patrick.net

swebb says

They supplied the crack, but they didn't make anyone smoke it. There has to be some responsibility/accountability with the borrower.

The best line I have read here in years.

Those people should not be here. They should relocate.

You left out they get better jobs, work 2 jobs, get raises. $10/hr is pretty low - these are entry level wages for that area. One or both of them should if they are at all industrious eventually move up the pay ladder, or be able to find a job that pays more.

It is a bad situation out there, and yes the banks/financial institutions have not operated in a ethical manner, shame on them, and I hope stronger much stronger regulations will come in place as to who can buy a house or not.

But, the coin has two sides. I did not read through all the posts and do not know what has been said already, but I have a take on this too. If we are to problem solve, we must look at issues from various perspectives.

Where is the responsibility of the buyer? If I am only making $40K /year, should I buy a home for $800K? Just as an example, of course a number of other factors play in.

As for myself, I would not mind at all living in my own home, but what held me back is the PRICE. I did a very simple unscientific calculation just for fun when I lived in a suite in a home. Landlady figured her house would sell for $700K, I was renting 2rooms/bathroom, share kitchen for $600 all included.
I figured if I was to buy this home and maybe pay $800 in mortgage, I would be paying till I am 160 years old or somethin like that. Obviously NOT REALISTIC AT ALL. That not counting in interest, taxes, maintainance, utils ETC.

This is more or less grade 3 math.

So, I have one thing to say: Hello???

I know, hindsight right? But still it does not add up.

I think one problem is people have become numb to credit, entitlement is rampant, keeping up with the jonese's regardless how idiotic it is.
I know people have been played by the media, banks. But come on!!! Would you go and buy a chocolate bar if it was $100 and it would take you 5 years to pay it off? A house is much more and far more complex purchase. Does it not make sense to really, really think this through before committing to the dotted line? If YOU dont look after your money, WHO WILL??

People have been saying, let the consumer speak. If a price is too high, people wont buy, if a product is shoddy, people wont buy. I guess the market is correcting itself by simple fundamentals, it has just been too high, and they could not afford it. Very simple.

Do the banks need to include an IQ/financial knowledge test before qualifying a buyer for a mortgage? If so, I could see many shaping up in their financial behaviour. This might be a good thing for the nation.

Ok, start your machine guns...

SIMPLE: don't have kids.

you don't need help being poor.

AdamCarollaFan says

SIMPLE: don't have kids.

you don't need help being poor.

Amen! The problem isn't how to help them, the problem is that they had too many Fing kids when they can't afford them. Until we get that through our heads, we'll continue to have poor who are looking for handouts to keep their lives in tact and keep pumping out children they can't afford. Cut off the umbilical cord and watch a significant change in behavior.

The Professor says

The Professor says

My real question is, given the underlying financial situation, how high can rents go before thay can't go any higher?

Anyone?

It's driven by supply and demand. Lower income people will leave the Bay Area and go to lower COL areas. If enough of them leave and the Area can't find enough low income workers, then wages will increase to the point that will bring those workers back.

The Professor says

Kids $0 (can't afford the time or money)

If you focus on that line item, you'll have figured it out.

No, it's not sustainable, in that, it can't replicate itself.

As designed.

Same with high college tuition and the middle class.

The only answer is to not replicate.

Again, as designed.

bgamall4 says

debyne says

The Professor says

The Professor says

My real question is, given the underlying financial situation, how high can rents go before thay can't go any higher?

Anyone?

It's driven by supply and demand. Lower income people will leave the Bay Area and go to lower COL areas. If enough of them leave and the Area can't find enough low income workers, then wages will increase to the point that will bring those workers back.

No, too many multigenerational people living and willing to work for cheap. It is not working for the worker right now as people have to retrench.

Well, then that's their choice. Why try doing something about it? It's in their hands.

bgamall4 says

debyne says

Well, then that's their choice. Why try doing something about it? It's in their hands.

I actually advocate multigenerational living. The banksters hate lack of household formation, and they almost think the young are stealing their profits by doing so!

I don't disagree with you...I think multigenerational living works on many levels. However, there is that trade-off of having to move and it sucks when it has to happen. I've had to pick up and move my family a couple of times and I hated it, but it was what was best for us in the long run and I couldn't be stubborn about it.