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How many of you who bought post-bubble are now a bit of a hypocrite?

By edvard2 follow edvard2   2012 Jul 20, 5:54am 12,328 views   32 comments   watch   nsfw   quote   share    


I spent the better part of a decade waiting for the housing bubble to inflate and deflate. We spend more then that amount of time saving. All the while I was pretty frustrated and aggravated over the whole bubble thing. Many years spent on dozens of housing forums with equally annoyed posters. It wasn't at all jealousy. Just outright frustration. All of us knew that eventually the bubble would pop. But even after it did of course things didn't happen as planned and the pop was more like a slow hiss.

Fast-forward to today and after having actually bought a house and being quite pleased with it and the experience, I find myself not thinking the same way. I used to get highly annoyed by news about housing- especially if the headlines was something like: " Home sales rise faster than expected" or " Interest rates drop more" or whatnot. But now I sort of don't care. I guess being a total hypocrite, to me its like- oh well, I got mine, so who cares? I seriously could care less if the home we got goes up or down in value. We have retirement accounts for that sort of thing. So other than that, I don't really spend a lot of time- if any- delving into the issues with the housing market.

Sure- I still think housing is overinflated- especially in the Bay Area. But do I actually really care as much? Not really. Thus why I guess I've turned into a hypocrite.

#housing

1   bmwman91   ignore (1)   2012 Jul 20, 6:05am     ↓ dislike (0)   quote   flag        

I can't blame you. After spending a decade being irritated, you have to call it quits sometime and use that energy to enjoy your life. You obviously didn't buy on a whim or for the usual stupid emotional reasons ("my kids neeeeeeeeeeeeeeeeeeeed a house or they will be forever unsuccessful and unhappy"), so you have the right to say "screw it." You certainly aren't in here, like some certain buyers of the last couple years, telling everyone that they have to be like you now.

2   edvard2   ignore (1)   2012 Jul 20, 6:13am     ↓ dislike (1)   quote   flag        

bmwman91 says

You certainly aren't in here, like some certain buyers of the last couple years, telling everyone that they have to be like you now.

No, and I still have no problem renting. In fact, I loved renting the last place we had. I recommend renting if you're not sure where you'll be in 5-10 years or if you haven't ( yet) saved up the cash for a down payment or don't have a retirement plan in good order already. Also- I'm finding that a lot of the things that were great about renting are not part of owning. Like for example I had to repair one of the door locks. Stupid parts were $30. Its also nerve wracking to realize that I am responsible for anything that breaks or needs repair: Appliances, paint, the roof, the yard, and so on. None of those things are cheap.

Am I glad we bought? Yeah. I like it so far. But I wouldn't say its superior to renting. Its in all reality to me a wash. Both have their pros and cons. Its just what might be best for people on an individual basis.

3   Tenpoundbass   ignore (16)   2012 Jul 20, 6:49am     ↓ dislike (3)   quote   flag        

I share your sentiment in the first paragraph, but not the second.
I think the RE Bears now are over reacting, they are waiting to squeeze the very last cent out of the down side.

I maintained even before I bought my house, that there comes a time that your sanity and sovereignty of your own house, becomes more valuable than what those idiots in Washington are doing now to thwart RE free markets. I was willing to get in the market at 175K based on 5% interest rates. Then the average house finally came down to 160K even better and the rates got even lower at 4.50%.

Now rates are even lower but of course the MIP insurance makes the monthly payment more than I am playing at 4.50%.

I'm not concerned with the RE spin that prices are rising again, because we all know that is a load of boxes, with a crock shit in each one.
IF that were the case, then the banks wouldn't be blitzing houses out to investors for pennies on the dollar, bringing down the price of RE for those real owner occupiers and driving down the pride of ownership in neighborhoods.

The end result I fear will end up with the bulk of the housing stock owned by the RE Investor class setting rents high, and driving RE way up out of whack. Because the inventory will be low due to the investor owners.

Does it effect me now? NO, but now, as during the height of the bubble, my concerns are less about me, and more about the future of my Children and their Children.

4   BayArea   ignore (1)   2012 Jul 20, 8:07am     ↓ dislike (0)   quote   flag        

Edvard,

I applaud your position, but, I also get this underlying feeling that you are trying to convince us way too hard that you "don't care." The harder you try to convince us, the less I am sure that I believe you ;-)

5   Michinaga   ignore (0)   2012 Jul 20, 9:20am     ↓ dislike (0)   quote   flag        

Edvard, I know how you feel, but I'm a hypocrite in a different way. My market is very, very different from yours -- I'm in Tokyo -- but I bought an old condo 15 years after the Japanese bubble popped, and felt really good about my purchase because, as I saw it, prices could still go down, but I was planning to rent out my condo some day, and I had a fantastic 130-month ratio even after maintenance wassubtracted out.

I paid 14 million yen (about $130k at the time) plus another Y3 million for renovations, and at the time this unit would have rented for about Y130,000 per month, but now I"d be lucky to get Y95,000. The lack of young people and the lack of job opportunities are pulling the market down further than anyone expected. People vacating eastern Japan after the earthquake hasn't helped, and power rationing for the foreseeable future isn't helping either.

So after feeling pretty chuffed three years ago, now I'm feeling like I still lost money. I know that it's the expensive renovations that are the culprit, and that each additional year I stay here is money in the bank, but it still bugs me to see rents drop every time I look at a flyer. I should just stop looking in the windows of real estate agents and just enjoy my home!

6   CrazyMan   ignore (0)   2012 Jul 20, 10:06am     ↓ dislike (0)   quote   flag        

CaptainShuddup says

I maintained even before I bought my house, that there comes a time that your sanity and sovereignty of your own house, becomes more valuable than what those idiots in Washington are doing now to thwart RE free markets. I was willing to get in the market at 175K based on 5% interest rates. Then the average house finally came down to 160K even better and the rates got even lower at 4.50%.

I'm not going to lie. If I could buy a house for 160K (sorry, not to be a dick, but that's borderline chump change) I'd be happy to buy and move on as well.

But when a standard middle class home in a non-ghetto part of the south bay is 600-700K, then yeah, I'm still a little frustrated with the prices.

Also, to the OP, the hypocrites on this board are nothing. The Redfin board is full of the biggest tools I've ever seen in my entire life.

7   CL   ignore (0)   2012 Jul 20, 10:35am     ↓ dislike (0)   quote   flag        

Hopefully, you don't feel that way because the market hasn't dipped precipitously since you've bought. Would you feel the same if it does?

What if they start renting foreclosed properties en masse and comparable rents drop lower than a mortgage?

Good luck either way Edvard.

8   bmwman91   ignore (1)   2012 Jul 20, 11:06am     ↓ dislike (0)   quote   flag        

Michinaga says

I should just stop looking in the windows of real estate agents and just enjoy my home!

Dude, you think that the RE industry is going to stop telling you to be unhappy with your life after you buy? Hahaha. Misery and discontent is the engine that powers their whole stupid cartel.

You are a sucker if you rent. So you buy.
You are a sucker if you don't have multiple other properties for cash flow. So you buy other houses.
You are a sucker to live in that old shabby house, what with your burgeoning RE empire. So you buy a giant mansion that you can barely afford. The economy contracts and you lose your job and have to sell the rental properties. The McMansion was ill thought-out and you walk away, and you rent again.
You are a sucker for renting. So you buy.
..........

9   Buster   ignore (0)   2012 Jul 20, 11:41am     ↓ dislike (0)   quote   flag        

Interesting post and I find myself in the same boat. For starters, I have always looked at my houses, condos, apartments and townhouses as a home. My home is very important to me, whether I am renting it or not. I rented until I was 36, and after that have owned 80% of the time. I'm not so much a hypocrite as I am someone who simply wanted what I valued and loved. My first townhouse I purchased because it was cheaper than renting. Sold, after 4 years, made a few bucks, and just a few. My second place, I built with my spouse because it was what we loved. It was super modern. Everyone told us we were crazy to build and that we would never be able to sell when the time came. But we forged ahead anyways because that is what we loved at the time. After 5 lovely years, made a few bucks, just a few but surprisingly it sold the first week it was on the market. The third place, a condo, we purchased because we could not find a place to live that we liked that would accept our dear Buster, the dog, and I love our dog more than most humans. The next condo, needed to stretch out a bit as two adults and a big dog were simply too much for an 889 sf condo so graduated to a 1048 sf monster condo....we sold the 889 sf one after just a year, and were living in crazy Vancouver so the price had gone up over 100K. I simply laughed and marveled how my Buster could make 100K/year having never attending school or work a day in his lovely life. Lived in our monster 1048sf condo for 4 years and had to move back to the US...another 100K, again, all due to Buster's smarts and not mine. Now in the bay area. For the first 6 months rented DT SF and loved it. Decided to buy when our landlord increased the rent from 3K to 5K...no lie. So again purchased a one of a kind cottage in the redwoods for 1/2 what it was listed for 3 years earlier. Sure, we expected it to go down in value and I believe it did. Current comps tell another story. So I never purchased once because I thought it was a great investment. I did so because I love homes and architecture, I love my spouse and high earner dog and I love redwoods and unique properties. It is my HOME after all. Did I get lucky? You bet as it could have just as easily turned out the other way. And it still might. But I have followed my loves and it paid off. I once asked my spouse if we lost everything, would he still love me and live with me under the bridge across the street when living in a high rise in Vancouver. He said he would and it warmed my heart. In the end you can't take the cash and homes with you but I believe in my heart that love will follow or lead us forever.

10   Carolyn C   ignore (0)   2012 Jul 20, 12:12pm     ↓ dislike (2)   quote   flag        

shut up! when you have kids you can talk. otherwise shut up yuppie

11   bmwman91   ignore (1)   2012 Jul 20, 12:29pm     ↓ dislike (0)   quote   flag        

Carolyn C says

shut up! when you have kids you can talk. otherwise shut up yuppie

Chances are that the poster you are telling to shut up has the money to play with RE because he does NOT have kids. Life's a load of compromises. Having kids is a HUGE item on the "want" list, and as you likely know all too well, checking that item off requires crossing out a bunch of others. If I asked you if you would rather have kids OR have a house, I do not doubt for a second that you would choose your kids.

Don't let yourself fall victim to the self-pity mentality...you got to have kids, which is physically not an option for a lot of people. There are more important costs associated with raising happy, healthy kids than buying a house. Yeah, other people have more money or are willing to borrow more to get their name on a deed. Just because you think that they are happier than you does not mean that they actually are, or that their happiness means that you must be unhappy until you are exactly like them. Would you EVER tell your kids that they can only be happy if they do what everyone else is doing? Would you tell them that they cannot be happy until they acquire an arbitrary measure of material wealth?

I already know what sort of response this post will generate, but hopefully I am wrong.

12   Buster   ignore (0)   2012 Jul 20, 12:43pm     ↓ dislike (0)   quote   flag        

Carolyn C says

shut up! when you have kids you can talk. otherwise shut up yuppie

Angry victim. Clearly you did not see the point of my post at all.

13   StoutFiles   ignore (0)   2012 Jul 20, 1:49pm     ↓ dislike (0)   quote   flag        

The smart money is on renting 99% of the time. You don't know if you'll keep your job, if the market will collapse, if taxes will skyrocket, if your home gets badly damaged, etc. Money wise, you will almost always come out ahead by renting.

However, you only get one life and a lot of people want to spend it in a house. That's fine, but the sooner you accept that you are likely losing money to own a home, the better you'll feel. Buy something you can afford instead of living month-to-month to pay for it. Stop worrying about falling value and enjoy the extra privileges buying gives you.

14   B.A.C.A.H.   ignore (0)   2012 Jul 20, 2:50pm     ↓ dislike (0)   quote   flag        

Ewww, icky poo - children.

"We don't want to do the 'kid thing'."

This attitude, more than anything else, will give the world the rise of The Islamic Republic of Europe, faster than you can say "what's become of western values?".

15   bmwman91   ignore (1)   2012 Jul 20, 3:05pm     ↓ dislike (0)   quote   flag        

B.A.C.A.H. says

Ewww, icky poo - children.

"We don't want to do the 'kid thing'."

This attitude, more than anything else, will give the world the rise of The Islamic Republic of Europe, faster than you can say "what's become of western values?".

Do I sense condescension towards people without kids?

Is it our duty to save the world from all those brownies by pumping out as many white, Christian children as possible? Yes, Europe faces some MAJOR issues from the mass influx of ultra-conservative Muslims that have no intention of integrating, but Europeans out-breeding them won't fix anything. Their issue stems from their collective lack of testicles to tell the Sharia Law masses to integrate or get the fuck out (and have the capability to boot them out if they refuse to comply).

16   B.A.C.A.H.   ignore (0)   2012 Jul 20, 3:19pm     ↓ dislike (0)   quote   flag        

bmwman91 says

Do I sense condescension towards people without kids?

No. Just the uppidityspeak of "some" people. I know lotsa childless adults, probably you do too, who don't share like that. Even in the Cool and Hip Bay Area.

17   B.A.C.A.H.   ignore (0)   2012 Jul 20, 3:20pm     ↓ dislike (0)   quote   flag        

bmwman91 says

s it our duty to save the world from all those brownies by pumping out as many white, Christian children as possible?

Where did I mention white or Christian? (You were the one who mentioned parochial school in the other thread, not me. Or did you mean a madrasa?)

BTW we both know that neither you nor I are part of a "white solution".

18   bmwman91   ignore (1)   2012 Jul 20, 4:03pm     ↓ dislike (0)   quote   flag        

Sorry, just being facetious. You know that Bay Area etiquette requires that any white person that does not outwardly display guilt for being white be labeled as a WASPy bigot. (more facetiousness btw)

But yeah, I would put my kids in parochial school because it is well structured and seems to do well at teaching more than SAT facts. I did 12 years in parochial school and I emerged an agnostic. It isn't the Christian brain-washer that some think it is.

19   swebb   ignore (2)   2012 Jul 20, 6:58pm     ↓ dislike (0)   quote   flag        

CrazyMan says

(sorry, not to be a dick, but that's borderline chump change)

Hint: next time just omit the parenthetical comment altogether if you want to "not be a dick"

20   lostand confused   ignore (0)   2012 Jul 20, 9:55pm     ↓ dislike (0)   quote   flag        

I think that is human nature. When we jump into something, you want to be right and start looking at reasons to justify your decision .

Some people in life get tossed around by tsunami waves and live to tell the tale. Some of them may realize you really have no control-well not all the control over life- and reach a state of neutrality about the outcome. But for most of us we do want to be right.

21   B.A.C.A.H.   ignore (0)   2012 Jul 22, 3:46am     ↓ dislike (0)   quote   flag        

E-man says

be honest with us here. It doesn't feel the same being a homeowner than being a renter

Everybody is an individual and we should not presume to know how others feel inside of their own minds.

If we could do that, there'd be 12 more people living in Colorado today.

22   FNWGMOBDVZXDNW   ignore (2)   2012 Jul 22, 10:47pm     ↓ dislike (0)   quote   flag        

I bought a year ago. Overall, it decreased some angst about the housing situation. We under-bought price wise, and that limited the emotional aspect to some degree. But it is still hard to be emotionless after making such a big investment. Maybe it's better just to recognize whatever emotional changes are there & move on.

If I bought a house that I thought was overvalued, it would bother me. It may still prove to be a good decision if you are going to be there a long time. But it's a big potential liability if you cannot walk away easily & that should probably be an emotional pressure.

23   Hysteresis   ignore (2)   2012 Oct 1, 2:10am     ↓ dislike (0)   quote   flag        

edvard2 says

But now I sort of don't care. I guess being a total hypocrite, to me its like- oh well, I got mine, so who cares?

after buying a house, i'm hoping to completely ignore housing news. i hate spending so much time on it. there's more productive things to do. it doesn't make you a hypocrite. it just means you've got other priorities.

my buying rule is no more than 20% net worth (for the down payment), and no more than 20% net paycheck(ie after taxes) for the monthly costs(mortgage payment, insurance , and taxes). ideally, it would be a 15 year fixed mortgage.

the reason for the rule is i want no more than 20% of all my assets and net income exposed to a non-productive asset.

this allows me to diversify and continue funding retirement with the cash left over.
also if RE prices crash another 50% (which i doubt but you never know), my net worth will drop only 10% (assuming a static 20% exposure to RE). this is a simplification but i'm sure you get the idea.

finally, after many years, as income grows (at least with inflation) the percentage towards monthly payments decreases. the portion of total net worth allocated to housing should also decrease assuming my investments grow faster than the price of the house, and due to increased savings.

24   dublin hillz   ignore (0)   2012 Oct 1, 4:48am     ↓ dislike (1)   quote   flag        

Ultimately, everyone should be a truth seeker when it comes to buy vs rent. Unfortunately, it appears that some people who were speaking the truth back during bubble days while everyone was blindly buying have become a bit like what they hated - now they preach renting no matter what and seem to be in denial about rising rents that crush workers. When prices for rents become exorbitant and extortionary that needs to be acknowledged instead of pretending like it does not exist.

25   Peter P   ignore (0)   2012 Oct 1, 5:13am     ↓ dislike (0)   quote   flag        

Truth is subjective. Everyone should do what is best for him and take personal responsibility for his actions.

26   Dan8267   ignore (3)   2012 Oct 1, 5:46am     ↓ dislike (1)   quote   flag        

It's human nature, and it's the reason why no party should have control of markets. Just remember, whenever someone gets a deal as a buyer and then as a seller because of timing, his kids and grandkids get screwed.

27   jsmarket   ignore (0)   2012 Oct 1, 5:54am     ↓ dislike (0)   quote   flag        

Edvard...you're like the twin brother I never knew.

I, too, sat on the sidelines (for 10 years) and bought a house 60 days ago. I used every bit of those 10 years renting and saved versus the equivalent home purchase and prevailing interest rates then. I feel a bit hypocritical, too.

We scored what we consider the home of our dreams, so different for everyone I realize, and put 20% down. The bank told us with our assets and FICO's we could've bought 2x the house and they would've approved us. In the 6 months looking from Jan to July, we went from Union Bank at 3.6% to First Republic at 2.9%. It was a Jumbo, so no FHA for us...if you're in the market for a JUMBO I highly recommend First Republic.

Hey, if your concerned about future house catastrophe's, just keep your home warranty up to date. First Republic requires it for the first year and our realtor bought it for us (cost her ~$400).

28   bubblesitter   ignore (0)   2012 Oct 2, 1:08am     ↓ dislike (0)   quote   flag        

I am here from day 1 of this site. Someday I'll buy but never come back here and scream - it is time to buy - like one guy who did it once he bought. IMO housing is never a good investment - it is a place to live - kinda luxurious commodity - you always loose money.

29   37108605   ignore (0)   2012 Oct 2, 1:18am     ↓ dislike (0)   quote   flag        

B.A.C.A.H. says

Even in the Cool and Hip Bay Area.

Any area to me that considers itself cool and hip? ISN'T

30   37108605   ignore (0)   2012 Oct 2, 1:19am     ↓ dislike (0)   quote   flag        

bgamall4 says

jsmarket says

The bank told us with our assets and FICO's we could've bought 2x the house and they would've approved us. In the 6 months looking from Jan to July, we went from Union Bank at 3.6% to First Republic at 2.9%. It was a Jumbo, so no FHA for us...if you're in the market for a JUMBO I highly recommend First Republic.

You are the exception, not the rule. Jumbos are evidence of a very expensive house. But, realize this, your 20 percent could be wiped out in a flash if toxic lending becomes the norm and destabilizes things. But if you are in an area where most of the loans are 20 percent down you will have a more stable neighborhood.

Gary Anderson strategicdefaultbooks.com

My theory is if one must take out a JUMBO? they likely cannot afford the place to begin with so they must be pretty fucking DUMBO

31   37108605   ignore (0)   2012 Oct 2, 1:21am     ↓ dislike (0)   quote   flag        

War says

Reader says

Any area to me that considers itself cool and hip? ISN'T

TOUCHDOWN!

It is a fucking joke isn't it? I have yet to see one God damn area touted as cool and hip be anything more than sad poseurs and insecure wannbes desperately shelling out big money for overpriced shite.


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