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My arse!
Why should I help out the ones who looked down thier noses at me 3 years ago because I was 'still' renting?
Sure, I feel sorry for people who geniunely get caught out in the housing bubble, but for the rest of the hoity-toity brigade I say:
MWAHHAAAHHAAAHH (little finger pressed against lips)
You folks are right. Here come the Repartments! This condo would have been an apartment a few years back. Now the empty unit that didn't sell shows up as a rental on this reltors site.
Michael Anderson Says:
We will buy their houses from them. It will feel mean to us, but they will beg us to do it.
And if they're very very lucky, i might even allow them to take make a small amount of profit on it.
At 2000 prices, natch.
Maybe we should all buy one extra house....a very small P.O.S. and have one of them rent it from us. This way they can experience the other side of the coin! :evil:
Peter P, you are a comic genius --this thread is hilarious!
Show me a distressed "victim" in this mess who did NOT willingly go into their stated-income NAAVLP with eyes wide open, bragging and insulting us 'JBRs' all the way up, and I shall offer my sincere condolences. They have just received a very harsh education in market economics --one that will hopefully stick with them longer than their H.S. math did.
For the rest, I'm with Muggy.
Peter P
2006 Jul 19, 2:19pm
Show me a distressed “victim†in this mess who did NOT willingly go into their stated-income NAAVLP with eyes wide open, bragging and insulting us ‘JBRs’ all the way up, and I shall offer my sincere condolences.
What level of condolence is morally required? Should we erect a memorial? What should we say on the memorial?
Peter P
2006 Jul 19, 2:35pm
Or can one of those empty comdo towers be designated as the housing bubble memoral?
What would Descartes say?
"I flip, therefore I neg-am..." ???
ehrrrrrrrrrr....
Or can one of those empty condo towers be designated as the housing bubble memorial?
the gubmint could offer pennies on the dollar for the apartments and turn the towers into public housing estates (again), but with a memorial plaque outside saying:
"this public housing is dedicated to the many extremely ordinary men and women who gave their financial lives to the housing bubble..."
hmm, except they might be the residents also, they won't want to be reminded...
I'm trying to develop a test to determine an individuals or families QLQ-Quality of Lifestyle Quotion. This test would be similar on a point scale to an IQ test. With all the talk about maintaining ones lifestyle, I think now is the time to quantify the quality of lifestyle one actually has, in order to compare each other on a relative basis.
Some factors that will be used to determine ones QLQ would include such questions as;
1) How many hours a day do you spend driving to and from work. hours? 0 points.
2)How many man hours of work must you or your family put in, in order to maintain your lifestyle? 100? 0 points
3)What percentage of your net income does you or your family spend to keep a roof over your head? 100% 0 points.
You get the Idea. When one says their quality of lifestyle is so much better because they live in a Mc Mansion, or has lots of toys that they actually own, lets give them a test to see if what they are saying is really true. They could be in debt over their heads, working mega hours at their jobs to pay their bills, and spending countless hours driving to and from work. Not a very good quality of lifestyle if you ask me. But how do we actually know, if we don't quantify this. A score of less than 100 would qualify you as a moron. A score of less than 80 would qualify you as an idiot. A score of greater than 160 would qualify you as a genus. In quality of lifestyle terms, of course.
I will entertain any thoughts from you on factors which will comprise this test. Feel free to post the QLQ as a thread topic.
Questions with examples did not post quite right, but I think you still get the idea.
Check the cry out for help in San Diego from this flipper
http://www.forsakencraft.com/proof.htm
yeah, he/she/it attended a robert g. allen course - way to go...
the forsakencraft site is generally a good one (except for the black background and 'solaris' themed phpBB page) -- patrick should take note ;)
similar site to what i hope to be doing...
previous selling prices in oz are no longer available publicly, only realtors seem to be able to get hold of that information, for whatever cost...
previous selling prices in oz are no longer available publicly, only realtors seem to be able to get hold of that information, for whatever cost…
Wow. So the MLS market data in Oz is even LESS accessible than here. But DS, I thought you were living in a consumer's/worker's paradise! What gives? ;-)
Anyone see the new Hummer Ad where the soccer mom ditches her minivan for a Hummer cuz the other ladies kids defeated her kid to the slide on the playground. Geez, these advertisement guys need to take a hike..
But DS, I thought you were living in a consumer’s/worker’s paradise! What gives?
nup, place is full of cynics, opportunists and players -- even robert g. allen comes here. it's still towards the bottom of the pile re a decent social settlement, which is why the boom has been quite nasty and widespread. but price transparency is something i should agitate for with the politicos, just to embarass them some more...
and property transfer costs are about 7% vs 12% in US, which in some ways makes it easier for flippers to treat property as a transactable investment class...
@Phil,
Yeah --the wife & I saw that ad last night. I like the way it not-so-subtly implies that buying a Hummer means you can engage in road rage w/out fear of consequences (nudge, nudge, wink, wink). Nice message, especially for the state that invented Freeway shootings.
and property transfer costs are about 7% vs 12% in US
Actually, I think you're greatly overestimating transaction costs here a bit. They're probably fairly close to one another. Typically, you'll have the standard Realt-whore commission of 5-6% + closing costs (credit report, escrow, housing appraisal, title insurance, etc.). This varies widely but probably adds another 1-2%, plus any points FB paid on the new loans (to bring 'pay down' the interest rate.
greatly... a bit
Hmmm... which is it? 'Greatly' or 'a bit'? I'll go with 'greatly'. :-)
Thanks, ajh!
Wow, so Allhomes.com.au = Oz version of Zillow/Open MSL. Cool. 8-)
oh cool, thanks for that ajh, i'll see what i can get from the site -- councils used to give out the information, then stopped, and i was under the impression you would virtually have to have an RE license to get it...
the 7% vs 12% figure is a quote from The Economist, which compared 6 or so countries recently... My mortgage broker mate in DC makes as much as 5% on a sub-prime transaction, whereas mortgage brokers in oz get 0.7% and a trail of 0.06%, so there's a ~4% difference straight away, plus they only use vendors' agents here, no buyers agents, who routinely get 2.5-3%, so there's another potential 3%...
Perhaps LQ-Lifestyle Quotin would would be more catchy nationally, if false pretenses are excluded in favor of quality. What is your LQ?
@DS,
Is there a link for the Economist article you pulled that from? I will say they generally do their homework on the numbers, but 12% seems very high to me for an average, even for the most clueless subprime FBs.
so there’s a ~4% difference straight away, plus they only use vendors’ agents here, no buyers agents, who routinely get 2.5-3%, so there’s another potential 3%…
The buyer's agent cut is never added on to the 5-6% std. commission; rather, the two agents typically split it. Sometimes the seller's agent gets more, sometimes it's an equal split, but I've never hear of a case where they get ~9% combined. If that were true, they'd probably need to apply a liberal dose of K-Y at closing.
Sorry, Mike,
Nice idea, but looks like someone beat ya' to it: http://www.expansionmanagement.com/emstatic/research/qualityoflife.asp
@DS,
This 2003 study pegged typical U.S. transaction costs at 9%:
http://www.ppionline.org/documents/Real_Estate_0303.pdf
Thanks Harm,
Good ideas are usually are not exclusive. By the way, I thought I was spelling the word quotient wrong.
I would ignore. Other people's plight will negatively affect my karma. Not that I'd weep for them. Their misfortune is largely the result of their own folly (i.e., greed or lack of a strong will).
They'll survive. People survived the Great Depression. So no need to feel pity for them. But I wouldn't recommend schadenfreud, either. It demotivates you from more positive undertakings, i.e., preparing yourself for taking over distressed properties or setting up businesses to employ the distressed folks at a much reduced labor cost. It does much good to yourself and the society at large.
yeah, HARM, i think The Economist article I read was also 2003, when they did a series on the housing boom -- (whcih was a bit TOO prescient back in 03) -- and it was a 'side-article' -- naturally, I can't find it now, and you need a subscription to access the full content online anyway. I remember noting the 7% and 12% marks in particular with some interest, as low and high water marks between the countries compared.
having met a mortgage broker in DC who gets 5% of the deal, i could see why it was high. IF you have to pay 2 agents 6%, AND a sub-prime mortgage broker 5%, that's 11% right away -- plus other settling costs like taxes and misc. fees. in Oz, you would pay 1 agent 2.5-3% and a broker less than 1% -- surely the differential will be 7% right away. YMMV -- e.g. 1 agent only, or a lower MB fee. in Oz, 'stamp duty' to govt for the transfer is 2-3% also. vendor pays the RE agent out of the sale, buyer usually pays all other costs.
admittedly, the vendor's RE agent fee of 3% is 'embedded' in the sale price, but it is included in all the treatments of transfer cost.
your article cites $13,500 for a $150,000 house, which is 9%. oh well, something has given way, given we just calculated 11%+ in one scenario. maybe prime (or sub-prime) lenders charge a lower fee on average? maybe lots of people don't use a buyer's agent in reality? i reckon the Oz buyer is still 4% better off, assuming other fees and taxes are roughly equal, which they may not be.
regardless, it raises a very interesting corollary: the LOWER the settling costs, the lower the barrier to entry as an investment class, and the higher the rate of speculation and investment to be expected. as per the forsakencraft site cited above, which shows the transfer costs are going to bury flippers -- share trading brokerage commissions are obviously a great deal less by comparison as an alternative investment vehicle.
the PPI article above suggests that computerising transfer functions will significantly lower transfer costs with a flow-on benefit to lower income homebuyers. i find this a little frightening in a market where pricing is uncapped, because the immediate effect will actually be to lower the barrier to entry of specuvestors as well. lowering transfer costs by themselves would be like greenspan lowering interest rates to 1% and keeping them there forever in terms of triggering a boom. some other balancing intervention would be required, such as legally preventing specuvesting, capping prices in the market, and so on (both practices which i endorse as policy suggestions anyhow).
just to clarify briefly, i fully understand that in US 2 agents split 6% two ways. the point is, there is virtually no such thing as a buyer's agent in Oz, they're not really a known concept. i've heard of one woman only who does it in sydney, and she is held up in the press as a sort of oddity. most people just look for their own places and make an offer, or go to the dodgy auctions and get fleeced... there was a buyer's agent concept at auctions lately, who intimidates the auctioneer and other bidders -- but auctions have declined in popularity since they legislated against fraudulent practices... it's a grand old world...
ajh, your allhomes.com site is only canberra, illawarra and SE NSW, which leaves out Sydney completely... and clearly not Vic etc -- you have to pay thru the nose for data from others, e.g. $39.95 for just 12 months data for 1 suburb... what I often need is to get the sales history of 1 particular property, which the councils won't provide anymore.... so, back to embarassing the pollies, i want to look into that...
This is an 02 Economist article: House prices | Going through the roof | Economist.com, free to view...
points out how 20% transfer costs in belgium keep prices lower (although i can think of other ways of controlling prices):
"Stamp duty and other transaction charges tend to be higher in many continental European countries than in America or Britain. In Belgium, transaction taxes, and legal and estate-agent (realtor) fees amount to almost one-fifth of the average purchase price. As a result, Belgians tend to move less often, and view property simply as somewhere to live rather than as a speculative investment.
That may be one reason why property is much cheaper in Belgium. Chart 5 compares the price of a typical two-bedroom flat (100 square metres) in a smart central area in the 13 cities. New York, Tokyo and London are by far the most expensive; bargain hunters should head for Brussels. Sell your apartment in South Kensington and you could afford to buy one in each of Brussels, Stockholm and Amsterdam. "
Bailing people who got themselves into bad situations will just lead to more bad situations in the future. But if they can show they've really been humbled by their experience and learned something, then they may deserve help.
But I'm not going to be sympathetic towards the people who ran up the market flipping and snubbing renters. They just had it coming. They enjoyed the ride up, and they deserve the ride down.
I loved the link that inspired this thread! Joe Dude (w/4 little mouths to feed) decides in JAN 06 no less to take (or is get taken) some RE "boot camp" dumps 77K of more borrowed money into upgrades and is now crying out for help?
This is a classic rookie mistake. Anytime money looks fast, loose and easy newbies figure they can not only play in that arena but that they can do it just by listening to tapes and w/o the direct guidance of professionals. I wonder just how much accountability flopper will get from Robert Allen (the guy that sold him "the course")?
How is this MY problem? Had Joe Dude opened a pizza parlor and utterly failed would there be cries of foul? People, it's b/c of the maternal connection that Americans have w/RE that we are EVEN considering any kind of leniency or bail-out. Let's make a quick distinction here. THIS WAS NOT DUDE's PRIMARY RESIDENCE! This was an investment (as in *Not FDIC Insured, may lose value). What's worse is that he JEOPARDIZED his *primary residence* to provide liquidity for this madness. Yes, it's the same thing as taking out a home equity loan to DAYTRADE!
Here's the big question. Will FB's be able to gain enough traction in congress to get them to consider an expansion of the cap. loss write off? I believe currently we sit at 3K per year. If they can accelerate the schedule they'll be able to write off the WHOLE loss in as little as 2-5 years and we'll ALL pay for their indiscretions! Don't let them do this! Let them f@cking DIE with cap. losses that can not be carried over into the next generation of FB's!
DinOr,
If farmers can get ag subsidies for growing food that we don't want (and using up tons of energy and water in the process, not to mention degrade the soil and increase erosion), then homeowners with half empty McMansions (and using up tons energy and water and money to run their homes, not to mention permanently taking the land plot out of agricultural use and increase congestion) certainly has a reason to feel the same.
Are you saying homeownership is not as American as tobacco farming? :)
If Joe Dude can "write off" his "abortion that lived" to the tune of 25K, 50K a 100K PER YEAR he essentially pays NO taxes that year! Meaning the Gov. has to get it somewhere else!
We didn't expand the cap. loss schedule for the stock market speculation gone bad, why should we expand it for this mess!
JUST SAY NO! (to capital loss acceleration)!
You bought it, you name it.
astrid,
LOL! Damn!
Sure, why not? We're letting them write off the int. on their "specuvestor home" why not subsidize them right down the old crapper?
The CFP Associations BEGGED the CPA affiliations to lobby congress to get the cap. loss sched. "stepped up" considering the magnitude of the stock market losses. The answer we got back was a FLAT NO! But, but these figures haven't been adjusted since the 1970's! NO. Next topic. Gee, thanks for going to bat for us guys!
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How are we going to assist distressed homedebtors in the coming days? Is this a moral obligation?
What would Immanuel Kant say?
What would J. S. Mill say?