HousingPANIC - The Housing Bubble Blog with an Attitude Problem, 2005 - 2008: BubbleTalk

July 20, 2006

BubbleTalk - Archived

Have at it, keep it clean

179 comments:

Anonymous said...: If there's already 3.5 million unsold homes clogging up inventory, why are the us homebuilders still pumping out houses like there's no tomorrow?

There could be 5 million homes for sale real soon, once these new homes hit, even more homes get listed by panicing sellers and demand dries up as nobody wants to buy now and lose money

u.g.l.y.; July 04, 2006 12:09 PM
Anonymous said...: Got an interesting article from "Google Alerts" as to the WHY
of wage stagnation while housing prices soar!

Fed Treading on Thin Ice as U.S. Housing Bubble Weakens

http://www.cepr.net/columns/weisbrot/2006_06_30.htm; July 04, 2006 2:53 PM
Anonymous said...: Damn, is it 2007 already?

That was a long nap!!!; July 04, 2006 8:26 PM
Smart Grid blogger said...: Great blog !!!; July 04, 2006 8:33 PM
Anonymous said...: Ooh, poor widdle Kimmy, did his Doctor Evil plans go boom boom?

http://abcnews.go.com/International/story?id=2153034&CMP=OTC-RSSFeeds0312

"The first two missiles launched appeared to be short- or mid-range missiles, but it appeared that the third — which broke up shortly after it launched — was a longer range missile, sources said."; July 04, 2006 11:06 PM
Anonymous said...: Here is a post from above rewritten using the anchor tag:

Towjam said...

Getting the masses ready.
Click Here; July 05, 2006 6:31 AM
Anonymous said...: Ill try my site and see if it works

http://forsakencraft.com/proof.htm; July 05, 2006 9:34 AM
Anonymous said...: opps lol what a rookie i am http://forsakencraft.com/proof.htm; July 05, 2006 9:35 AM
Anonymous said...: WallStreet Journal article from NNJblog; July 05, 2006 3:49 PM
Anonymous said...: http://nnjbubble.blogspot.com/

A 'Loud Pop' Is Coming,
From the Wall Street Journal:

Surviving a Real-Estate Slowdown (No Link)

The real-estate market shows signs of slowing. Is there deeper weakness ahead? Fewer questions are more important to mutual-fund investors. Many own funds with real-estate-related shares -- not to mention homes and vacation properties. And many economists believe a slowdown of the housing market could hurt the overall economy.

To get a lay of the land, we tracked down Kenneth Heebner, who since 1994 has managed the $1.2 billion CGM Realty Fund. It has the best 10-year record of all real-estate-focused mutual funds, according to fund tracker Lipper Inc., up an average of nearly 22% a year during the past decade, well more than double the broader market. The fund also has one of the best one-year records, up 32% through June 30.
...
Mr. Heebner, 65 years old, is better positioned than many real-estate fund managers to speak about prospects for the housing sector. His fund has viewed its mission more broadly than most rivals, so he isn't shy about ditching real-estate stocks. Among big holdings for CGM Realty during the past year: coal-company stocks, a hot category that qualifies in Mr. Heebner's view because coal companies own a lot of land. He also runs three other mutual funds, including CGM Focus Fund, so he spends a lot of time looking beyond houses and hotels to other parts of the economy. These three funds have among the best five-year records in their categories.
...
WSJ: How is the housing market?

Mr. Heebner: A significant decline in prices is coming. A huge buildup of inventories is taking place, and then we're going to see a major [retrenchment] in hot markets in California, Arizona, Florida and up the East Coast. These markets could fall 50% from their peaks.

WSJ: What has you so concerned?

Mr. Heebner: I'm worried that more people will default on their mortgages. Risky mortgages such as interest-only and pay-option adjustable-rate mortgages require no principal amortization and in some cases payment of only a fraction of the interest due, have been widely used in the last two years. Some people got 100% financing for their homes. It made the tech bubble look like a picnic. When housing is going up rapidly and you can buy far more than your income can support, some people are eager to make big profits by extending themselves financially.

As housing prices fall more people will be under water, and these people are just going to walk away from their homes. They are going to say, 'I'm outta here.' You're going to see increasing foreclosures over the next several years. As [home] prices come down, it will create a difficult environment for home builders.
...
WSJ: More than 25% of homeowners don't have a home mortgage because they own their property outright. Won't this keep problems in check?

Mr. Heebner: Most people won't have problems and much of the country will be fine. I don't think anything will go wrong in places like Texas, Iowa City or Minneapolis. ... But prices are being set by a minority of participants in the market, [those who have borrowed the most and used the most aggressive types of mortgages]. There will be a loud pop in inflated markets. It's where prices were artificially inflated by people buying houses with risky mortgages that we'll see problems. ... The person who feels the pinch is the person who used an aggressive mortgage and is struggling to meet the mortgage payments.
posted by grim 10 comments

Runaway Housing
I came across this commentary/opinion piece from "News With Views" this morning. I'll add a disclaimer here, I don't know who this outlet is, or what their agenda might be. I just thought this piece was interesting, so I'm going post it up:

RUNAWAY MARKET
By Jon Christian Ryter

The price of the typical 3-bedroom, 3-bath, 3,000-plus square foot American home is skyrocketing beyond the ability of the atypical American consumer to purchase one—or keep up with the spiraling payments. The mortgage payment dilemma is based in large part on the creative financing plans that are used today to qualify moderate-income buyers for mortgage loans that everyone knows is well beyond the ability of the average wage earner to pay when the full mortgage payment matures in three to five years. On the other end of the home market spectrum—because of the megaprices being charged for older dwellings that were affordably priced homes less than two years ago—new home sales are plummeting because existing homeowners who want to "move up," are finding fewer takers for overpriced older homes. In many parts of the country, the sellers' market has completely vanished. The "bidding wars" where prospective home buyers start at the asking price and compete with one another has been replaced with an ugly bearish buyers' market where consumers are balking at Realtor-inflated older home prices that have more than doubled in the past couple of years.

In many boom markets oversold homeowners are trying to refinance mushrooming mortgage payments that have resulted from the unique forms of creative financing that put them in homes they simply couldn't afford and should not have purchased. Fixed rate mortgages that were sold with 0% interest for one or two year years suddenly becomes mortgages with 6% interest—and the mortgage payments that they could barely afford at 0% have ballooned. Or the homeowner was cajoled into taking an adjustable rate mortgage that is spiraling out of control each anniversary as the Fed continues to increase the prime rate to slow inflation—at the expense of home owners who were assured by overzealous mortgage brokers that the low interest gravy train express would not slow down in their lifetime.

Now, in many of the slowing real estate markets, new home owners are being asked how much of their genuine equity—the down payments and the principle paid in their monthly mortgage payments—they are willing to lose to get rid of their expensive albatross. For many, the American dream is fast becoming the Nightmare on Elm Street. One such home buyer is San Diego homeowner Cortney Henderson who celebrated her graduation from UCLA San Diego with a Ph.D. in biomedical engineering by purchasing a modest new home—for $540 thousand. Her home is a simple one-story bungalow with an attached garage—the kind of house you'd find in Montana or Idaho, or Rudyard or Trout Lake, Michigan for $85,000 to $99,000.
...
Henderson should never have been given a half million dollar loan—regardless of her credit score. Her $27,000.00 down payment (she earned her down payment as an egg donor at a fertility clinic—something you fertile housewives might think about when you and your husband are trying to find the down payment for your new home) helped cinch the deal. The rule-of-thumb used by mortgage bankers to determine if you can afford the house you want to purchase is whether your fixed monthly debt obligations—not just your mortgage—are less than 25% of your net income. In Henderson's case, her mortgage payment (including insurance and taxes) ate up 70% of her gross earnings. If it was not for the $700 a month her boyfriend kicked in to help her, Henderson would have already lost her home. If she has an ARM [adjustable rate mortgage], the odds are better than even that she would be forced to sacrifice her home in a "get-out-from-under-the-mortgage" fire sale within a year or two. That's because, San Diego is viewed as one of a dozen markets where major home pricing "corrections" are about to take place. If that happens, Henderson will be stuck with a home priced well above market, and will likely be forced to dump the house for less than the current balance of her mortgage to get rid of it.; July 05, 2006 3:52 PM
Anonymous said...: Finally, and article from the AZ Republic detailing the carnage in the Phoenix metro area. It even notes price declines. There is still some fluff, but overall, bad, bad news for the investor tools on the fringes. You can't feel badly for someone that got in too deep, or is still delusional that their POC house is worth what they think it is.

http://www.azcentral.com/news/articles/0705pmarket0705.html; July 05, 2006 4:01 PM
blogger said...: last anon - thanks - just posted.

nice to see some truth about the desperation on the ground coming from the builder-advertiser supported arizona republic

but notice catherine reagor was not the reporter - hopefully they've taken her (and her rolodex of realtors) off the case

this story will be fascinating to read about in phoenix. a text-book case of a mania, and the following panic

think about the jobs that will be lost in phoenix. think about the foreclosures and bankruptcies. think about the hispanic issue added to the mix.

you're looking at a urban disaster worse than new orleans.

really.; July 05, 2006 4:39 PM
Anonymous said...: KEITH: PLESE DON'T DELETE THIS POST.

Your blog will be much cleaner and nicer to use if all the posters know how to use hyperlinks.

---------------------------------

How to use the anchor tag <A>

O.K. lets say you want to provide a link to the site

www.financialsense.com

Here is how you do it:

<A HREF="http://www.financialsense.com"> Click

Here</A>

This HTML code results in the following link:

Click

Here; July 05, 2006 5:25 PM
Anonymous said...: Comment; July 05, 2006 7:26 PM
Strategic Investor said...: The reason that homebuilders still build homes is that even at these lower prices, the difference between the cost of constructing a home and selling it are huge (at least, they are if you acquired the land some time ago), so they are still very profitable while oversupplying the market. This is why most bull runs (in any market) wind up crashing, and not simply flattening out.; July 05, 2006 11:41 PM
Anonymous said...: Not that it's terribly relevant, but I work in a technical medical field; so I'd like to think that my co-workers have enough brains to be clued-in to what's about to happen to RE in LA. Apparently not.

I overheard a very new hire tell a co-worker today that she's meeting with the realtor after work tonight to see if she can afford the house she's wanting to buy. And mind you this young person isn't a day over 30 so I doubt she's rolling in enough dough to throw a pile of money at this place.

Couple of days ago, another young foreign co-worker who's got all of two years total work experience (so he's making somewhere in the $20s/hr) told me that he and his new wife (and new baby) have purchased a home being built in the high $600Ks. He knows that the market's topping, but said that comps are over $700K for similar homes.

I've given up trying to warn anybody about the pending RE crash.; July 06, 2006 2:39 AM
Anonymous said...: http://www.detnews.com/apps/pbcs.dll/article?AID=/20060706/BIZ03/607060381; July 06, 2006 11:44 AM
Anonymous said...: Here is a big part of the problem:

"The price of the typical 3-bedroom, 3-bath, 3,000-plus square foot American home is skyrocketing beyond the ability of the atypical American consumer to purchase one—or keep up with the spiraling payments."

When did a 3 bedroom house have to have 3 baths and 3000 sq ft to be typical? I almost found my bachelor self getting into that trap on a home I had designed. It is 2700 sq ft 3 1/2 bath with 1300 sq ft of wrap around porch. I even was going to add 700 sq ft to the 2 upstair bedrooms. I do not even need those bedrooms.

We used to live and raise families in smaller houses like these:

"On the other end of the home market spectrum—because of the megaprices being charged for older dwellings that were affordably priced homes less than two years ago" ... "Her home is a simple one-story bungalow with an attached garage—the kind of house you'd find in Montana or Idaho, or Rudyard or Trout Lake, Michigan for $85,000 to $99,000."

That describes the 1100 sq ft 2/1 house I lived in dowm near Palm Beach, FL. that cost me $55K in 1983 and sold for $70K in 1989.

We do not really need to live in mansions do we?; July 06, 2006 2:05 PM
Anonymous said...: Click

Here; July 06, 2006 6:33 PM
Anonymous said...: It has been 1 year since me and my wife sold our home. Around the time we sold our home, we looked at a house that was listed for 635K.

That same house is now priced at 465K.

It is tempting to think that now is the time to buy...I was thinking of making an offer of 420K...

Should I wait longer?

Just curious - man it is hard to time this crap. Got lucky on selling, not so sure if I'll be so lucky on the buying side. If it was up to me, I'd wait longer - but my wife hates renting, if momma ain't happy, then nobody is happy.; July 07, 2006 1:28 AM
Anonymous said...: 'I was thinking of making an offer of 420K...'

Huh huh, huh huh! He said '420' huh huh!; July 07, 2006 1:40 AM
Anonymous said...: "Energy costs will kill McMansions for most folks. Hell, it will kill most free-standing residences.

I predict most major cities will be ringed by a skeletal halo of dead suburbia in 10 years."

Sounds a little apocalyptic, though perhaps not entirely implausible. The dead suburbs of abandoned McMansions will provide homes for squatters, illegals, drug gangs, and all sorts of human refuse.; July 07, 2006 4:42 AM
Anonymous said...: My favorite are those people that live so deep in thier massive gated communities that it takes 1/2 hr to get out into civilization to fill up with gas and groceries. LOL.

I say we block off all gated communities and criminals locked up!; July 07, 2006 5:01 AM
Anonymous said...: The massive consumer debt will be relieved this year due over leverage of the %4 SPR index as the Milton factor multiplier is put to use by the Fed; July 07, 2006 5:03 AM
Anonymous said...: More homes for sale in King County, but prices keep climbing

Seattle Times- Frustrated recently by a shortage of available homes, King County buyers finally saw some easing last month. They had more homes to choose from in June than they did in May or even in June 2005.

But prices continued to rise, according the Northwest Multiple Listing Service, which released June home sales statistics today.

Some highlights from Central Puget Sound counties:

King County reported 6,489 single-family homes for sale last month, an increase of 462 over May and 951 above June 2005. The median sales price hit $434,950, up from $427,950 a month earlier. West Bellevue was the most expensive area; the median sales price in that waterfront community was $1,187,500. The county also reported 988 condo sales last month — unchanged from a year earlier. However, the median price rose 16 percent to $250,000.

Rising home prices come on top of rising mortgage interest rates — a double whammy for homebuyers. Mortgage-money provider Freddie Mac reported today that 30-year fixed-rate mortgages now average 6.79 percent — the highest rate since May 2002. Last year at this time the rate was 5.62 percent; July 07, 2006 6:55 AM
Anonymous said...: Checi this out. I just got this email form a zip realty realt-whore:

No one can predict how much houses will appreciate; therefore all we can do is see where they have been going. That said, houses continue to increase in value over time due to increased demand, limited supply and inflation.

I always think that now is a better time to buy a house, rather than waiting.

The number one reason is because inflation does not stop. So the same amount of money buys more now than it will in the future.

The second reason is that demand for housing, particularly in California, continues to rise as our population grows.

The first thing to do is to get pre-approved. I have a wonderful loan consultant at Eloan who will guarantee you the lowest cost mortgage. Would you like me to have her call you?

Thanks very much!; July 07, 2006 7:07 AM
Anonymous said...: I'm not really buying this housing bubble thing. For example, King County median prices are up 16% the first quarter. People are still buying houses like crazy around here.

http://seattletimes.nwsource.com/html/businesstechnology/2003110149_homesales07.html

So why does everybody think that housing is going down? If anything it's just slowing a bit in some high markets while the flippers unload their inventory due to the rising interest rates.

Housing has never fallen more than 20% anyways, even during recessions.; July 07, 2006 8:18 PM
Anonymous said...: I'm not really buying this housing bubble thing. For example, King County median prices are up 16% the first quarter. People are still buying houses like crazy around here.

http://seattletimes.nwsource.com/html/businesstechnology/2003110149_homesales07.html

So why does everybody think that housing is going down? If anything it's just slowing a bit in some high markets while the flippers unload their inventory due to the rising interest rates.

Housing has never fallen more than 20% anyways, even during recessions.; July 07, 2006 8:18 PM
Anonymous said...: I don't think housing is going to go down significantly.

The reason being, is that interest rates now are still relatively low. They are rising.

So a lot of people now, who didn't jump on the bandwagon, are going out and buying new houses. NOW.

King County in Seattle, for example, is up over 16% this year already.

Some other places in the country are more flat, but that was because a lot of the flippers were selling their properties.

Now you have people coming out of the woodwork to buy, and the prices are STILL going up.

The only places that seem to be stagnant or going down a bit are Phoenix, Las Vegas and Florida, which were insane to begin with.; July 07, 2006 8:50 PM
Rob Dawg said...: Wow, here we were just a bustin' on the FBs and housing and along comes the pro-urbanist wackos.

Energy costs cenurb v exurb are a wash.

Crime is much much higher in urban areas. So much higher that since 1929 density and degree of urbanization has been the single largest predictor of crime rates in the entire nation for the entire period. And this isn't me or some university study, this is the FBI.; July 07, 2006 8:58 PM
Rob Dawg said...: Not Buying The Bubble said...
I'm not really buying this housing bubble thing... People are still buying houses like crazy around here.

And the fact that even you see that the buyers are CRAZY doesn't give you a hint?; July 07, 2006 8:59 PM
Anonymous said...: "Housing has never fallen more than 20% anyways, even during recessions."

LMAO. What a f-tard you are . Where were you during the mid 90s when my Lake Elsinore rental dropped 40% in value? Google some old articles you fool.; July 07, 2006 9:03 PM
Anonymous said...: Value? Meaning your perceived value? Or the average sales price of houses around the area falling by more than 20%?

Where in the country was a house bought at say, $200,000 (insert # here), and was sold for less than $160,000 during any subsequent period?; July 07, 2006 10:39 PM
Anonymous said...: Oh, and BTW Riverside was like the only place that dropped that much.

They closed a lot of bases in SoCal and things dried up. But most places in Riverside didn't drop 40%.

The housing market is regional, get it? We're talking a nationwide drop if there is truly a bubble, and it's not going to happen nationwide because the economy's going up and if anything happens the Fed will step in.

Basically all this bubble talk is the same as Y2K.

What happened for Y2K? Was there a big disaster?

No. NOTHING HAPPENED.; July 07, 2006 10:46 PM
Anonymous said...: Here's somebody who says it better than I can:

The early 90s had several events that rocked real estate nearly simultaneously: A recession, real job losses in California, a race riot, and a huge earthquake. None of these things are happening now. We are coming OUT of a recession, there is job GROWTH, and the last two (race riots and earthquakes)can happen anytime. In the early 90s, people were leaving California because it did not seem a pleasant place to live anymore: Middle class folks were going elsewhere to find a nice place to raise their children. Today, the people who are leaving are those who cannot afford to buy houses, which does not speak to the desireability of living here, only its affordability.

In the early 90s, there were still large areas near the center of Los Angeles which were still being developed: There are none now.
Are things overpriced? Certainly, but I do not foresee a huge drop.
There are too many people with huge incomes and retired folks who have too many assets.; July 07, 2006 10:48 PM
Anonymous said...: seattle seems to be the only city in the country defying gravity

they do have great companies and great jobs there - they may survive the Great Collapse of 2007; July 07, 2006 10:53 PM
Anonymous said...: There are 2 Seattle factors: Microsoft and Boeing, which are going to be growing a lot in the coming years.

However, I'm still not buying any great crash happening. That would cause a big problem with the economy and the Fed would step in.

In fact, if we see a slowdown towards the end of the year they'll probably start lowing interest rates again.; July 07, 2006 11:07 PM
Anonymous said...: Anyways, this is my prediction for what will happen.

Slowdown, and some people hurting in 2006.

Economy growth slowing down (it's already slowing down).

Stagnation, and some more people hurting in 2007.

Economic growth just about stops, yet prices keep rising due to higher commodities. Inflation keeps rising.

Stagnation, and some drops in 2008 as oil prices rise some more.

Economy starts dropping.

$ starts going down, real estate prices start dropping in 2009, as we enter into recession.

2009-2012. Recession. House prices drop in major markets by 20%.

2013. Recovery starts. Inflation has eaten up most of the bubble.

More kids by the 10+ million illegals drives demand for yet more housing.; July 07, 2006 11:16 PM
foxwoodlief said...: Keep on dreaming, just be careful your dreaming doesn't become a nightmare. Some of the nastyiest and most cynical comments on this site must come from apocalyptic loosers. Insert some rationality into your point of view and quit being so negative just because (apparently) you missed the boat.

You want affordable homes? I can list thousands of towns and cities in America where homes are dirt cheap but when it boils down to it, where do you want to live? Amarillo, Texas or Austin? Bakersfield or San Jose? Cincinati or Phoenix?

For those who've read my other posts, I left Phoenix for Austin and so far, love it here. Is it perfect? No. Are there things I miss about Phoenix? Yes. Would I move back? If prices in the neighborhoods I would want to live return to a more "rational" price. Do I think Phoenix is doomed? Definitely NOT.

Taking the year off and enjoying Austin I've had time to think about what is important about where you live and no matter how beautiful an area is if there are no JOBS you can't live there. People forget that places are cheap and inexpensive for a reason.

Ten years ago we thought of moving to Maine but didn't because as beautiful as we thought Portland and Camden were, jobs sucked, pay sucked, taxes were high and homes not enough of a bargain for the negatives I've mentioned. Same is true of lots of places in this country.

I don't think I can name ten cities in the USA that I would want to live in. Why? Most are too conservative, not thriving economically, or just ugly strip malls. Three hundred million folk and where do they all want to live? Mostly where the jobs are!

Austin was in hurting status the past five years after the .com meltdown. In Phoenix I met folk from Austin who couldn't sell their houses and didn't have a job so they moved where there was work, Phoenix, and rented their Austin homes out. Now you can see that Central Texas has shaken off the recession and prices are rising, unemployment is low, job opportunities are rising and people have a more positive outlook for the future.

The state of the economy isn't going to implode. The majority of middle class people I know have money in the bank, low interest rates, bought homes before the bubble in their areas, didn't cash out all their equity, have good jobs and little debt.

I'm sorry for all those folks who live above their means and have no skills or bought in a feeding frenzy in bubble markets but the rest of the country hasn't changed much.; July 07, 2006 11:40 PM
Anonymous said...: The massive speculatory bubble and its silly offshoot the Real Estate bubble are near end!!!!

fox, either get with the program or stop complaining, when cycles end, they end. This one is ending. The conditions are ripe, the financial bubble is ready for its great explosion much like its 1999 peek swell.; July 08, 2006 12:23 AM
Anonymous said...: "Where in the country was a house bought at say, $200,000 (insert # here), and was sold for less than $160,000 during any subsequent period?"

Ramsey County, Minnesota. At the bottom of the 1980s-ealry 90s housing bubble, home values across the county dropped an average of 30% from the peak. For instance: my next-door neighbor's home was valued at $102,000 at the peak. It sold at the bottom for just over $72,000. My own home's value dropped from the peak of $99,900 to $67,900 at the bottom.

Doubtless you'll get to experience your very own significant home value decline soon, at which point you'll have learned the hard way not to blindly trust realtor overgeneralizations.

Also see
http://tinyurl.com/mythk
for all kind of news articles about the 80s housing bubble.; July 08, 2006 2:32 AM
Anonymous said...: It will never drop. You're all crazy. You want a disaster to happen because you missed the boat. So you're looking for any evidence, any at all that you're right.

Well it's just not happening.; July 08, 2006 2:48 AM
Anonymous said...: I mean, look at the inventory data.

Look!!! 150 million houses in the U.S.

Here's the available inventory to buy in major markets.

http://www.benengebreth.org/housingtracker/

It's like nothing!!! Nothing at all. 14,000 houses in San Diego. Out of how many? It's a TINY percentage. Less than 1% in most cases of the available houses.

It's not going to drop. You're all NUTSO.; July 08, 2006 2:54 AM
Anonymous said...: Not buying the bubble,

You make some good points, but real estate is regional. Seattle is kind of tight with land and their economy is good so you're right maybe about Seattle not being in a bubble.

Also, you are correct that housing prices have not significantly dropped nationally in the past. But I believe the reason this era is different from the past are the novel loan products. I don't like to generalize and I'm not a genius but people are stupid. They don't understand ARM's and interest only loans. They don't understand that interest rates are very low by historical standards and that there mortgage payments will rise when interest rates increase.

Many think, "Hey I'll get a 5-1 ARM because the mortgage is so low and I'll sell before the 5 years is up." As Warren Buffett said, "Dumb lending always has its consequences. It's like a disease that doesn't manifest itself for a few weeks, like an epidemic that doesn't show up until it's too late to stop it."

If you believe that you have a better financial mind than Soros, Heebner, Buffett and Munger, you're a better man than me.; July 08, 2006 5:14 AM
Anonymous said...: I sold a 2/2 pre-construction Florida condo in Dec. 04 for $224,900. Last month I sold an identical unit in the same complex for $178,000. During that time other identical 2/2 units sold for as much as $265,000. I sold a 3/2 in the same complex in Nov. 05 for $299,900 and an identical unit sold last week for $185,000. The crash is very real in this particular development.; July 08, 2006 5:26 PM
Anonymous said...: I'm bearish on housing these days, but I agree that Seattle seems safer than many other cities.

By the way, my hometown of San Francisco doesn't get mentioned all that often anymore. It used to be the first city anyone mentioned when discussing the housing bubble - now that honor seems to have been transferred to miami, las vegas, pheonix, san diego... ie., places that have seen lots of construction.

I noticed that while the bay area is up 6% yoy (median price), SF actually dropped somewhere between 1-2%.

My personal situation: I'd like to buy a house (cramped apartment, one year old), and I can actually afford to do so normally (ie., 20% down and a 30-year fixed). I could rent a house for much cheaper, of course, but I'll live in SF forever, so short term fluctuations don't mean much to me. The only reason to hold off would be to get a better deal (which is a damn good reason, but not without risks).

What do you guys think? How risky is SF relative to San Diego, or other expensive and overbuilt markets?; July 08, 2006 6:10 PM
Anonymous said...: There are price reductions going on all over southern california 100,000 is normal.

Very few buyers, only those relocating with families. Note they typically need to sell an existing house also.

A few idiots are catching the falling knife.

And this is the hot summer buying period, wait until fall and there will be no buyers.; July 08, 2006 11:21 PM
Anonymous said...: The RE bubble is a popping for sure, but if you must buy now or in the near future.

Click Here then scroll down to the post from

Wise_guy_in_RE and read his secretes.

SECRETE #1: DON'T USE A BUYERS AGENT/BROKER.; July 09, 2006 6:06 AM
Anonymous said...: I simply don't see how a city of Seattle can sustain 10%+ price increases in home values year after year.
Salaries increases aren't matching those gains and they tax you to death in this state. No even close.
Eventually, something has to give no matter how easy banks make it to get loans.

But I do think Seattle's situation is unique in that one of the main reasons inventory continues to push prices higher is the dumb ass democrats like Maria Cantwell and Patty Murray who recieve their campaign money from organizations like the Sierra club who for the past 20 years have dominated this state's politics as more californians moved up here and voted this dingbats into office passed all kinds of legislation in the 90's that capped condo development downtown.
This created a massive urban sprawl in all directions and traffic has become a nightmare.
Now Seattle is a city where barely anyone lives downtown.
Only recently have they realized their mistakes and made it easier for developers to build projects and increase the heights of residential buildings possible.
They look with envy at what Vancouver has accomplished.
Now your seeing a flood of condo towers being built or in the works.

So its a lack of inventory for atleast another 2 to 3 years which will continue to push Seattle real estate up and up.

I predict by 2008/2009, your going to start seeing a massive glut of luxury condos developing and that might finally cause a big correction in SEattle real estate.

All these condo projects going up ofcourse are priced at 400K and up.

Another factor is that Seattle has become a real hotbed of immigration from foreign countries.

A lot of mexicans and a lot of eastern europeans and russians are moving here.; July 09, 2006 6:42 AM
Anonymous said...: You forgot all the H1-Bs from INDIA that work for MICROSOFT.

They always bring their wives/husbands, which due to their arranged marriages always have degrees to. (They fix people up of similar educations).

So you have a ton of families with 2 people earning into the six figures.

Wonder why house prices are so high on the Eastside? Think about it. Families where both parties work so they make $200k+ a year.

Think about it a second ... how high will houses go with those kind of incomes.

A LOT higher.; July 09, 2006 6:55 AM
Anonymous said...: Seatle is a god awful place to live, one of the most dreadfull places in America.

You Seattle realtors on this site trying to unload your properties are worthless crap holes.

Seatle has only 2 employers 1 of which moved its corporate offices to Chicago because nobody with any talent wanted to live there and the other is moving all its technology work to India.

There are so many listings in Seattle that I think it will be a bigger bust then even Vegas or LA.; July 09, 2006 10:16 AM
Anonymous said...: Seattle is even a bigger boom / bust town then LA.

Seattle is ALWAYS the hardest hit:

Gold rush boom & bust: Seattle busted much more then California.

Great Depression: In Seatle it was the Great, Great Depresseion.

80s Defense Industry Bust: In Seatle they had an infamous billboard reading "Will The Last One Leaving Seattle Please Turn Out The Lights". LOL

.COM: Seattle Tanked More Then Silicon Valley.

Real Estate: What and See! LOL; July 09, 2006 10:23 AM
Anonymous said...: David at Bubblemeter has admitted he sent the following question to the Washington Post live chat on real estate:

Ashburn, Va.: I'm so mad at my neighbor. I bought my new home here in Ashburn last summer and plan to sell it next year (after holding two years to avoid taxes) to make a nice return on my investment. The problem is my neighbor is trying to sell his house (very similar to mine) right now and he keeps lowering his asking price. Each time he lowers his price, I see my potential profits next year getting squashed. Doesn't he realize he's hurting the comps for all of his neighbors by doing this? I don't think he is acting very "neighborly" by doing this. I want to say something to him and tell him he should stop putting his interests ahead of his neighbors. Its people like him who are ruining the market for the rest of us. If he would just refuse to lower his price, we could maintain our comps and everyone would benefit. What can I do to stop him?; July 09, 2006 3:08 PM
Anonymous said...: For those of you waiting for the bubble to pop to pick up property at a significant discount to today's prices, I think there are some very encouraging signs on the horizon:

1. Foreign Central Banks are starting to diversify away from the dollar. This will put pressure on the long-end of the curve, since Treasury yields will have to rise to continue to attract foreign capital flows to finance our current account deficit.

2. Energy and commodity prices are continuing to surge - due primarily to Indian and Chinese economic growth. Demand growth, coupled with an extremely vulnerable supply chain and growing political risk in major energy producing countries, means energy prices will likely go even higher. This will force Bernanke to keep pushing up short-term rates to avoid a hyper-inflationary death spiral.

3. Real wage growth is stagnant at best. The globalization of the service sector and a growing base of immigrants filling the blue-collar workforce has exerted downward pressure across the entire wage spectrum. Stagnant wage growth coupled with rising consumer debt levels has led to a widening deterioration in debt service coverage ratios, particularly in mid to lower-income households. This is leading to widening spreads between Treasuries and mortgage bonds.

These three phenomenon are having a dramatic effect on the demand curve for new housing - there simply are fewer buyers available at every price point. Meanwhile, supply is surging - due to the fact that the entitlement and construction process is so long, developers who embarked on residential projects in 2003-2004 are just now starting to deliver units. DC is a great example - 50,000+ condo units are due to hit the market in 2006-2007.

This imbalance between demand and supply is driving the massive "inventory glut" on the market. For the market to "clear" (i.e. for inventory levels to return to normal equilibrium levels), three things have to happen:

1. Prices would have to drop dramatically OR

2. Rates would have to drop dramatically OR

3. Incomes would have to rise dramatically.

While these three options are not mutually exclusive, the smart money is on a dramatic decline in prices. However, I wouldn't put it past Bernanke to pause or even start cutting the Fed Funds rate in the near future - all of his writings suggest he is far more willing to accept hyperinflation than deflation. And remember, the Commerce Department reports "inflation data", and as we all know, the Commerce Department's inflation gauges are easily manipulated. But even if Bernanke decides to let the inflation cat out of the bag, the result will still be a collapse of the housing market in the long-run. Eventually, the rest of the world will realize that all of those dollars and dollar-denominated assets they are holding are worthless - for the dollar system itself is a Giant Ponzi Scheme.

So, for now, I'm short dollars, long Euros (and long gold - but keeping my trailing stops tight with gold, for the Fed can easily manipulate gold markets by leasing their gold holdings to short-sellers)...and waiting patiently for the inevitable dramatic decline in the greenback which, by extension, will hasten the collapse of the U.S. housing market.; July 09, 2006 4:09 PM
Anonymous said...: CNN Money predicts the next real estate boom in 2025 !

But what to do with all existing suburbia?

http://tinyurl.com/qu22t

The next real estate boom
Dense settlements, not sprawling ranch houses, are the future of housing - and could make for a smart real-estate investment.; July 10, 2006 4:27 PM
Anonymous said...: i was talking with a local framer yesterday while watching the race at a bar. he stated that building is still going great guns around here. I see some big houses being built on nice parcels of land and many subdivisions of boxes being carved into otherwise good land.

It looks like Madison County, Al has not yet been hit hard. Hurry up bubble, bust already.; July 10, 2006 5:44 PM
Anonymous said...: What is this blog made of? Single young people without children???

Homeophobes??

What you folks seem to forget is that the desire to mate and breed is genetically imprinted, PERIOD.

99% of people that are financially stable and have a biological urge to breed are sure as hell NOT going to want to raise offspring in an apartment or condo.

DUH; July 10, 2006 8:06 PM
Anonymous said...: Why do I want The Bubble to crash?

Because it is time!

The growth mania and the juggernaut of the Church of the Free Market Triumphant have left us with insurmountable debt, a collapsing environment and a population of TV addicted zombies.

Only another round of Hard Times will remind us Euro-Americans that we are citizens first, not consumers! We have to zero the checking account of the "Malafactors of Great Wealth" who operate through the clever fiction of the corporations. And the only way this will happen is if the Great Housing Collapse leads to the Greater Depression which leads to a complete repudiation of the Regan Revolution.
I want all those Wal Mart shopping, McMansion dwellers in their SUVs to finally get it. Their stupid, selfish greed has fucked us, our children and our grandchildren.
Oh yeah, and it would also remind the country that they allowed this through the election ofGW Bush, A President as Good as the American People.; July 10, 2006 9:49 PM
Anonymous said...: The thing is this. Look at the price of housing (medians).

In 1970 it was 30k.
In 1980 it was 60k.
In 1990 it was 140k.
In 2005 it was 308k.

So roughly every 10 years or so, the price of a house doubles.

So really, how is this a bubble? How is this different than any past bubble?

Really, nationwide, there is no bubble.

The problem is just that wages aren't rising that much.; July 10, 2006 11:43 PM
Anonymous said...: Sorry ... that should have said in 1980 it was 69k.; July 10, 2006 11:44 PM
Anonymous said...: Anyways, if there is some crash, it's taking too long.

Very BORING ... where is pain and suffering that's happening faster?; July 11, 2006 1:23 AM
Anonymous said...: If wages double then housing may not crash.

Ask your boss tommorrow to double your salary in order to keep up with hidden inflation.

LOL.

Inflation may buffer the crash but not in real terms. American are not educated enough to understand the concept of inflation adjusted prices so the media will not even try explaining it.; July 11, 2006 9:05 AM
Anonymous said...: 4 Sales Signs Are Everywhere!; July 11, 2006 9:05 AM
Anonymous said...: No big crash without a recession. Just stagnation. But a recession would bring the real estate market down like Forman in Zaire in the 8th Round.; July 11, 2006 5:50 PM
Anonymous said...: "Recourse" is going to be a big topic in states where it applies.

The word is getting out in OC, CA.

http://tinyurl.com/ouokn

Advise: "sell"! I love it.; July 11, 2006 6:04 PM
Anonymous said...: Trying to do the right thing and downsize everything. I'm one of those save the environment, recycle guys, love my house but the motherfucker used 46000 galons of water last year!! The bill was fine but I was shocked at how much water my household used and we don't take 6 hour showers or overwater our lawn and such. So if I waste that much with 3 people what is the rest of the "I don't care" crowd using per month?; July 11, 2006 7:45 PM
Anonymous said...: "...used 46000 galons of water last year!!"

An acre-ft of water. Big deal. They waste way more than that watering golf courses, filling waterski lakes, etc.

The house didn't use it, your family did. Just the toilet alone would be 1/3 of that usage: (365 days x 4 people x 2 flushes x 5 gallons per flush = 14,600 gallons, bet it is actually higher if they go more than 2 times per day). Try to get the women to piss on the outside shrubs if you want to cut down. 1 shower per day at 10 gallons each (probably a lot more on a normal shower) would be the rest of the water usage.

Why would moving change your water usage? Do you water the lawn a lot?

That is a lousey reason to sell a home you love. You should be more concerned about the electricity / gas used to heat and cool, and the cost of the energy.; July 11, 2006 8:52 PM
Anonymous said...: The massive speculatory bubble and its "unsexual" offshoot the Real Estate bubble are about ready to begin bursting!!!!

Housing from a economic sense, peeked in Q4 2005 and only began its downward momentum in Q1 2006, thus we need to be patient. I would argue there are 3 possiblities:
1.No Recession or the infamed soft landing idea
2.Recession, or the "hard landing" idea
3.Crash, most likely triggering a depression.

8-12 months after the "economic" peek should we expect the decline to begin rapidly weakening the economy and home values itself.

As I have said forever, Q3 and Q4 2006 are where the real battles will be fought over the decline.; July 11, 2006 9:31 PM
Anonymous said...: You know, this site and the bubble sites are just about the only people that think there is a bubble, or housing will go down.

There are still people that I've met who are investing in Real Estate, and even bought condos this weekend.

One bought a condo last year and sold it this year for over $80,000 gain.

The thing is, if you're right (the bubbleheads), then why is everybody else so stupid?

Or are you stupid and everybody else is correct?; July 11, 2006 11:11 PM
Anonymous said...: Time will tell. I bet the ones buying will be sorry. Why are prices dropping and inventories rising?

Pays your money and takes your chances.

If you do not buy into the busting bubble idea, hang out at flipper blogs. better yet, go buy a little sh*tbox in a cramped subdivision project in a nice location like PHX. Go ahead...; July 11, 2006 11:16 PM
Anonymous said...: So I was driving around Scottsdale today, and came across a 1,240k comped house for sale for 320k!!!

Needless to say, suddenly it was obviously you Housing Panic folks were right!!!

Just messing with you, bubbleheads!!! There are no free lunches and you all missed the boat!!!; July 12, 2006 1:22 AM
Anonymous said...: One bought a condo last year and sold it this year for over $80,000 gain.

The thing is, if you're right (the bubbleheads), then why is everybody else so stupid?

Your comment is misleading. There is about a 99% chance this person bought in the first part of 2005. Try asking someone who bought their condo in Sept-Dec of 2005 how they are doing.

I do not believe in a full-fledged housing crash, but I do believe many people will sell for less than they bought over the next few years. Some people define that as a popping bubble, and some don't, but we do have a housing stock price bubble and a real estate agent bubble. I guess the housing inventory is the opposite of a bubble.; July 12, 2006 1:31 AM
Anonymous said...: The only people selling will be those forced to sell.

A friend of mine's mom wanted to move to a smaller place, so she put her house on the market in California, Bay Area, in 1990, I think for $240k.

It didn't sell ... no decent offers... no decent offers. She waited, waited, waited.

Finally in 1992 she sold it for $240k.

So most people will just wait out any downturn. But when has there ever been a downturn in real estate where there wasn't a recession?; July 12, 2006 1:38 AM
Anonymous said...: Actually, I was looking at some of those houses in Phoenix.

You know, with markdowns and bonuses you can get a pretty nice, new, 3 bedroom house there for around $240k with a decent size yard.

Not really bad at all.; July 12, 2006 1:42 AM
Anonymous said...: Like this house here, in Surprise.

17319 W CARIBBEAN LN, Surprise, AZ 85388

4,3,250k.

You trying to tell me this is going to fall 50% or something? No freaking way.

Get real. You bubbleheads are all nutso.; July 12, 2006 1:46 AM
Anonymous said...: Eating my words. I am eating my words.

Check out that house on realestateabc.com

Last sale 12/2005 for $350,000. Now it's listed for $250,000.

17319 W Caribbean Ln | 0 mi 12/05/2005 | $350,000 | N/A N/A | N/A N/A | N/A | 5,50

WOW. I'm eating my words!!! WOW!!!; July 12, 2006 1:54 AM
Anonymous said...: WAKE UP CALL: SOUND THE ALARM BELLS!!!!

"by making the real estate bubble (which is already deflating quickly) explode,"

Global systemic crisis / Phase II
The 4 structural stages of the speeding up of the global systemic crisis; July 12, 2006 1:57 AM
Anonymous said...: Okay, something does not compute. Realestate ABC says that house is worth $371,000, but it's listed on Zip Realty for $253,000.

?????????????

Typing mistake? Or is Realestate ABC not keeping up with the bubble implosion.; July 12, 2006 2:36 AM
Anonymous said...: Came across a classic Onion article that reminds me of the housing market these days:

http://tinyurl.com/qqlfy; July 12, 2006 3:26 AM
Anonymous said...: US Congress just outlawed ARMs, Intrest Only, and Neg Am loans:

"This is a scourge on our society. It causes innumerable problems," Republican Bob Goodlatte of Virginia, one of the bill's sponsors, said on the House floor before the vote.

http://tinyurl.com/mlleb

Want to know what REALLY ruins famlies? Bankruptcy from toxic loan products, not some guy betting on a football game or some poker player.; July 12, 2006 3:42 AM
Anonymous said...: You know, watching all these listings and hapless sellers trying to get out of their houses ...

Poor people who bought at the end of last year.

Must suck having $100,000 evaporate in less than a year.

I was in Canada for the stock market meltdown, but we can watch this meltdown on the Internet.; July 12, 2006 7:58 AM
Anonymous said...: Here is another great video report on a possible developing trend: Are mystery fires hitting flippers investment homes?

Firebugs McMansion Service

http://www.youtube.com/watch?v=Hnn0ma96F2o&search=bubble%20%2B%20real%20estate

If that direct link does not work: Go to www.youtube.com and use the magic search terms "bubble + real estate". There will be several videos to chose from. Pick "Firebugs McMansion Service." You will laugh yourself sick. I mean the idea of burning down homes because of the real estate bubble is really sick. And also very illegal. But stranger things have happened. Oh, well . . .

On a side note: I love Housing Panic Blog. Enjoy your daily postings.

But I also enjoy the site below a great deal. It deals with a broad spectrum of issues other than the housing bubble, mortgage bubble and global stock market bubble:

http://newspundit.net; July 12, 2006 12:30 PM
Anonymous said...: Two Trillion in Real Estate ARM Loans will Reset at Increased Rates in 2006 and 2007

The solution?

Firebugs McMansion Service

Perhap this hot link will work better:

Click Here to View Video; July 12, 2006 12:47 PM
Anonymous said...: Another good one:

Death of the Real Estate Agent

Click Me and Laugh Loudly

Then feel free to visit this news site:

http://newspundit.net; July 12, 2006 12:55 PM
Anonymous said...: Hey Keith,

Here is a real lulu:

http://www.renewamerica.us/columns/bowyer/060621

This guy is talking about citizen's assets as being the assets of the US, which can be balanced against US Gov't liabilities.

And there is NO bubble:

http://www.renewamerica.us/columns/bowyer/060705; July 12, 2006 2:23 PM
Anonymous said...: Just got an unsolicited fax that is offerring 1.25% option ARM. The annual interest quoted is 1.25% 1st year, 1.343% 2nd year, 1.444% 3rd year, 1.552% 4th year, 1.669% 5th year. They also offer no doc, cash out, no money down. Investment props (up to 4 units) allowed.

It has not stopped yet.; July 12, 2006 2:26 PM
Anonymous said...: Can anyone help pull the real gems from this article?

http://tinyurl.com/k5q5y

Here is a nice one: "Something is screamingly wrong with consumers".

Looks like the implosion is underway.; July 12, 2006 3:00 PM
Anonymous said...: A real story about a BUSTED BOOMER!

MR. Smith, (real name withheld) worked as an engineer for a Baby Bell for over 30 years. A few months ago, they gave him a pink slip (unexpeced by Mr. Smith) and 3 months severence pay.

Mr. Smith is now in his early sixties and never saw it comming. Last couple of years wiped out most of his retirment funds that were invested in his sinking telecom company stock. To make matters worse, Mr. Smith had been living paycheck to paycheck on his over $150K salary. Just last year he refi'ed his home with a 100% ltv - cash out mtg, for a kitchen remodel job.

Current situation - Monthy minimum bills $6K + food, gas, and clothing. Savings $0. Remaining home equity $0 or negative if forced to sell. Remaining avalible credit on credit cards $35K. Monthly income outlook after 3 months of severence pay runs out: $4K combined company pension + social security.

Problem: He is insolvent and new job prospects are very unlikely; also If he takes new job he loses out on SSI income. Also now under new BK rules, he can't file chapter 7 - is forced to file chapter 13 and will have a large percentage of his retirement income taken to pay creditors. Also at the beginning of 2007 his ARM resets and he wont be able to afford the payment.

I expect him to stop paying the MTG real soon and foreclosed in 9 months to 1 year.; July 12, 2006 6:33 PM
Anonymous said...: How can you live paycheck to paycheck on a $150k salary, and why would you need to refi???

Sounds like you're making up a load of B.S. This would have to be an awfully stupid person with an awfully expensive lifestyle.; July 12, 2006 8:52 PM
Anonymous said...: Maybe someone can help me out, but how can sales volume be down HUGE in almost all areas, but mortgage applications are not falling off as well? Check out the MBA number:

http://today.reuters.com/investing/financeArticle.aspx?type=economicNews&storyID=2006-07-12T110018Z_01_NAT002142_RTRIDST_0_ECONOMY-MORTGAGES-URGENT.XML

What gives? Are Refi's and equity extraction rolled into this number?; July 12, 2006 8:56 PM
Anonymous said...: Pretty simple. In most places there is no bubble, and people are still buying houses.

It's just in some markets where the inventory is very high.

Since mortgage rates are rising a lot of people are buying now to buy before the rates rise anymore.; July 12, 2006 9:08 PM
Anonymous said...: "Just" in "some" markets? Give me a break. It is a NATIONAL bubble and it does exist, prices are also down 3-5% from 2005 yet the stupid lags don't show it in "median" data, but contracts sure do and they will keep on declining while "official" data plays catchup(as it probably will to 2010's).

Housing bubbles in Omaha,Columbus and Chicago are bursting with rising inventories, not just the coastal markets. Job growth has weakened over the last 2 months and is now declining. By the end of the year I expect negative job growth and skying unemployment.

All because of housing decline. Don't get fooled by lags and progaganda. The end has cometh.; July 12, 2006 9:33 PM
Anonymous said...: The movie clips do not show up on some systems because of filters. They must have a security issue. Pics are better.; July 12, 2006 9:37 PM
Anonymous said...: A friend of mine's mom wanted to move to a smaller place, so she put her house on the market in California, Bay Area, in 1990, I think for $240k.

It didn't sell ... no decent offers... no decent offers. She waited, waited, waited.

Finally in 1992 she sold it for $240k.

You fail to comment on the loss of two years worth of earning power for her money in this very benign scenario. Many people lost their entire savings in CA and many many more will lose it this time.

Learn a concept: opportunity cost.; July 13, 2006 2:00 AM
Anonymous said...: Ummm ... opportunity cost for 2 years??? There was no opportunity cost. She just dated a urologist and watched David Letterman.

It's only the loser flippers that are losing out to opportunity cost.; July 13, 2006 2:08 AM
Anonymous said...: "Ummm ... opportunity cost for 2 years??? There was no opportunity cost."

There was most certainly opportunity cost. There is opportunity cost each day, and basically earning 0% interest on her money for 2 years and having it erode by 5% due to inflation those two years is painful.

As I said, hers is a benign example. It will be much worse for many.; July 13, 2006 2:18 AM
Anonymous said...: How can you live paycheck to paycheck on a $150k salary, and why would you need to refi???

Living paycheck to paycheck means that your monthy expenses are the same or more than your monthy income.

So add up fixed expenses of mortgage pmt, 2 auto leases (1 for him and 1 for his wife) credit card debt payments that the min just doubled on and due to a flawed credit record (default rates) on those card balances to boot, and payments on student loan debts for his three adult children who are in college. Due to his income level he had to pay/ sign guarantee the loans.

Add it all up, and you get a man drowing in debt who is at early retirement age - BUSTED BOOMER.

And the need to REFI; he's in a interest only mtg that will reset to a rate that is apx 3.5% higher as at reset time as its based on LIBOR + 2.75% MARGIN. Effectivly his monthy payment is going up by 60% to 70% on the 1st reset; and will continue going up from there every 6 months.

He can't afford the mtg pmts for very much longer and his debt to income ratio wont permit a refi!

A REAL and very sad STORY.; July 13, 2006 6:08 AM
Anonymous said...: FOLLOW UP POINT TO ABOVE POST.

The BUSTED BOOMER was getting by ok on his $150K salary.

What busted him was the pink slip.

He is now out of work at 63 years old with very dim outlook to find another job w/ comparable pay. He was a technical phone network engineer who worked for a baby bell (phone company). Outside of the telephone companies, he has no real marketable skills. So for all practical purposes he was forced into early retirement without a parachute!!!!; July 13, 2006 6:20 AM
Anonymous said...: Keith,

Your longstanding prediction about the demise of the traditional realtor to the forces of the Internet is becoming a reality:

http://www.usatoday.com/money/economy/housing/2006-07-12-realtors-usat_x.htm?csp=34

Enjoy,
prof; July 13, 2006 7:26 AM
Anonymous said...: This just makes no sense. Phone technicians don't make $150k a year. That's a salary level for directories at companies at minimum.

Anyways, nice try on the story.

I met a guy like that, though, during the Internet Bubble. Their product was crashing at our company (problem with our network, ironically, but their code couldn't handle it). He was telling me how he'd rather hire H1Bs. I was telling him how H1Bs suck and are taking American jobs.

He got laid off the next week from his cushy $150,000 a year job. The idiot had leased 2 luxury cars, just bought a new house in Modesto (he commuted to San Jose). What a moron.

He was about 45.

Your story would make sense except for a couple of things. The salary level and the age of the guy you're talking about.; July 13, 2006 7:56 AM
Anonymous said...: There is no real estate bubble in Waco Texas.

You can a get a nice home for 150K.

Therefore, there is no real estate bubble.; July 13, 2006 10:13 AM
Anonymous said...: "Anonymous said...
Keith,

Your longstanding prediction about the demise of the traditional realtor to the forces of the Internet is becoming a reality:

http://www.usatoday.com/money/economy/housing/2006-07-12-realtors-usat_x.htm?csp=34

Enjoy,
prof

Thursday, July 13, 2006 7:26:56 AM"

Great article. On the one hand, it shows the length that the real estate agents will go to protect their commissions (i.e. buy out the state reps, so what else is new?) On the other hand, a lot of states and the FED, are not buying their B.S.
That said, I have to add that the seller has to do their homework. Having sold both thru a realtor and also by myself with no realtor, just using my attorney, doing it yourself can be a real money saver. But the pitfalls that can creep up out of nowhere can throw you for a loop. Are realtors smarter than you, hell NO!, but they work at it every day, they know the ropes, they have more experience. The seller (not flipper) maybe does this a couple times in their life. It’s advisable to not rush into the "no agent" sale with only the notion that it’s easy and a lot cheaper. The seller must educate himself or herself thoroughly before plunging in!; July 13, 2006 3:52 PM
InfidelSix said...: To: Stuck in PA

Yeah, now if they could just do the same with lawyers!; July 13, 2006 6:28 PM
Anonymous said...: This is kindof scary, to say the least.

The fact is, the government and the citizens are not at all prepared for high oil prices, a housing crash and all that.

It's going to be brutally scary, especially with a war in the Middle East. If oil goes up over $100 as it is almost sure to, then people can't commute. If housing is so soft, people can't sell their houses.

It's going to be a bloodbath ... housing crash, stock crash, recession, etc. And we've already borrowed so much money in the govt. that it's not going to work to do more deficit spending.

The 11% unemployment in the 1980s wasn't so good. I guess we're back to those times, though.; July 13, 2006 7:07 PM
Anonymous said...: "InfidelSix said...
To: Stuck in PA

Yeah, now if they could just do the same with lawyers!"

Amen to that! Kill all the lawyers, let SATAN sort em out!; July 13, 2006 9:44 PM
Anonymous said...: If the story about the 63 yr old engineer is true, and even if it is not, there is a real lesson. People are NOT ready to retire because they are too far in debt and have not saved.

That guy in the story probably wishes he saved more and spent less.; July 13, 2006 10:09 PM
Anonymous said...: But the story makes no sense. What 63 year old person doesn't save money?

Figure he had kids when he was in his 30s, he hits 53 his kids are in college. 55 his kids are out of college.

That's 8 years of saving at a high salary ...

The entire story makes no sense. Change the story to 53 years old and the salary to 75k, maybe it makes sense.; July 13, 2006 10:45 PM
Anonymous said...: Your story would make sense except for a couple of things. The salary level and the age of the guy you're talking about.

Believe it or not.

I have no reason to lie. The story is true. The man was an engineer, and had a bunch of LUCENT stock in his retirement portfolio before the big hit on telecom. If you are familiar with the BELL LABS on East Broad Street in Reynoldsburg Ohio (East side of Columbus Ohio) parts of this company were broke up and spun off. This guy was no low level technician, he was a highly skilled engineer (beyond that, sorry but I don't know what he did). Skilled Engineers with 30+ years of experience at a baby bell do make in the $150K range!

At any rate, the guy is a relative by marriage of mine so no names here. I only see him once a year at the family get-togethers. I really wish for his sake that this story was made up; but its not. and he will have to suffer the rest of his life for failing to plan correctally for his future.; July 14, 2006 1:23 AM
Anonymous said...: Sat back and thought about all the comments on my story about the BUSTED BOOMER.

If anyone else had posted this story, I would find it hard to believe. Being a prudent saver all my life and living well within my means- the idea that someone who earned $150K a year could be so completely stupid is very hard to believe.

But then again, I have had my share of hard times and know the value of a buck. This guy lived his whole working life without a care in the financial world. Before the telecom crash, he expected to retire in style on his paper telecom gains.; July 14, 2006 1:35 AM
Anonymous said...: tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl tinyurl

USE IT.; July 14, 2006 1:52 AM
Anonymous said...: It's easy to use up a 150k salary with a big house, kids, cars. I have two young kids, wife at home, and we spend about this a year (before tax), even though my house is paid for.

Luckily my total income is $220k when bonus + stock is added, so I am able to put aside about $70k a year. I would like to save more, but things are very expensive in daily expenses. Also my cars are owned outright as well.; July 14, 2006 1:52 AM
Anonymous said...: "Anonymous said...
Sat back and thought about all the comments on my story about the BUSTED BOOMER.

If anyone else had posted this story, I would find it hard to believe. Being a prudent saver all my life and living well within my means- the idea that someone who earned $150K a year could be so completely stupid is very hard to believe.

But then again, I have had my share of hard times and know the value of a buck. This guy lived his whole working life without a care in the financial world. Before the telecom crash, he expected to retire in style on his paper telecom gains."

People old enough to be my grandparents, both in late forties, adopted me at birth(born 1949.) Mom and dad both went thru the great depression. I also know the value of a buck thanks to their lifelong example. However, myself and the rest of the frugal savers out there are the exceptions, not the rule for those in their late fifties/early sixties in 2006. I know of far too many people making impressive six figure salaries that live literally paycheck-to-paycheck, and have NOTHING to fall back on. It’s scary!; July 14, 2006 3:03 AM
Anonymous said...: I only make about 100K per year, my many houses are paid for, my pickup truck is paid for, my SUV is paid for, I get to travel around the world for free, all my meals are paid for, all my taxis and limos are paid for, whenever I sign papers I get all these cool presents sent to my family members and friends....

...I just do not undestand why all you fellow Americans complain all the time?

George Bush.; July 14, 2006 3:27 AM
Anonymous said...: Can't speak for former Lucent engineers, but it's very commonplace for the high-flying trader bigshots on Wall Street to spend all the money they have and then some. Exotic cars, fast women, penthouse suites....a lot of them live for the moment. Their lives reflect their jobs. If they are not putting up a lot of risk, they're not happy.; July 14, 2006 4:40 AM
Anonymous said...: except the fast women. the fast women make them happy, at least for a hour or so.; July 14, 2006 5:26 AM
Anonymous said...: Blogger turns paper clip into house

TORONTO (Reuters) - A Canadian man was handed the keys to a three-bedroom house Wednesday, exactly a year after he offered a red paper clip online, asking to trade it for "bigger or better" things.

In his latest trade, Kyle MacDonald, 26, swapped a bit role in a Hollywood movie for a house in the small Western Canadian town of Kipling, Saskatchewan.

When he started his quest with the paper clip, MacDonald said getting a house was his goal.

He traded in the paper clip for a fish pen and eventually moved up to an afternoon with rocker Alice Cooper before snagging the Hollywood movie role in his 14th trade.

Wednesday, the mayor of Kipling presented MacDonald with the house in return for a role in the movie "Donna on Demand," starring Corbin Bernsen.

Kipling, population 1,140, will give the role to the winner of a contest it plans to hold in September. "We're getting some very positive attention, and that never hurts any community," Mayor Pat Jackson said in a telephone interview.

Local businesses have donated housewarming gifts such as flowers and wine, and a 12-foot red paper clip has been erected in the front yard. The town plans to build "the world's largest red paper clip" at a yet-to-be-determined location.

MacDonald, who lives in Montreal, has become an Internet and media sensation during his series of swaps, garnering interviews and attention from as far away as Japan.

He said on his Web site that he and his girlfriend will move into his new house before September and plan to throw "Saskatchewan's biggest housewarming party ever."; July 14, 2006 12:46 PM
Anonymous said...: Keith,

Do you have a update on the flipper bench and fence?; July 14, 2006 3:04 PM
Anonymous said...: NEWS ALERT ~~~~~~~~~~~~~~~~~~~~

Roof Collapses at Horton

By Nicholas Yulico
TheStreet.com Staff Reporter
7/14/2006 9:57 AM EDT
Click here for more stories by Nicholas Yulico

D.R. Horton (DHI - commentary - Cramer's Take) fell more than 9% Friday after it reported a drop in third-quarter new-home orders and slashed its full-year earnings forecast.

The largest U.S. homebuilder said that its orders for the quarter ended June 30 fell 4.4% to 14,316 homes from 14,980 a year earlier. The value of the homes sold dropped to $3.8 billion from $4.1 billion.

The company expects to post third-quarter earnings of 93 cents a share, well below analysts' average estimate of $1.30, as compiled by Thomson First Call. The company's forecast includes about 11 cents a share in write-offs related to land option contracts.

"The current home sales environment is characterized by an increase in both existing and new homes available for sale, higher than normal cancellation rates and an increase in the use of sales incentives in many of our markets," said Chairman Donald R. Horton in a statement.

For the full fiscal year, D.R. Horton sees earnings of at least $3.65 a share, compared with its earlier forecast of $5.25 to $5.35. Analysts target full-year earnings of $4.92 a share.

"We think the sharp deterioration in earnings throughout the end of fiscal 2006 likely reflects sharply lower closings and significantly lower margins," Bank of America analyst Daniel Oppenheim wrote in a research note.

He estimates the company's gross margins will fall to 16.2% in the fourth quarter of this year, down from 25.2% in the fourth quarter of 2005.

Oppenheim cut his 2006 EPS target on Horton to $3.65, down from $4.85, and slashed his 2007 target to $1.85, from $2.55, due to faster-than-expected margin declines.

Horton's sentiment echoes warnings from across the industry as builders ratchet down their fiscal 2006 estimates. Several major homebuilders, including Toll Brothers (TOL - commentary - Cramer's Take), KB Home (KBH - commentary - Cramer's Take) and Pulte (PHM - commentary - Cramer's Take), have cut their fiscal-year guidance in the past two months.

Shares of Horton fell 9.1% to $20.77 early Friday.

In other builder news Friday, Raymond James released a report that said contracts for housing sales fell 42% year-over-year in June in the greater Washington area, according to an area realtors groups. Closings declined 38% and the inventory on the market now represents 7.1 months of supply, compared with 1.6 months in June 2005, and 5.9 months in May.

"We continue to believe the Washington, D.C., market is headed lower as excessive speculation and overbuilding will weigh on the market for the foreseeable future," Raymond James analyst Rick Murray wrote.

Public homebuilders that have a major presence in the market include NVR (NVR - commentary - Cramer's Take), Toll Brothers and Hovnanian (HOV - commentary - Cramer's Take).; July 14, 2006 3:54 PM
Anonymous said...: I am single and only make 2/3s of that 63 engineer. I was flat broke 8 years ago and started at a pay 1/3 of the other guy. Somehow i managed to save, pay off, accumulate, and still have enough fun to stay entertained.

But I drink low price beer (a lot of it), eat meat bbq'd on the backyard grill (3 big dawgs to share with), and do not have kids who want every kind of junk they sell at Walmart.

This guy made his own bed. So solly pal.; July 14, 2006 4:03 PM
Anonymous said...: Hey Kieth, looks like fortune teller Osman has competition over at Mish's blog.

http://globaleconomicanalysis.blogspot.com/; July 14, 2006 4:06 PM
Anonymous said...: Anyone want to wager if the US gov't is printing more money or stamping more buffalos / eagles? I bet the ratio of printed paper to gold coins is astronomical.; July 14, 2006 4:10 PM
Anonymous said...: Gold coins at Kitco are over $700 each. The buy price is now well over my cost basis even though I paid $680 for some. I paid $605 for others... too bad all were not at that price.

So gold is not a store of value?? Do the anti-goldbugs still think that?; July 14, 2006 4:12 PM
Anonymous said...: how much debt do you have; July 14, 2006 6:52 PM
blogger said...: nice day for oil, gold, shorts and cash eh?

i,m in sweden through sunday so chat away; July 14, 2006 7:20 PM
Anonymous said...: Debt? Who me? Zero. My taxes, which are like debt only more enforcable, are really low also.

Only need to pay for:
Utility bills, gas
Taxes, registration
Food, drink, clothes, play, maintenence

Otherwise all goes into savings; July 14, 2006 8:03 PM
Anonymous said...: I had a interesting conversation with the woman that sat next to me at the bar during lunch (great steak salads there). She works for a BK lawyer. It seems that since the new law came into effect the buisiness is way down. I asked about the counseling needed before BK and was told it is a $34 internet class, about one hour. Who is BK and still has internet? What will the FB get in one hour?

They have not been doing foreclosures. that may be the next up market in RE.; July 14, 2006 8:39 PM
Anonymous said...: At what price will you physical holders of gold sell? Wait for a reversal in the trend? Keep it until the sh*t really hits and use for emergencies?

I may be very tempted if it gets over $1K but that may be a death sign for the US$ and maybe holding would be better???

Thoughts?; July 14, 2006 8:47 PM
Anonymous said...: I'm thinking of selling my GLD next week before Ben goes all hawky. Then rebuying when its down.; July 14, 2006 8:58 PM
Anonymous said...: As long as I have a job and continue to make money, I'm going to keep my gold.
I bought it in case of a financial crisis only! I will trade it for another currency after the crash of the dollar which I believe is coming real soon! You will never be able to trade the dollar for any currency when it crashes.; July 14, 2006 9:05 PM
Anonymous said...: I became more fond of Maple leafs over the Eagle because they were .9999 and they did not heve US on them. There may be a psychological barrier to them like there is in the Krugerrand. I also like Kangaroos, but my fave is the leaf. Buffalos are too high.; July 14, 2006 9:18 PM
Anonymous said...: That's so weird about that engineer. Hard to believe ... very hard to believe.

Then again, I run into stupid people all the time, so maybe this is not so hard to believe.

Like my aunt had all her retirement $$$ in a stock 401k when the Internet bubble burst, and she lost almost everything ... like 75% of her retirement gone in a couple of years.

At 65 she went back to work again.

Anyways, everybody around here in Seattle who didn't believe in a bubble that I've talked to, now after 2 weeks, they are all watching the bubble. I've talked 3 people out of buying houses so far.

Yet one guy who bought last August with an ARM is still thinking he'll sell his house in 2 years for $200k or more profit ... LOL

I told him he should have sold in June of last year, and he said he didn't even have his house then. And I told him that's the point, he shouldn't have bought when he did.

He still thinks I'm wrong, though. LOL; July 14, 2006 9:37 PM
Anonymous said...: That guy will not like you after YOU burst the housing bubble and he lost money.; July 14, 2006 9:54 PM
Anonymous said...: Check this out!

http://exurbannation.blogspot.com/

Dr.evil hehe.; July 16, 2006 12:37 AM
Anonymous said...: here is a good yahoo story about the lagging economy. "the curse of the devil wears Prada"
http://tinyurl.com/ofveh; July 16, 2006 5:57 PM
Anonymous said...: I first started looking at home prices in northern Virginia about 4 weeks ago. My wife wants to move closer to my daughter who lives there and is expecting twins. While northern Virginia may not be as bad as Pheonix or San Diego, there's every indication that sellers there are experiencing some real pain. I started by searching the Northern Virginia Fine Homes website http://nvfh.com for current listings. For any homes of interest, I would then enter the address on the www.realestateabc.com site and look at the last sale price for the home. The first one I looked at was bought in November 2005 for $520k and was now for sale at $450k. To assess the level of seller distress I then started looking for listings for homes built or bought in 2005 with a "motivated seller". I quickly found one bought in 2005 for $660k and for sale at $449k and the grand-daddy of them all, a house bought in 2005 for over $1 million now selling for $795k. This in only a very small sample. These were all single family homes. Frankly I was astounded. I knew prices were slipping but I had no idea they had slipped this much. For those who are still questioning whether house prices really can go down I would recommend checking the facts on the websites listed above.; July 16, 2006 11:14 PM
Anonymous said...: Here's the frontpage story for Sunday's Seattle-Times.

Only 9 areas in King County left for middle-income buyers.

Highlights:

Throughout the county, buyers earning solidly middle-class wages have been increasingly unable to find what are traditionally thought of as middle-class houses because escalating prices mean the pool has been shrinking dramatically.

King County's median household income in 2003 was $57,857, which allowed buyers easy accessibility to 28 areas — seven within Seattle city limits — whose median home prices were $256,000 or less, a Seattle Times home-price analysis showed. Median means half are more; half are less.

Fast forward to last year: House prices shot up, but incomes barely rose, so median-income buyers found even fewer neighborhoods where they could afford the median-priced home — just nine in the county, including one in the city.

But for how long? King County's single-family-home prices shot up 19.7 percent in the first six months of this year, compared with the same period in 2005, according to The Times analysis. It's based on price per square foot, considered the truest measure of housing cost.

As the residential real-estate market cools in other parts of the nation, one question is why Seattle's market remains robust. Money magazine predicts homes in the Seattle-Bellevue-Everett area will appreciate 10.5 percent between this June and next. That's twice the rate predicted for the country overall.

Californians account for roughly 30 percent of our newcomers. Their state's housing prices make Seattle's look like a fire sale and nearly guarantee that California homeowners arrive here equity-rich. Just one example: Late last year, San Francisco's median home price was $825,000 — more than double Seattle's.

At the end of 2003, the King County index was 116.9. That meant a median-income family had almost 17 percent more income than the bare minimum required to buy the median-priced house.

By the end of 2005, King County's index had dropped to 80.1. That meant that a family fell almost 20 percent short of the income needed to buy the median-priced house.

http://seattletimes.nwsource.com/html/localnews/2003130153_homeappreciation160.html; July 17, 2006 4:44 AM
Anonymous said...: This explains the kind of delusional thinking that I still see in So Cal, where people think prices will continue rising: http://news.yahoo.com/s/space/20060715/sc_space/desirecontrolswhatweseestudyfinds; July 17, 2006 6:25 AM
Anonymous said...: Oops! Here's a usable link to the article that explains the level of delusional thinking: http://tinyurl.com/n9smj; July 17, 2006 6:35 AM
Anonymous said...: Gold has topped in the $660s-$670s range. Prepare for another big downdraft eventually to below $500 in the months ahead, along with US$ Index strength perhaps to the 100-105 range.; July 17, 2006 2:28 PM
Anonymous said...: WOW!!!! As the anon posted above, you have to go to www.realestateabc.com
and check it out!!; July 17, 2006 2:52 PM
Anonymous said...: ST. PETERSBURG, Russia - It wasn't meant to be overheard. Private luncheon conversations among world leaders, picked up by a microphone, provided a rare window into both banter and substance — including
President Bush cursing Hezbollah's attacks against
Israel.

Good. It shows Bush as a real man. I'm sure the liberal media will take it all out of context. I've appreciated Bush ever since him and Cheney called that Newsweek reporter an asshole during the 2000 campaign.

Flame away libs.....; July 17, 2006 5:22 PM
Anonymous said...: Nickel is a highly economically sensitive commodity (like copper), as its dominant use is in stainless steel.

If there's a global recession, it will tank.

Then again, I do own a few shares of Norilsk Nickel---world's #1 nickel producer.

And in a sign of times: it's Russian.

NILSY

very volatile.; July 17, 2006 6:46 PM
Anonymous said...: If gold gets low enough that coins retail under $600 I will be buying more. Silver may have more potential upside but gold is more compact, thus easier to stash away. And it does not ozidize like silver does.; July 17, 2006 6:57 PM
Anonymous said...: Condos crashing in SD: http://tinyurl.com/fe62w

USA Today has a piece indicating rents may actually fall (this is the opposite of what usually happens during a housing bubble burst) purely because of the quantity of new condos that will end up being rentals. It makes sense that rents will fall in Miami, SD, Phoenix, DC, the bubbliest spots. However, there will soon be many thousands of former owners renting.

Where I live (WLV), condos that rented last year for $1800/month and sold for $435K have been on the market for nine months. Now several in my complex have had "for sale/lease" signs on them for over four months and remain empty. In fact, 2-3 in 10 properties for sale are vacant around here. I predict CA will have a pretty strong outflow of homebuyers in the next two years. Of course, as the realtors love to point out, net population here always grows. What they fail to mention is that it's entirely due to all those millions of $5/hour immigrants and their fertility rate. Yes, there is a housing shortage. There is a severe shortage of $65,000 condos and $150,000 single family homes. There is GLUT of $400K condos and $600K boxes in the burbs!; July 17, 2006 10:06 PM
Anonymous said...: Don't discount Al Jazeera just because you don't like it. You may not agree with what it says, but about a third of the world reads it.

Yes, its politically biased. But the media you rely on is also politically biased.

Know your 'enemy'. No better way of doing that than reading their newspapers.; July 17, 2006 11:32 PM
Anonymous said...: Al Jazeera has good scoops, which of course come with political bias. Essentially it is down to this:
1.Iran is testing its political power
2.Israeli wants a puppet government in Lebanon to take out its enemies
3.The Neo-Cons who want total war in the middle east tell Israeli it is "ok" to launch a offensive on Lebanon HOPING that Syria and Iran get dragged into the war which the US could go to total war production and force a complete war against the whole Islamic world.

The problem: They would need China's approval. If China doesn't believe the US is acting in their best interest and potentially hurts them, they call in the bonds and destroy the US economy.; July 18, 2006 12:09 AM
Anonymous said...: Found a house in Seattle this weekend. Was priced before 4th of July for about 1.9 million. Reduced down from 3.5 million.

Relisted this weekend for ~5 million.

Trying to figure out what's up with that, if it sold or what.

Prices really aren't falling. I don't think there's going to be the panic people are predicting.; July 18, 2006 4:48 PM
Anonymous said...: Bank of America to slash 200 jobs from local center
http://tinyurl.com/qng22; July 18, 2006 8:44 PM
Anonymous said...: $3.5M to $1.9M in a short time is not a falling price? Not buying is really not understanding. Maybe the $5M was a NAR inspired trick to get into a different price bracket and find a different buyer.

It won't work. Tell us how much the listing is for in two months fool; July 18, 2006 10:32 PM
Anonymous said...: San Diego home prices dip as condo fever cools

"There are no desperate sellers in the resale market with two exceptions," Burns said, pointing to investors who overestimated demand for high-end condos and apartments converted to condos.

The market's median price for resale condos fell 2.1 percent to $386,750 in June from $395,000 a year earlier. The month's median for new homes, which includes new condos and buildings converted to condos, dropped 8 percent to $422,000 from $458,750 a year earlier, according to DataQuick.

http://news.yahoo.com/s/nm/20060717/us_nm/property_sandiego_dc;_ylt=Araoeniu.q5MYRUiD2UucNas0NUE;_ylu=X3oDMTA3ODdxdHBhBHNlYwM5NjQ-; July 18, 2006 11:06 PM
Anonymous said...: Boston Globe's Real Estate message board is really funny.

ATT: Sellers
Message #190.1
Posted by Shoshanna on Jun-5 12:19 PM

Attention to all you Sellers!!! Especially those sellers who have nice houses under $400K. Stop lowering your prices to "fire" sale levels! Take your houses off the market and wait if you can. The buyers out there are the worst of the worst and they are way too fussy and cheap. Let them wait and wait and in the meantime they are paying about $18,000K a year to rent and the interest rates are rising and even if the houses do drop more, it is all a wash. From mortgage brokers to real estate agents to home sellers, everyone is saying the same thing about the buyers. I know that when I bought my house - it was a fixer upper and so weren't the houses of all my friends, neighbors, familys, etc. We all bought houses that were outdated, etc. and we invested our time and money into making them nice and I for one am not going to give that away because of buyers perception. They want the granite kitchens and the double sinks and the huge square footage but they just don't want to pay for it. They want a colonial that is mint with a two car garage. They don't want to have a starter home, like a ranch, or cape or raised ranch like we all had. The young people who are looking at houses now are absolutely spoiled. They threaten to leave Massachusetts, and I say go for it! Go down South and get a huge colonial for $300k and have culture shock. Also, for all you southern bound people, the highest forclosure rates in the country are in the South especially Georgia. Thats right, the South and the midwest have the higher foreclosure rates in the country!!! Not Massachusetts! Oh and did anybody mention that the cost to air condition your mansion or your ranch down South will far exceed the heating bills you pay in the winter. Massachusetts's winters have been getting steadily warmer.

Also, the rest of the country is sky high to live, unless you want to live in the middle of nowhere! The baby boomers are going down south to retire and die and in their wake, the south will be left a barren cheap oasis.

Oh, and by the way, I am a seller with a beautiful home to sell and I will be removing it from the housing market when the contract expires. I have made one price drop and it is now listed at zillow.com estimate and here it will stay. My house has a/c, and new heat and electric and I can stay here indefinitely. I will not drop my house price and I am requesting the you home owners do not drop your to "Fire Sale" levels to sell your house unless you have to. Most home owners (80%) of us do not have to sell our house. My advise is to wait it out!! Stop lowering the price of your house - it is not helping!!! Pull your house from the market until "buyers" get more realistic.

I don't feel bad about my house not selling at all, I am earning equity each year and getting tax breaks because I am a home owner. We looked at renting apartment - ridiculous!! I don't think so. The prices are outrageous - you either live in a dump in a bad section or an overpriced luxury apartments! I put over $100K dollars of work into my house when I bought it and that is mostly for stuff that had to be fixed. Where are all you sellers? Speak up and don't give in. This is the price for real estate and it is only slated to increase, albeit only about 2.5 to 3.5 percent but it is still better than renting because you work down your mortgage and you don't work down the rent!

Sellers Unite!!!

I would really like some input from other sellers who are in support!

http://boards.boston.com/n/pfx/forum.aspx?nav=messages&tsn=1&tid=190&webtag=bc-re_mainboard; July 19, 2006 2:13 AM
Anonymous said...: Zillow rates the price at $199,000.oo to $257,000.oo and after a year on the market and 8 deals that fell through, I picked up a condo in a "panic seller situation", in downtown orlando for $152,000.oo, as a home and a place to live! Comps, are $180,000's.
Yea sellers! Thanks HP.; July 19, 2006 3:19 AM
Anonymous said...: "Let them wait and wait and in the meantime they are paying about $18,000K a year to rent and the interest rates are rising and even if the houses do drop more, it is all a wash."

Is that $18K per year the same as $1500 per month? Sounds like renting is cheaper. That hand sure makes a seller's hand, which is bleeding well over that per month, look weak.; July 19, 2006 2:33 PM
Anonymous said...: Sounds like renting is cheaper. That hand sure makes a seller's hand, which is bleeding well over that per month, look weak.

The rent in a like unit is $1,250.00 a month and my mortgage is now $716.00 a month. Renting is cheaper unless you buy down the mortgage with cash whilst the dollor is still worth something and before interest rates go to the moon. (:
I am not an invester, I just want a home and I want out of the insanity.; July 19, 2006 4:32 PM
Anonymous said...: P.S., The Realtors only charged 2% for the deal. HE HE HE
The desperation is palatable.; July 19, 2006 4:39 PM
Anonymous said...: Just read on YHOO that flat screen TV demand has been much lower than expected lately, and prices are dropping.

http://tinyurl.com/m3nc9

Toys that were bought with easy money are getting cheaper. Yippee! FBs, unload your nice toys on me. I will pay $.10 on the dollar.; July 19, 2006 5:42 PM
Anonymous said...: Hi Fellow! I was just searching blogs,and I found yours! I like it!
If you have a moment, please visit my stock market new site.
Good luck!; July 19, 2006 6:37 PM
Anonymous said...: Believe it or not - they are still engaging in bidding wars here in Huntsville, AL. The price range of the guy that had to get into 6 bidding wars before he "won" a house is in the $120-$150K range. None of the sellers had to drop from asking price. The house he won was 43K over ask. About $75 per ft SFH.

It must be the expected influx of people from the BRAC. I do not know how many speculators are out and about here.; July 19, 2006 7:20 PM
Anonymous said...: Keith,

Sorry if this offends you, but another good blog is out there.

http://paper-money.blogspot.com/; July 19, 2006 8:29 PM
Anonymous said...: In Seattle prices are still going up as well, especially on the Eastside.

IMHO we're just not going to see the panic people are claiming.

Sure some people who bought ARMs are going to have problems, but nothing like the crash we saw in stocks in 2000.; July 19, 2006 9:45 PM
Anonymous said...: Seattle was a echo bubble, those prices will BEGIN down soon as inventory is skying, the early signs idiot. Yes, things are going to get that bad. Deal and move on. ARMs are a problem, but one of many, again, move on.

Your post was awful.; July 20, 2006 12:23 AM
Anonymous said...: Nice video (UN ambulance picks up Hamas militants in Gaza).
http://www.youtube.com/watch?v=AqGjz7iJTns&search=UN%20Ambulance

Isn't United Nations a lovely leftist organisation?; July 20, 2006 12:36 AM
Anonymous said...: Your wannabe panic is so stupid.

http://news.yahoo.com/s/ap/20060720/ap_on_bi_go_ec_fi/bernanke

Do you really think the FED is going to let this spiral out of control?

I'm going to wait until Phoenix corrects a little more this year, I think, and then buy a retirement home there.

But that will be the bottom. 50,000 houses in a city that big with a population booming isn't going to hold down prices very long.; July 20, 2006 5:46 PM
Anonymous said...: "But that will be the bottom. 50,000 houses in a city that big with a population booming isn't going to hold down prices very long."

Wanna bet?; July 20, 2006 6:13 PM
Anonymous said...: Buying a house there will be betting.

But they're so fricking cheap. $250,000 for 4 bedrooms, that it's not much of a bet.; July 20, 2006 7:00 PM
Anonymous said...: Oh, BTW, Preforeclosures are way, way down...

As of 6/22/2006 they were around 235,000 and now it's around 176,000.

Big drop.

Eating your panic words yet??? Doesn't seem to be a panic but more of a slowing.; July 20, 2006 7:19 PM
Anonymous said...: Bernanke sees soft landing for housing; July 20, 2006 7:50 PM
Anonymous said...: Your like a dying beast thrashing about aimlessly
in an incoherent attempt to cling to life.; July 20, 2006 9:43 PM
Anonymous said...: "The downturn in the housing market so far appears to be orderly,"

SO FAR! Panic to come soon.; July 20, 2006 9:58 PM
Anonymous said...: "Do you really think the FED is going to let this spiral out of control?"

You seem to be under the impreesion that the Fed has
a lot more power than it does. It's only real tool is adjusting interest rates. What do you think they are going to do? All the suckers have already bought into this market. There are so few left to keep it a float.; July 20, 2006 10:01 PM
Anonymous said...: No, it's just that the panic that has been talked about isn't happening.

If anything, things are actually improving on the foreclosure and preforeclosure front.; July 20, 2006 10:24 PM
Anonymous said...: "Not buying" is going to be buying a house in PHX to retire there. What a fool. Enjoy the rest of your life in hell, pal.

Nice dry heat. Don't pay any attention to the dust, smog, spiders, snakes, or criminals. You will be just fine.; July 20, 2006 10:51 PM
Anonymous said...: Where does "not buying bubble" get the alleged improving forclosure numbers????? In MA, you can research at the registry of deeds sites (www.masslandrecords.com).

YOY forclosure complaints (i.e. enered forclosure) and foreclosure deeds (i.e. lost house in foreclosure). Spend an hour of hard research and you will see the tip of a very large foreclosure iceberg.; July 21, 2006 1:20 AM
Anonymous said...: Oh, BTW, Preforeclosures are way, way down...

As of 6/22/2006 they were around 235,000 and now it's around 176,000.

Cite your source.

If anything, things are actually improving on the foreclosure and preforeclosure front.

Prove it.

I'm going to wait until Phoenix corrects a little more this year, I think, and then buy a retirement home there.

But that will be the bottom. 50,000 houses in a city that big with a population booming isn't going to hold down prices very long.

You might want to sit in your rocking chair, and ponder for a moment why the population is "booming". Then correlate that with the housing market and figure out why the population will not boom quite as much as you think going forward.

Every housing bull that I have seen has no data or irrelevant data (or in your case, erroneous data) to back up their case.; July 21, 2006 2:48 AM
Anonymous said...: "not buying the bubble"
Where did you go?
Are you going to prove your last statement?
Your losing your credibility real fast There buddy! are you getting caught in all your lies? Embarassing Is'nt it?

Striker.; July 21, 2006 3:37 AM
Anonymous said...: "No, it's just that the panic that has been talked about isn't happening."

Patience my boy patience.; July 21, 2006 5:15 AM
Anonymous said...: Hi Fellow! I was just searching blogs,and I found yours! I like it!
If you have a moment, please visit my basic homeowners insurance site.
Good luck!; July 23, 2006 6:15 AM
Anonymous said...: Hi there Blogger, a real useful blog.Keep with the good work.
If you have a moment, please visit my average mortgage payments site.
I send you warm regards and wishes of continued success.; July 23, 2006 8:41 PM
Anonymous said...: I am here because of search results for blogs with a related topic to mine.
Please,accept my congratulations for your excellent work!
I have a stem cell banking site.
Come and check it out if you get time :-)
Best regards!; July 27, 2006 2:54 PM

HousingPANIC - The Housing Bubble Blog with an Attitude Problem, 2005 - 2008

July 20, 2006

BubbleTalk - Archived

179 comments:

About Me

HP blogs & websites

Blog Archive