Tell your best bubble story here. Seems to be a lot out there now.
* Your friend the hairdresser who's trying to talk her bartender boyfriend out of buying that new Scottsdale condo that's "gonna double in two years"
* Your aunt who works for the bank, who tells about all the folks getting rejected for new home equity loans because their property won't appraise
* Your coworker who's getting her real estate license
* Your neighbor who is putting their house for sale at last year's price
* Your drive to the local store today, where you pass 25 for sale signs on the way
* Your $1000 monthly rent on a $1 Million dollar home
May 07, 2006
It's HousingPanic Story Time
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28 comments:
The bag boys at the grocery store were ‘chatting each other up’ about their Real Estate Investments while bagging groceries! Talk about the "trickle down" theory. That spoke volumes to me as to "John Q. Public's" perception of the RE Market. LOL
The entire block across the street from my home looks like a construction zone with all the flippers/remodels/teardowns/half-finished units. New/remodels an ugly mismash of condos,duplexs,for- sale empty weed-strewn properties, brand-new 2-story 2000 sq ft monstrosities squeezed onto 2500 sqft lots. This entire downzoned r-2 area is a flippers free-for all.
I live in the Sacramento area, and a parent at the school my kids attend just told me he and his wife put a bid on a $550,000 house in the same neighborhood. They bought their current home 6 years ago with an ARM/Interest only loan, and they've refinanced it 2-3 times already, despite a recent bankruptcy, and they purchased a new van a little over a year ago. They plan on keeping their current home and using it as a rental, and his plan is to rent it out for $1,300 a month, which won't even cover the monthly mortgage payment. He told me he's keeping it, because "Prices keep going up! I'm keeping it because I'll gain more equity in the next few years!" He's a blue collar worker with no high school diploma, and although he makes $70,000 a year, his favorite pastime is getting drunk as much as possible. She's a stay-at-home mom, but she has a part-time "job" getting people to refinance their homes (no license, I'm not sure how this works), and she's probably had 3 sales since she started doing this a year ago. The $550,000 home was sold to them by a close friend of theirs who just got her real estate license earlier this year (I think it's his first sale). When I asked if he'd gotten a fixed rate on the second home, he told me yes, but I'm not sure I believe him. How did these people qualify for this second home? What do you think will become of these people?
Is anyone going to collect all that lounge/chill music used for those condo websites?
* Your coworker who's getting her real estate license
If your young and think of a career in Real estate. Now is the time to get your training and learn your trade.
When you are experienced and ready to roll the ratio of agents to property sales will be at their best
Both my wife and I are now involuntarily unemployed. I have a hard science PhD/ivy undergrad and she an East Coast selective school education. (Blue collar worker making $70k? I never made that much.)
I also have a little home in San "Bubbles the Dolphin!" Diego, but fortunately not anotherf@ckedborrower.com style.
I bought in 2000 for $270k with a 30 year fixed and 25% down. Financed to a 5-fixed ARM and then upon enlightnement I refied again at start of 2005. 30 year fixed @ 5.25%. :) :)
Yes my mortgage+tax+insurance payment is less than equivalent rent. (But I had to get a roof for $6k last year.)
Zillow.com pegs my property (today) at a preposterous $559,621. {there are a number of problems like no garage, it's small, 1 bedroom is a converted garage, etc...)
The ZillowPeak(tm) was Nov/Dec at $621k
In my area of Reno,NV just yesterday a house was reduced 100thousand, not counting the previous reductions of 96,000 and another 100 thousand. Its nice, but sits on a busy corner with a lot of new homes being built right across the street.
Another house up the street from this one, just RAISED their price 200thousand - Going the wrong direction!!...maybe they are freaking out?! about the new postage size lots for sale down the street. Also, this one has been sitting on the market for almost a year now.
now this is an excellent thread. focused mainly and squarely on the bubble. more like this please.
A True Story:
I live in a small two-bedroom one-bath rental in a very nice area, Downtown Orlando, Fl.
My home is surrounded by BIG $500,000.00 homes, owner occupied. My rent? $750.00 a month.
I follow RE like some people follow Stocks. So, I saw a FSBO sign in a small 2 BR/1BA similar to my rental home, good neighborhood, etc. I thought, "Hey, maybe a bargain?". I called the owner and asked him the price. A whopping $270,000.00! My mortgage for the same type of Lifestyle, calculated to $1,510.00 plus insurance and taxes.
I asked the seller why I should increase my monthly debt by more than double to buy his pos house. His answer. “The Lot is worth $200,000”.
My cash is safe......it is NOT going into RE.
Joey, million dolar homes in CA don't rent for $1,000; but they rent alot closer to $1,000 than $4,000 to $5,000
I rent a home in Del Mar valued at $800K and pay $1,900 per month
Here's my bubble story. I bought a condo in NOVA in '99, because I was sick of renting/roommates/live-in boyfriends. Paid $76k ($72k mort.). Lived my life, worked, paid the bills...fast forward to late 2004, when I started hearing about how much real estate was going up. I looked on realtor.com at similar condos and realized I was sitting on my dreams.
See, I grew up in CA, in a rural area with horses and your various "farm animals." When I moved away to start my own adult life, I thought I would never again be able to live that way. Now, in late 2004, I saw a way. I waited a few months, while I researched lower-cost places to live, where I could buy some land, and then sold the condo in early 2005, for $300k. I had something like 7 offers, all for over list price, in three days of listing. I was amazed anyone would pay that much for a 1 bedroom condo.
I took my cash and ran away to New Mexico. I'm waiting to close on my 40 acres (paying cash). I also bought a small condo in ABQ, for a place to live while I build the ranch. When the ranch is done, I'll either rent the condo or just sell it.
I miss my friends in NOVA, but I'm glad I sold and moved. I love NM. The people are friendly, the country is beautiful, and the real estate prices are reasonable...for now. I could not be experiencing this if not for the bubble. Thank you, Mr. Bubble, and all the greater fools!
Foo--yes, I've run the numbers, and realize there can be a benefit to financing. However, I really like not having a mortgage payment. It's a personal thing. Thanks for the advice, though!
i'm renting a beautiful 2400 sq ft home in w sonoma county on 5 acres,excellent schools etc.even with the 10% drop since august 05 it would easily sell for 1.25 million.rent is $2000.and the landlord mows the 5 acres...he spends 2 full weekends a month just keeping th grounds firesafe.
I'm renting a 1 million dollar place in Manhattan Beach, CA for $1100.
I stopped in at the local Quik-Stop to gas up friday afternoon. The neighbor's kid (19, makes 10.50 an hour)
is the night manager. He tells me he just bought a $450,000 home with his GIRLFRIEND! She's in college, works part time on weekends at the local lumber/hardware store. I asked him where he got the loan. Oh, the nice people at the sales office at the development where they bought the home put them in touch with a great mortgage company. Silently I shake my head to myself and walk out. I can imagine what kind of loan they got. His last parting line:"There's no reason why anyone can't afford a home these days". These kids will
get a major learning lesson shortly. Directly or indirectly, I guess we all will!
Anonymous said...
I'm renting a 1 million dollar place in Manhattan Beach, CA for $1100.
Sunday, May 07, 2006 11:52:40 PM
TROLL!
I live in one of the best westside LA neighborhoods and Joey's right on the money about the high rents here.
Foo--I'm buying about 35 miles SE of ABQ. Near the town of Tajique. The 40 is in the foothills of the Manzano mountains, so I have some trees and views. Click my name and go to my blog to see photos...you'll have to scroll down a bit.
Mitch--thanks! Yes, I did have the thought, "Ihis can't go on forever, I'd better sell while I can." Had trouble convincing my mom that I was doing the right thing; she wanted me to take a 2nd on the condo to pay for a down payment on a place here! All because her loan officer friend said it was a good idea. "She wouldn't steer us wrong, she's my friend!" Yeah, riiiiight. And my mom is usually so smart about things.
Funny true story, from S.Cali ---
Drinking beers one weeknight at a local watering hole.
Two attractive ladies come in and take a table at the bar.
One is dressed so provocatively, wonder if she's a "professional."
Me and a bud go over and chat them up until a male business associate of theirs walks in.
He is a rough-looking sort, has some guady SuperBowl leather jacket on, huge gold chain and pendant.
Looks like a pimp.
They excuse themselves to talk "business."
When I stop by a little while later, I find out what business they're in.
You guessed it.
The ladies are realtors, the dude is a mortgage broker.
HILARIOUS
To the person buying near Tajique new mexico. I hope you seriously have a gun. I just moved from ALB and when I was down by Tajique I saw plenty of really sketchy characters. I saw a carload of drunk people, with two kids in the car- not in car seats, pull up to the liquor store beside us. It would seem it's such a amall place, that the cops are all related to the locals. It's also at about 6k feet high. Very hard on your health. I am not totally down on new mexico, I still own 20 acres down by Ruidoso. It's just that prices have already made their move. I bought my land for a thousand an acre, and I don't believe it will really be worth more, until things start getting more civilized there. Good luck.
Two stories - my co-worker on the phone to her husband, complaining about how high her property tax is and how it "can't be right."
My friend (a realtor) fervently hoping that his sister-in-laws will go in together and buy a house. I am choosing to believe that he thinks the market will turn around.
I work for a developer here in San Diego. We have a condo conversion that still has about 100 units to sell with sales all but completely dead. They have thrown in every incentive they can possibly use and still sales have not picked up. They are now looking at slashing prices, just to hopefully break even. In addition they have had several major builders back out of entitlement deals leaving behind hundreds of thousands of dollars. Luckily they are in other segmants of the market than just residential.
A big increase of housing prices in March, with a record amount of unsold inventory. A paradox.
There must be millions of acres of undeveloped land around and manufactured home builders creating houses for 25% less than stickbuilt varieties. These prefab homes appeared like stick built. There is 25% off your new home cost from the get go.
There are so many guest rooms in this territory, if people got together they could save a bundle on their rising home insurance.
great site, my mom's best friend's daughter's husband (yeah its a stretch, but true) recently QUIT his 25 year career as a CPA to buy-fix and resell (flip) homes. The whole family is upset. Drove thru a new development in st augustine fla, on one block alone 8 homes for sale, 4 had the same phone number on the FSBO sign. Also, these same four homes had lime green posters (think kiddie sci projects) taped to the front door screaming about the $30k price reduction!!
i was getting lunch to go at a local restaurant when i overheard a young men in his 20s, working behind the counter, said to a customer that he just finished closing on a townhouse in So Cal area. I am so glad I got out last year and currently renting.
Austingal--yes, I know the area can be shady. I'm taking the chance that it will be worth it, to be able to live out where I don't hear boom-boom car stereos, and where I can ride my horse for miles on the adjoining state land. A couple big dogs, a gun, and getting to know the neighbors are my plans.
I'm interested in how the altitude effects health, in your opinion. You're a nurse, right? I'm a 37 year old woman, no kids, no health problems (knock on wood). I'm active and plan on doing a lot of the manual labor involved in keeping a small ranch going. Other than getting used to breathing the "thin" air, what should I expect?
P.S. got the land for $800/acre
*sigh* Just heard from a friend in NOVA that she and her husband just signed a contract on a house. I don't know any details yet, didn't even know they were shopping. God, I hope it turns out OK for them. They bought their current house a few years back...about 8-9 years IIRC. I sure hope they can sell it if they need to. I also hope they haven't taken HELOCs on it. Ugh.
Eager1, I don't know anything about the rental market in FL, but it sounds like you have a chance of talking them down. Can you offer to pay them for an entire 6 month or 1 year period (if you have the cash to do so)? I did this as a student, and was able to knock 10% off my rent.
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