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Casey!S
Good theories, but more important than wages being stagnant for the better part of a decade and the fact that we're looking at the tip o' the iceberg where re-sets are concerned, the majority of the blame falls squarely on the doom and gloom media.
Remember there's only 3 things that matter in real estate, debt, debt and debt.
Hellow Kitty,
Is Ted Truitt Jack Black or is that just some guy that does a really good impersonation? Love the white suit btw!
I was talking with a friend and he brought to my attention that the real departure ramp for subprime actually goes back to 1986. Since I don't appreciate when people are more bearish than myself I asked him to explain. He said that when c/c and other revolving debt was no longer tax deductible it "forced" a lot of people (based on DTI) out of the prime market. I thought that was an interesting point and another nail in the "it's all subprime's fault" coffin. I had often thought of it in terms of shifting debt/tax deductibility, but never as a catalyst for the growth in subprime.
Wow. Begging for business. Hmmm... doesn't sound like much of a "sales pitch" to me. I've got enough problems of my own without having to worry about whether or not "Don" is getting bored.
As they used to say in the ad business, "what's in it for me?"
Actually, it says it's a credit union - doesn't that mean it's more on the up and up?
Perhaps Don could advertise for a date, with a giant billboard of himself standing there, pants down, d**k in hand, sobbing, "Date me... PLLEEEASE!!!"
@eburbed,
Nice "end of the week wrap up"! To be fair though the DC and WA home's PITI should have the assumptions changed to reflect "0" Down and a neg. am loan! (Remember, it's all about the payment).
Muggy,
I have noticed that the credit unions seem to be positioning themselves to take advantage of the meltdown. And when I say meltdown I don't just mean subprime! I'm talking about trust. For the most part they're outside of the REIC. In fact I'm pretty sure most RE playahs don't even know they exist.
Just think how many FB's could've got a lower rate and better terms w/ their own C/U but instead wound up at the hands of some pedophile MB?
The SF Chronical Chart on the DataQuick website has been updated with the April numbers. No need to hurl those March numbers at the SoftservePricesss. I noticed that in my hood sales are down more than the average ~18% decrease.... maybe the fortress is cracking in the East Bay. I would like to see inventory numbers before dancing a jig, though.
I hate to say it, Randy, but Mill Valley is looking pretty solid. The hottubers may be the last to go (I guess when the Realtors lose their attitude, it will be time to buy.)
I am typing away in the Southwest terminal at PHX right now.
I do not understand why anyone would want to retire in Phoenix or Scottsdale. Ads for new homes are everywhere. The heat is unbearable.
Sedona, on the other hand, is absolutely lovely. I can easily see myself living there.
I'm not sure what I like so much about this article. I think it is the fact that the writer mentions the National Association of Realtors at the beginning of the piece, but then refers to them at "the Realtors" (instead of NAR) thoughout the article -- like they were some kind of crime syndicate or something of that ilk.
Housing enjoyed an extended surge in which sales of both new and existing homes set records for five straight years until 2006. The Realtors are forecasting that existing home prices could decline by around 2 percent this year, which would be the first setback for an entire year on records that go back four decades.
But Lawrence Yun, senior economist for the Realtors, noted that the expected price decline would still be modest in comparison to the 50 percent appreciation in home prices that occurred during the boom period.
"knows why carbon matters"
Huh? Because silicon steak would taste funny?
PeterP, nice to see a post from you. You reminded me of me sitting in the NM airport typing away. I agree, I can't imagine living in Phoenix, hell I can't believe I went and visited a friend out there a couple of years ago. I liked Sedona as well.
I'm sure you have some interesting observations about the housing market there. It was still booming when I visited but the inventory had just started growing, and sitting longer. It's kind of fun to see the non California market, we sometimes think CA is the whole world until you go somewhere like AZ or NM and see how totally different the market is as far as price and desireability.
SQT,
"...I don’t think any of us can. We just blindly forge ahead anyway...."
unless u r a Princess.
It’s kind of fun to see the non California market, we sometimes think CA is the whole world until you go somewhere like AZ or NM and see how totally different the market is as far as price and desireability.
Sedona is one of the prettiest places I have visited.
This house in Sedona (7 bedrooms and 13 bathrooms) looks very nice. It is definitely not cheap though. :)
I moved out of the BA last year.....it really is amazing how far your money goes once you leave.
I had saved a couple $100Ks for the purpose of upgrading my rat-shack Cambrian Park house for something more livable in, say, Campbell. But I finally had to ask myself why. Pretty much every place else in the country is much much cheaper. Although my family had lived in the BA since the mid 1800's, I was the last one there: everyone else had either died or moved away. So I was free to shop around.
I got out a map of the US and did some thinking. I eliminated most places quickly (deep South, NE, midwest, southwest). That left Virginia/NC and the Pacific NW as candidates. I ended up picking Boise and relocating here. Now I have much less invested in a much nicer house and the bulk of my money is in cash and stocks. Selling out in San Jose in April 2006 was in retrospect a great idea.
sybrib,
So you're going to buy me a tiara, a magical pony, and endless drinks at various European watering holes, right?
Otherwise and as I've specifically requested before, cut it out.
sybrib
Attacking someone personally because they have a differing opinion from your own leads me to believe you're weak of mind. Argue the point all you want. But if you want to go call names there are no shortage of shout-blogs out there to suit your fancy.
Although The Marina is unquestionably one of the greatest locations in the country to raise a family, today the apartment buildings, shops and restaurants seem to be bursting at their seams with beautiful, young and fit 20- and 30-somethings.
Huh? How is The Marina the "greatest locations in the country to raise a family?"
If I want to raise a family, and have the money, I will be in Marin County, Connecticut, or other nice places. There is too much riff-raff in SF.
DennisN,
Good for you! Boise is becoming something of a destination for Portlanders as well. Something about the rain, (I'm told?) That and socially it's like "The Rose City" was 30 years ago. Going on vacation? No worries, your neighbors are only too happy to pitch in and they expect the same. Before PDX became a "couples town" (everything is structured around art galleries and SHOPPING) it was a f_a_m_i_l_y town.
Btw, having cash is a good thing. :)
Hey, this is a long shot, but doesn't this Realtor (TM):
http://www.hill-co.com/about/detail.php?aUID=225
fit the profile of TOS? The credentials seem better than I'd have expected from the "real" TOS, but, who knows!
From OO's tips, I signed up at property shark and started looking at my neighborhood (Rivermark) at Santa Clara, I know most of you guys here despise McMansions but I am just reporting the mortgage data that I see. Where our tract was built, it was sold around 700K, then it jumped to 1M and now about 1.2 M for the same house. People are carrying 600 -800K mortgages, many people only put down 10%, and I only recall couple mortgages that are conforming out of about 30 properties I looked at.
Contrary to Sybrib's believe, many of these buyers are Asian but they don't pay all cash, in fact, I only saw 2 cash transactions. Maybe they put there money somewhere else, but I doubt it. When ARMs reset, it's gonna hit hard for the later buyers, at least so far most of the early buyers here can refinance if they haven't already.
The Marina is a terrible place to raise a family. It is a great place for young 20 something professionals who like the (formerly known as) "Yuppie" scene. If you have kids there are few kid-friendly restaurants, you have to pay through the nose for private schools, and you have to put your kids on a stretchy leash while playing in the park for fear of sundry unsavory characters lurking about.
For the same $ one can raise a family in nicer parts of Marin, San Mateo or Santa Clara counties, and running to the store for emergency diapers during potty-training doesn't become an hour long exercise in frustration and overpriced futility.
No kidding Peter P. What were u doing in Phoenix btw?
I am back in the Bay Area now.
I was in Sedona for vacation. It was amazingly beautiful. Much of the Bay Area looks hopelessly ugly, although many places in Marin are also quite insipiring.
There are a bunch of wealthy Asians who go to Stanford and then buy/work in SF
I went to Stanford but I fail to see how one leads to the other.
I went to Stanford but I fail to see how one leads to the other.
Very few Stanford students are wealthy AND Asian. However, some are Asian, but aren't really Stanford students after all:
http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/05/26/MNG5JQ2AP01.DTL
My girlfriend nannied for a mixed couple (white guy, Japanese wife). I think they both were Stanford Alumni. It seemed predetermined that the kids were going to go to Stanford.
They are quite well off. The wife made a killing on her Idek stock options.
PeterP, glad you had a good trip.
To each his own, that house was gorgeous but that kind of price gets you your pick in Rancho Santa Fe, or Del Mar. I think I'm partial to California. As crazy as it may sound, luxury living in San Diego seems reasonably priced for what you get.
As crazy as it may sound, luxury living in San Diego seems reasonably priced for what you get.
That is true. The Bay Area has too much luxury-priced crap.
CB---
I don't think the elites in places like Mumbai and Taipei and Shanghai covet the Rivermark and its Santa Clara Unified School District.
They buy-in for the enrollment areas of Monte Vista, Lynbrook, Saratoga.
Rivermark might be new, and it might be a different kind of self-selected enclave, but it ain't Monte Vista.
Muggy,
Stanford sounds like a pressure cooker. Remember the coed from San Diego whose father expressed his anger at the police when they ruled it a suicide?
Then there's the imposter coed who was outed this week, also from Southern Cal.
@justme,
What a truckload of bullshit.
Agree, but that hasn't stopped the Troll of Many Handles using the "median price of an existing home increased 6.2%" (or 6.6% for SF) meme over and over and over . . .
Stanford sounds like a pressure cooker.
Huh? It was rather relaxing to get through Stanford. Just be happy and eat good food in Palo Alto and you will be fine.
Can someone please tell me what is keeping Europe together? No offense, but what is the competitive advantage of Europe?
Ack. Another Rent Hike at my complex!
Starting on the 24th month of my stay here, my rent will have gone up 12% from when it started.
WTF. :(
SQT,
I wish all of you that live in the BA could see this, it’s just beautiful to behold.
Oh, I so wish I would see that here. This morning, as I sit, chilled, on a couch in my rented McMansion, I gaze out over Tam Valley. I cannot see across the expanse to the clusters of recently built McMansions crowded together, as if seeking warmth. Warmth, denied by swirls and eddies of infinite thick fog that blankets these hills and valleys twenty-nine days a month.
Yet stubborn sellers continue to defy the inevitable. Later today we'll skip the dozens upon dozens of grotesquely overpriced houses in this area, even though they've languished on the market for hundreds of days.
What were the things u did in High School to get into Stanford?
I went to Stanford grad school. Its Masters program is actually very easy to get into.
did you feel you had more pressure
No. I felt more pressure at UC Davis during my undergrad years. But again, I had fun anyway.
Stanford sounds like a pressure cooker. Remember the coed from San Diego whose father expressed his anger at the police when they ruled it a suicide?
Then there’s the imposter coed who was outed this week, also from Southern Cal.
sybrib,
From personal experience, Stanford is no pressure cooker at all. In fact, I'd argue the opposite - undergraduates are coddled to the point of being spoiled. The professional school programs (MBA, MD, JD) are known to be more relaxed and laid back than their East Coast peer institutions. The exception is some of the "hard" science graduate programs, in particular EE (exceptionally low qual exam pass rate for the PhD program) and chemistry (lots of nut jobs on faculty and in the PhD program).
The recent suicide is tragic, but I think it is more a reflection of the girl's typical Asian immigrant high-pressure family (check out the family's web site for instance), and less so, her undergrad experience at MIT.
Interestingly, that girl and the two "fake" Stanford students just outed are all three Asian females. Coincidence or not?
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Dear Patrick,
I enjoyed your housing crash article. It made me feel very good about renting in NY at rent stabilized prices since 1993 and having used the savings to invest in American commercial property, residential property Latvia, Bulgaria and Panama. I have never actually lived in a house I owned and think Robert Shiller's housing puts are a great investment.
I think you were not quite explicit about your principle point: that the US housing market has become a Ponzi style casino in which the commission grabbing mortgage bankers and Wall Street are the house and the retail buyers the naive punters. And anyone who doesn't count his cards and get out in time loses.
Real estate can be a great investment, if you:
1. Invest without emotion and at or below replacement cost, as in Latvia in 1998.
2. Buy where others are too scared because of perceived risk, as in Eastern Europe 5-10 years ago.
3. Buy where prices are the same as 23 years ago, like in Tokyo now.
4. Buy where the rental yield far exceeds bond returns, like in Tokyo now.
5. Buy in growing, cheap resort areas where the yields are close to or in double digits, like in Bulgaria, Turkey or Malaysia now. Beach apts in Malaysia can be bought for 500 euros/m2 with yields of 8-10%. Real estate taxes per year in Bulgaria cost less than dinner at a good restaurant in
Riga.
6. Buy where rapid construction cost inflation + the introduction of a mass mortgage demand will juice demand, as Rumania, Turkey or Bulgaria.
7. Buy in small stable countries with no income tax and good financial services and legal systems right next door to big, disorganized corrupt countries with lots of money to launder, like the Baltic States from 1995-2005 and Panama, Singapore, Turks & Caicos and Malaysia now (next door to Colombia/Venezuela, Indonesia/China). Buy in condotels with in-house rental management companies, so your rental revenue is at per day hotel rates instead of by the month, while the per square meter purchase price is at a normal local market rate.
8. Buy REITs with good yields (Singapore, Japan, Eastern Europe) in fast growing markets and leave the work to Cohen & Steers or the REITs' managers.
9. Invest in areas where EU infrastructure funds are producing wage and construction material inflation and raising replacement costs by double digits per year while the overall CPI is 2-5%.
10. Invest with my brother in the Baltics. My brother's fund is Baltic Realty Partners. His first fund was Latvia Realty Fund (www.latviarealty.com).
Best from sunny Riga and
Kind regards,
Lester G
#housing