinated defecatory bomber birds will smash housing prices in a volley of white terror. Only those that smear the blood of a realtor above their front door shall be spared.

The complete collapse and utter repudiation of socialism.

HRHMedia says

realtors should be paid $500 transactions fees on home sales upto $1500
no more

Valuations/Assessment & Inspections of homes should be done by the state and tied to the note!!!!!!!!!!!!!!!

The state should hold the info and charges for a look by prospective buyers.!
(It should be the basis of the owners property tax valuation)!

The state should take some responsibility for the condition of the property it collects taxes on!

As is the case with realtors, THE STATE isnt independent of the transaction. The state would favor higher inflated values to gather higher property tax, finance their social agenda, and keep their elected position, keep high level of govt jobs.

You need someone completely independent who wouldnt benefit either way.

In California, that catalyst is Governer Jerry Brown.

In November we will have an election ito expand sales and income tax. The clueless voters will probably give him waht he wants.

My guess is that a win in November will embolden his next attack on Proposition 13 to expand property taxes.

Zlxr says

I'm concerned that we will get a new kind of money called IOU's which are really hard on the bookkeeping and bank balances. And I'm kind of wondering how a bank that isn't really solvent is going to honor IOU's.

That actually did happen back in 2009 as i recall. and yes some banks did honor the IOUs.

http://www.reuters.com/article/2009/06/25/us-california-debt-idUSTRE55O07Q20090625

California set to issue IOUs as fiscal crisis weighs

I think it will be caused by an increase in the interest rates. Then watch out!

HRH, I totally agree with your fee structure for realtors...they make way too much money. Why not start up a real estate company and establish a commission plan like that for the people who work there. Then when it becomes wildly successful you can franchise the operation and make millions.
Problem solved - no more greedy overpaid realtors !!

APOCALYPSEFUCK is Shostakovich says

They don't. The Realtor® should get $6 an hour, $6.50 an hour if they blow you, wash and wax the car and run to get you cigarettes.

Yes, and I know plenty of them who, I bet, would love to take you up on your offer. They haven't sold a single house in the last 2 years, but they will all tell you that sales are at multi-year high with multiple offers in the double digits.

What about HELOC-bombs? Along with the housing market boom, the HELOC boom began in the early 2000's. Most of these HELOCs were interest-only loans for the first 10 years, which then become 15-year fully amortizing loans.

However, most of these folks probably refinanced their houses in the mid-2000's. With houses appreciating six-figures a year, who wouldn't? Realistically, some of these HELOC bombs may start going off next year, but they won't peak until around 2016-2018.

I guess my only question is, how many houses are still sitting on a HELOC bomb, and how many have already defused their bombs?