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The Housing Trap


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2012 Sep 18, 8:53am   204,426 views  261 comments

by Patrick   ➕follow (59)   💰tip   ignore  

http://www.amazon.com/Housing-Trap-Buyers-Captured-Yourself/dp/1479156213/?tag=patricknet-20

It's $12.50 so that if you buy two (makes a great gift!) then you don't have to pay any shipping charges.

Here is the table of contents:

Trapped! 8

  Can't Sell 9

  Can't Pay Off Mortgage 10

  Must Keep Obeying Boss 10

The Conspirators 12

  Your Agent 12

  Your Mortgage Broker 18

  Your Bank 18

  Fannie And Freddie 19

  The Federal Reserve 20

  Newspapers 21

  The NAR 23

  Congress 24

  The President of The United States 25

  Current Owners 25

  Your Boss 26

  Your Parents 27

  Your Wife's Parents 27

  Your Wife 27

Fallacies and Fantasies 30

  Appreciation 30

  Building Equity 32

  Renters Throw Money Away 34

  Tax Deduction 37

  Real Estate Is Local 39

  So Little Supply 40

  So Many Buyers 40

  Foreigners 41

  House Prices Don't Fall To Zero 41

  Supply And Demand 42

  Land Shortage 44

  Fundamentals Don't Matter 44

  Commissions Don't Matter 45

  Agents Don't Care What You Pay 46

  My Neighborhood Is Different 46

  You Have To Live Somewhere 47

  Rentals Not Available 48

  Rentals All Suck 48

  Owners Can Remodel 49

  But The Newspapers Say... 50

  But The Appraiser Said... 51

  Home Sweet Home 52

  Status 53

  Affordability Is Good Now 53

  Owning Limits Your Monthly Payment 54

  People Buy On Emotion 55

  Baby Needs House 55

  I Just Want It 56

Scams and Dirty Tricks 58

  Realtors® Claiming They re "Free" 58

  Claiming That You Need An Agent 60

  Showing You The Ugly Dogs First 61

  Underpricing 62

  Missing Price 64

  Missing Address 64

  Renting Property Without Permission 65

  Straw Buyers 65

  Faking Comps 66

  Faking The Dimensions 67

  Faking The Sale 67

  Erasing Price History And Relisting 68

  Faking Higher Offers 69

  Hiding Your Low Offer 69

  Taking Bribe To Hide Your Offer 70

  Hiding Offer To Get Double Commission 70

  Hiding Offer To Get Seller To Take Loss 71

  Photoshop 71

  Advertising Agent Instead Of House 71

  Kickbacks 72

  Bribes 72

  A Trick Of Your Own 73

What Should You Do? 75

  Be Paranoid 75

  Never Sign Any Agent Agreement 75

  Never Reveal Your Price Limit 77

  Hire Your Own Independent Inspector 78

  Favor FSBOs 78

  Do Not Rush 80

  Do Not Overpay 81

  Deliver Offer To Seller Personally 83

  Pay Cash 84

  Long Term Lease 85

  Walk Away 85

  If You're A Realtor® 87

Calculating Fair Price 88

  Two Kinds Of Rent 89

  Borrowing Does Not Help 91

  Downpayment Doesn't Help Much 91

  Conventional Mortgage 92

  Deduction Doesn't Help Most People 93

  Appreciation Is Uncertain 95

  Taxability Of Gains 96

  What About Leverage? 97

  What About Inflation? 98

  Rules Of Thumb 99

  Anything else? 101

Long-Term Solutions 102

  Call Housing Inflation What It Is 102

  Help Correct Reporters 103

  No Public Guarantees For Private Debt 104

  No Mortgage Interest Deduction 105

  Public Bids On Housing 107

  Legally Binding Offers To Sell 108

  Eliminate Comps As Meaningless 108

  No Empty Houses 109

  Publicly Financed Elections 110

  End Proposition 13 In California 111

  The Georgist Land Value Tax 112

  Spread The Word 113


« First        Comments 133 - 172 of 261       Last »     Search these comments

133   JodyChunder   2012 Sep 20, 10:25am  

PockyClipsNow says

I prefer my idea

Funny -- I preface nearly every other sentence with those very words...

134   Oxygen   2012 Sep 20, 2:01pm  

Quigley says

When my wife makes the mistake of belittling me or talking down to me, even if she has a point about something, I get mad! If she nags at me like I'm a child that needs to be told again and again, I get mad, and nothing productive is accomplished.
On the other hand I think that women are set off more by the presence of or lack of shown love. If I refuse to help my wife with something, that to her, shows lack of love and she gets upset. If I don't compliment or dote on her and make her feel like I want to be with her, again lack of love = meltdown. If I, heaven forbid, make a disparaging comment about her person, that is just asking for an estrogen bomb! Forgetting birthdays, anniversaries, v-day etc are all manifestations of a lack of love.
Guys might feel love for their sweetheart all the time, but she needs us to show it for it to be any good for her.

http://www.youtube.com/embed/hPIxrzmatq0

135   RealisticOptimist1   2012 Sep 20, 2:28pm  


RealisticOptimist1 says

I wish this could go mainstream, but unlikely. Just this weekend I was out with friends and talk about the house next door (I rent) being up for sale for 350k with 10k in taxes was viewed as a "good price." I was trying to make a joke about it being a "bargain," but to my disappointment, they took it seriously. Keep in mind this house sold for 195k in 2001, and taxes have more than doubled since then.

This could go mainstream!

Just loan your copy to them for a while.

They'd never read it, which is why I don't even bother engaging in discussion. :/

136   elliemae   2012 Sep 20, 5:38pm  


Elliemae told me that she paid the $25 to createspace.com to have "expanded distribution" through stores and other online sellers, but all they did was undercut her price, bringing her profit to $0, so she doesn't recommend that that.

Anyone can be an online seller - so if you pay for the "expanded distribution," that means not only can bookstores order it but also the Amazon online booksellers can too - only they receive all the profit.

So, when you pull up a book on Amazon and there are a bunch of options (a few of which undercut Amazon by less than a buck and one that sells it for $60 (!), most of the time these sellers are ordering from Amazon the same way as if you ordered directly from Amazon - only they're reping the profits. Does that make sense?

I put my book up for $16.95 plus s&h; and believe me - it's a bargain considering people pay thousands out of pocket when they qualify for Medicaid, or they hire a case manager to assist with placement when they still have to make the decisions anyway - but some asshole listed it immediately for $16.19.

I learned alot about the publishing angle. Let's get real - if my book sells enough that a publisher is interested in it, I can deal with it at that time.

137   JodyChunder   2012 Sep 20, 5:50pm  

RealisticOptimist1 says

hey'd never read it, which is why I don't even bother engaging in discussion. :/

10K in TAXES!!!...you must be TEXAS!

138   Patrick   2012 Sep 21, 2:44am  

elliemae says

I put my book up for $16.95 plus s&h; and believe me - it's a bargain considering people pay thousands out of pocket when they qualify for Medicaid, or they hire a case manager to assist with placement when they still have to make the decisions anyway

I agree your book is really valuable to the right crowd (people in need of good nursing home advice), but that crowd is rather sparsely dispersed through the general population. So general advertising is probably not going to be very effective, and maybe even word of mouth will be difficult because the people who need it probably don't even know each other.

Somehow you have to advertise right to the audience that is in need of nursing home info. Maybe people here have ideas on how to do that?

139   crazydesi   2012 Sep 21, 3:08am  


I'm still waiting for my own copies! I have not seen a physical copy of the final book yet.

But several people wrote me that they got their copies, so it's coming.

I got the book on 17th and finished reading the book on 17th night itself. One thing I did not like is about the spouse pressure, it is little exaggerated. My wife got mad by reading that page (btw she always tells her friends to read patrick.net before going with a realestate agent to see homes).

Overall its a great book, but a small one.

140   Patrick   2012 Sep 21, 3:58am  

crazydesi says

the spouse pressure, it is little exaggerated

Is it better to just delete or neuter that part of the sake of political correctness and inter-gender harmony, or to keep it for the discussion and controversy value?

I believe there is truth in it, but I can also see how it can be perceived as offensive.

crazydesi says

Overall its a great book, but a small one.

Thanks. Part of the idea is not to waste any words.

141   happycamper   2012 Sep 21, 4:33am  

crazydesi says

the spouse pressure, it is little exaggerated

Agreed. On the other hand, we live in a society where house, translated, "home" is an emotionally charged concept that has been around for a long time. That is a tough one to get past. Especially, when so much of our society promotes the concept as part of "the American dream". Personally, this bubble has created a new way of thinking for me in regards to that American dream, that perhaps I may not have been open to before.

142   freak80   2012 Sep 21, 5:03am  


Sheesh. Sales tax is the first tax that should be eliminated in favor of a land value tax. It would be the same amount of revenue, but the paperwork and harm to commerce would be far less.

But it also means less government control of individuals. We can't have that.

143   javco   2012 Sep 21, 5:21am  

Patrick,

Placed Amazon order on the 14th for your book, eagerly awaiting arrival. BTW: . Had another line item to qualify for free economy shipping with HT order, place PayPal, etc.

I was notified SIX DAYS LATER on the 20th that the 'order shipped' with est delivery date of Sept 25.

Good God. Beware of 'Free Shipping' delays. . .

Congrats on the Book. If I ever receive it I look fwd to commenting !

ps: even though CA mail-order sales tax took effect on the 16th, Amazon, the company with a heart still charged sales tax on the order placed on the 14th. . .

144   Patrick   2012 Sep 21, 6:46am  

Hmmm, another article seeming to show that women want that house about twice as much as men do:

http://money.cnn.com/2012/02/14/real_estate/dating_homeownership/index.htm

This also supports my point in the book that women prefer men who own houses in general -- but the study failed to examine women's preferences between men who own houses vs. men who have large amounts of cash and no debt, but are renting.

145   freak80   2012 Sep 21, 6:47am  


This also supports my point in the book that women prefer men who own houses in general -- but the study failed to examine women's preferences between men who own houses vs. men who have large amounts of cash and no debt, but are renting.

What about men who own small, crappy houses? ;-)

That's my "game plan" to avoid long-term serfdom.

146   resistance   2012 Sep 21, 6:54am  

You can call it sexist, but I think it's likely that once a woman moves into that small crappy house, it will probably get spruced up and no longer be crappy.

And if you own it outright, I'd expect that's a big plus too.

147   freak80   2012 Sep 21, 7:02am  


You can call it sexist, but I think it's likely that once a woman moves into that small crappy house, it will probably get spruced up and no longer be crappy.
And if you own it outright, I'd expect that's a big plus too.

Hmmm...good point. Of course if it's TOO small and TOO crappy, she might want to move to a much bigger/nicer house. Then I get stuck with 6% realtor fees and other transaction costs, PLUS I end up with a bigger/nicer place than I can really afford. Sort of the worst of both worlds.

I don't think it's sexist. For whatever reason women tend to be more status-conscious with houses, and men tend to be more status-conscious with things like sports cars. ;-)

148   leo707   2012 Sep 21, 9:02am  


crazydesi says

the spouse pressure, it is little exaggerated

Is it better to just delete or neuter that part of the sake of political correctness and inter-gender harmony, or to keep it for the discussion and controversy value?

I believe there is truth in it, but I can also see how it can be perceived as offensive.

I have not read it yet, so I can't really speak to whether or not it is too sexist.

I don't think that you should delete or neuter the section just for political correctness and inter-gender harmony.

However, even if the wife pressure page is correct 75% of the time for women and only 25% of the time for men, then you are making people feel unjustly pigeon holed a good deal of the time.

I don't think that it would "neuter" the chapter if it was make less of an absolute judgement on the psyches of women. But then again having not read it yet, I have no idea what the fuck I am talking about.

;)

149   MAGA   2012 Sep 21, 9:49am  

Just downloaded the Kindle version of The Housing Trap. Thanks Patrick.

150   Patrick   2012 Sep 21, 9:57am  

Thanks! I can see the extra Kindle sale here:

https://kdp.amazon.com/self-publishing/reports

There were three earlier today, and now there are 4:

Paper books are now at 111 sold!

151   MAGA   2012 Sep 21, 10:11am  


Paper books are now at 111 sold!

So are you going to buy a house with your new found wealth?

152   Patrick   2012 Sep 21, 10:28am  

Not unless it's a really good deal!

153   MAGA   2012 Sep 21, 10:37am  


Not unless it's a really good deal!

Here is a good one for you. Half an acre of land, walking distance to the Elementary School, just down the road from the club house and golf course.

http://www.zillow.com/homedetails/7203-Saddle-Side-Boerne-TX-78015/26166175_zpid/

It's been on the market for a while as the property backs to a busy road. I've seen worse here in the Bay Area. Owner would be willing to make a deal I'd bet.

154   skinnyninja   2012 Sep 21, 10:43am  

Bought and read it on Kindle. Happy to be renting for $425/month!

Thanks for your book, and your site.

155   Patrick   2012 Sep 21, 2:18pm  

Any advice for improvement?

156   MAGA   2012 Sep 21, 2:32pm  

Enjoying a quick bite to eat while reading my Kindle version of The Housing Trap. :-)

(Millbrae, CA)

157   skinnyninja   2012 Sep 22, 8:18am  

Test alternate subtitles:

"Avoid a lifetime of debt and live free"

"A mortgage is no way to live"

"Why everyone in housing wants you broke"

"Finding economic freedom in today's market"

Etc.

Brainstorm more, then rotate them into Adwords a la Tim Ferriss. Find the most clickable subtitle. Sell more books.

158   Indiana Jones   2012 Sep 23, 1:26pm  

I'd absolutely trash the "wife" title and go with "spouse". I am actually a little surprised you included the term. I for one did not take into consideration whether or not my husband had a "house" for me when I decided to marry him. That is a sweeping generalization About women and I believe you are vastly limiting your market if you make this a gender issue.

My best friend's husband pushed them into a house twice in the last ten years- one they short sold and they now own a house they are heavily underwater in and behind on their mortgage. It is not always the women. Men are also pressured to be "homeowners" and having ownership of a house show them as being a "good provider".

159   Patrick   2012 Sep 24, 2:07am  

You can now see the first few pages with the "Click to LOOK INSIDE!" link on the Amazon page for "The Housing Trap":

http://www.amazon.com/Housing-Trap-Buyers-Captured-Yourself/dp/1479156213/?tag=patricknet-20

160   freak80   2012 Sep 24, 2:46am  

skinnyninja says

Happy to be renting for $425/month!

Do you live in Erie, PA? There, a decent 1 br can be had for that price. I know because I used to live there.

The local joke was, "you know you're from Erie when your winter heating bill is higher than your rent."

161   37108605   2012 Sep 24, 3:30am  

freak80 says

The local joke was, "you know you're from Erie when your winter heating bill is higher than your rent."

I had a cousin in Erie, actually very nice people around that area. Real salt of the Earth hardworking people.

You know that phrase applies to many already, or will apply to many areas soon.

162   37108605   2012 Sep 24, 3:33am  

leo707 says

I don't think that you should delete or neuter the section just for political correctness and inter-gender harmony.

NO WAY

I agree. PC lunacy is SO 2000.

163   aragonzbooks   2012 Sep 24, 9:29am  

What I appreciate most about Patrick's book are two essential ingrediants to a classic: genius, and courage. Patrick is a true hero and, although I do not know him personally in any manner whatsoever, I respectfully urge everyone to post reviews on Amazon amid so many authors who have never sacrificed as much for their audience of readers and buyers of books as Patrick has done for all of us. Thanks again Patrick, and thanks to anyone else for listening.

164   freak80   2012 Sep 26, 2:22am  

Reader says

I had a cousin in Erie, actually very nice people around that area. Real salt of the Earth hardworking people.

The kind of people the modern Democrat party has abandoned.

Luckily they have their guns and religion to cling to.

165   aragonzbooks   2012 Sep 26, 4:28am  

The wife/woman thing doesn't bother me at all - we need Patrick's help with this book to survive the nightmare; and I don't have time for the niceties when Truth at the core, and those with the courage to put it out there (like Patrick and elliemae) is what really matters.

166   MAGA   2012 Oct 1, 11:46am  

I finished The Housing Trap this afternoon, on my flight from SAT to SFO. Good work Patrick.

167   Patrick   2012 Oct 1, 11:57am  

Thanks! Suggestions for improvement?

168   David9   2012 Oct 1, 12:18pm  

I also finished your book this weekend Patrick. What sticks with me most is that little book is really my only friend when it comes to buying a property. 'Paranoia has never failed me' is one of my mottos.

Improvements? Nothing striking that comes to mind, not all situations fit all people. I intend on reading it again and could probably come up with blog like discussion as in this board if interested.

It's your second book! You should be damn proud.

I have two copies and fully intend on sharing.

169   Patrick   2012 Oct 2, 5:58am  

152 paper copies and 42 Kindle copies sold so far!

I've started writing radio stations hoping to get interviewed. One good national interview and I think sales could really take off.

170   David9   2012 Oct 2, 6:07am  

Again, I think you have something here.

Most people don't know really how the Real Estate Industry works and your book is easy enough to read for most.

As you are probably aware, there are people out there who don't want you to get the information out.

Paranoia, it works.

Best of luck with the marketing, say a 100,000 sales goal to start would bring some liquidity. I hope, to start.

171   Goran_K   2012 Oct 2, 6:20am  

Patrick, I think your cause is just, but how are you going to battle the FED gangsters who have made it their mission to create a false bottom in the market?

I think the bears have lost. The good guys lost this battle.

172   Patrick   2012 Oct 2, 6:29am  

David9 says

Best of luck with the marketing, say a 100,000 sales goal to start would bring some liquidity. I hope, to start.

At $5 royalty per book, 100,000 would do nicely!

Goran_K says

Patrick, I think your cause is just, but how are you going to battle the FED gangsters who have made it their mission to create a false bottom in the market?

One secret is that the bond market is far more powerful than the Fed. When the bond market demands higher interest rates, rates will go higher no matter what the Fed wants.

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