‘Boom Over’ For ‘Once Promising Albatross’
Barrons has one columnist starting to see the housing bubble. “I have long argued that we’re not in a nationwide housing bubble, although we’ve had some local ones. Therefore, I didn’t think we would see a general housing crash. But I must admit I’m worried that we might see more than just corrections (10% or so) in some areas. And so are several experts and real-estate professionals with whom I’ve spoken this week.”
“‘I don’t think nationwide you’ll see a bust,’ says Mark Zandi, chief economist of Moody’s Economy.com. But we might in certain markets, he adds, the usual suspects like Miami, Las Vegas and Phoenix.”
“And we may get some sense of how deep a correction we’ll have sooner than we think. ‘This is a watershed moment,’ says Jonathan Miller, president and chief executive officer of a large New York real-estate appraisal firm. ‘If we’re going to see trouble, it’s going to be over the next 12 to 18 months.’”
“Bear markets, be they in stocks, housing or commodities, go through certain identifiable phases, like Elizabeth Kubler-Ross’s famed five stages of dealing with dying, denial, anger, bargaining, depression and finally acceptance. ‘It’s a three to five-year cycle on the downside,’ says Kenneth Rosen at UC Berkeley.”
“We’ve already passed stage one, characterized by ‘a falloff in new sales and orders,’ says Rosen, and are just entering stage two, in which unsold inventories build up. That may be where the crunch begins.”
“‘If inventories keep rising, the pressure on sellers to cut prices will be intense,’ says Zandi. Prospective sellers, of course, can just take their homes off the market and live in them until they think they can get a better price. But speculators don’t have that luxury: At some point they can no longer carry a money-losing investment, so they may throw in the towel and unload their once-promising albatross.”
“That’s stage three, says Rosen, and it usually finishes about three years from the beginning of the downturn.”
“The final phase is when we see massive defaults or delinquencies on mortgage loans. That’s several years away, he says, and this time the damage could be worse because of the large number of exotic loans giddy lenders extended to desperate home buyers. So, we could hit bottom by, say, 2010. Rosen predicts actual nationwide home-price declines of 5% by 2007, the first time prices have fallen in any year since World War II.”
“‘The boom is over,’ declares Jonathan Miller. That perception no doubt has begun to trickle down to prospective buyers and sellers. And we might get some sense of whether sentiment has tipped in the other direction when the trees start to bloom again and for-sale signs go out on front lawns across America.”
I think Ken Rosen’s “down cycle” prediction of “three to five years” is too short. It went up for 10 years in California to incredible heights. What factors say it won’t take longer than “three to five” to correct imbalances and such?
It is a well known saying that markets go down three times as fast as they go up.
Here’s some interesting insite from an insider …
“I’m a Construction Superintendent for large N. California homebuilder. Word to the wise: THe $HIT is about to HIT the FAN.”
“Centex just had a 150K off “12 hour sale”
Centex in Lincoln is “throwing in” a $40K swimming pool
Pulte has reduced prices in some of the hottest markets in the country
The company I work for has only sold 20 houses in the last three months- we usually sell 20 per month. Including our Bay Area operations (South Bay/East Bay)
All builders except for the custom guys (who apparently are so blinded by greed they can’t see the writing on the wall) are at a dead stop in El Dorado Hills, CA.”
“My concrete contractor (2nd largest residential production concrete outfit in the greater Sacrmento area) has gone from 400 slabs a month last year to 150 this year.”
“Everybody’s saying it: “this is looking like the late 80’s”…
“Guys are trolling through my trailer/jopbsite looking for work; reminds me of the 80’s…”
“Things ARE slowing dramatically..”
Good info. And that is what makes this blog so useful. No media screening on items like this, just the facts.
Many thanks.
here is the link to that comment:
SoCalMtgGuy
Another F–KED Borrower
FB FORUMS
Sorry I didn’t give you credit for that. I copied and pasted it from a thread on elitetrader.com.
No, don’t worry about it. I was just putting a link there so that people can ’see’ where we got our info (I’m sure they made that post other places). The link didn’t even show up either…I tried to use the ‘link’ tab in the comments box.
http://housingbubblecasualty.com/forum/index.php?topic=100.0
Hopefully that will work.
SoCalMtgGuy
Forwarded this to the controller of a large home builder. I will let you know what his take on this his. If he reponds back.
Robert Campbell. Late 80’s is a decent, but misplaced analogy. The late 80’s bust was caused by excess Fed tightening which was easily taken away when the recession hit. Many farily valued areas with stable economies actually appreciated during that time due to the stimulus and overvalued areas, while hurt, did not fall as much as they could have in nominal terms. Condos and the like, which are essentially ubiquitous, were obviously hurt the most.
In 2006, we don’t have the luxury of a Fed which is ready and able to cut interest rates in order to “cushion” a localized housing crash. First, housing is not overvalued everywhere and excessive Fed cuts could cause unwanted bubbles in undervalued areas as well as further fuel commodities inflation which will eventually passed through into final goods in some type of stagflation/deflation cocktail.
So we who live in urban bubbles don’t have the luxury of a Fed which is able to bail our fellow moronic neighbors/coworkers/friends out of their stupid decisions.
Hedge,
You make good points that the alignment of economic factors is different today as compared to 1989-90. What will turn out to be a common denominator to both housing crashes, especially in California, will be the same: excessive speculation.
In my view, the Fed can only do so much once an asset market becomes grossly overvalued. Such is the case right now. At some point, all euphoric/bubble markets simply fall under their own weight. When everybody who wants to get “long” is on-board, there is no more demand to keep the mania going.
The Fed can lower rates if they wish, but falling prices and market psychology (fear) will strongly suppress the willingness of buyers to step back up to the plate until they perceive that it’s safe to do so again.
True.
But are not some of the excesses “worse” than at earlier cycle tops (’89-’90; early 80’s)?
If so, could it take longer?
The housing market in California went (roughly) up in the second half of the 80’s, down or flat for then next 6 years (until ‘96) and then up again until the present. Where is the 3:1 ratio apparent in that?
Yes, the excesses are MUCH worse. I don’t know if that means the bust will be longer, or faster. I worked in RE sales during the last downturn and based on that experience I thought we were in for a long slow downturn (I thought it would start in 2005). But, based on the extreme nature that the boom has now taken on, I’m thinking a quick drop may happen, followed by a long slow additional decline. The optimism got so extreme, I think we could see panic selling.
There is better access to information today than in 1989, the reaction should be fast.
deb, HOZ - good points.
The factor that make this last longer than 3-5 years is a strong economy.
“Prospective sellers, of course, can just take their homes off the market and live in them until they think they can get a better price.”
Of course. Except for the ones who currently have $1400 neg-am payments that will soon reset to $3000. And the ones who’ve only been able to hold on by liberating equity each year. And the ones who are spending 60% of their income on PITI for a house that’s 100K underwater when they have no skin in the game…
Same drivel over at the NYT.
http://www.nytimes.com/2006/02/17/business/17investors.html?pagewanted=2
‘But a reason that a speculative sell-off is not likely to lead to a bursting bubble is that unlike stocks, where investors can panic and sell large volumes in a matter of hours, owners of real estate will only slash prices so far. “People resist and don’t sell,” said Mr. Case. “It tends to stabilize prices.”‘
Good thing there are no external circumstances that could ever force someone to sell for less than what they want - er, DESERVE.
“People resist and don’t sell,” said Mr. Case. “It tends to stabilize prices.”‘
Get a clue, Professor Case. That was so 1990s, before an unprecedented collapse of loan underwriting standards put free money with strings attached into a record number of unqualified buyers.
You dont pay HOA fees, taxes, maintenance, insurance, etc to hold a stock. This housing crash is going to be worse than any crash in history including the stock market crashes. Just wait…..
http://www.realestatedecline.com
And HOW, pray tell, are they supposed to “unload their once-promising albatross”??? Cross their arms, blink twice and *POOF* the house is sold? Easier said than done for sure.
BayQT~
For DC a down cycle of three to five years sounds about right. The Washington area in the last decade has gone though a paradym shift with DC becoming much more attractive than other submarkets. That said, it could eaisier shave 10% to 20% off the high.
A “paradym shift?” That sounds to me like a “new economy.” And 10-20% shaved off the top, in DC, would leave prices way too high, in relation to the historical measures that matter, incomes and rents. With the understanding it is a fools game to predict the numbers, I will wager that SFH’s fall 30%, condos 40% or more.
paradym shift = its different here
its different here = its the same as everywhere else
its the same as everywhere else = Shit is gonna hit the fan
What will the FBs say after the bubble bursts?
“Brother, can you paradigm?”
paradym shift = its different here
is different here = its the same as everywhere else
its the same as everywhere else = the shit is gonna hit the fan
paradigm
I just sent my college degree back. Sorry
I’m keeping my degree - put “pardym” in quotes, after all. DC Bubble has a cool website, but I don’t think she grasps the magnitude of what is going on here.
paradigm.
This just in- Lennar Homes is now offering up to $60,000 off preconstruction homes in their developements towards Leesburg & Mt. Dora Florida (yes there really is a Mount Dora in Florida).
These two cities are about an hour north of Orlando, quite a commute. Unfortunately there are not many jobs north of Orlando offer the pay ranges it takes to afford half million dollar homes.
“Mount” Dora
? The highest point in Florida is 345 feet! Even Delaware and Rhode Island have higher points than that.
Johnathan Miller (quoted above) runs a very straight-talking real estate blog. If you haven’t checked it out, it’s worth the stop:
Matrix
grim
Northern NJ Real Estate Bubble
Thank you grim…Added to my link!
Ryan homes in Northern VA has a red sticker on every page offering 20-70K discounts “for a limited time”. Ryan is the area’s largest builder.
Limited time meaning before they go BK?
ryan- time limited to next time
DC lives of the sweat of the entire nation and GOV workers never lose their jobs= perpetual parasites- so DC will come down less than real cities
same as 1990-1996
flat,
True, but military and government workers are very transient. I looked at two rentals last year - one family was going overseas with the State Department and one was being sent to CT with the Navy. We also have a massive amount of immigrants who are in the service industries here in the VA exurbs. Not to mention construction day-laborers.
I don’t neccessarily agree. The DC and NoVA market is also heavily dependent on government contractors and other commercial enterprises peripheral to the government and directly or indirectly dependent on federal spending. With the massive deficit, I’ve heard there’s a great deal of belt-tightening in non-military, non-Katrina spending.
And government employees (I knew some who used to refer to their employer as “Club Fed”) don’t make anywhere near the kind of money needed to afford a junky $800K townhouse.
The coming default tsunami and credit implosion will hit DC and NoVA very hard.
John,
I have to agree that Gov employees don’t make the kind of money that is necessary to get even average digs in the area. There has also been a huge reliance on exotic loans in the area with teaser rates. Fed salary increases aren’t even keeping up with inflation now, so see how they cope with 50%-100% mortgage increases when their teaser rates end!
Yes, your first paragraph says it - DC would appear to have much more of a diversified economy than in the past.
Think about all the office parks that have sprung up in the past 10 years stretching all the way out to and beyond Dulles. Those used to open fields. There are not many govt buildings with worker bees in them out there - though some are govt parasite companies, no doubt (defense, etc.).
“Bear markets, be they in stocks, housing or commodities, go through certain identifiable phases, like Elizabeth Kubler-Ross’s famed five stages of dealing with dying, denial, anger, bargaining, depression and finally acceptance. ‘It’s a three to five-year cycle on the downside,’ says Kenneth Rosen at UC Berkeley.”
I wonder where Kenneth came up with this idea?
I agree, there are a lot of journalists lurking here.
Only one honest one, the guy from Bankrate.com. I forgot his name.
Not surprising really, blogs are making them quazi irrelevant, Craigslist is killing their paycheck and the internet is making all but hyper-local news a commodity.
Since Mr. Rosen appears to be lurking here, I have to ask him if he still believes that home prices in the Bay Area are minimally impacted when the NASDAQ is below 2500 (or some such level)?
His reasoning was stock options - he mentioned such in ‘02 or ‘03 after that index was hit hard. Obviously, it hasn’t mattered much the last few years thanks to Easy Al, among others.
Mr. Rosen?
That would be Dr. Rosen, MIT educated (along with Ben Bernanke).
A bottom by 2010 is highly unlikely because homebuying demographics just begin to turn negative around that time (the first boomers turn 64 that year), and don’t improve until around 2025.
That’s because too many baby boomers will be trading down or staying put during that timeframe to be offset by genex buyers.
That’s right. If Harry Dent is correct in his predictions, the baby-boomer timebomb means we won’t see the bottom of the housing cycle until 2020-2023.
I agree with this to a point…I think overpriced neiborhoods near large job centers (like Pasadena, Bay area, OC) could hurt bad because the boomers hold so much wealth and trade up buyers might not be able to fill the glut.
However I also believe areas that are popular with retireies will recover faster (NV, AZ, FL, OR) than the rest.
Has all the tendencies of a Japan style housing bubble bust in terms of longevity.
oops, meant to say :
Has all the potential tendencies to be a Japan style housing bubble bust in terms of longevity.
I disagree. Not because I don’t think there’s an enormous bubble, but because American demographics are not Japanese demographics. Japan is rapidly aging, they produce few children, and unlike the US, Japan does not welcome hordes of young immigrants.
I think there will be a very sharp “correction” in US housing prices, but I don’t think that 15-20 years from now we will be faced with the same quandry of negative real interest rates and declining prices. Properties will be much cheaper just a few years from now and we will have lots of young people ready to begin the cycle anew.
How relevant is the baby boomer time bomb? This is all about supply and demand, it seems to me. And right now supply is soaring and demand is shrinking. I don’t think we will have to wait until 2010 for the bottom. But it will take a long time to come back. It took over 25 years during the Great Depression for real estate prices to recover. The baby boomer effect may lengthen the recovery time.
>>>>The baby boomer effect may lengthen the recovery time.
Very interesting point. That will sure shoot down the buy and hold strategy.
It you buy and hold at the bottom (say 2010) and the unit cashflows well, it would still be a good investment even if the recovery prolonged.
I spoke with a friend of mine in the mortgage industry, and he told me that the best rate he can currently get for a sub-prime borrower is 8.25%. Looks like, with Wall Street demanding better rewards for their risk in buying sub prime mortgage back securities, the price to the consumer has just gotten a lot higher. First time I heard of this finally trickling out to the consumer.
And this further shrinks the buyer pool as fewer buyers will qualify at the higher rate. Soaring inventory and shrinking demand is a formula for an incredible housing bust starting very soon.
Hi guys,
I am looking for a link. There is a website cited here all the time which shows the PE ratios and Affordability indexes for tonnes of cities on graph form. I am sure some of you know what I am talking about. Any link would be appreciated!
I think that this is what you are looking for. There are a number of mirror sites.
http://www.housedata.info/
SunsetBeachGuy, I’ve posted links to some of those graphs, particularly Bakersfield and SD, to Craig’s List. It was like waving a clove of garlic in front of a vampire. They hiss “go away!”
Yeah, there are some real mental giants on Craigslist.
I only lurk over there when I am in an angry/aggressive mood.
Facts are stubborn.
Ben-
Can we add photos to this site yet? or post them ourselves?
We are going to be working on that this weekend.
Thanks.
wow i checked yahoo RE for costa mesa yesterday it was like 92 for sale, today it is 140… first time i’ve seen it over 100 in like 2 years…
“‘If inventories keep rising, the pressure on sellers to cut prices will be intense…”
********************************************************************************************************************
Intense? You better believe it. Look at this posting from a realtor in FL:
“We already know its a lot slower now since inventory is 400% higher than it should be and was last year this time. But what this means is a little subtle. My take is that the demand from last year and high market prices finally succeeded in shaking loose a lot more inventory from potential sellers who were sitting on the fence in their old junker homes holding out for the very top. Then along came interest rate increases, hurricanes, holiday slowdowns etc. and the idiot sellers tacked on 20% more to asking price to give themselves bargaining room (dumb tactic). Then the local papers started putting out all the doom and gloom at the same time the Realtors are feeding these guys many thousands of dollars per week in advertising. Phones stopped ringing and sales slowed. Then Realtors got mad at the newspapers for the negative press and stopped all their advertising to save cash flow. Now the mullet wrappers are hurting too and calling up for advertising specials and its a classic Mexican standoff and Realtors are standing on principal. In the interim some of us hard working Realtors hell bent on making a go of this market to help our personal clientele are finding buyers only to have stupid and greedy homeowners thumbing their noses at the first offer they have received in 4 months and not dropping their prices. I just had the pleasure of canceling a listing contract from an asshole owner who was $40K over the top of what anything in his neighborhood had sold for refuse a 20 day close on a fair market price. He was stunned when I told him the buyers walked away after he insulted them by refusing to come down no more than $1K on a home that was $40k to high. That’s what Realtors are doing all over town now. If a seller is too stupid to realize the market is flat and is out of the price range we are dropping all their advertising and not showing their listings until they get real about their price or we cancel listings and give them to the competition on a referral (to recapture 20%) so we tie them up with losing listings. Its almost a game to me now.
At any rate - this year will be fine but it will be a lot slower and some sellers are going to have to learn what it is like to compete with other properties that are more fairly priced. The market works but just takes time to equilibrize.”
If you had principles you wouldn’t have thrown a snit about the papers reporting market conditions you scumbags.
Hilarious to listen to these guys whine and cry. Keep ‘em coming!
New lexicon: “equilibrize”
It was painful just to read this butchery of English grammar.
Did you guys see this?:
George Bush, “We will Keep the mortgage interest tax deduction”
An interesting point I saw was that he said this in response to a question from a HOMEBUILDER.
He also did state you better be worried about interest rates going higher though…..link below…
http://money.cnn.com/2006/02/17/pf/taxes/bush_mortgage_deduction.reut/index.htm
Too bad homebuilders, despite your best lobbying efforts to pressure interest rates down it isn’t going to happen. We don’t owe you a living or the road to riches.
ouch, he will be removing them! always bet on the opposite of what he says.
Does Bush know something?
“Referring to concerns the builder had raised about interest rates, Bush said, “You’ll be happy to hear I don’t set interest rates.”
He went on to praise new Federal Reserve Chairman Ben Bernanke. However, he added, “If I were you I’d be worried about interest rates.””
http://www.msnbc.msn.com/id/11411191/
I caught that too. I thought it sounded quite ominous, actually.
The comments in this blog are very good.
I am a real estate economy neophyte. I have a question: What is the relationship between rents and “burst” housing bubbles? I assume rents would skyrocket - is this true?
thank you.
When the house price-to-rent ratio falls back to historic levels, there will be a lot more “price fall” than “rent rise.” Since we are likely experiencing a price bubble (prices not sustainable based on fundamentals) then it is the prices that will adjust. I haven’t seen anything to suggest that rents are unusually low compared to incomes or employment.
thank you peterbob. that makes sense.
Rents are tied to income. Just because people have gigantic mortgages, doesn’t mean they can charge high rents to help cover them. They can try, but most are learning it doesn’t work that way.
SoCalMtgGuy
Another F@CKED BorrowerFB FORUMS
Rents are much more tied to actual incomes and ability to pay. You can’t get a IO, neg am, teaser rate, no doc, 100% loan to pay the rent!
During the last SoCal bust, many owners who couldn’t sell rented their homes out insead, increasing the rental supply.
Prez Bush’s exact words to the homebuilder were:
“If I were you I’d be worried about interest rates.”
wow.
http://money.cnn.com/2006/02/17/pf/taxes/bush_mortgage_deduction.reut/index.htm
LOL if that doesn’t kill your caviar dreams and champagne wishes I don’t know what will.
And see it didn’t take a day or a week to get that info it came in seconds.
Damn I love the interenet. I think it’s going to be a huge player in this housing slide.
From msn Your Money board….
Rent for $1100/month
Mortgage $4000/month
Tough choice
From: TheEnd_ser (Original Message) Sent: 2/17/2006 12:12 PM
Me and my wife are curently living in CA and renting an appartment for 1100 (quite a lot, not over the top for CA but quite enough).
Our combined gross income is 88,000 / year. I believe that we’ll have a net income of 5,750 / month.
We have 15,000 in savings, no debt, and a good credit score (i believe somewhere over 720 both me and my wife).
We’d like to buy our first house. Right now the hose we’re looking at is about 520,000-535,000.
We’ve talked to a loan broker and he told us that it probably wouldn’t make much sense puting down a 3% or 4% as it would affect the monthly payments very little. So he said we should do a 100% finance and he gave us some options that were interest only. But i kindda have my doubts about interest only loans. I mean if the price of the house doesnt go up and in 3 or 5 years we decide to sell it will be like we paid one hell of an expensive rent on that house, right?
A more classic loan is also possible, a 7/1 ARM but that would make the monthly payment about 3,555 ( a 80% loan at 6.25% and a second 20% loan at 10%).
So we’re looking at
3,555 - monthly payment
140 - HOA
490 - tax
100 - insurance
————
4300 - approx total.
The thing is that would leave us with a 1450 a month for groceries, gas, phone, TV, water etc. By our calculations it is… doable but it’s kindda to the extreme limit.
So er… what should we do?
Go interest only?
Go to the limit with the monthly payments and all that?
Wait another year and save, by our calculations, $3,500/month so that by Jan 07 we’d have about 60,000 in savings? Won’t the rates be much higher by then? Won’t the houses be more expensive by then?
I’m speechless
It is obviously stretching. One should not spend more than 1/3 gross on housing costs. For 88K, that number is around 2500 a month including HOA, tax, insurance without considering deduction.
Your rent is currently 1100. At 4300, you are looking at a 300% increase. I understand that homeownership is valuable. However, whether it worths 3200 a month over renting is up for you to decide.
NOT FINANCIAL ADVICE. CONSULT A PROFESSIONAL.
First of all, get another broker. This one is trying to push you into a expensive mistake.
I’d sit tight and save as much as possible. Take your savings and maybe stick some in a short term CD just to make some interest on it while you wait for prices to come back down to a reasonable level.
Actually, the above advice is what I am doing >; )
Come on…MOST would push them to buy. They don’t make commission telling people NOT to buy. That is why they need a ‘honest realtor and broker’ or an unbiased 3rd party to help them.
SoCalMtgGuy
Another F@CKED BorrowerFB FORUMS
Fellas,
Thanks for the advice, but this is not me… I just pulled this off of a different message board and posted it.
Just thought it was amazing what people are willing to do to be a homedebtor.
Shouldn’t this guy be protected under the Endangered Species Act?
Re: Endangered Species protection
That’s about what I was thinking! Pocketing an extra $3200/month right now by renting?
That would seem like a no brainer. He and the wife should go and save that for 60 months and they’d have their dream home.
[Not knowing anything else about them - easy for me to say, of course]
WTF! Don’t be moron. Rent!
…this time the damage could be worse because of the large number of exotic loans giddy lenders extended to desperate home buyers.
That’s right ~ the “desperate home buyers” were all just a bunch of victims. Woe is them!
That’s right ~ the “desperate home buyers” were all just a bunch of victims. Woe is them!
_____________
Honestly, let’s go easy on these recent homebuyers. Most of the first-time buyers have only seen housing prices go up — a lot. And when they ask their PAID ADVISORS (in the case of buyer’s agent), they are told to rush into the deal so they won’t be priced out FOREVER (in all caps, like that…seen it many times on RealtyTimes.com). They were pushed by Realtors, lenders, the government (ownership society and FNM, FMC to help facilitate the deal), and they were pressured by friends and relatives. It’s been very difficult to be on the housing bear side these past few years, as many here can attest. You really had to have nerves of steel and an ability to hold your ground even against your own spouse.
No, I hate the lenders and related industries (pension fund managers, hedgfunds, etc. who threw money at this bubble without regard for what the consequences would be) who opened the floodgates so bartenders and shoe salespeople could purchase million-dollar homes on a stated-income neg-am loan.
I don’t even blame the speculators. If someone offered you a million dollars for no work would you do it???? 99.999% of us would. And the only reason we didn’t do it is because we were too “smart” to take the risk. Risk that the speculators didn’t see because prices have only gone up in their financially conscious lifetime.
desperate homebuyers=greedy morons
No mercy for knuckleheads that get to endure their self-inflicted wounds.
Mercy and Kindness out the ears for acts of God to that disadavantage people through no fault of their own.
You don’t have any principles if you boycott the papers for reporting market conditions you jerks. Hope you choke on your attempted censorship, no advertising means no sales means no fat commisions means you back to selling shoes to fat women at buster brown like Al Bundy.
The old big newspaper in San Diego is filled with housing/furniture/refi ads and doesn’t talk much about the looming crisis. To wit “Today’s home buyers may be making a soft landing on a plateau.” Gosh ,that almost sounds pleasant, like a swan ruturning home after a scenic glide with a friendly bald eagle.
The non-profit local news site has almost daily updates on the local and national housing market. They even hired a local real estate blogger to do weekly articles. Craigslist is killing newspaper revenue so the builders/realtors have a ton of leverage right now and it shows.
Can someone please repost the one from last month about the spoof on the home flyer about with horse farting in the distance. It’s Friday.
I think it might all happen quicker than we think because of internet. Years past, where could u get unbiased info easy and quick? Nowhere. Everybody with any sense researches everything they buy on the net now, and it would be hard not to stumble across housing bubble info lately…
Agreed. Also, in the last few years, so many people have become accustomed to following house prices (I guess so that they can feel smug about how wealthy they were becoming) that more people will “know” that prices have fallen.
1.5 hours later 2 more houses for sale… 142
Home sales by zip on Melissa Data is up again…
destinism = don’t buy a house under those conditions. The bubble is going to blow in CA, or in others - the $HIT is going to hit the FAN - be there to catch one at $200K less -then payment will be easier.
Has anyone noticed that comments are difficult to follow - seems that you’ll read one and then one or two will appear prior to the last one . . .
It’s because the comments are “nested” in that you can reply to a specific post. It will show directly under the post as opposed to the bottom of the thread.
Since you brought this up, I know some posters wanted this format, but wondering how all feel about it at this point. As someone who is obsessed with reading each and every post, it is difficult to do so, as you have to re-read the whole thread each time you go back.
Thoughts & opinions?
ca renter,
That’s why we installed the plug-in that shows ‘unread comments’. You should find it in the sidebar. Please let me know via email if this option isn’t working for you.
Thanks, Ben! It’s so far down on my screen (way below posts, etc.) that I didn’t see it.
February 2006
Shift from looking for the “Dead Cat Bounce” to who still has “Skins in the Game”. Interesting to see the focus shift from the timing of the pain to identifying the “inflictees”.
Check out this albatross…….
What it doesn’t say or show is the I-5 North freeway is less than 100 yards away from the bottom of the picture!
Yeah, I like the old “latest post on the bottom” format.
At least that guy is doing the math. Most people would just buy the house and realize that they’re paying 3000/month more after a couple of months when it’s too late.
hmmmm…
I thought I posted another comment with the link attached..?
Here
http://www.nomalane.com
“The old big newspaper in San Diego is filled with housing/furniture/refi ads and doesn’t talk much about the looming crisis. To wit “Today’s home buyers may be making a soft landing on a plateau.” Gosh ,that almost sounds pleasant, like a swan ruturning home after a scenic glide with a friendly bald eagle.”
I think KirkH just made me shoot Pepsi out my nostrils.
“Gosh ,that almost sounds pleasant, like a swan ruturning home after a scenic glide with a friendly bald eagle.”
Mighta peed maself, too!
(does that come out in the wash?)
Good, then we’re even
DUDES,
If record inventories, a declining pool of buyers, and the reversal of exotic financing isn’t a sign that a crash is imminent in urban metro areas, then I don’t know what is.
Crashes don’t last 20 years; economic degradation does. And while I think economic degradation/convergence (w/Asia and LatAm) is a real possibility, it will not affect the educated, English speaking pool of talent, rather it will only serve to further stratify our society between the haves and have nots.
Furthermore, economic degradation WILL be met with fabulous interventions by the authorities to create inflation (think Italy, Argentina, etc.) and in the long-run this will be bullish for inflation hedges such as real-estate, gold and other various commodities.
The next housing bust will be monumental, but will also be the last (in nominal terms) for the next 30-40 years.