The Cold, Hard Truth Is That Prices Must And Will Fall
It’s Friday desk clearing time for this blogger. “Joan Olsen is an example of someone who took out a mortgage she couldn’t afford. A retired welfare worker, she said she didn’t fully understand the loan terms when she refinanced her San Diego condominium 15 months ago with an option ARM. Olsen, 73, had a top-tier credit score of 760 but said she could afford to make only the minimum payment on her loan. Her loan balance is $289,000, up from an initial $272,000. If it hits $312,000, which it could do in 20 months, she’ll be required to pay more than $2,000 a month.”
“Meantime, home prices have tumbled: One condo in Olsen’s building sold recently for $251,000, so refinancing isn’t a viable possibility. ‘I have no one but myself to blame,’ Olsen said, ‘for signing off on something I didn’t understand.’”
“Olsen’s lender…said it was negotiating with her, trying to modify her loan so she’ll be able to stay in the condo, though she fears her retirement will have to end. ‘I think there’s no way around it,’ she said. ‘I’m going to have to work at least part time.’”
“A glut of houses for sale. Foreclosures. Stricter lending standards. Seems all we hear lately is the bad news in the housing market. But, there are some bright spots for sellers and buyers, both nationally and locally.”
“Andy Twisdale, a former president of the Hilton Head Area Association of Realtors, said potential buyers are returning to the local real estate market, but, with so many homes on the market, can be choosy. ‘We see many people make an offer and, if they don’t like the counter-offer, they go on to the next property,’ Twisdale said.”
“During the upcoming tax year, Berkeley County (WV) Assessor Preston Gooden, said the county saw a dramatic decrease in the number of homes with significant increases in property tax assessments. Assessments in many areas of the county appear to have stabilized, while others are decreasing slightly, he said.”
“‘We’re seeing a real significant difference from last year,’ Gooden said of the county’s assessments.”
“The decrease was because of the burst in the housing bubble and the fact that homeowners were trying to get as much as they could for their homes, Gooden said. Recently, he said, he heard of a property that was listed for $299,000. The homeowner eventually sold the property for $227,000, Gooden said.”
“The number of mortgage originators headquartered in Northeastern Minnesota declined by an eye-popping 50 percent this year, according to data provided by the Minnesota Department of Commerce.”
“First Minnesota Mortgage Corp., which was based in Duluth, is on the commerce department’s inactive list, but Jo Cady of Hibbing bought the company’s assets in August 2006 and formed a new company. With 15 years as a banker and four years as a broker under her belt, she is distressed that she must turn away business.”
“Lender requirements change from day to day. She said that one day in November she opened her e-mail to find that one of the lenders her company works with changed its requirements and five loans that were in process died at one time.”
“‘I start from square one every morning,’ Cady said. ‘This is the worst I’ve ever seen it.’”
“The Grade II listed former coach house and stables went on the market in April for £4million. But the price has now come down 25 per cent – as part of a wider trend that is seeing many property prices slashed.”
“Local estate agent Edward Naden said: ‘Buyers aren’t paying over the odds for anything. Properties have to be competitively priced.’”
“Turkey’s housing sector revived by declining interest rates as of 2005 seems stagnant nowadays. Primarily in Istanbul prices decreased 15 percent in some districts. Price of a house in Maltepe, for instance, was YTL 160.000 in 2006, but today buyers pay only YTL 135.000 for the same house.”
“Nabi Cücük, general manager of the Reha Medin Real Estate, says house prices in the second hand market dropped about 15 percent. Brand new houses, adds Cücük, are sold at 40 percent more of real value. ‘So prices should be lowered at least 40 percent. Quake proof, secure and descent houses in Istanbul should be around YTL 200.000. But it is impossible to find one at this price.’”
“More than 266,322 houses, flats and holiday homes lie vacant in the Republic — enough to house a million people, the Sunday Independent has learned.”
“Housing Minister Batt O’Keeffe claimed two weeks ago that much of the present problems in the housing market was caused by rogue builders who are ’sitting’ on finished properties as they wait for an up-turn in the market.”
“The figures are also surprisingly high in Galway where almost 12,000 houses were unoccupied while even commuter counties such as Kildare (5,363 houses) Meath 5,414) and Louth (4,692) are suffering.”
“Speaking to the Sunday Independent, Fine Gael’s Deputy Brian Hayes noted that the figures suggested that when it comes to the housing market there now appears to be ’serious issues of over-supply.’”
“Nevada’s nation-leading foreclosure rate has dumped a flood of bank-repossessed homes on the market, depressing prices and turning a hot market with tight supply a saturated ice-cold. New father Alon Natanel, a 32-year-old mortgage loan officer, got rid of his convertible BMW for a more affordable SUV recently.”
“It was better to transport an infant, he said, and suited what the slumping housing market has done to his income — which fell from six figures to four.”
“‘You cannot put a baby in a convertible,’ Natanel said. ‘Especially when you cannot afford the payments.’”
“‘It’s going to turn around,’ Natanel said. ‘It’s just a matter of time.’”
“Massachusetts single-family home sales in November slipped to the lowest level for the month since November 1994, according to the Massachusetts Association of Realtors.”
“MAR, which represents the state’s real estate agents, presented the data with its trademark optimism, encouraging renters — who do not need overcome the difficulty of selling an existing home before buying a new one — to take advantage of what it called a ‘buyer’s market.’”
“Imagine a scene on ‘Little House on the Prairie’ in which Merlin Olsen says to Michael Landon, ‘Howdy, Charles! Heard locusts are fixin’ to attack your wheat crop and you might lose the farm. Alright, well, see ya. Say hello to Half-Pint and whatever the blind one’s name is.’”
“Sorry, you can’t imagine this because Merlin Olsen had something called empathy.”
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
“And if you must talk about it, could you please at least pretend it doesn’t make you happy? Last weekend I was at a party, and a fellow guest spouted cheerfully: ‘Housing prices are going to crash, and all those rich jerks are going to be screwed.’”
“I’m certainly not rich. I’m probably not a jerk. If I am indeed screwed, I would prefer that whoever brings this to my attention does so with less obvious relish.”
“Look, I get it. If I didn’t own a home, I might feel similarly. But I hope that before opening my mouth, I would think: What would Merlin Olsen say?”
“In 2002, the median price of a single-family home in Los Angeles was $270,000 and the median homeowner’s income was $65,000. By 2006, the cost of that same house doubled, to $540,000 — pushed by unbridled speculation fueled by unparalleled access to mortgage capital. But median income rose a paltry 15%.”
“There are ‘experts’ out there who once preached that there was no bubble; they now preach that all real estate is local and that prices in your neighborhood won’t be affected by foreclosures and price declines elsewhere.”
“The cold, hard truth is that foreclosures are serving only to hasten the painful process of shifting housing prices back to a level the market can sustain. Prices must and will fall. Everywhere. Probably 25% to 30% from their peak.”
“2008 is the year when gravity will reassert itself. You should be adjusting your expectations of your home’s value so that it’s correctly aligned with market realities.”
Another great week! My thanks to those who support this blog. Please check back this weekend for news, your market observations and topics.
Dude, are you even ready for next year? Dogs and cats living together indeed!
No offense but I can bet my cat can beat up your dog.
Er…Ex…guilty as charged!
Dog and cats living together! Ha!
Next year, sigh, not a laughing matter.
On a high note, luv ya Ben (you to Ex!)
Leigh
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
….And if you must talk about it, could you please at least pretend it doesn’t make you happy?”
LOL! That LA times piece is rich. Oh yeah, those of us who currently rent have *no idea* how thoughtless and arrogant people can be about real estate. Poor sarah miller. I’m sure she didn’t brag to a soul when her house went up 20% a year. Of course, it doesn’t occur to her that my renting between 2003-2006 meant that neighbors didn’t give me the time of day because they thought I was either 1) too strange and antisocial to not to want home ownership or 2) too dumb to buy or 3) too poor to buy.
Cry me a river, “homeowner”. What goes around comes around.
“Poor sarah miller. I’m sure she didn’t brag to a soul when her house went up 20% a year.”
Poor Sarah S. my old pal from Marin County who called me an “effing idiot” because I didn’t want to sell my stocks to buy a house.
That was Memorial Day 2003.
I wudda, shudda, coulda huh?
Is sarah miller a commie? Does she knows how capitalism works… if I am making a profit I will shout of Joy about it!
“I am probably not a jerk. If I am indeed screwed, I would prefer that whoever brings this to my attention does so with less obvious relish. I would rather hear someone assess my risk of cancer and, truly, it would be about as appropriate.”
Yes, Sarah Miller, you are a jerk. Comparing a diagnosis of cancer to the loss of your imagined real estate riches is proof positive of what a souless little cretin you are.
So, you lose a few bucks, you kid goes to public school and you have to work and save for retirement. Yeah, a turn of fortune tantamount to lymphoma. So your greed is more important than your health. Good to know. Be sure to teach your children that.
If I knew this witch, I’d slap her with more than a trout.
Spike:
BRAVO!!
There’s no way I could have said that better myself.
I’m sorry -still at work so not having cocktail yet, but what the hell is with “what would merlin Olsen do?” What next - housing advice from Grandpa Walton?
One of my friends was advising me to jump into the fray back in 2005 saying there was only the prices would go, UP. I resisted, but frankly I couldn’t argue against him. We, the HBBers, were a little helpless as insanity raged on. Past summer this friend’s daughter was persuaded to buy a condo at 160K that was ‘worth’ ~200K in 2005. What a good deal we got, he told me. Now there are 3 more, newly remodeled condos of identical size are for sale in that building at 130K, 128K and 121.5K. My turn to gloat! “I’d consider buying one as an investment property when the price is below 100K” I told him. I enjoyed his discomfort.
Hey Sara Miller, lick balls. I bet your kids are little pricks anyways. Are there names Hunter and Skyler or Apple and Prune? A few good kicks in the pants will probably serve them well.
Spoken like a troo New Yawker! *snicker*
lol
When I read that quote I had to go to the source article to verify it didn’t say more. So I googled her.
She was apparently fired from teaching 6th graders due to her using books that weren’t exactly appropriate:
http://www.latimes.com/news/opinion/la-oe-miller29may29,0,1110736.story?coll=la-opinion-rightrail
Ok, her example wasn’t bad. Poor choice of reading material… poor choice of the time to buy. Note that she is a regular writer to the Latimes opinion section. That makes me suspect… Rich? I couldn’t figure that out.
But after all the gloating we ‘renter scum’ had to deal with over the last few years, I see nothing wrong with being happy that we’ll get a bargain on homes. Heck, I just blogged on the bargains out there on cars! Could they get better? Maybe. But what’s important is that its ok to be happy to get a bargain.
And if people are unhappy because we’ll point out they overpaid for a home? So what! When the LAtimes stops making it seem like a sin for not buying, then I’ll be quieter at parties.
It was funny how I met a bunch of new people this holiday (non-HBB’ers) who are all holding off buying. We’re entering the 2nd half of fear…
Got popcorn?
Neil
Neil, you should peruse the listings in Trade-A-Plane (http://www.tradeaplane.com). The small Cessna stuff is holding its value as it always does but if you’re in the market for a Bonanza, 182 or something else high performance, this is your lucky day.
“Cessna 615 Echo Sierra, reduce speed. There’s a Bonanza ahead of you on final.”
Some guys get to have all the fun.
Hey!
Here’s a suggestion ~ buy one if you can fly one
Dangerous topic,
Several coworkers are trying to sell planes. If the single engine Cesnas are holding up, its only due to their ability to ‘carry the loss.’ Note: I’m not basing this off any facts I’ve read, purely what I see at work.
Maybe its time for me to get a pilot’s license.
Got fly?
Neil
http://www.tradeaplane.com
Umm… I looked at the site. Why is there so much residential real estate for sale on an aircraft site?
My, lots of ‘premier locations’ in Florida for sale. Not to mention quite a few recently delivered aircraft for sale.
Got popcorn?
Neil
Of course not silly!
I’ve got popcorn!
Just a retired U.S.A.F. non-pilot!
100LL Avgas at $6 and likely to approach 7 or 8 soon. No… go fly a kite bucko
remember the rule of the 3 Fs….if it floats, flies or forecloses, you should rent it.
I hope that’s the same Sarah Miller, because that teacher would probaby be embarrassed to be confused with this idiot.
Kinda like Arnie’s awkward search for another Sarah.(Connor)
lol
Articles said author of the same book.
There is a woman in my office who is desperate to buy. The only way I can get through to her at all is to acknowledge that she is making a very different calculation than I am.
I tell her that I want to wait for the credit market to get as tight as it can since I have no debt, high credit score, money for a down payment, and a long history with a bank as well as a good job. She doesn’t have the first four, but she does have a good steady professional job. She wants to do a no money down thing, so she doesn’t think she can wait for the credit market to tighten much more. I am willing to concede this point. When I tell her that she might have to bring a significant “downpayment” to the closing if she ever wants to sell the place, she concedes my point. But it doesn’t seem to matter. She just wants to buy and we are talking about a one bedroom condo in northern VA here.
I don’t get it.
I bet most of the people who bought during the bubble don’t care what us renters say unless they are actively trying to sell or are facing an impossible reset. A lot of other people just don’t care.
As for the guy at the office who told me I was crazy when I said that if I couldn’t afford a fully amortizing fixed rate mortgage I couldn’t afford to buy? I don’t talk to him about real estate anymore. I hope he likes the fairly high story (4th, 5th or 6th, I think) walk up he is currently in, because I’m thinking he is going to be stuck in it for a while. I hope his wife and baby like it too.
I have a co-worker that is dying to buy in New Jersey. I wouldn’t say a negative word to her if I was held at gunpoint. I want her to take an equity beating that would make Gerry Cooney grimace.
gerry cooney lmao
where exactly is ken norton?
Not to mention a property tax beating in NJ.
“I don’t get it.”
I sold my home in 4 days because I took the hbb advice and priced competitively but the relatives still look at me like I’m stupid when I comment about a family member’s girlfriend in NJ trying to sell her home.
I commented recently that dropping the price by a few thousand when it’s been on the market a few months already isn’t going to get anybody’s attention. It needs to be 10% at least. (Big scowl from family member who is supposely waiting for her to move up here to be with him.)
The sad thing is housing here is so much cheaper than NJ and she will be pocketing 50% equity.
I’m sorry to say it appears to be a “greedy seller” moment but the fam says that she’s pretty smart. She knows what she’s doing. Apparently we’re just renters now and we do not.
I vaguely remember an article that appeared at the height of the bubble - I think it appeared in the NY Times - in which the author attempted the psycho-analyze those who could not make the commitment to home ownership. Anyone else remember that one? I’d love to dig it up and take another look.
Nothing wrong with not being able to commit (if you are talking about marriage). I was ripped off a few times by the other sex, so I remain single.
there are still plenty of people in nyc shouting the bitter renter crap
it is still different here but changing a little everyday
most people have accepted the economy stinks so it is only a matter of time
ot-had the unfortunate experience of going to a mall on long island today and it was packed (lots of gift card recepients )
i bought a pretzel and a diet coke- just doing my part as a consumer
The article was published 7/31/2005 in the New York Times under the title “Fear of Commiting”, by Teri Karush Rogers. It starts: On the diving board of dashed hopes and denial paces an unhappy figure: the would-be buyer who shops for years but resists taking the plunge. Like timid bathers, some just need time to acclimate to the chilly reality of what their money can’t buy. That process can take some time. Eventually, though, after long and careful looking, they do take the leap. But others never do. They focus on flaws and high prices as a way of rationalizing an underlying inability to commit to real estate. ”There are so many levels to this situation,” said Dr. Ann S. Maloney, an Upper East Side psychiatrist who recognizes the routine guises of denial. ”A lot of people will say they are afraid of losing their investment. The classic is, ‘We’re looking for a perfect place.’ The next one is, ‘We’re waiting for what we can afford.”’ Such thinking, if prolonged and paired with the inability to make a decision one way or the other, can signal what’s known as an obsessional personality… and so on, it’s really nothing worthwhile, I just saved it as one of the more exotic swamp flowers of that mess that was the housing bubble
Peter T. Now we know why that girl in So Cal (school shrink I believe in her late 20s last week) bought that 600K condo…she obviously was very “centered” per shrink speak…
crush
btw there are good psychologists/psychiatrists out there…i know there are some here…sorry to “lump.”
c
I cant tell you how many strange looks and how much criticism I took for selling my house and renting. I think these people deserve a little dose of reality.
Hi Kr, O’v, Polly (*wink baby), GeoSalt and many, many HBBers:
Who the heck has any business asking another if they own or rent?
I seriously mean this in the kindest way.
My Grams will squeeze the provarbial nickle to the buffalo
poo’s. (Wonderful person)! Oh, she is almost 91 years young. My angel. Shops, cooks, cleans…heck…makes me look like a hack!
Now we are a nation that judges another on whether they can buy or rent?
OK. I get the idea of living in a good neighborhood.
Who gives a rats butt if you’re renting or owning?
Why would a polite person even breach this conversation?
I’m a lowly renter? I’m a righteous home owner? Whiskey Tango Foxtrot?
How did we become so out of touch? I do not remember these conversations ~ perhaps I was not paying attention.
Once, in Dayton, OH, acquaintances asked why we did not buy vs rent. I was not insulted, I simply addmitted I did not want to be married to more than X properties. End of conversation. What the hey is wrong with renting or owning?
Jesus, Maria!
Lawd! What happened to neighbors?
Dang, I don’t know, just blowing off some steam.
What if:
We cared ~ about each other instead of the status quo?
Looked each other in the eyes and said, “Good to see you!”
It is the small things in life that matter ~ hopefully, collectively, we will cherish these as the water level rises.
Happy New Year,
Best Always,
Leigh
Amen Leigh. I feel like an old person whining about the good old days, but there was a sense of civility that no longer seems to exist. You didn’t talk about your money or lack thereof or what you did with it. Nor did you particularly talk about politics, sex or religion much except for possibly best friend or close relative. There was civil discourse where we could disagree without disrespecting each other. Now it seems so many are just attention whores showing off so everyone else will notice them. Pretending to be what they think is considered top of the heep, hoping they will feel like they are special. It’s all smoke, mirrors and desperation. Maybe the bad times will force folks to get back to simple living and appreciating each other. Rant off.
During a brief sojurn in NYC I was taken aback that “the natives” I’d meet at cocktail parties would immediately ask me where I was living in Manhattan– the exact cross streets no less– whether I had a doorman, and the rent I was paying. Although I passed muster, it felt like a rather invasive way to size me up in short order. “Getting to know you….”
I guess digging your head in the sand would be alot better than facing the truth…
I followed your response up…I have no idea to whom you are responding ~
Forgive my ignorance, but it does compute ~ please ~ help?
er…does NOT compute (blush)
In order for the free market to work, those of us who make correct decisions should be rewarded while those who make foolish mistakes should be punished. That is why when I go to parties, I always make fun of a friend that bought a house last year. This friend no longer will speak to me.
Well, I finally feel vindicated. My secretary at work over the past 3 years has kept going on and on about what her “wonderful” investment California real estate and how we should buy no matter what. Yesterday she finally told me I was right about the whole real estate debacle!! She said “of course the prices of the past few years were fake” and agreed they need to come down significantly. I about fell over!! It got so bad over the past few years that we had agreed not to talk about real estate because of our disagreements. She said that the reason prices are going down in her area (Duarte) is simply because of one realtor who under-prices all her listings just so they will sell. I smirked and nodded my head - at least I finally got her to admit this whole thing out here was a huge Ponzi scheme no need to push her further. Next year will be really fun!!
Duarte, you’re effing kidding me right? That was a POS in the 70s.
I’ve been on vacation over the last week. It’s great to see the market has continued it’s decline while I was gone. In case I don’t get a chance to say it, Happy New Year Ben Jones.
Yes, happy New Year, Ben, you deserve it. I’m just back from a short vacation in the Central Coast with my family. Saw a whole lot of houses for sale, though asking prices are still in bubble mode from what little I saw. It looks to me as if the end of the year is being a kind of catalyst for this crisis from a psychological point of view. People are realizing that the things they were hoping for did not materialize and reality is beginning to sink in. The Union Tribune (San Diego) yesterday had a article on how the diminishing amount of trash shows that the city is already in a recession. Today’s LA Times was a treasure trove for a grumpy bear like me. But the main thing is I am actually having conversations with other human beings besides my long suffering hubby and the people in this blog regarding the mess. Magical thinking will only take you so far. Neighbors, kids’ friends’ parents, casual acquaintances, you name it. Everybody is beginning to feel it. 2008 is going to be one hell of a year, even if you count out the international situation which had been bad for some time. We will have stories to tell our grandchildren…
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
I’ll stop talking about it when the consequences of your greed finally stop affecting the place where I live. I’m not holding my breath.
But this is capitalism dude… buy low and sell high. So if talking about the crisis makes prices drop, me as a potential buyer love it!!!
You wanna socialize the losses my dead commie?
But this is capitalism dude… buy low and sell high. So if talking about the crisis makes prices drop, me as a potential buyer love it!!!
Exactly! Give me a reason to shut up.
Seriously, I don’t think I can talk prices down… but I see no reason to talk them up either. Hey, I yapped about the dotbombs as they were going… Its just the capitalistic cycle. 
What’s wrong with young families getting a discount on their home?
Got popcorn?
Neil
“If I am indeed screwed, I would prefer that whoever brings this to my attention does so with less obvious relish.”
I’ll try, I really will. But it’s just so hard not to do, some days. And I agree with snake charmer. Hillsborough County was completely savaged by the bubble. It will take years to recover, if indeed we ever do.
Whoever is using relish to lube up the Joshua Tree, please stop. The customers don’t like the texture.
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
I’ll stop laughing and talking about it when the MSM and government stops making all the FB’s victims and starts talking about their greed.
Not me. I’ll still be laughing about it to my grandkids!
“I’ll stop laughing and talking about it when the MSM and government stops making all the FB’s victims and starts talking about their greed. ”
A M E N Salina
I mean really, how does someone reach 73 yrs of age, live in sunny-sophisticated San Diego, and all of a sudden not know how to read a contract? I don’t know about all you guys/gals, but as an illustration, these FB stories are good testimonies, but it sure is growing tiresome…only because the whole country is being prepped for a bailout (that is growing tiresome too)…the “it’s not my fault that I was greedy camp” is a bunch of C&AP! (how bad would she have felt to flip that to some other FB for 100k and brand new lexus profit?)
On another note, this blog is not simply about buy vs rent, this blog is about an asset bubble…housing…Ben had the foresight (to say the least), and helped ALL of us…thanks for not squandering (the sharing of it), Ben.
There is nothing wrong with owning a house, as long as YOU own it, not someone else (and you can afford taxes, ins, mx, etc). I know all of us will buy a house as soon as we arrive at a bottom, or a personal bottom that we can buy at and can PERSONALLY afford. BTW in the future, maybe 2, maybe 5, maybe 10 years, it will most likely be the best opportunity of our lifetime, unless this is that asset bubble to end all/or our economy/ies for some time (God forbid).
Anyway, happy new year everybody…and thanks Ben for the blog…been here for 2 years now…it saved me in early 06 when i almost bought a POS near Sacramento.
BTW all you non-lemmings that were capable of self thought, prudence, and could sense that all was not right, just keep your traps shut!!!!!!!!!! (LOL)
IGNORANCE IS BOASTFUL…knowledge is reserved
-a smart dead roman dude quote
crush
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did.
No.
We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
I didn’t buy a house in the past four years, nor did I experience the (dis)pleasure of being scorned, mocked, harassed, or called a “bitter renter”, as has been related by many commenters on this blog.
For all those who have had to fend off the bad advice, who’ve had to endure the bogus “concern”…for all you Bitter Renters out there:
This one’s for you!
Happy New Year, all!
Prices must and will fall. Everywhere. Probably 25% to 30% from their peak.”
God, I hope so. I’m a renter in Honolulu and prices have stayed stubbornly high here. There’s been a little downward movement but not much. We’re going to rent another year and hope the market corrects during that time.
The longer I rent the harder it will be to get back to buying. I like the ability to pull up stakes and move to any location in the future. The biggest win in renting is not paying the costs of home maintenance in both time and money.
Sing it!
It’s getting very hard for me to even think about buying. Admittedly, I live in Manhattan where the usual stigma of being a renter doesn’t quite apply but the ability to just “up and out” is too too sweet.
“The biggest win in renting is not paying the costs of home maintenance in both time and money.”
I am anticipating that with the HELOC spigot turned off, we renters (and non-FB’s) will be the only folks with the time and $$ to travel. I’m guessing in about two more years, possibly sooner, the travel industry is going to be in a major price war. Imagine air, lodging, rental car and two meals per day X 10 days for under a grand–you pick the destination. I think it could happen. If not, oh well. I’ll just spend my discretionary time/$$ elsewhere!
Hey Salinasron,
On December 24 I phoned in a complaint about a long crack in the wall of the apartment in a large complex I’m renting. On the 26th, the cracks were all patched. On the 27th, the painting crew covered all indications of cracks and it’s seamless. This is much better than renting in house. Maintenance at large apartment complexes can be very speedy. This one is so impressive my head spins (or maybe it’s because I just finished the second glass of 2004 Sequoia Grove Cabernet Sauvignon). Yup, the longer I rent the harder it will be to get back into buying.
I don’t know about your logic. Long term.. you should buy… but only when sanity comes back in the market. I bought in 2001 w/ a 30yr fixed & have 23 more to go.. but after that… it’s paid off. No 2nd… no funny refis… nada. Just a plain, original fixed loan. I wouldn’t want to pay rent in 23 years (1 br will probably rent for $5000/month then).
Huh? (1 br will probably rent for $5000/month then).
Is that sarcasm off?
Best,
Leigh
Just a plain, original fixed loan. I wouldn’t want to pay rent in 23 years (1 br will probably rent for $5000/month then).
Good point. With inflation flaring up, owning your home will be a much better option.
I just wish prices in Manhattan dropped already… I’m afraid they won’t have time to drop before inflation starts in earnest.
Prices will drop 50% from peak; that’s the result of myriad calculations performed on this blog (historic rent:price ratio, historic income:price ratio, minimum pay option:full payment ratio, etc). The bottom will occur between 2010 and 2012 (as deduced from Ivy Zelman’s ARM reset chart). Hang in there, BobR. This thing has a long way to go.
“It was better to transport an infant, he said, and suited what the slumping housing market has done to his income — which fell from six figures to four.”
“‘You cannot put a baby in a convertible,’ Natanel said. ‘Especially when you cannot afford the payments.’”
“‘It’s going to turn around,’ Natanel said. ‘It’s just a matter of time.’”
__________________________________________
Keep dreaming dumbass. BAHHAHAHAHAHA. See you in the soup kitchen line with all the FB”s you put there. Scumbag!
“‘It’s going to turn around,’ Natanel said. ‘It’s just a matter of time.’”
Tick
Tock
Tick
Tock
Tick
Tock
…………………
I think this will fit in with Curt’s post:
Time Has Come Today (The Chambers Brothers), 1968
http://www.youtube.com/watch?v=misGExA4HY0
Lyrics in the link below. And I can’t BELIEVE how appropriate and “timely” the lyrics are. Wow.
http://www.geocities.com/ironwallcoleman/songs/time.htm
BayQT~
I hope dumbazz is careful not to say anything about the housing crash to Sarah Miller when he bumps into her at the feed line because she might cry. Bwahahahahahahaha! LOL!
“See you in the soup kitchen line with all the FB”s you put there. Scumbag!”
LOL - I love it!
Poor poor Hibbing. It was once known for Zimmerman and McHale. Now it will be known for subprime and foreclosures. The times-they-are-a-changin’, indeed.
“If I am indeed screwed, I would prefer that whoever brings this to my attention does so with less obvious relish.”
Ben, I was going to post a link to that LA Times opinion piece, but you found it first. I nearly spit my coffee when I read that in the dead tree edition this AM.
Gimme an “S”!
Gimme a “c”!
Gimme an “h”!
…
What’s that Spell?!
What’s that Spell?!
What went around seems to be coming back around to Sarah Miller.
Sch?
For the first time since after the Sept. 11, 2001, terrorist attacks, Nevada is facing a major downturn in its retail sales tax collections, prompted by falling sales of autos, furniture, durable goods and home-building materials.
______________________________________________________
All this and the LV perma-bulls think that building casinos will just lead to more people coming…good luck.
Think state income tax to pay for all the new infrastructure and schools.
Ahh…. the ol’ “Build it & they will come” mentality.
Developers & casinos who live by this creed will pay dearly.
Ah, but didn’t you see this at the end of the mailtribune article?
Mick Galatio, president of Desert Wind Homes Inc., is getting ready. This year, instead of building 20 to 40 homes at a time, his company is building four to eight. And he’s ready to offer cut-rate deals to any serious buyer, throwing in options and closing costs up to 15 percent of the price of the home, slicing margins to the bone.
But he’s read Applied Analysis’ report of an expected shortage and he has seen how quickly a boom on the Strip translates into a housing recovery since he founded his Las Vegas-only company in 1994.
“We need to be ready to get our houses on line and get back to the marketplace,” he said. “My expectations are after the first of the year, I’m going to be out there looking at who’s got land for sale.”
Terrorist attacks… bullcrap… that was Cheney in the bunker running the show… http://www.infowars.com
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
Of course for the last four years all us renters heard was how your house was going to pay to send your kids to school and fund your retirement. God, we must be REALLY stupid for renting when we could’ve bought! When we mentioned that there was a bubble we got treated with scorn, contempt, and ridicule. It was as if we were trying to say the world was actually spherical in the time people believed it was flat. We mock you because you were stupid and greedy. And wrong. Very, very wrong.
We mock you because you were stupid and greedy. And wrong. Very, very wrong.
Yep.
That really says it all.
Got popcorn?
Neil
Seconded.
We mock you because you were so smug and mocked us when we didn’t choose to buy. You bragged about all your money, equity, purchases and plans for the future. You pitied us too stupid to jump on the bandwagon. Well guess what Sarah - you were a bitch and so is payback so I’m enjoying doing the “I told you so” dance while mocking you.
Memo to everyone who DID buy a house in the last four years: How come you have stopped talking about what a great investment it is; how they’re not making any more land, buy now or get priced out forever, etc., etc.?
“Olsen’s lender…said it was negotiating with her, trying to modify her loan so she’ll be able to stay in the condo, though she fears her retirement will have to end. ‘I think there’s no way around it,’ she said. ‘I’m going to have to work at least part time.’”
So we have retirees re-entering the workforce, stressed debtors getting two jobs, massive immigration, layoffs-and-more-layoffs, etc… and you have an over supply of workers. That means wages in general are most likely to flatten or decline.
“That means wages in general are most likely to flatten or decline. ”
yep I think so
I’ve been predicting for a bit:
Import inflation
Domestic deflation
wage deflation is part of that…
Got popcorn?
Neil
OK, that’s it. I’ve had enough of listening about popcorn!
You guys are all “bitter popcorn renters”. If you don’t “buy popcorn” now, you will be priced out forever.
corn, the next tulip…could be, now that they’re subsidizing farmers to do the ethenol thing…Neil, we may not be able to enjoy popcorn much longer?
now i’m scared…i’ll trade you 4 repos for a bag of popcorn?
ok, five…
crush
That’s right…hammer that point home. Wage inflation will not save the FBs or reflate their long lost bubble.
Many an FB bought with the assumption that wages would keep pace. I heard that very same advice dispensed firsthand between my friends and their parents… they were wrong.
On that one point I disagree. Many people in 2001-2002 were grumbling about outsourcing and the consensus was that higher skilled Indians with stronger work ethics are willing to work for fractions of what they get paid to do.
….And if you must talk about it, could you please at least pretend it doesn’t make you happy?”
I’m sorry but this quote is bringing my anger right up to the surface. I wish I could laugh but scorn is all I have left.
Wait a sec, Im ecstatic you regret your stupid choice.
Laughing my bitter renter azz off.
i have no sympathy for these fb’s if the market was still going gangbusters we would be hearing about their financial genius
but now we hear how they were duped
oh well my rent is paid, the x-mas gifts are paid for and
i am on vacation this week relaxing without a care
oh i just remembered i have to get an oil change on my car
man this renting stuff may pay off afterall
Wait a sec, Im ecstatic you regret your stupid choice.
Laughing my bitter renter azz off.
ROTFL For some reason your comeback was the one to make me laugh in this thread. Oh… thankfully I was able to swallow my red wine.
After *years* of the other side she says this. I would love to get a true confession out of her. Did she gloat when she bought? I thought so…
Got popcorn?
Neil
“Please stop talking about the housing crisis in front of those of us who did.”
Ok, here’s a bit of Friday reflection about the housing crisis. Why is there such an amazing amount of denial about what is happening right now? Why do people get so upset when you even bring it up? I have been trying to warn family and friends about the upcoming melt down. I have been met with a variety of responses, ranging from a blank stare, to outright hostility. “You WANT our entire economy to collapse don’t you?”
I tried to warn my 2 brothers, who were getting ready to sell their overpriced homes. When I saw the writing on the wall, I urged them to hurry up if they were going to do it. Because in about 6 months, the real estate market was going to seize up like an engine without oil.
Guess what? Both brothers still have their houses. They are still planning to get ready to sell them. Even though they have a vague understanding that something seems to be wrong.
There is a difference between driving in the dagger, and trying to warn people about something that you know is coming.
I believe the best way to get your point across about housing is to play the affordability card. My rule of thumb is that if there’s 70% home ownership, the affordability index should be 70%. Tight correlation between these two variables is necessary for a stable market. Also, your brothers probably don’t realize that borrowing costs/requirements have tightened. So, even if they can find a buyer, the bigger question is can they catch a falling lender?
You all need to read this from the AP
“It was ugly,” declared Richard Yamarone, economist at Argus Research. “It is the one sector of the economy that doesn’t show any signs of life. It doesn’t look like there is any resuscitation in store for housing over the next year,” he said.”
Also, see the new construction and sales reports from the USG ESA over here.
I don’t see the problem.
They’re pulling permits at the rate of ~1.15 million homes per year and selling them at just over ~0.6 million a year (plus about 250k of those permits being for apartments, not sold through). Ok, we have about a year’s worth of new home inventory and we’re building at 150% of the absorption rate.
Why… that would only matter if people get scared of buying.
or smart. But the NAR is doing everything to prevent the later from happening. lol
Got popcorn?
Neil
How does one calculate the odds of a recession? Whatever the equation, is there no room for a fudge factor, like 2.5y, where y = “A giant, obvious reason for a huge recession regardless of all other factors”?
“I think you can classify what we are seeing in the housing market as a crash,” said Mark Zandi, chief economist at Moody’s Economy.com. “Sales and home prices are in a free fall. The downturn is intensifying.”
A soft crash …
A soft free-fall …
Soft intensity …
Help me out guys.
timberrrrrrrrrrr
“Sales and home prices are in a free fall. The downturn is intensifying.”
Is it bad to have a REALLY BIG SMILE on when I read that? Nope. I’m happy as I know a whole bunch of sensible savers who will have the opportunity to own a home they’ll love for a reasonable multiple.
Maybe even my company will slow down the planned transfers out of bubble areas? Eh… too late actually. Prices won’t drop 45% by March… so we’ll make the announcement then.
I really should have opened a better bottle of wine…
Got popcorn?
Neil
A rough & burning soft patch…
“Olsen’s lender…said it was negotiating with her, trying to modify her loan so she’ll be able to stay in the condo”
Olsen’s “Condo Pimp” is trying to get more fees out of her.
I call elder abuse!
“I’m certainly not rich. I’m probably not a jerk. If I am indeed screwed, I would prefer that whoever brings this to my attention does so with less obvious relish.”
Ah yes, Sara, but if you bought in the last 4 years in LA you are most certainly STUPID.
This is so funny. The tides have turned on the smug homeowners. The same ones that called us bitter renters for years are now asking for sympathy.
How’s this…when I buy your house for half of what you paid for it in the next year or so, I can give you a GREAT lead on a rental! Enjoy!
It’d have to fall by 50 % to get back to ‘affordable,’ even if you fancifully expect incomes to stay steady when the construction sector disappears, right? And 60 % to get back to where it started.
Its 56 degrees in sunny San Diego today!
It snowed down to about 2000′ here in the foothills of sacramento.Very cold air came through.I’m here in roseville and rained all day.Maybe i should go ride around with a realtor and get free food at some open houses?
It’s a global warming 46 degrees in San Francisco
Merlin Olsen, a FB, is pissed that people who didn’t buy a house in the past 4 years are gloating and he wishes they would stop. Oh, I see Merlin - it was okay for all of you (now) FB’s who DID buy during the boom to shower scorn on those who were not buying because then we were, “Stupid if you don’t buy now. This is going to be a non-stop bull run in property prices for the next 10 years.” Oh, really….
Sorry, Merlin. What’s goes around comes around. We who didn’t fall for the greed machine, the NAR b.s or get sucked in by the mortgage broker and realtor scam artists, con men, carpet baggers who jumped into the property boom like hungry fleas on an old dog, now get our turn.
I have a close friend who, in 2003, was urging me to get back in and buy after I sold earlier. He told me about several brilliant people he knew who were buying not one but two houses. Palm Springs and Las Vegas were the top locations. “The place to buy,” he said, “Is near a golf course. Prices will go thru the roof with all the baby boomers retiring.” He himself bought two properties near Palm Springs in 2004. Both on the edge of a golf course. Both now over $100,000 under water. However, because he’s a friend I’m not going to label him a fool - the way he labled me “stupid” in 2003. Of course, I could say to him what was obvious during the boom: “I don’t think I’m interested. If looks too good to be true - and that means it probably IS too good to be true.”
I could imagine Burl Ives singing a jolly holiday song about the housing bubble.” Have a Holly Jolly mortage the worst kind I fear the kind that resets and causes regrets so have another glass of beer”, he kinda looks like Merlin olsen to me anyway.
Saying “prices must fall” makes assumptions about the stability of the dollar. Remember people, there is one possible scenario under which prices *do not fall*: A massive dollar devaluation. Yes, prices *should* fall by 50% in some areas. But what happens if the dollar loses 50% of it’s value?
And don’t say it can’t happen.
How does that change the ability of people to service their mortgage?
Unless wages rise, and they rise within the correct timeframe, this is not an option.
The key point has always been the ability to service the debt, and that is firmly tied to income. With Chindia online, I see no hope of wage appreciation.
Back to you, sir!
Ah, right you are. I meant to say, or should have said — a massive flood of liquidity, lowering of rates (and a resulting dollar devaluation).
There is no reason to believe that the value of the US dollar will fall by 50%. Furthermore, even if it did, that would not translate into a doubling of house prices because houses are not valued relative to foreign currencies, they are valued relative to local incomes. Because any likely scenario involving further devaluation of the $$ is not likely to be accompanied by wage inflation, house prices are not likely to be saved by inflation.
The US dollar has already fallen over 60% vs. the Canadian Dollar from the top to the bottom. The US$ used to trade at a 60% premium to the Canadian Collar in 2003 and now trades at a slight discount. BTW, we’re one of your largest trading partners.
sohonyc,
You just predicted a depression starting by summer. You do realize that, don’t you?
Prices will fall. We cannot inflate our way out of this. Think about what Big V just said. Nothing will cause fast wage inflation.
Will a sudden increase in gas prices to $4/gallon help home prices?
Nyet
Will families struggling to afford beef or pork help home prices? No.
Will watching the price of everything imported increase domestic jobs faster than import jobs are destroyed? No way! Sorry kiddies, no toys! Want an imported car? Tough! Want a domestic car to tons of imported parts? Nope!
Game over. We have at least two years of declining home prices ahead of us. There really nothing to stop it.
So sit back and relax. I’m seeing nice wine deflation.
Got popcorn?
Neil
Congress is considering a tax credit for everyone. Not sure how long they could keep that up.
I’m seeing nice waist-line deflation.
IN the past 6 years, the dollar has fallen 50% against the Euro. It was only down 33% just a few months ago. Our money is showing its true value……….paper.
Thanks Ben Bernanke and the US CONgress for spending us into oblivion.
Hello ‘29…
“Look, I get it. If I didn’t own a home, I might feel similarly”
Ahhh! There’s the problem. You DON’T OWN A HOUSE!
If you did where would the problem be?
Touche, sir.
Off Topic - Can anyone help identify a bank that is less exposed from losses from the mortgage mess? I want to find a cd that pays reasonably well but is not from WaMu or the like (I already have ING, finally made it to 100k and should start another bank). Any ideas out there?
Thanks in advance,
J
If you are going to put money (CD) into another bank - what does it matter? You’re insured. As for exposure? Don’t worry about it. The banks are a club. If one looks in trouble, another will step up to the plate and take it over. If a lot of them look like they are in trouble the Fed will bail them out. Your problem (and my problem) is what your dollars are going to be worth in the future. A lousy 3% or 4% or less than 2% isn’t going to compensate for the devaluation which might happen as more and more countries dump the dollar as a favorite currency.
Try FNBO Direct. Poor customer service, but I looked up their financial situation on the FDIC website, and I think they’re relatively sound, with pretty good interest rates.
New York Community Bank Corp (trading symbol NYB) claims they did not get into the subprime business. 5% to 6% yield. Its stock may be better than CD.
It’s not a subprime problem anymore, and probably never was, subprime just blow up first - but all recent mortgages, alt-a, prime, can become loss-centers, if house prices fall enough and owners walk.
How about treasury direct? They can always pay you back with freshly-printed money!
Weiss ratings has a list of the strongest banks in the US here:
http://www.weissratings.com/HL_Bank.asp
They get their money from customers who buy the ratings, not the companies they rate.
ot: any docs on this blog? I’ve got a fever of about 103 and am breaking out in a rash. What disgusting tropical disease have I contacted? I’m too cheap to go to see anyone
Would you take legal advice from this blog? Go see a doctor!
Do you have an ARM resetting next month? That could be the cause…..
103 degrees is dangerous chick! 105 call the doc.
not that kind of doc, but 103 is getting pretty high….
my guess would be a virus, take anti-inflammatories (I like advil with food) to get the fever down and benadryl to stop the rash. Monitor closely, if fever goes up you gotta see someone (things like this always seem to happen on friday at 5…)
hope you feel better
Chick where i this rash exactly?
I copied this:
“In general, the severity of a rash and fever does not relate to the severity of an illness. It is more important to assess how ill a person feels or is behaving. An unexplained rash that looks like bruises (purpura) or blood spots under the skin (petechiae) and that occurs with fever and signs of illness may indicate a serious infection or medical condition that requires immediate medical care. Prompt medical treatment may prevent serious complications and even loss of life.
A sunburnlike rash that starts 2 days after a fever of 102° (38.9°) or more may be caused by a rare condition called toxic shock syndrome.
A rash and fever may occur with conditions such as a local skin infection or a viral illness, such as a cold, the flu, strep throat, or mononucleosis.
A health professional can evaluate your symptoms and recommend treatment.”
TX Chick probably has hives brought on by the fever associated with the nasty flu that I just got over. It’s that fever that should have us most worried.
It’s measles. Can you believe it.
Holy moly! Were you ever vaccinated? That was a fast diagnosis, too. Must be a good doctor. Well, I hope you get better soon.
Yeah, I can believe it.
I got measles when I was 30 years old and couldn’t was shocked. I was out shopping for clothes, trying them on, and over the course of an hour, I became covered with bright red spots. At first, I thought I had become allergic to expensive clothes
In retrospect, it was pretty funny. I sure thought I had already had the measles (you can only get them once right?) but apparently I was the only one in our family that hadn’t had them. If I remember correctly, measles isn’t harmful to adult women but can cause serious problems for adult men.
Yes, I can,
My six yr old has them, goes to show how effective the MMR vaccine is.
Aw crap. My 7 month old sun is supposed to be getting MMR soon. I was hoping those measles shots were more effective than that.
Wow, measles. That sucks. I hope you get better soon.
txchick and JayinMD,
Take a look at this article, may help explain the measles:
http://www.eurosurveillance.org/ew/2007/070920.asp#2
I was told some of the measles vacines in the 1960’s were ineffective.
Vaccines work on the principle of herd immunity. You get a vaccine, your immunity jumps to a certain percentage less than 100%. (100% vaccines do exist but are higher-risk and not often used, since it involves being exposed to the disease itself.)
When you get a certain percentage of the population immunized, the chance of disease incidence drops to near zero but not zero. Add in communities where vaccination is passé (such as Whidby Island or Boulder, Colorado) and there’s a distinct chance that an immunized person will catch the disease. (Vaccine-averse communities will often breed up stronger versions of the disease, enough to overcome the resistance of the vaccine.) My husband caught whooping cough even though he’d been immunized, presumably from somebody who hadn’t been vaccinated.
About the only good news is that if you have been immunized, your case is likely to be milder than if you hadn’t. And with modern drugs and treatment, we don’t have the horror stories of yesteryear.
Tx: Not a doc but daughter did same thing when she returned from Mexico last year. Urgent care couldn’t figure out what it was but said use Cortaid for the rash and take advil for the fever and it was all gone in a couple of days. Hope you feel better soon.
Take an aspirin and a cold bath ASAP. If your fever doesn’t go below 102 within a couple hours, go to the doctor. Anything above 102 can cause delerium, and anything above 104 can cause brain damage. Make sure your husband stays near just in case you start to lose your senses.
measles, meningococcemia,hepatitis, endocarditis, rickettsial infection… it just gets worse.
I had the same thing you did 2 days ago.
Did you buy real estate recently? … maybe it is a curse if you did.
“Look, I get it. If I didn’t own a home, I might feel similarly. But I hope that before opening my mouth, I would think: What would Merlin Olsen say?”
Who cares what Merlin or any other half-wit wizard’s namesake would say? Do you think Jesus cares about that numbskull and his stupid empathy? Well, I don’t. For all those housing geniuses that missed no opportunity to gloat about their new-found “fortune”, passing it off as a foregone conclusion that I, a bitter renter, would be poor forever and that was just fine, I say “GUESS WHAT, YOU ARE SCREWED, AND I RELISH THAT.”
Yeah!!! Prices in the DC/Northern VA area are finally coming down. And I can only hope that this is just the beginning. I have friends and family that are stuck with overpriced homes here. They bought in 2005. Dumb, really really dumb. I tried to warn them but they regard me for the most part as a far-out nut who has “crazy” opinions. I believe most people are followers and overly concerned with status - even though they would never ever think of themselves that way. I am still dumbfounded how intelligent, educated people could not see this real estate madness for what it was - a giant bubble.
“‘It’s going to turn around,’ Natanel said. ‘It’s just a matter of time.’”
Yes, and eventually the sun will burn out; it’s just a matter of time.
And who will have more fun waiting…those like this Natanel character…or us?
“Please stop talking about the housing crisis”
Sorry, Sarah…
Umm…
BWAAAAAHAHAHAHAAHA OOOHHHH AAAAHHHHHHHH HA!!
“In 2002, the median price of a single-family home in Los Angeles was $270,000 and the median homeowner’s income was $65,000. By 2006, the cost of that same house doubled, to $540,000 — pushed by unbridled speculation fueled by unparalleled access to mortgage capital. But median income rose a paltry 15%.”
How can you read that paragraph and think a severe correction isn’t on the way? I have been screaming this information for over a year about Portland as well but no one’s listening. The numbers are different, but the percentages are roughly the same.
Prices doubling in 4 years. Has that ever happened before? What’s even more destructive is the dollar amounts involved this time around.
I was going to say that Ms. Olsen was one of the few that have been honest enough to admit her mistake when she said: “I have no one but myself to blame,” Olsen said, “for signing off on something I didn’t understand.” But then I note she’s still trying to get the mortgage holder to work out some magic deal for her. What I really don’t get is going into a new mortgage in your 70s.
Olsen, 73,
What lender would give a loan to a 73 year old? That’s worse than putting twice pipes on a station wagon.
The debt machine has reached maximum efficency - it can milk folks from cradle to grave… if they let it.
And so they sold their souls to the company store.
They’ve been doing that for a long time. Friend of mine got one at 73. He had a good military pension and his estate was good for it after he died.
Cannot “discriminate” based on AGE, race, religion…….
blah, blah, so yes, the government says they MUST give them the loan.
It is ILLEGAL to refuse a loa based upon the borrower’s age.
That has been Federal Law for a few decades.
BTW, I’m guessing that she probably did the refi or whatever it was to cover medical bills. Medicare has those really nasty 20% copays for office/out-patient care; and the ‘doughnut hole’ on the drug coverage is now up to over $3000 which you hit after having $2400 in prescription expenses. It is easy to get into that gap if you have any health problmes - my 2 meds are over $430 a month and I blow through that $2400 in coverage fast.
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
of course it was A OK to boast and brag about rising home values the past 5 years.
SCREWOFF!!!!!!!!!
This poll shows that the housing bubble is on everybody’s mind:
http://money.cnn.com/POLLSERVER/results/36820.html
“Memo to everyone who didn’t buy a house in the last four years: Please stop talking about the housing crisis in front of those of us who did. We’re too busy to listen. We’re trying to figure out how we’re going to send our kids to school, or if we’re ever going to be able to retire.”
“And if you must talk about it, could you please at least pretend it doesn’t make you happy? Last weekend I was at a party, and a fellow guest spouted cheerfully: ‘Housing prices are going to crash, and all those rich jerks are going to be screwed.’”
Two of the most arrogant S-O-Bees have ridiculed me for being in my 40s and renting instead of owning real estate. I am laughing VERY LOUD at the FBs. NO SYMPATHY to the Greedy!
Man, am I gonna do some serious elbow bending tonight.
After falling out of escrow four times, our house finally sold today.
I owe you one Ben and fellow HBB bloggers.
I bid my neighbors farewell this afternoon - man, I can just smell the fear.
Some realtor asked me if I was in the market for a new house. Yeah right.
BTW, if you want to get a tazer look on a realtor’s face, use the word “wait” liberally in conversations with them.
“wait” as in I’m waiting “till 2009, or “I can afford to wait” or “with the housing market in crisis I’d rather wait, or my favorite ” I’m waiting “till the bubble bursts completely and no longer resembles a souffle”
Wait - the new black.
I’ve only seen realwhore fear once…last time I talked to one as i casually looked at an open house last summer near sacramento (no interest, but curious as to what was being touted), and after I asked about the price, i said, “really, well, that’s way too much, these houses probably cost a third of that to build (which probably is a stretch).” HE SAID NOTHING. But I could sense fear.
crush
I went to an open house last month for a home being sold for $269,000 that has been for sale for a few years. The realtor said the owners had to sell because they are getting a divorce. I said sometimes people lose their fortunes when they divorce. I asked the realtor why they were asking so much when an identical house across the street sold for $245,000 a few months ago. She said, what are you? A realtor? Today the house is priced at $250,000.
“Look, I get it. If I didn’t own a home, I might feel similarly.”
Wrong. I do own a home. I’m disappointed that neighbors have moved away from the neighborhood because they couldn’t afford a home. And I’m hoping my children will eventually be able to afford a home.
The bubble only helped those who hoped to get money without working or saving. Affordable housing helps everyone else.
The RE bubble certainly was like a Dire Straits song “Money for nothing.” So America.
The bubble only helped those who hoped to get money without working or saving. Affordable housing helps everyone else.
So true. Too bad the politicians will not see it this way.
Hi, all, I have a question:
Is this the permanently high plateau that everyone was talking about last year?
Bwahahahahahah!
ok, anyone who uses “memo to…” as a literary device deserves all the scorn, contempt and ridicule the world has to offer.
“It was better to transport an infant, he said, and suited what the slumping housing market has done to his income — which fell from six figures to four.”
Youch! A four figure income?
And if it’s just a matter of time before things turn around, why not keep the convertible?
He can’t afford the SUV either on an income that is 4 figures which means at or below $9999 a year.
Hope his wife works. At that income, they are way way below the cutoff for Food Stamps, Medicaid (kid and her), and public housing.
Taking the bus might be a better option than the SUV.
That’s gotta be a typo, even minimum wage here in cali @ $6 something is five figures.
“Comment by txchick57
2007-12-28 17:43:33
“It’s measles. Can you believe it”
Shoot darlin ~ I though you were pulling our toes.
OK. Here goes.
Ice bath…very uncomfortable…very necessary. Hurts like all heck.
Avoid ANY dairy, (easier said than done), and lysol everything.
Liquids:
Clean water: (Clean)
green tea,
juice: (grape, pomegranate, cranberry)
citrus: lemon, orange, grapefruit ~~
NO SOLID FOOD!
Trout to the head…where is that hubby?
Into the hospital or seriously, ice bath.
Respectfully,
Leigh
“Nobody puts baby in the convertible”
Even Swayze was in real estate.
The consequences of greed is HUGE! Every home owner in the country is affected in some way by property taxes and the greedy assessors in every county in the country are as greedy as the RE agents that perpetrated this mess on us. I truly hope a MAJOR tax revolt is started in every state and reduce the coffers of every county to ZERO so they learn to budget with in OUR means as we are the public and we deserve better than GREED!!!
long time lurker here with a question…so it is obvious that the real estate market is a death swamp and looks to only get worse…but since all I read is a re-hash of those points can anyone tell me what they see as a way out or when they predict a turnaround?
The re-hash is because we’ve seen this coming for years…well, maybe Ben for the latter, and are just watching the slow, very slow-mo train wreck…there’s little we can do but to add commentary, and wait. Remember, this blog started prior to the apex of the asset bubble (housing)…it has just recently popped (circa late 05-06). Joe six-pack is just starting to realize it…now it will continue downhill for some time…NOBODY knows how long. The “way out” will be when prices hit 3x avg income, nationally (or locally…for where you live). But, nationally, to use the example would be at least a 50% drop…btw that’s a rehash of many previous posts. Most likely it will overshoot on the way down…you don’t know the bottom until the bottom has passed btw. Most likely this will bring about a recession in the interim…the financial industry is in uncharted territory…or territory not seen since 1920s-early 30s…that may sound apocolyptic, but it’s the sad sad truth…just like the drum beat of the victim FBs (masking their true fault, greed), the finacials are claiming ignorance of their deeds…deeds that will have dire consequences for their companies, and the economy. The turnaround will not happen quick, and there will be alot of losses in areas we still don’t know. The answer is: to try to predict a turnaround is to get sucked into the ever rehashed: is like trying to catch a falling knife…just try to be smart and live within your means…don’t get sucked into this perceived “neo-american way,” because it never was the american way to be a greedy self-absorbed blame thrower. This country was built on hard work, toughness, intelligence, responsibility, spirituality, generosity, etc…not on ME, or I, but WE and Family…
crush
Oh yes. Prices will fall. At least 50% in most areas. Maybe more than 90% in quite a few.