patrick.net

Watching Randy doing his lowballing should be fun too.

Swimsuit Calendar?

Huh? Should I start going on diet? :twisted:

SP says:
Swimsuit Calendar?

I could make a massively non-PC remark here, but I'd probably regret it when sober tomorrow, so no mas.

Ha, ha!

That picture is classic!

Too funny. OMG...

I can't speak for others but I'm having about as much fun as one can have (with their clothes on!)

As SP shared in the prior thread "being Economical with the truth" ALWAYS has consequences! For me, having a front row seat watching that improvisation blow up in realtwhores/lenders/FB's faces is about as good as it gets!

Just yesterday I was on a conference call w/Steve Lehman (Fedrated Market Opportunity Fund) and he said during his introduction that while he is seeing a HUGE credit/housing bubble, he'd prefer not take up a lot of time on it. Apparently in his mind it's past it's tipping point and all that remains is to step back and measure the crater. One comment he did have though is that there really hasn't been any meaningful "tightening of credit".

It struck me a little odd b/c when you think about it has anyone heard comments from friends/co-workers where they *couldn't get financing?

Hmmm, anybody who is looking for a rental in my neighborhood can have fun.

$10,000/month with no property taxes, upkeep, down payment to lose as the market tanks or $2.8 million to buy.
http://www.joelgoodrich.com/2523Steiner/index.html

Perhaps the graphic should morph into the family trying to claw their way out of the giant pit that the falling house caused because they bought in 2005. There could be little glimpses into the future, the father still working at 75 because his retirement 'investment' was the house. The kid working at a restaurant because the college 'investment' was going to be home equity. Mom working retail and driving a Camry (the shame!) and without a facelift!
Owners of the American Dream, purchased 2005.

SFWoman,

Uh.... how much is the payment on a $2.8 million mortgage again? I see that it's newly constructed in '05-'06. Was that their plan? Even if they only have HALF that into it at 120k a year in rental "income" it will only take about 12 years to recover their initial specuvestment.

Isn't this just another way to advertise the property?

SQT,

Pool TABLE? I wanna POOL!

If anyone thinks the graphics is inappropriate we may want to take it down though.

I modified the graphics a little bit. It should be fine now.

The picture was very well done, thanks. I just afraid that the bottom may cause problems.

I wish we’ll enter a recession this year.

The Bay Area is too crowded again. A recession will probably make it a better place.

SFWoman Says:

> Hmmm, anybody who is looking for a rental in
> my neighborhood can have fun.
> $10,000/month with no property taxes, upkeep,
> down payment to lose as the market tanks or
> $2.8 million to buy.

I’m glad I didn’t buy this place for $3.3mm when Leslie De Brettvile first listed it at the end of the summer.

http://tinyurl.com/2h9raf

GC,

I can't speak for Seattle (they have real employers up there) and *astrid insists that market is "different". While the Case-Schiller CME data* (and I apologize for incorrectly identifying that as the NAHB data) shows relative strength in Seattle AND Portland we have been the markets of last resort for equity locusts. The tail end of the "rolling bubble".

According to NAR Salem, OR was the #1 appreciating market in the nation last year! Since it's 11 miles from here I do have a little local "expertise". What in essence has unfolded there is that they have built an entirely "different" city just south of Salem. A 3/2 in older more established neighborhoods hasn't appreciated markedly in fact those sellers have got to be asking themsleves, "What bust? We never saw a boom!"

South of Keubler they are frantically shoe horning 3,500 sq. ft. McMansions on to 5,000 sq. ft. lots and it is this whole 'new' city (strategically designed so you can live your whole life without ever actually setting foot in Salem proper) that has driven the median here. Given it's our capitol and much of the old inventory was 2/1 they really had no where to go BUT up! The "easy I-5 access" assures (well.... reduces the liklihood) you'll have to encounter all of the gangbangers the Rose City PD ran out of Portland. This is NAR's "crown jewel"?

*CME originally only covered the 10 largest US markets but has since added 10 new markets. My bad.

Maybe we could all have patrick.net housing bubble T-shirts?

DinOR,

Huh? As much as I like the PNW, I don't think I ever insisted or even suggested that market is *different*.

cyppok,

Well, after a fashion that's exactly what HAS happened!

Many, MANY of the folks that went on to be mortgage brokers actually came from a securities industry that not only went bust but also was showing signs of "burdensome" regulation. This explains why so many of these people consider themselves "mortgage planners". I've ran across several that actually have "Financial Planner" on their business cards. I'm not kidding!

Now that "regulation creep" has FINALLY reached the lending arena my guess.....is your guess. They'll go on to some other form of "financial services" that includes dealing with the aftermath they've created. But only if it involves fast money. Camp followers.

An extra special article brought to us last year by "The Automatic Millionaire" author David Bach, posted by Yahoo! on their Finance - Real Estate section:

"Why Homeowners Get Rich and Renters Stay Poor" by David Bach

http://finance.yahoo.com/expert/article/millionaire/2585

DinOR Says:

> Uh…. how much is the payment on a $2.8
> million mortgage again?

A 30 year fully am fixed rate $2.8mm loan at 6% would have a monthly payment of $16,787.

> I see that it’s newly constructed in ‘05-’06.
> Was that their plan? Even if they only have HALF
> that into it at 120k a year in rental “income” it will
> only take about 12 years to recover their initial
> specuvestment.

The current owner is a super sharp real estate guy who has done real well over the last 30+ years and it looks like his timing was just a little off on this deal. There is a $2.3mm loan on title (and the property has not yet been reassessed) so with an IO loan the guy will only be negative a couple grand a month if he rents the place for $10K a month.

As prices continue to fall I think there will be a growing demand for high end rentals as people cash in and sell their homes that have gone up in value by millions in the past few years.

astrid,

I had thought some time back you had shared that you felt b/c of their proximity to growth markets in Asia, their technology base and mild climate that Seattle "might" weather the downturn better than most.

If this isn't accurate I apologize. I'm pretty sure YOU wouldn't use realtor-speak like "it's different here"!

"I think there will be a growing demand for high end rentals"

Yeah, uh I THINK I could talk my wife into living there? Thanks for the explanation FAB. That home is just not what typically comes to my mind when someone says "rental". As much detail went into the construction the guy must have been cringing every step of the way toward completion.

Hmm. Realtors have a sunny outlook, but the common man thinks that a housing correction is in progress? Blame it on the "negative press". Pay no attention to the man behind the curtain.

http://realestate.msn.com/buying/Article2.aspx?cp-documentid=2727041

OK. Here is some for fun. Heard it today while driving to work. (Keep the coffee away from the keyboard before you read this.)

Equity Happens

Guru Robert Kiyosaki started the ad with his own introduction and said learn from experts. Then the ad guy took over and started peddling Las Vegas real estate. Claims a lot of people are moving to LV and there is shortage of land for construction. (NO. I AM NOT MAKING THIS UP.) He said, if you are reading stories in MSM you need to find out the truth from the real experts. He ended the ad with following quote ...

Equity happens. Make sure it is happening to you.

the cool people can’t afford living there anymore — they are not wired to make money.

I am sure a few BMR units can't hurt. ;)

SFW

If all the Strawberry McMansions rentals keep trying to push their prices up we might well end up renting something around there. But we have to escape this place in the next couple months or my wife will strangle me in my sleep. No offense to anyone else who likes it here, but Tam Valley living ain't all it's cracked up to be. And I'm not seeing any bargains in Corte Madera/Larkspur. Just looks to me like lots of people trying to rent for an amount suspiciously equal to a 30-year jumbo refi'd into sometime over the past 6 months.

SQT,

I...... wouldn't be all that concerned with former stockbrokers converting to mortgage brokers and back again. Having even a DAY lapse in your sec. lic. is a major freaking hassle. A lot of firms attempt to do "U-5" you on your way out the door to your new firm. Any "break in service" looks really bad.

Besides how many sales managers would welcome you with open arms (and sink a ton of money into re-training you) when it's obvious you'll be down the road at the first sign of trouble? I realize many here are reluctant to acknowlege the disparity in the two regulatory environments so I'll just say these types are *not what the sec. industry is looking for.

GC,

I have a client that has a south facing condo/loft/whatever right on Western Avenue with great views. No, I mean REALLY great views! They're renting for about half of owning and they both believe a correction is inevitable in the Emerald City. He's in Costa Rica right now so I don't plan on seeing him until Spring. Must be rough.

What's all this "needs" talk?

But we have to escape this place in the next couple months or my wife will strangle me in my sleep.

At least you will be in your sleep. ;)

BTW, is it really that bad there?

Randy, I'm dreadfully curious, what is a "Strawberry McMansion"?

I’m glad I didn’t buy this place for $3.3mm when Leslie De Brettvile first listed it at the end of the summer.

http://tinyurl.com/2h9raf

This is another example of the point I made a while back that in SF there is supposedly some architectual guideline that all low-rise residential buildings must have oriel windows on their facade. This place seems to be going for some kind of mish-mash of Wright and modernist styles.

SQT,

I suppose there are correct applications for an annuity but in my experience, they're actually pretty rare. This is why we've seen so many "added features" like some, I dunno "lock-in period" and such to make them more appealing to a broader audience. Most of us need growth, when you're annuitizing wouldn't be nice if you had something TO annuitize?

Our idea of fun this year is going to be hitting people with some serious low-ball bids. If it isn’t at least $100k below asking, we won’t bother. Some of my husbands co-workers are already doing this. And when they put in the offer they’re also saying they want stuff like the refridgerator, microwave, pool table etc. as part of the deal. It’s going to be fun this year. :twisted:

Only $100K? I'm surprised there are no takers!

Bad Boy,

Uh I thought an upper decker was a home run that landed in the upper deck? No?

what is a “Strawberry McMansion”?

Just a normal McMansion, even more overpriced because it is located in a little tract of land east of 101, between Mill Valley and Tiburon. The kind of place that Habitat for Humanity gets assaulted by angry residents if they try to build 2 units for fire or police workers to live in. Hell's wrath if we're forced to live among the Prols.

Otherwise read, commeth Les Débiteurs, I'll change my name to Randy Valrandy.

It's an upper-tanker.

Oh what fun, type in "king city" in zillow and see the prices. The pure folly will not be lost on anyone that has driven through king city.

500K for a $tucco $hitbox in king city, come on now.

Oh what fun, type in “king city” in zillow and see the prices. The pure folly will not be lost on anyone that has driven through king city.

Perhaps people who get enough speeding tickets around there may decide to buy a house for odd reasons?

A light bulb ban? Kalifornistan indeed!

http://tinyurl.com/yphpqz

From the automatic millionaire piece:

Assume you're renting a house for $1,500 a month. Now let's say you stay put for 30 years, during which the landlord increases the rent by 5 percent a year. Over those 30 years, you will hand over a total of nearly $1.2 million in rent payments -- and at the end, you'll have nothing to show for it except a bunch of cancelled checks. To add insult to injury, you'll now be paying $6,174 a month in rent!

Now let's imagine that instead of continuing to rent, you buy the same home for $200,000 (this is just an example, and prices will vary greatly from market to market, especially in big cities where homes are typically much more expensive).

That's actually a pretty valid example. A $180k mortgage is about $1108.

But does this condition actually exist anywhere?

But does this condition actually exist anywhere?

Ha!

GC Says:

> It sometimes depresses me that by buying up
> properties at cool locations, the rich people end
> up gentrifying and then slowly destroying the very
> culture and hippiness that attracted them there in
> the first place; the cool people can’t afford living
> there anymore — they are not wired to make money.

With (very) rare exceptions rich people are not attracted to “hip” or “cool” locations and only buy there because they are not “rich enough” to buy where they really want to live. I bet you can’t find a single person who bought just North of the Panhandle (aka NOPA) in SF who would not be living on the other side if Geary if they had the money and every person I know (and know of) that bought between Geary and California in the past few years would have been North of California if they had the money…