You Have To Go As High As You Can
A report from CBC News in Canada. “Toronto’s real estate market ‘defies all odds,’ but government officials should proceed cautiously when deciding how to cool it down, says a real estate agent. ‘To be honest, I just hope they really think about it and go slow, with a very relaxed approach,’ said Dan Cooper, an agent with Royal LePage and CEO of Dan Cooper Group in Oakville, Ont. Cooper said there is a need to ‘relax’ the Toronto market but not to ‘wreck’ it. He said media coverage in the last few weeks has created what he called negative spin and has prompted new listings. ‘Today, my group, we’re putting on 13 listings. I have a lot of people who aren’t even thinking of selling but they’re selling because they want to take advantage of the market. They’re scared. The tables are turning already.’”
“Danyelle Boily, a real estate agent with Bosley Real Estate in Toronto, said she is telling clients simply to offer as much they can, given their budgets. ‘We don’t know how to advise anymore. We just know that you have to go as high as you can, and if you’re out, you’re out,’ she said. ‘That’s just the way it is. There’s no rule of thumb anymore.’”
“Cooper, who has worked in the business for 26 years, said it’s a ‘different game’ than years ago. ‘If you have a buyer who wants a property, they have go in at list or above, no conditions, certified cheque, probably double what the vendor is looking for,’ he said. ‘It’s all about the seller. It’s a true seller’s market.’”
“The Toronto market has been startling, with the average sale in the Greater Toronto Area skyrocketing last month to $916,567. That’s up 33.2 per cent from a year ago.”
The London Free Press. “London’s red-hot housing market meant realtor Angela Wilson couldn’t take a holiday on Good Friday. She and her business partner, her mother, Linda, were at a Riverside Drive model home before noon, ready to meet potential buyers. And in London, there are more buyers than ever, so many there aren’t enough homes to meet demand. ‘It’s crazy,’ Angela Wilson said. ‘It’s something we’ve never experienced before.’”
“Bidding wars, lineups to see new housing subdivisions and record prices in most city neighbourhoods are becoming routine in the once-stagnant, reasonable London market that seems finally to be catching up to the rest of Canada. Weary would-be Toronto-area homebuyers unable to afford the astronomical prices are only part of the story in what Jim Smith, president of the London St. Thomas Association of Realtors, said is more than just a bubble. For too long, he said, London prices have lagged, but with huge price hikes in Toronto, property values are inching up here.”
“There are reports of houses going for $20,000 to $30,000 above asking prices. But bidding wars drive prices to $60,000 or $70,000 above the asking price also are taking place. One high-end home sold for more than $200,000 more than the asking price to top $1-million.”
“More out-of-town realtors are starting to come to London, mostly from the Toronto area, applying for access to lockboxes to show London properties. Forty-one have contacted the association office in the last two weeks, and ‘that’s just the tip of the iceberg,’ Smith said. Hot markets also are reported in London’s bedroom communities. ‘I’ve heard stories in St. Thomas where people are lining up to go through the open houses and then they’re just taking bids at 6 o’clock,’ Smith said. ‘You talk to a lot of veteran agents and they will tell you they’ve never seen anything like this before,’ said Smith, who’s been a realtor for 25 years.”
“Realtor Diane Lajoie with Sutton Select Realty said she’s heard of young buyers making offers on six or seven properties — as many as 13 offers — without making a deal. She’s heard of properties getting as many as 21 offers. ‘We’ve never seen anything like this,’ Lajoie said. ‘We’ve been in busy markets before but this is really unprecedented. It’s happening at every level, in every part of town.’”
“The sales boom can be partially linked to a more connected world in which buyers can move to London and work online. But there are others who are retiring in Toronto and cashing out on their real estate to come here ‘with a mittful of money in their pocket,’ Smith said. Bank appraisers aren’t balking at the price increases and are ’seeing the value’ to approve mortgages, he said.”
From CTV News. “Many buyers and sellers are waiting to see what will come of Tuesday’s scheduled meeting between Finance Minister Bill Morneau, Ontario Finance Minister Charles Sousa and Toronto Mayor John Tory, who are expected to discuss ways to rein in Toronto’s hot housing market. Real estate agent Josie Stern says the market appears to be cooling. ‘A little bit of air has been let out of the bubble,’ she says.”
“Sellers who’ve bought new homes are rushing to list their old property, she adds, but many are not getting the high bids seen a month ago. ‘We’re finding that a lot of people are leaving the city,’ says Stern, who estimates that about a third of her 35 sales this year involved sellers either downsizing to condos or moving to more affordable markets. ‘It’s empty-nesters, it’s (couples with) babies, it’s all kinds of people that are doing this.’”
“It’s a story Vancouver real estate agent Melissa Wu knows well. Years of record-setting sales saw Vancouver homeowners cash out for smaller markets with more space. But that changed after the B.C. government introduced a 15 per cent foreign buyers’ tax last summer, which Wu says especially soured interest in west Vancouver luxury homes priced at more than $4 million.”
“Her recent sales included a $2-million get for a century-old home owned by a retired couple. Their plan is to downsize to an older condo costing less than $500,000. The rest of the proceeds will go to their kids and retirement fund. She says the sale was a record high for the neighbourhood, but it took an agonizing three weeks to secure — longer than it would have last year, she says. She advises Toronto homeowners thinking of selling to take advantage while they can. ‘There’s always a shift coming in,’ she says of this hot market. ‘Sell before it corrects.’”
“Stern would like to see a crackdown on real estate speculators in Toronto, citing one buyer who bought 15 properties in the last two years. And she cautions those tempted to cash out that there’s always a risk the market won’t co-operate. ‘People have been asking themselves that question since the year 2000: Should I sell? Should I cash out? And there have been people who have cashed out and have regretted it because they’ve seen what the market has (done) — they’ve never been able to rebuy the houses that they’ve sold.’”
This is a fascinating point in time for observing a mania. In the first article they are holding a press conference type event for the UHS! What an incredible stark view of greed, with huge sums of money all around. What’s this?
‘others who are retiring in Toronto and cashing out on their real estate to come here ‘with a mittful of money in their pocket,’ Smith said. Bank appraisers aren’t balking at the price increases and are ’seeing the value’ to approve mortgages’
Well, well, so what happened to the money if appraisers are hitting the number?
‘Her recent sales included a $2-million get for a century-old home owned by a retired couple. Their plan is to downsize to an older condo costing less than $500,000. The rest of the proceeds will go to their kids and retirement fund’
OK, let’s remember something here: no value was created, no wealth. The shack wasn’t fixed up, it was just lived in. Now these people can sit back and live better, but it comes at the expense of someone who just took on a massive mortgage, probably aided by an appraiser who hit the number. If these arrangements worked, we’d have solved world hunger, but we haven’t.
Fool and money…
“but it comes at the expense of someone who just took on a massive mortgage,”
Somewhere, Charles is smiling.
Speaking of greed and mania, looks like this puppy’s going down:
http://www.zerohedge.com/news/2017-04-17/unicorns-watch-horror-uber-careens-towards-extinction-event-down-round
Fascinating. Instead of dot.bomb followed by a housing mania and crash, this time we’re gonna get a tech AND housing and god knows what else implosion all at the same time, looks like.
No value, no wealth.
‘The New York Times uncovered a secret Uber program called Greyball, through which the company uses software and data to evade law enforcement in cities.’
‘Many held this company up as “the role model” for how to run, how to fight, and how to play by your own rules regardless if those rules may turn out to be in violation of known laws. i.e., “It’s all about disrupting and the Benjamins – screw everything else.” (i.e., AirBnB™ and it’s now legal issues as one example)’
This nuts. One would think that if you are breaking laws left and right, it could at least make money.
I forget where I read it, but Google is set to roll out a new service for employers that gives the search history of the person under consideration for a job. Seriously. The spooks of the old Soviet Union would have drooled themselves senseless for such a thing.
We will all move to TOR, and not use Google.
Tor was created by the naval research lab, and apparently your use of it makes you more of a target than if you didnt.
Google is definitely evil. I’ve said a million times, their slogan is to warn us, not for its employees. Company logos are never self-reflective but an advertisement to the outside world about its character, abilties and principles.
“Premium Employers” will probably get full access to your entire gmail account, too.
Google sucks.
It also sucks that Trump signed that ISP bill, letting them sell every web site you visit to anyone who wants it, without your permission.
Yes. At least on Facefark, it’s free to be an unpaid asset.
If you are going to blame Trump at least get your facts straight.
On the way out the door, obama slapped “privacy” regulations only on ISP providers.
Big democrat donor web sites owners like Google and FB were never covered by obama privacy regulations in the entire eights years of his reign.
uber and airbnb give everyone permission to be a cab or hotel
I like it,but it’s their own undoing
“A new report says Uber used a secret program dubbed “Hell’ to track Lyft drivers to see if they were driving for both ride-hailing services and otherwise stifle competition. Only a small group of Uber employees, including CEO Travis Kalanick, knew about the program, according to a story in The Information, which was based on an anonymous source who was not authorized to speak publicly.”
I’ve switched mostly to using Lyft now because the drivers are nicer and the app allows me to kick them a couple of extra bucks at the end for a tip.
All of a sudden I’ve been getting pushed offers from Uber - 25% off my next 10 rides, 50% off my next 5 rides, etc
I bet they used the same concept to see if I had both on my phone and are trying to get me to come back.
The very blackest of swans
from The Economist:
All these rules failed and the scheme collapsed. Law was exiled and died in poverty. The French state’s finances stayed weak, helping trigger the 1789 revolution. The idea of a “fiat” currency was perceived to be the essence of recklessness for another two centuries and the link between money and gold was not fully abandoned until the 1970s, when the Bretton Woods system expired.
Of course, the parallels with today are not exact. Law’s system took just four years to collapse; today’s fiat money regime has been running for nearly 40 years. The growth in money supply has been less excessive this time. Technological change and the entry of China into the world economy have generated growth rates beyond the dreams of 18th-century man. But one lesson from Law’s sorry tale endures: attempts to maintain asset prices above their fundamental value are eventually doomed to failure.
Its an old scam…
Genghis Khan even did it…
https://www.google.com/amp/s/letstalkpayments.com/amazing-history-paper-money-gengis-khan-epoch/amp/
Caligula did it in a way. Even in an age of metal money, he ordered the gold coins to be cut with silver. (He needed the money cuz Krugman told him to borrow a lot). Friedman documented they promptly experienced inflation in his proof that increased money supply causes inflation. But those were relatively closed money systems. Today money and jobs can fly off around the world. The counterfeit cash results in oversupply, overcapacity and bubbles.
On the way to misery, bankruptcy and war…
There is no way a peaceful and democrat society can exist with massive financial fraud.
When the economic fake miracle pops, people are ruined and angry.
And that is how Napoleans and Hitlers and FDRs come into massive power.
“There is no way a peaceful and democrat society can exist with massive financial fraud.”
Probably not when bankers own the congress and have implicit immunity from justice and the judiciary.
krugmandur/friedmanlander
BAhhhhhhhhhhhhhhhhhhhhhhhhh
‘The growth in money supply has been less excessive this time’
When was this written?
2009, so the printing orgy was still young
pretty obvious by now that Canada is being colonized by China.
Canada= East China
U.S. = Northern Mexico
Europe= New Mecca
worlds overpopulated countries flooding into the stable areas now while bidnezzmen & politicians rub their greedy hands over profits & pensions.
meanwhile stupid overly-aggressive low-IQ people never figure out: it’s not the GEOGRAPHY but the fair, even application of the SYSTEM in a location that makes it desirable, as refugees/immigrants cling to the same bad habits & attitudes which doomed their old countries.
ex: look at what the Mormons made of the Utah desert in 100 years as a prime example of people who pulled together to make it BETTER, not tear it apart in a greedy FU gimme-mine-now frenzy!
while another desert area, over 2000 years old, continues to be a neverending source of misery: the middle east!
it will NEVER be stable.
Never.
they love to bicker and argue and fight over the slightest provocation, and hell, just for the sheer pleasure of it!!
for local examples observe community volunteer events, like riverway cleanups or food bank drives . . . who gives?
and who takes?
it’s right there in front of your face.
the “human” nematode swarms (like on my kids Spongebob show)just
overwhelm everything in its path.
he who breeds, leads.
(and needs housing / haha )
Ben, I don’t know whether you previously excerpted this long article from MacLeans, but it is horrifying, with contemporary anecdotes from Canada mirroring the manic 2004-06 period in this country:
“Not many events can compel people to shell out more than $150 to spend an entire Saturday perched on metal folding chairs inside a chilly, cavernous auditorium. But in Toronto, the prospect of getting rich in real estate will do the trick. Last month, a spectacle billed as the Real Estate Wealth Expo stormed into town, drawing upwards of 15,000 people to see an eclectic mix of speakers, from motivational speaker Tony Robbins to musician and gyration enthusiast Pitbull.
At 8:30 in the morning, a quartet of real estate industry professionals takes the stage to whoops from the crowd for a panel on Toronto’s housing market. Local realtor Daryl King (the “king of real estate!” according to the moderator) tells the crowd the key for first-time buyers is just to get a foot in the door. “We haven’t seen the end of it,” he says of the region’s double-digit surge in home prices. “So buy today, before it’s too late.”
…
“The average selling price for all homes in the Greater Toronto Area, including houses and condos, surged to $916,567 in March, a 33 per cent rise from the year before, according to the Toronto Real Estate Board. Since January alone, prices are up 19 per cent. A lowly semi-detached house in the city is now worth more than $1 million.
Prices are growing even faster in the surrounding suburbs. More first-time homebuyers and investors are looking to Barrie, Ont., a city about 100 km north of Toronto, where the average selling price jumped 33 per cent compared to the year before. Even real estate agents are surprised. Chris Messecar, a local realtor, listed a semi-detached home in March with an interior that hadn’t been updated in about three decades. On one night during the bidding period, a woman was murdered about a kilometre away from the home. The incident did nothing to dissuade potential homeowners. ‘Only one agent reached out about it and said they were somewhat concerned,’ Messecar says. He received 11 bids, and the property sold for $104,000 over asking.”
http://www.macleans.ca/economy/realestateeconomy/how-canada-completely-lost-its-mind-over-real-estate/
The bubble popping up north will be epic…
A whole new generation of victims.
’she cautions those tempted to cash out that there’s always a risk the market won’t co-operate. ‘People have been asking themselves that question since the year 2000: Should I sell? Should I cash out? And there have been people who have cashed out and have regretted it because they’ve seen what the market has (done) — they’ve never been able to rebuy the houses that they’ve sold.’
Like Australia, the Chinese QE kept things going. Instead of being “lucky” as they say down under, IMO they will eventually see this as a great curse.
The financial saga of Sir Isaac Newton comes to mind.
Made a fortune in the South Sea Trading company stock. Then sold all his stock.
Was all out. Got jealous at the fortune he was missing as the stock continued to rise and got all back in.
Lost it all and went bankrupt.
“Lost it all and went bankrupt.”
“How did you go bankrupt? Two ways. Gradually, then suddenly.” —Ernest Hemingway
More from MacLeans. Belatedly, Canadians are typing “housing bubble” into the Google search box.
http://www.macleans.ca/economy/realestateeconomy/canadians-are-googling-housing-bubble-like-mad/
And to complete the MacLeans trifecta on housing articles, there’s this guy, the head of the CMHC, apparently being feted as a reformer unafraid to speak truth to power. He’s hired 100 new employees with backgrounds in risk management, all of whom no doubt will proclaim that there’s no housing bubble.
“Siddall’s previous employers include Goldman Sachs and Lazard Frères & Co., two of the world’s top investment banks. When he got the call to join CMHC, Siddall was working at the Bank of Canada, helping to devise highly technical schemes to end “too big to fail,” post-crisis shorthand for the perception that governments would rescue the biggest financial institutions whenever they got into trouble. “Evan is consistently analytic, thoughtful and highly effective,” says former Bank of Canada governor Mark Carney, who hired his fellow Goldman Sachs alumnus in 2012.
…
CMHC can’t control the housing market, [Siddall] continues. “That’s a misunderstood factor about CMHC. We and our colleagues at the Department of Finance are constantly accused of not solving the problem. We’re standing in front of a lot of core economic reasons for why housing prices are higher.”
…
Siddall is unbridled. In a speech in Vancouver last fall, he called out politicians who favoured taxing international buyers as a way to deflate the city’s bubble. He agreed foreign speculation was a factor, but said CMHC research showed domestic speculation was a bigger issue. “When a white person buys a house, we don’t notice,” he said at the event, hosted by the Vancouver Board of Trade. “If somebody of a different colour does, we do. And that’s not good economics.”
In an interview, he’s asked if he thinks he’s in a race against a financial crisis. He struggles with the answer. “Boy, that’s . . . I don’t know,” he says.
http://www.macleans.ca/politics/ottawa/inside-the-taming-of-cmhc/
Oh no! Applebees is closing a lot of sites!!
Boeing is laying off.
Meanwhile, Obama is hanging out on yachts drinking mojitos.
Here’s a comment from the ZH article on Boeing’s “layoff”
“Meh. Squirrel!
Northrop Grumman is hiring so many new people in my county that they can’t find housing(well, “good” housing). A realtor just went door to door with this story(to a few hundred homes in several adjacent gated communities), offering ppl cash for their houses(best school district, etc). And this is just an anecdotal snapshot. Raytheon and Rockwell Collins are also booming around here. And Harris Corp recently diverted a main road and “bought” part of a nature preserve for a new building and more of a security buffer.”
Here’s another one:
“Have a close friend who was repeatedly offered jobs by Boeing as he worked with them on several projects but he knew of their reputation for brutal layoffs and always took a pass. He finished up his engineering career in his hometown and is happily retired there.”
So I guess Boeing layoffs are fairly routine.
I’ve never eaten at Applebee’s.
Not enough crow on the menu at Applebee’s for your liking, eh
dingus, I gotta hand it to ya. I’m surprised your head hasn’t exploded yet from the extreme cognitive dissonance of trying to compare me to a cross between Hitler and the Ladies of the PTA, just because I objected to Facefark’s live stream of the murder of an elderly man.
Of all the crazy posts I’ve seen, that one takes the cake.
I dunno man, google surreal humor? Anyway, I’m glad you enjoyed it… I cracked myself up writing it, but that doesn’t take much to do.
There are over 2000 Applebees stores. Closing 60 isn’t much of a dent. You know I think a lot of it is simply geographic too. The US population isn’t spread out among company towns like it used to be. Imagine places like Dayton OH or Syracuse or Odessa emptying out. They can’t support an Applebees. But there are still plenty people in Austin and Denver who get Hello Fresh instead.
Bennagins was good.
Oxide can you give us some boots info on fed workers exiting etc.
The local rags are mum.
Oxide,can u expound on fed exits,rumors,etc
Tx
When the Canadian bubble pops it will be much welcome relief and these greedy lot will be put in their place.
Not directly housing related, but a sadly amusing note from Latin America. A private company with a bribery department, I think I’ve seen everything now. And that’s a rather large sum. Are the names of the recipients on the spreadsheet too? Rio, are you out there to comment on this? My Portuguese is very basic, but according to one Brazilian paper, it looks like various politicians had the equivalent of sponsors within the firm, an arrangement intended to avoid internal conflicts over whom to pay.
“Odebrecht SA, the Brazilian engineering company at the center of a historic corruption scandal, paid out a total of about $3.3 billion in bribes in the nine years through 2014, according to testimony cited by local media on Saturday.
Through a department specifically established to pay politicians and other recipients for public works contracts, Odebrecht paid as much as $730 million annually in both 2012 and 2013, the years when bribe payments peaked, according to a spreadsheet that a former executive reportedly gave investigators as part of a plea deal.”
http://www.reuters.com/article/us-brazil-corruption-odebrecht-idUSKBN17H0MW
Meh. In most ‘developing’ countries, bribery is nothing more than another cost of doing business.
What I find most entertaining is the foreigners who move to my neighborhood and find out the hard way that bribery doesn’t work here, for the little people at least. For the large developers, on the other hand, they can get away with doing just about whatever they want.
Case in point: in my area, you can fill in and build on a wetland. How? You have to either create another wetland somewhere else, or buy the development rights from somebody else (typically in a floodplain where you can’t build anyways). Our system is rigged for the big dogs.
“Meh. In most ‘developing’ countries, bribery is nothing more than another cost of doing business.”
+1 Indeed. Here it’s better known as consulting fees.
Greenwood Village, CO Housing Prices Crater 18% YoY
https://www.zillow.com/greenwood-village-co/home-values/
right on queue we have a short covering rally today.
I come to this site everyday seeking like mindedness and support. I really can’t take this housing market much longer. I sold back in 2013 due to a divorce and have been renting a very nice town home with my two children every since. However, I am ready for my own home with places to park for friends and family and a little more privacy. I’ve saved almost $100K for a downpayment, I have zero debt, make a great living, have a credit score of 830. But I look around me, and continue to see outrageous prices for homes built on tiny tiny lots or older homes that haven’t even been updated asking for top dollar. My conscience won’t let me buy.
The realtors I speak to continue to tell me it’s a good time to buy and houses are only going to go up. I feel like some kind of alien from a forgien planet! I can’t believe more people don’t see this. All I hear is “Everyone wants to live in Portland so everyone’s moving here! ” Seriously???? Is that also true in Toronto, London, Moscow, Sydney, Seattle, Denver, Dallas, Boston, San Fran ext?
It’s getting me depressed. Does everyone just live way beyond their means? I feel even though I make huge sacrfices for my finanical well being I’m going to end up getting screwed in the end anyway.
Sometimes I wish I was just ignorant and blissful.
I think we’re in the same boat. I have a huge down payment waiting to go but can’t bring myself to take the plunge because my current living situation is pretty great and everything about this housing market screams “there’s no way your average American can really afford this”.
When I really have the tinfoil hat wrapped on tight I start wondering if we’re lied to about average incomes so everybody feels rich & spends more, or maybe I’m the only person not raking it in from the underground economy.
The places I’m looking at moving to are the same ones that fall into the so-called “everyone wants to live here” category… Seattle, San Diego, San Jose, etc….so I’m increasingly worried there may be something to it. On the other hand, I look at Kansas City and Nashville and those prices are also inflated and I have a hard time believing people are moving there in droves. The conclusion that I’ve reached is that we’re in bubble territory and I don’t want any part of another bubble, even if I miss out on potential gains.
The last time I started getting freaked out about house prices was in late 2007, when I originally found this blog. Obviously we were at just about peak bubble at that point. I stopped reading in early 2012 after I bought my short sale house at the end of 2011 and when it was clear that many of the folks here would never be happy/enjoyed spinning in circles and yelling that the sky is falling. But I think the pendulum has swung enough again where they’re on the right track and our fellow tinfoil hat wearing HBBers will be proven right again within the next few years.
It is very difficult to keep hanging on and watching prices go up in the meantime, and easy to understand why your average shmo with no self control is clutching his 128 oz soda container and jumping in at these inflated prices to prop up the bubble further…. as for the rest of us, we need a support group to keep our finger off the trigger!
‘folks here would never be happy/enjoyed spinning in circles and yelling that the sky is falling’
I’m not going into why these timelines and generalizations are completely wrong for the 1,000th time. But at least half the posters here are gambling fools, like you. Please buy 4 houses sight unseen right away. We need buyer capitulation and the last wave of greater fools to flush this thing out.
Ben, I’m surprised you made it through my post but decided to focus on that one portion of it. The HBB was a tremendous support system for me while I restrained myself in 2007-late 2011 & I believe it saved me a bunch of money I would have otherwise torched (whether you believe the money I ultimately did spend was torched is another story…but at least it was far less than what I’d considered blowing in 2007!).
I’m not claiming that the housing market had fully recovered in 2011 or that my purchase then was some kind of wise decision - only a relatively educated one, after years of sitting on the sidelines through the worst of those years biding my time. I’m very happy with my current housing & financial situation, even if inflation is gnawing at my savings/future down payment on an even nicer house - it is worth it to live responsibly & be prepared for a rainy day, and I’m happy living well below my means.
I have no intention of buying any houses right now sight unseen, certainly not 4 of them, I can’t imagine how you could read my post and come to that conclusion, so will take it as some playful absurdist hyperbole. At this point I think you are preaching the gospel and will be proven right here within a few years with a serious downturn of the market, perhaps both financial and housing.
All that said - I maintain that you and a number of other HBBers could easily be considered the fringe in 2011-2013, and I don’t think we’re ever likely to see a correction that pushes prices much lower than what we saw 6 and 7 years ago, barring some kind of fullscale collapse of our financial system, which I’m also betting against. A severe correction, sure - I’m prepared for that and then some. But a collapse to pre-2005 levels or more? Welllll, I may be a fool but I sure as heck ain’t the only gambling fool if anybody is betting on that happening (and I know you’re out there). I don’t even know how to respond to that belief, how do you convince somebody Jesus didn’t come to earth on December 31, 1999?
I’m sorry if you are taking my comments as some kind of attack & remain a fan, independent of how many joshua trees you’d like to see me impaled upon. Please keep doing what you’re doing, frankly I would have been heartbroken if you HAD closed up shop during the years I accuse you of yelling that the sky is falling…I definitely believe the HBB is once again relevant & am looking forward to what the future brings, even if your vision of it is a little bleaker than my own.
This:
“after I bought my short sale house at the end of 2011″
Explains this:
“I don’t think we’re ever likely to see a correction that pushes prices much lower than what we saw 6 and 7 years ago,”
You got barbecued and you know it.
Race,
I’m waiting on the sidelines to buy a new house, I explained I have excess cash, am living below my means. My current house could lose half it’s value as of the time I bought it and I’d be in the black/have enough net worth to make it for years without a job. I’m fine, I’m far from barbequed. If I extended myself and pursued the dream of buying a nice place in the San Jose or Coronado area right now, yeah, I’d probably be barbequed…and I’d deserve it.
I’m probably being trolled but based on your past posts, probably not…you seem like the kind of dude to selectively read what you want to read/see what you want to see, the opposite side of the same coin that Suzanne and the FBs are stamped on.
I’m just following this thing. I’m also probably the most optimistic person you could know. Economics doesn’t really have a bleakness to it. It just tries to explain what’s going on. A mania is something rare, or it used to be. It defies ordinary economic theory and I’ve always been interested in manias. Plus I got to see one first hand in Texas 30 years ago. I could see it being worse or not worse than a few years ago. There are a couple of things I’m watching: one, it’s not just housing. Tech stocks, junk bonds, commercial real estate and farms. The latest FOMC minutes singled out these very assets. The other thing is the public is still shell shocked. Another housing crash could freak a lot of people out with unpredictable outcomes.
I did stop posting much in 2009 and 2010 because I was working on foreclosures 7 days a week. IIRC, in 2011 there were reports of people camping out for houses in California and writing love letters to sellers. I started following it again and here we are.
BTW, the other day a person I know in Tucson told me the lunch crowd were all talking about getting rich buying houses. About a month ago I found an article saying Tucson’s YOY shack inventory had gone up 80% and another saying one in eight housing units are vacant. A year or so ago I posted an article with a loan officer saying Tucson had caught the cash out refi bug.
lordy be, what the heck was that all about?
People convince themselves of all sorts of distortions. Especially when it comes to money. When that money is borrowed, one has to immerse themselves in that distortion. They have to in order to cope.
Ben, I sure can’t argue with those thoughts & appreciate you taking the time to reply.
I wish I was more aware of the Tucson market & could weigh in on the housing situation here, but I’ve been entirely focused on moving elsewhere & haven’t kept up with what is going on as well as I did in years past.
My neighbor’s house sure isn’t selling after multiple cuts (approx 525K->450K, they originally bought for 400K in 2015)…it is a pretty nice place, it would be a shitshack anywhere in California, but not in Tucson. I’m kind of hoping it takes years to sell, because if they profit from their speculation it will be that much harder for me to resist the urge to move before we see a correction.
I don’t think we’re ever likely to see a correction that pushes prices much lower than what we saw 6 and 7 years ago
I think the next correction will probably push prices about as low again…on an inflation-adjusted basis. Per Shiller’s data, the last three cycles reached a trough within about 10% of each other (nationwide).
What inflation? Wages today are exactly what they were in 2000. Housing prices? 300% higher.
‘about as low again’
There isn’t going to be another China, 100 years of concrete in three. If the public sees Fannie and Freddie in the tank again, there won’t be much appetite to get that ponzi horse up again. And central bankers will get most of the blame. On the plus side, we’ll get to test my theory that it’s the same bubble. Because if it is, prices should go well below.
IIRC, in 2011 there were reports of people camping out for houses in California and writing love letters to sellers.
I don’t remember that…I purchased in 2011 south of SF (pre-Facebook IPO). I recall being able to walk through a number of listed homes with our agent, with the agent frequently saying “we can do better”. There were relatively few listings, but not a great deal of urgency.
We made a deal on our home before it was officially listed…about the only thing that I did recall was our agent suggesting to us that we should have three offers written (x, x-1%, and x+1%), and a letter from our lender noting our pre-approval for an amount that made x+1% feasible. We would decide which offer to make on the fly. IIRC, I think we offered “x”–and made the deal by agreeing free rent-back for a month or so.
We had a standard contingency and closing time-frame (full inspections, etc.).
It was a one-on-one negotiation, not a bidding war. The seller was interested in making a fair deal with a capable party…she didn’t give a hoot about anyone feeding the squirrels, and she wasn’t in any kind of distress.
I may have just gotten lucky, and perhaps there were love letters written in 2011…I just don’t recall recall buying in that kind of environment, or hearing of those stories starting up again until a couple of years later.
BTW, I’ve been approached on a couple of apartment deals in Tucson….there is plenty of vacancy there. No thank you.
And now something from Alive in Tucson
https://www.youtube.com/watch?v=kKwXHDs1R6Y
phony scandals, adding to the playlist:
Home prices are falling all around
It’s time I was on my way
Thanks to Yellen I’m much obliged
For such a pleasant stay
But now it’s time for me to sell
I’m done owning today
For now I smell joshua trees
And with them shrieks
And it’s headed your way
Ah, sometimes I grow so tired
But I know I’ve got one thing I got to do
Ramble on!
“Alive in Tucson”
Hope you’ve had the chance to treat Martha to lunch.
Nice
Thanks for the support Alice and well said! I spent the first 20 years of my life in Kansas City, if homes are quickly appreciating there…..we are definitely in bubble territory. Nice people, but not much to do there. Good Luck
1compare stocks to housing,what did u miss?
2 wait for hate,may take a year or two
One of the problems is you’re competing for houses against:
1) Those who purchased before the bubble, and now the dollar figures are just monopoly money to them. Again I’m hearing talk about people saying they’d never be able to afford their houses if they tried to buy today.
2) Investors, all cash, investing OPM (other people’s money).
3) The debt indifferent who don’t care about climbing aboard the foreclosure conveyor belt for a few years, losing the house, rinse repeat.
Spending money you’ve earned, versus trading a house that’s appreciated astronomically makes the transaction more problematic. Plus, if you care about avoiding the foreclosure conveyor belt, that adds another wrinkle.
No good choices here.
“My conscience won’t let me buy.”
Uncommon resolve.
Herndon, VA Housing Prices Crater 8% YoY
http://www.movoto.com/va/20170/market-trends/
Nvar.com shows prices median up 7% yoy
And 25% for the last 4 years,but sellers I know can’t break even
Yet prices fell 8% in Herndon.
@Kirsten,
You are not alone. I am in same boat. Wife keeps telling me every year, see it’s going up - told you to buy last year. And I am counting such years.
I am in Bay Area. It’s insane here. Every year price goes up by 50K-100K.
Thanks to the tech stocks. Amazon, Google, Facebook, Apple and many startups. Their employers can throw insane $ from their stocks, not fair to anyone else living in Bay Area.
I feel frustrated just like you.
Been at this site, almost every day, hearing about crash for a year or so.
But no crash in site. I feel this will continue for at least 2-3 years.
I hear crash is coming. But nobody can predict exactly how and when.
So it does not help us …
why dont you pack your sh@t and leave?
dude, that was one of the funniest replies I’ve ever seen on this blog.
Crashes rarely happen all at once.
Right now.
Miami, London and Western Australian are in a downward accelarating spiral.
NYC and DC are tripping over the edge.
Who knows what sets it off globally.
But the bubbles will all crash.
‘downward accelerating spiral’
Add Brazil, lots of Arab cities, Calgary, Kenya, and Nigeria. Over the edge: Taipei, Seoul, Vancouver, Houston, Anchorage, Malaysia and out on a limb I’d add Auckland. This is familiar: in 2005 the UK and Australia headed down first, even though they like to say the US crash caused their “great financial crisis”. Funny how they never look at the timing. And India. Been in a funk the whole darned time. That’s a big place! I learned a new one today that is stinking it up: Muscat. I had to look it up:
‘Muscat (Arabic: مسقط, Masqaṭ pronounced [ˈmasqatˤ]) is the capital and largest metropolitan city of Oman. It is also the seat of government and largest city in the Governorate of Muscat. According to the National Centre for Statistics and Information (NCSI), the total population of Muscat Governorate reached 1.56 million as of September 2015.’
https://en.wikipedia.org/wiki/Muscat,_Oman
Muscat Love!
Times like these, it’s not a bad idea to have some physical precious metals on hand, just in case.
“Who knows what sets it off globally.”
Tech implosion, maybe.
I can think of a dozen plausible scenarios…
It doesn’t take much to start a cascading set of events as everyone tries to get out with their “profits” out of their slice of the bubble.
Add in 40:1 leverage….
Ah! The government shutdown. Mark your calendar for the end of April.
Yes, congress has all of one week in order to pass another continuing resolution (until mid-summer? through the end of the fiscal year the end of Sept.?) or things shut down.
I’m kind of hoping for it, as I have a few riding mowers that need going through to start the mowing season.
Thanks Foo Bar…..SF is insane. There has to be a tech bubble funded by so much VC money that it has to implode.
Tons of start up companies have come here to Portland in the last three years. It’s hard to tell exactly what the hell these internet businesses even do? I started researching a few and they all seem to be experts in “creating platforms and maximizing optimization!” Some specialize in uncommon stuff like “”Wildfang” (men’s clothing for women)…..ugh whatever. I’m going to follow tech, that should lead the crash and VC money is slowing down. Most of these companies won’t survive.
The houses selling in the over $500k market has slowed way down here. They have been on the market for months and it will be interesting to see how many of these luxury homes that don’t sell by the end of this summer, end up on Craigslist as rentals this fall.
Tell your wife to hang tough!
Same here on the east coast. Lots of tech money here, wealthy college students (well, wealthy parents) and a building boom seemingly everywhere in Boston and across the river in Cambridge. Prices for both rentals and buying are insane. How long before it busts (if it does) is the big question.
The Boston Globe ran this article in January 2016. Are they right or are they wrong?
https://www.bostonglobe.com/business/2016/01/07/think-boston-housing-expensive-now-wait-five-years/6qTjKdarDT2AdZkpqrJWaJ/story.html
Meanwhile, we wait.
typo, no crash in sight.
Redwood City, CA Rental Rates Crater 11% YoY
https://www.zillow.com/redwood-city-ca/home-values/
To follow up a previous comment on this huge pro democrat major Hillary supporter company…
—
Fears Google Hire could allow employers to see your entire search history
|4/16/17 | news.com.au
THE tech giant is working on a job site called Google Hire, which could let prospective employers snoop your embarrassing search history.
IN THIS day and age, every boss is going to quickly Google a prospective employee before asking them to come in for an interview.
But now the technology giant is working on project called Google Hire, which The Sun reports will help employers learn perhaps a little bit too much about their new recruits. It will reportedly be a recruitment tool similar to LinkedIn — however, early reports suggest it will be available through your personal Google account. If that’s the case, it will link things like your search history and YouTube account with your job applications, laying it all bare for employers to see.
Dont be evil…..oh, there’s no money on it? Screw that then.
Hello NSA!
Thanks, 2ban. That’s what I was talking about.
“Real Estate Agent Accused Of ‘Upskirting’ At Open Houses”
http://denver.cbslocal.com/2017/04/09/real-estate-agent-patrick-finney-upskirting/
Houston, we have a problem.
http://www.zerohedge.com/news/2017-04-17/houston-commercial-rents-plunge-vacancies-hit-22-year-high
Here’s another one from Ontario today:
http://www.nugget.ca/2017/04/17/housing-market-becomes-ontarios-next-big-issue
“Finance Minister Charles Sousa summed up the political situation to reporters at Queen’s Park Wednesday: “Families are pissed they can’t win bidding wars.”"
LOL, ZH is just chock-a-block with bad economic news today:
http://www.zerohedge.com/news/2017-04-17/us-restaurant-industry-suffers-worst-collapse-2009
Can you imagine this bouncing around in your skull everyday all day?
https://youtu.be/BdWEbweX1rQ
It’s the anthem of Debt Donkeys and Degenerate Gamblers.