June 27, 2006

New HousingPanic rule: Only smart people allowed to comment

There. That should take care of it.

Seriously everyone, elevate your game. I realize it's the wild wild west of the internet, but let's all try to learn something here, and learn something from each other.

No, HP's not a left wing tree hugging loony. No, HP's not a right wing hate-filled neocon. No, HP didn't lose any money on gold.

Yes, HP thinks realtors should go away. Yes, HP thinks the bubble has popped and the housing industry is crashing. Yes, HP thinks illegals Mexicans should be deported. Yes, HP thinks we should get the F out of Iraq. Yes, HP thinks the US's fiscal house is a house of cards. And yes, HP thinks Bush is incompetent, Hillary is a joke and the system is corrupt.

I call it like I see it and make my argument. Anyone who uses name calling or swears as their main argument shows their lack of intelligence.

Make your case, keep it clean, add to the discussion, and have some fun on this blog.

34 comments:

Disgorge! said...

* Yale economist Robert Shiller, author of "Irrational Exuberance," says America's housing bubble is the worst since 1890, a totally psychological bubble unlike the post-WWII boom which was based on strong fundamentals and demographics.
* Morgan Stanley economist Stephen Roach says emerging markets will continue on the decline because they rely on exports to America and inflation is forcing domestic consumers to scale back spending and consumption.
* And in his latest Forbes column, economist Gary Shilling says the coming "house-price collapse will be far worse than the 2000-02 bear market on Wall Street and will bring a serious global recession."

panicearly said...

help with this scenario.
A friend makes 80K/year and got a job offer for 120k, 50% raise! sounds like a great deal right?
Now he bought a home for 490k in 2005,
that gets no more than 1400k rent,if he were to rent it. pre 2002 the same house would ask for 250k
Nothing is selling in his market and it may not even move at 400k at this point.
I think he has cash for settlement if he were to find a buyer at 400k
but is very reluctant to "let go" of the money.
The new job however is in a more expensive city rent wise.
What would you do? take the new job at 120k, current job looks "secure".
both jobs are in IT.

an event(50% higher pay) that would normally be celebrated, unless you are an FB.
Without further data just to limit the direction of this discussion
what would you do in this scenario.
thanks.

CJFitz said...

I prep homes for resale on Cape Cod. I'm urrently talking with area realtors and builders who say this housing downturn looks MUCH WORSE than the late 80's downturn. Inventory is skyrocketing on the Cape.

panicearly said...

Sales of New Homes Up 4.6 Percent in May!
whats the magic behind this number?
1. builders are offering lower prices or incentives, driving new home sales away from older homes,olders homes gathering more dust.
2.the few buyers left reason they are getting a better deal. same price but new home. old vs new
3. sales are being counted at contract not at closing. how many of these will be cancels?
4.builder are not emotional about the house. they will make the deal to move inventory, or there is no profit.
5.builders offer higer commisions
driving the realtors to them and away from stubborn and in denial homeowners.

This is truly the end game. the last few sales will go the builders who will drop prices in a heartbeat.

debt is wealth said...

I keep meeting more friends of friends and family who are just starting out as realtors. I predict the most recent ones will never close a deal. The market is already a realtor's nightmare.

Also running into more friends who are in it deep in real estate---even young ones I wouldn't have thought had the money to invest, and even in not-so-hot areas.

twib said...

I find this blog fascinating. Why? Because I honestly don't know of anyone (friends, family, even acquaintences) who is hurting because of a real estate downturn.

Maybe that will change. One thing I can say is that real estate continues to be hot here in Austin.

I still get a kick watching "Vacation Home Search" on the travel channel. Folks running around buying 300-400k houses they plan to spend a few weekends or weeks a year in. If this economy turns sour, it would be fun to do a "Where Are They Now?" episode.

ex_macr said...

I am not sure what you have against mexicans, but who is going to pick our fruit and veggies, carve your meat, clean your hotel room, cut your lawn, build your house, carry your couch into your mcmansion, keep your restaraunt clean?

rdub9000 said...

I'm predicting a substantial crime rate increase in the "highly overvalued" areas as the economy slows, and the housing industry tumbles.

My car was stolen this weekend right in front of my APARTMENT (not my house). I guess there is something to be said about having a garage, even if it is attached to on overvalued financial landmine. Buy and use a "club" everyone. Or get lo-jack.

I'm thinking that illegal immigration will continue to be an issue as this thing comes down, and crime increases. Not necessarily because it will be illegals commiting all the crimes - but becuase they are an easy target to blame. Which is unfortunate...but is human nature to scapegoat the outsiders.
As construction jobs get fewer and fewer, these folks are going to either move back to mexico - or find a way to survive. The competition for jobs out here for illegals seems to be fierce. They literally push each other over to get to a truck that parks to pick them up first.

There are tons of street corners here in San Diego where the illegals hang out, waiting for people to pick them up for work.
It seems like a lot more of them are not getting work...I wonder how long it is going to be before the law just starts checking their papers, and deporting them.
I give it a year.


Rdub

Richard said...

Yep - first comes the swelling of illegals on street corners...then the yards sales...then the crime. Couple the housing crash with 12% inflation - add in $4.00 gas - and wammo -

Got Bullets??

BubbleShanker said...

rdub9000:

What kind of car did you have stolen, year, make, miles?

anonymous said...

I am not sure what you have against mexicans, but who is going to pick our fruit and veggies, carve your meat, clean your hotel room, cut your lawn, build your house, carry your couch into your mcmansion, keep your restaraunt clean?

So what you're saying is that you value Mexicans for their position as permanent second-class citizens. That rhetoric sounds familiar...oh yeah that is the same attitude the White South had towards blacks after emancipation.

I think Mexicans are great, I speak spanish, love Mexican food and my long-time best friend is Mexican. He is not however an illegal alien. Get your facts and your terms straight and then try to argue your point.

anonymous said...

I find this blog fascinating. Why? Because I honestly don't know of anyone (friends, family, even acquaintences) who is hurting because of a real estate downturn.

Austin and much of Texas is a bit late to the game. Also the fact that Texas has a ton of buildable land and few restrictions on development have kept costs of development low in Texas. I wouldn't expect to see any real drastic changes in Texas real estate. But you'll be flat for as long as the rest of the country is going through this.

foxwoodlief said...

Thanks Keith for reminding people to be civil in their dialogues. I know that those who refuse to identify themself "anonymous" seem to be the most vicious toward any comments that don't fall into their limited span of expectations.

As a new Austinite I concur with the comments by Twib. As in all things you can be right and wrong at the same time (ask any married man). Here in Austin things are on an upswing after five years of stagnation, hopefully a model of what will happen in places like Phoenix or Miami. The market here corrected itself and now things are growing again. The only thing that can improve the economy here in Texas would be tax reform to reduce the regressive taxation of property. Then the government better tighten the requirements to purchase a home and do away with 100% loans (though I guess a person with cash should have options to invest elsewhere) and restrict equity extraction (no more 100-125% extractions, people need to maintain that 80/20 or pay mortgage insurance).

In all economic models there are winners and losers. Inflation or deflation, those who understand the markets, win. For those who prefer "gold" what they really prefer is a constant value so when people start recognizing true cost then bubbles might end. As for gas prices? Even at $3 a gallon gas is cheaper adjusted for inflation than it was in the 70s.

As I mentioned before on this site, my parent's paid $17,000 for a house in 1962 and it the cost per sq ft adjusted for inflation would be over $160 a sq foot today (they live in the bay area). So for a person to buy my parent's house at $800 a sq foot...for a fifty year old track home isn't buying value, but here in Austin you can buy a nice home, quality built for $100 a sq ft or less so home prices have remained pretty constant in "real dollar" terms. You need to buy to live not to get rich or flip. You buy a shelter over your head, fix a price for 30 years (or 15 or what ever meets your financial plans) and that makes good sense versus renting where costs go up. My parent's mortgage in 1962 was $120 a month, and like all things (cars, bread, etc you can almost ad that extra zero for an equivalent cost ....a $2,000 car is $20,000, a 25c loaf of bread is $2.50etc) They never refinanced their house so for 30 years they paid $125 a month to live in a neighborhood where today the homes sell for over a mil. Tell me renting would be better long term?

Just don't overpay. If people look at value, don't bid up houses in frenzies to buy (sorry you don't pay $300,000 for a house valued at $250,000 just because you want it and think someone else will do the same)

Save your money, make a large down payment, look at inflation adjusted costs to make sure you aren't buying in a bubble market and houses become homes instead of a get rich quick scheme.

Keith I too am a ficial conservative and social liberal and agree with you on most points. I've been mocked for reading your site by some "anonymous" bloggers because I don't always buy into their doom and gloom apocolyptic views. I read your site to get a pulse on other communities where I don't live. I read your site for the articles you post that I might not read in my local paper or the NY Times or the Economist. I like hearing other point of views to help me plan my course of actions with my investments. Bloggers tend to have their ear to the ground and hear the heards long before those looking at the horizon for dust so I think your site offers some good clues to what MAY happen.

You'd be the first to disclaim any investment advise gathered from this site or people may come back to sue you if you were wrong and they lost money selling out of fear or such (just like many are now trying to sue becaue they got sucked up in bubble frenzies around the country). You got to look at your own situation and what makes sense for you.

If you are single, renting may make sense as a 1bdr even in pricey cities can be a lot more affordable than buying and the free cash can be invested or saved. If a person is a professional with four kids, he may not want to rent a three or four bedroom place where the cost ends up more than his mortgage unless he needs/desires flexibility to move at a moments notice.

Not everyone bought a house in the last five years at inflated prices, not everyone is mortgaged to the hilt, not everyone has extracted every penny of equity, etc so one shoe doesn't fit all and a housing crunch doesn't affect everyone the same. Even during the Great Depression 70% worked, 30% unemployed. If you worked things were good.

autofx in Phx said...

"Only smart people should be allowed to comment."

I guess Keith missed me while I was away on vacation!

Well, Keith, your sometimes near-hysterical thread titles don't inspire the highest quality participants.

You're obviously trying to create some type of carnival here, and you've gotten what you've asked for.

autofx in Phx said...

ex_macr said: I am not sure what you have against mexicans, but who is going to pick our fruit and veggies, carve your meat, clean your hotel room, cut your lawn, build your house, carry your couch into your mcmansion, keep your restaraunt clean?


and then one of the anonymous bloggers said: So what you're saying is that you value Mexicans for their position as permanent second-class citizens. That rhetoric sounds familiar...oh yeah that is the same attitude the White South had towards blacks after emancipation.


We tend to give people as much respect as they give themselves, so as long as Mexicans are willing to do this kind of work en masse, well...

It's silly to compare Mexicans to Blacks.

Most Blacks are here because we dragged their ancestors to this continent as slaves.

Most Mexicans are here because they came here by choice seeking a better situation than they have in their own country, where the gap between the rich and poor is far worse than in the USA, and where there are fewer opportunities.

By the way, yes, many White Americans truly do value Mexicans for their [self appointed] position as permanent second-class citizens. Those who run businesses and want cheap labor are in second heaven when they are able to hire hard-working, competent Mexicans who will accept less pay than anyone else.

Of course there are those Mexicans who get educations, start their own businesses, become doctors, lawyers, engineers, etc.

The fact remains that the others chose to do what they do.

anonymous said...

I know that those who refuse to identify themself "anonymous" seem to be the most vicious

Oh don't be a hypocrite. Like calling yourself foxwoodlief is really identifying yourself. I'll call your bluff; if you really want to identify yourself post your name, address and phone number and to be totally certain you can send me your SS # as well.

anonymous said...

It's silly to compare Mexicans to Blacks.

Most Blacks are here because we dragged their ancestors to this continent as slaves.


It's not as silly as you would think. I understand that blacks came here as slaves but they were here for so long they had lost any ties to Africa and had become black united states citizens after emancipation. They were viewed and are still viewed in many areas as second-class citizens from that point on. Mexicans come here by their own free will and choice and yes they shouldn't expect anything more than what they would earn according their skill level and education. But to say we should value Mexicans because they clean the crap off of our toilets is akin to saying Blacks are valuable because they will do our dirty work. And in fact there is much racial tension between blacks and hispanics because they compete for the same work. I don't like the stereotyping and I don't like the muddling of the term Mexicans with illegal aliens. No individual or racial group should be made to feel that it is a permanent second-class citizen. Temporary, that's fine. But it is wrong for Whites(myself included) to value a certain race or origin solely for it's capablites to perform tasks they "won't do" (like picking cotton).

rdub9000 said...

Someone asked about my car that was stolen.

2004 Chevy Trailblazer
30K miles.
Tan/silver

bastards.

Kilroy said...

Chevies is easy to steal.

rdub9000 said...

Do you have my car kilroy?

I didn't see a sign saying "kilroy was here"...

:)

Anonymous said...

Hope your new rule works Keith.

Your articles are a nice concise wrap-up of what happened that day.

Your pictures are entertaining as heck.

Your commentary is spot on.

But too many whacko posters brings the blog down, to be sure.

So good luck with the new request.

kilroy said...

rdub9000,

Nope, I don't have your car. Probably at the chop shop right now though. I just happen to know that Chevies are prime targets for thieves because even a dedicated moron can steal 'em. Hondas are bad about getting stolen here of late also but I think that has more to do with popularity than the ease in jacking them. Hope your insurance pays off for the loss.

Anonymous said...

So Rush Limpbone may be headed for some
"hard" time. Oh Letterman and Leno are
going to have months of fun with this
twit.

debt is wealth said...

The crime rate is already headed back up, especially property/economic crimes. Somehow not so surprising.

My complex (which is gated) had two car break-ins in the past month. I have been there a year and this just started happening. Hmm...

whydibuy said...

debt is wealth...Gating has no effect on crime if the gatekeeper or someone within the community is the criminal. There were plenty of robberries in a gated ind complex I worked at and the gate watchman never saw " nuttin" even though it was the only access to that site. As for residential areas, I heard of one where some lowlife teenager of a resident was stealing stereos and GPS systems out of parked cars.

Anonymous said...

chupa mi verga

Homoaner said...

"I am not sure what you have against mexicans, but who is going to pick our fruit and veggies, carve your meat, clean your hotel room, cut your lawn, build your house, carry your couch into your mcmansion, keep your restaraunt clean?"

Why, all the LEGAL immigrants, especially the refugees, who we've been welcoming into our country, of course.

We have a large refugee population where I live, and they do not appreciate competing with illegals for jobs. They feel they have had it hard enough with being forced to flee their country, only to come here and find employers preferring to hire illegals who won't complain or assert their rights.

We can also rely on our country's perpetual supply of low-skilled, minimally-educated, low-IQ citizens who will never be capable of holding anything better. Not to knock average citizens here, I'm describing the mentally below-average, who will always make up a significant percentage of our population. Those folks used to be able to eke out a living as janitors, warehouse workers, laborers, and the like - jobs that are now going to illegals. So do you want to have these folks making a living through welfare - or working?

Anonymous said...

hey! lovet his blog!

foxwoodlief said...

Well at least as foxwoodlief (and yes that includes my last name) allows me to own up to my posts. What about you? You lump yourself into a pot with how many other anonymous posters? If you said you were Joeblow then every time you choose to blast someone everyone who reads knows it is the same person commenting. Own up to your posts so we know which ones are yours. At least those who call themselves paintblot, panicearly, or foxwoodlief have an identity that follows them throughout their posts so one knows where they are coming from. Own up to your comments with a consistent identity that we can pin on you.

anonymous said...

Please like you couldn't change your identity in a heartbeat or maintain 2, 3, or 100 different identities at the same time. How do I know your not paintblot, or panicearly or even Kieth? Besides I have a registered identity, it's name is anonymous, I made it especially for you. You can click on it to get extra info...oooohhhh; like the name of my nonexistent blog.

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