Why are you so obsessed with housing that you continually visit a housing bubble blog instead of working or going out for a nice jog?
He he he he.
December 12, 2006
HousingPanic Stupid Question of the Day
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78 comments:
In my case, it's mostly Schadenfreude.
In my case it's because I hate realtors!
sold my condo last year, now renting, no need to work anymore, lots of free time now. =)
did go for a jog earlier.
want to become a millionaire off the fools.... sometimes in life people makes mistakes and guess who profits from those mistakes... the rich and wealthy.... well it's time to profit...
Basically validating that I'm not the only contrarian around.
Compensating for not watching the blogs the last couple years. If I did I would not have taken a bath on the sale of my place, because I would have known its price was inflated & I'd never have gotten involved in the first place.
Because when housing prices started to skyrocket in Australia and I decided to keep renting, people told me I was a loser!! This blog makes me think I was just way ahead of the pack. Plus you are very funny Keith!!
The blogs are the place that I can learn more about whats really going on in the housing market. I want to buy another house as soon as the market permits me to do so by moving back to the market's time tested fundamentals. The MSM isn't going to report this information, so this is where I come to find it.
It also gives me something to do while I eat my morning oatmeal and my lunch. There's no way I would spend a nice evening on a blog.
Because I was almost sucked into this market in 2005, and I backed down at the last minute. Even though I was depressed at the time (and felt priced out of the market) reading this blog, other blogs, and even the MSM now, it's become apparent I made the right choice renting.
Housing prices are FALLING in the Tampa area, and I believe they'll continue to do so through the next 3-5 years.
-Dragasoni-
"A" housing blog or "this" housing blog? This blog because it sometimes veers off the cliff into religious and political issues. While that is distracting and the comments are often over the top, it's almost never boring.
I just clicked a few Google ads for ya. Merry Christmas and keep up the good work. Give 'em hell.
This blog because thehousingbubbleblog got longwinded and he doesn't do any video or pictures. I also like BubbleMeter and Curbed and BNN PaperMoney
Because it's entertaining and even more because you've been *right.* We need a counterweight to Suzanne's "research."
I sold at the height (2004) and have been a happy renter ever since but a change of circumstance in the near future means I may unfortunately have to buy.
Do you think I'll make a better deal 1) with or 2) without HousingPanic? The answer is obvious.
dqavid in jax,
this is NOT wheer yyoure gonna find out whats happening in the housing market- you ll hear one side of it , thats for sure,, but if your looking for someone to tell you when to buy, it wont EVER happen here cause most feel that ALL housing is simply going to be sold to you 40% lower cause some flipper in ca is in trouble..
And if natl avg median goes down 40% (it wont ,more likely national median flat to higher in one year) then they wont buy anyway, will continue to think things would get lower still
so you need to read up on facts--
last housing statistics showed 140 or so areas gaining in value, while 40 or so declined-- even if you think this is lagging number or whatever it doesnt show preciputous decline in most of the country
fact #2 - new purchase mortgage applications at 7 month high (google for yourself- its FACT) so no big decline in demand in soft market, actually the opposite
fact #3- builders have cut WAY back on new projects- the ratio of new housing starts to existing sales is the LOWEST its been since records kept (about 40 years!) look it up on motley fool website if you want-
therefore inventory could shrink further as less new supply coming in
fact #4- inventory has been shrinking in the vast majority of markets every week for the last month and a half or so-- even in the warmer areas (where winter effect not so severe) and it shows that sellers arent simply going to sell at any price ,, most arent desperate like they think here, or else inventory would be going up like mad nationally
fact #5 -- the crowd is usually wrong , particularly the retail crowd-- the retail crowd is very very bearish,, you can see this here on the blog-- and the fact is that even though there are many more bears (retail) the homebuilders index (stocks) are up almost 30% over the last few months-- so a smaller number of "smart money" larger accounts (institutions) have been buying from a larger number of retail bears,, cause the smart money looks forward and sees that supply/demand has been shifing and the sell housing play is old news
fact #6- OVERGENERALIZATION- this is my favorite, and youll see it in the response to this post-- ie people (like here) will generalize based on anecdotes and the most overvalued and specualtive markets (like phoenix , clifornia, nevada or boston) and assume this is the whole picture, or that so many people are going into foreclosure that the world will end ( again the FACT is that about .42% of people are in preforeclosure right now, thats .42% , NOT 42% like some here believe, so if this number goes up 5x its still a small amount of the total market
fact # 7- so youve got to look at the current supply and demand picture nationally-- and look at numbers,, not facts or bias like the soon to come attacks (like im an idiot) because they cant afford a house where they live or phoenix is overpriced or ca is overpriced- you gotta cut through rah rah seesions and look at the big picture
and from here the numbers do NOT support things getting worse, in fact the opposite is more likely true based on new mortgage apps, lower supply, and the new housing starts/existing sales at a historic low, and the 10year bond yield down almost 100 basis points from its peak--
and you dont have to buy in some investor subdivision in phoenix, the country is bigger then this
oh , and not buying is not free you got to pay the debt of rent as an alternative which goes up 4-5% avg per year, while the owner has a fixed payment if he wants and can pay off the property and gets tax breaks (and there ARE plenty of areas where post ta mortgage is the same as rent, they will OVERGENERAIZE places like phoenix or orange county here, dont have to buy there
finally , they will say there is tax and maintenance on house-- well duh, what they dont get is the landlord is NOT charity and has these costs too and will pass them on to the renter, landlords who dont(ie desperate flippers) wont be in that business very long, dont count on it
so look at BOTH sides of a market, any market , and youll be better off
It is addictive.
For the pics!!
Started out when it was
HPtheregoestheneighborhood.blogspot.com back in Oct of 05, because no MSM news existed about the growing bubble, while I was watching it happen right before my eyes.
Now, I like your guests a lot. I still walk two miles a day, have three start up businesses and work a full time night job.
Was never one to hang out with Chicks much. Lots of testosterone on this board. Lots of people smarter than me, so that is a always a good read.
Made new friends.
Have too much fun.
I agree with number 1, plus this is history in the making. I'm enjoying watching this all unfold, because I know at the end, I make a killing.
I lucked onto keith's site, and it kept me from following the herd, everybody we knew was buying second homes out of state. MSM is getting better(barely,) but HP once a day is still the place to get the scoop (or is that poop?)
our office is very slow (sign of bad economy?) and we surf the net all day long. I have been a housing bear for 4 years and told i was a fool, so i visit to read up on anecdotal evidence and look for new links from other bears for more tidbits.
In '05 I could see housing was inflating. Searched the net and found this blog, which was telling a story that MSM hadn't discovered yet.
Now the story has gone mainstream. Does this blog still have a raison d'etre? Yes, because the deflation of housing will take time and we'll still need a forum to discuss it.
I often ask the same question about you, Keith. You claim to have a full time gig in London. How do you have time to find all these pix and do all these posts?
If I ever forsake this blog, it will be because of the racism and flamethrowing. You're completely wacko about Iran, and not much better about immigration, Mexicans, and RE professionals.
Boredom, anger, and because I got kicked off Ben's blog. (just kidding)
Its the ultimate economic train wreck. We're heading toward sustained deflationary period, and the nature of the economy is such that we get to watch it all in slow motion.
Anyways its always the most exciting on a roller coaster right as it passes over the top and heads down.
I've been on the bench for 3 months and have nothing to do. I get my annual bonus next week and then will probably quit. In the meantime I'll keep collecting my low 6 figure salary and spend my day reading useless blogs....and I do also work out almost daily.
I owned 3 homes, sold two of them in mid '05. Everyone said I was crazy, especially my expert realtor. Vegas baby!! Everyone wants to move here, you're nuts to sell now, said Mr. Expert. I still live in the 3rd but I bought it at such a low price that prices would have to fall 70% for me to lose money.
Well here we are 18 months later and I'm still laughing all the way to the proverbial bank. Speaking of which the profits from my genius market timing are sitting as we speak in 6.25% CDs. Nothing flashy, nothing fancy just a nice safe investment which should allow me to retire in 10 years at the ripe old age of 48.
I think many of the posters here are a few colors short of the full crayola set, but entertaining nonetheless.
Anon 12:58,
In your long post you criticize HP’rs for over generalizing, and then you throw out a blanket statement that rent goes up 4-5% average per year.
This is definitely not the case everywhere, and as more and more sellers discover that they are not going to find a buyer for their overpriced house, many will become landlords.
Given the law of supply and demand, the increased number of rental properties will create a favorable market for renters and a large pool from which residence they may choose to live in. This will create downward pressure on rent prices, so your “4-5% rent increase per year” likely no longer applies.
Post after post here on HP seems to back this up - anyone here care to chime in on whether your rent is increasing and if so, by what percent?
The rent that I charge on my rental house has not changed for the past 5 years. The local market just will not support a price increase, and this is in the Seattle area, which is definitely a bubble housing market.
Just some anecdotal evidence of what is really going on, which is why I come to this blog - to find out what is actually happening out there in the real world, as opposed to the standard party line spewed out on a daily basis by the MSM.
-Mammoth
VFR Monkey wrote (on another thread this past weekend):
“It's expensive maintaining an old house- or any house, really- when you're not mechanical and can't DIY.”
--------------
But, the truth is, you CAN do it yourself! All the information you need is right there at your fingertips - on the Internet. You can also go a bookstore (used or new) and pick up a good home repair do-it-yourself guide.
Please have a little bit of faith in yourself - none of this is brain surgery, you know.
-Mammoth
But Mammoth, the internet is for porn!
hi mammoth,,
the 4 percent or year or so is just an averag,, isnt for every particular house of course-
if taxes keep increasing as they generally do , most landlords would have to keep passing on these costs to be in the business long term, if it becomes unprofitable for new landlords, ie the rent cant be increased then less new landlords or aptt bldgs would stay in the business, thus less supply of rental houses and higher rent
as a matter of fact, your particular story aside,, you seem pretty well informed and probalby know that rents actually have been rising pretty good on average over the last year or so as there is more demand for housing as buyers ait on sidelines ,, again this is nationall average and may not apply to overbuilt "bubble " areas like yours where there is no pricing pressure
but if wages inflation and the costs of owning a home like taxes do gou up over time its more then reasonable for rents to go up as well, as the long term proffessional apt bldgs etc need to make a profit or they wont stay in business..
in your case, you may be able toafford to stay in business long term based on when you bought and payments,, but there wont be a great new supply of other landlords going forward if they cant pass on costs, im sure youd agree...
ps Ive been a succesful landlord and owner (and renter before that) for about 25 years, and here in the midwest rents have gone up over time by about that amt, or else couldnt afford to stay in business (with propety taxes etc)--
and youd have to look at average rents for comps in seattle over a 10 or 20 year period to see where rents have gone
good luck,,,
just trying to be voice of reason to all the one way arguments here..
mammoth,
the standard party line as spewed by main stream media,, in my opinion IS exactly similar to here
almost every magazine on the newsstand seemed to have a story on the housing buble,, same with tv news etc...
you wouldnt know by looking at MSM that new mortgage applications at 7 month high, inventory shrinking on average, more areas up in median value then down, and that ration of new housing starts to sales is at the lowest point ever recorded (bullish news for furure supply)
I think to see an alternative view to the main stream media you have to look carefully at the CURRENT trends and numbers which seem to be reversing or at least flattening out vs last summers bearish numbers
and a good place to start looking forward is to see the almost 30% rise in homebuilder index last 3 months, obviously if so many are bearish a smaller number of larger institutions are bullish and fading the retail bears..
by the time everyone ASSUMES a market can go ONE way in this case now , housing is assumed it can only go down (last year assumed only go up by most) then the market is more likely to reverse
in this case it looks like a classic bottoming,, ignoring current numbers by filtering with extreme bearishness based on regional worst case areas
even though I love Iran's president, there are more interesting nuggets here than the MSM which reads like Ben's Blog.
Mammoth said...
“Given the law of supply and demand, the increased number of rental properties will create a favorable market for renters and a large pool from which residence they may choose to live in.”
I agree. Locally, I’ve seen the number of rentals increase. Homeowners that tried to sell last summer are trying to offload that alligator on to a tenant. These new landlords have to compete with each other and the local rental complexes. This may keep rental prices down, if not dropping them significantly, making that alligator even hungrier, adding to foreclosures, adding to more inventory. Moreover, for those rental units that do find a tenant, that’s just one more family that’s not looking to buy for another year.
guys ,
its just the opposite,, the current market is creating MORE renters (many are renting as an alternative to buying) and less landlords (especially speculator ones who dont care about cash flow and who can rent out at negative cash flow due to appreciation hopes) I thought youd all pretty much agree that there are less buyers now (more renters then) and less specualtor landlords,,
so whose gonna be left , mostly landlord that will have to pass on their costs in rent increases to stay profitable,, as houses arent zooming up these days for the most part--
and the ones who can afford to rent cheap are those who bought pre bubble (like mammoth probably) the rest of the cheap rent landlords wont be growing that much as it wont be profitable,imho
ananymous said...
dqavid in jax,
this is NOT wheer yyoure gonna find out whats happening in the housing market-...
Thanks for the NAR rah rah session. I can get all of this information from the local newspaper. Despite of all these items, it's a terrible time to buy where I live.
With that said, these blogs are the only outlet for a lot of information. You can not find a lot of the RE numbers in the local newspaper because of their bias for the REIC.
Is for fun.
And it's nice to know I'm not alone in my views (some of them them anyway - there is some racist crap on here from time to time).
Also waiting for the shit to hit the fan, and I see brown speckles looming on the horizon.
I saw a house here in San Diego that has dropped its asking price 15% in the last 3 months. That is a good sign... For us renters anyway.
Maybe if YOU didn't post so much I wouldn't spend so much time on your site!
It's your fault!
Only increases in population can create more renters, while buyers and houses can come and go from multi-home owners portfolio re-sizing.
Just my $0.02
david in JAx,,
youre welcome,, im not a realtor though,, just trying to give you the other side of things that arent given here
personally , I have no bias at all,, and would be the first to have said the market will soften when mortgage apps went down about a year ago and supply was going up
now when the reverse is happening, how dare I bring this to peoples attention, LOL
I dont get it , if the unbiased facts both ways were given here there would be no reason for me to post them
again, just want to poiont out im NOT biased and am not rooting for housing to crash or do anything,,
I just want to read both sides of a disscussion,,many here like to cherrypick, what they say is interesting, and in many times true but not the whole picture
And by saying that giving FACTS is some NAR rah rah seesion, shows that you are in the same biased camp--you gotta think for yourself
my prediction based on CURRENT supply demand trend is that national medain house price one year form now is flat to slightly higher.. (not your neighbors house in Phoenix investor subidvision or orange county, im talking national average)
so thats my prediciton in writing ,its unbiased and much more likely true then those who think natl median will be 30 or 40% lower, well see whos right (i am cause i look at things more objectively and dont get sucked into bull or bear crowds)
good luck
I'm hooked on your pictures Keith!
I love reading other posters opinions on this RE bubble, the money supply, Fed meetings, gold and everything else going on in the economy.
The best part - reading what HP posters are over-hearing in public or through friends and aquaintances on the denial that RE always goes up.
It's almost like being a fly on the wall, only better.
Keith, My company will give me a 0% loan for 5 yrs for 20 % of the home cost if I buy before end of March'07 .
Reading you blog and other blogs (housing bubble) I am very scared to buy something now on the other hand I am not seeing prices going down either. Please educate me more on buying a home in the bay area.
Anon 4:15:05,
Thank you for your input to this blog, and for not being afraid to ‘go against the flow here.’
But despite your viewpoint, despite your saying that inventory is decreasing and that mortgage apps are at a 7-month high, and despite that you believe the market is now bottoming, there is one apparent fundamental which you are not addressing:
***Housing is becoming unaffordable for average working people!***
Either (1) wages need to significantly increase, (2) new creative financing needs to be developed to enable more people to afford today’s housing prices, OR the price of a home needs to level off or come down.
(1) Sure doesn’t seem to be happening, and for those who are getting decent pay raises, today’s rising costs for food, gas, taxes, and everything else one buys actually negates the gains from a pay increase. And for those who aren’t getting pay increases, a home is becoming less affordable every day.
(2) Given today’s risky loan climate, it looks like the pendulum is going to start swinging the other way, and credit will start tightening rather than loosening any further.
Since neither (1) nor (2) is going to produce additional money to compensate for (your assumed) continuing increase in housing, how can housing keep on going up in price? Who is going to buy?
That is the fundamental, which many of us here are stuck on.
Cheers,
-Mammoth
hi mammoth,
thanks for the interesting and friendly response..
I would agree with you 100% that wages vs housing price is an important factor in valuing housing, its always been
yes and im going against the flow to try to make people think outside a one way box if possible
We just have to dig a little deeper into this wage/house price factor to find coomon ground
I think wed both agree that in certain areas of the country there is much more risk and potential overvaluation where wages are out of whack with incomes ASSUMING that most buyers in that area are working stiffs like you and me.. I would think phoenix/scotsdale and parts of ca ARE prime examples of this-- in phoenix, the working wage base was never that high, and prices got way out of whack ( the 40k a year millionaire syndrome)- id agree and wouldve never invested here based on this
also in San Fransisco for example, the percent of income on AVERAGE (some is much higher) used on a home is well over 40% I think and therefore potential bubble
of course in these areas its not wealthy people with complex tax eturns using exotic mortgages, but working people stretching it to the max (cause things can only go up, LOL right) so this adds to the problem
I think wed both agree on this all right??
The other side of the coin Id like to bring to your attention is that the vast majority of areas are not so out of whack with incomes (and culturall lifestyle of maxing out and keeping up with the Joneses - which is particularly strong culture in CA and scottsdle for example)
In many areas of the midwest, where i live, the amt of income going towards mortgage is MUCH lowe, about thirty percent or so.. and since there were never the same flashy new money gains,, people are a little more normal , can afford ther mortgages for the most part and live hapily ever after
I would suggest that these more fairly priced and "normal " markets are much more prevalent then peopl here think, but they dont make news!!! Its not exciting , its more esciting to here about AZ flippers with no experienc or reserves using negative amortization arms
so all im saying is that one must keep a cool head and not overgeneralize california for example to the whole country
and nationwide, the supply /demand picture really is looking a bit better not worse.. and for the wage /price reasons we both agreee on this certainly doesnt mean that phoenix and or some homes in CA or boston or whatever arent overvalued just that there is a silent majority of places not in that boat that dont make headlines
One final point-- note that the wage to price numbers assume that the majority of homeowners rely on salary to make payments, and or havew a mortgage
one thing that many here are missing is that in some other high net worth areas like Aspen for example, many already made their money and paid cash for their homes, are just enjoying life and are less vulnerable to the wage /price issue--in other words you cant compare phoenix and Aspen-- tis the 40K millionaire in phoenix vs the paid cash out of money market Aspen guy, totally different market
And for most more fairly priced areas,,I Do think its reasonable to assume that wages will keep going up a certain percentage each year,, this is historically what has generally happened, and dont see us going inot deflationary environment based on recent #'s and commodity prices
thanks for the thougthful discussion , you raise some good points
Anon. claims that rents have gone up by 4-5% in the Midwest over the past few years? Huh? They have actually dropped in the Twin Cities over the last few years. My rent has not gone up in over 4 years--all utilities have always been included, so even in times of high fuel costs, etc. the prices have not been handed down to the tenents. In my neighborhood I can rent my apt for $700 a month and walk to work or I could pay $700K for a home. Hmmmmmm, opportunity costs but that would be ridiculous. As for midwesterners paying a mere 30% of their salary to cover a mortgage...again, what vague part of flyover country are you referring too? As that is most certainly not the case here in the Twin Cities where med. income is ~45K.
Imonly going by statistics, youre going by anecdotes..yes the average payment even in an area high priced like chicago is in the low 30's I believe
why do you attack statistics
maybe you dont realize that many people have had there home for years, didnt buy at the peak of some fl bubble ,, and are responsible and can afford there mortgages..
remember ,even now the preforeclosure rate is less then 1/2 of 1%- not everyone is desperate, even if theis number goes up 6x
STATISTICS VS EMOTION-
ok i said that i thought that housing debt to income ration for chicago may be in the low 30's
I MAY BE WRONG IT LOOKS LIKE ITS LOWER and more affordable to current homeowners on average, lol
GO TO THE BUBBLEBUSTER.COM and llok up chicgao tatistics
thebubble buster is generally like this site, very bearish on most areas!!! so the bias is bearish, ok
look at their Chicago report it shows HOUSING DEBT TO INCOME IN CHICAGO is only 23.3 percent for 3rd qtr 2006
and the same site shows san fransisco in the 40+ percent range
so stop attacking me as uninformed till you look in the mirror,,
i look at facts not wishes or bias..
so look up the numbers for yourself, this isnt about your personall bias or wishes, most homeowners are not desperate or so overextended in most areas
this is geeting old having to constantly battle emotion and anecdote.. all areas of the country are not the same, really...
You really have an interesting blog, with a variety of viewpoints represented, and a very low signal to noise ratio. I don't agree with you on alot of things. I have just started reading this week, and I consider it an early warning on what I see as a very hard and nasty bubble pop, which I am ahead of the curve, having lost my house over a year ago. I also felt the tech bubble pop, when I lost my career as a programmer. I hope that some day we all can share wealth tips (like that ever happens!) when the market recovers. (Will tech ever have another 1999?) In the meantime, it is good to read savvy people discuss their strategies. You will never see this in the MSM.
Dragasoni, I'm sure there are some areas that have skyrocketed but then they were expensive when Iived there in 1976, 1980, 1988, 1991. Still, when I see homes in Ybor for $250,000 that I imagine are still in the ghetto that in 1999 you couldn't give away for $25,000...but I imagine there are plenty of homes that the average two income family can buy that are not so out of whack.
Still, I look at Tampa Heights where I bought my ghetto house for $20,000 in 1989 and it was 3200 sq ft built in 1905 and see it worth $450,000 at your market's peak...I sure hope the area has improved.
Keith I come here to support you so you can afford those expensive beers and with the pound costing you $1.97 each, sure good that your company is paying most of your living expenses. Does it make you homesick for a cheap place in Phoenix?
in this case it looks like a classic bottoming [...]
Tuesday, December 12, 2006 4:15:05 PM
Or a dead cat bounce?
anon,
sorry you lost your house-- but id say that if you want to get "wealth tips" as you say you might want to listen to what the truly wealthy are doing (and its not being afraid to buy any house and just renting) althought there are some good ideas here too from some...
Anon,
could be a dead cat bounce, sure,, but dont be so quick to assume that its not a bottoming in most areas either - either viewpoint doesnt make you an idiot, and that goes for looking at improving supply /demand combined with huge bearishness and thinking that it could be a classic bottoming like any other market..so well wait and see, that would be reasonable, calling someone an idiot who looks at current numbers and questions a bear herd based on that is not so reasonable..
Anonymous said...
david in JAx,,
youre welcome,, im not a realtor though,, just trying to give you the other side of things that arent given here...
OK, for the record. Here is some information on my area that is not published in the MSM and can only be found by reading blogs and linking to the information.
1. Jacksonville has a 24 month supply of homes on the market.
2. Median price without incentives has dropped over 10% YOY.
3. Sales are down over 50% YOY.
4. Sales and prices are continuing to decline.
What the MSM tells you.
1. It's a great time to buy.
2. This is a temporary price decline.
3. Buy now or be priced out forever.
4. 1000 people a day are moving to Florida (proven to be incorrect).
I look at both sides. But, to get accurate information, I have to to to the blogs to get links to current information. The local media only prints NAR and NEFAR sales pitches.
On another note. If your going to come on the blog and Rah Rah Rah for the NAR, quit being a whimp and get a handle.
Oh, I also forgot to note that median prices are now six times average income in my area. Another reason it's a terrible time to buy.
david in jax,,
did I ever say that All areas are going up and that none are overvalued??
NO simply being the voice of reason and saying you cant overgeneralize the worst case areas
AND you live in FLORIDA, you are overgeneralizing this
Im not rah rahing anyone,, just giving national facts and statistics
you on the other hand are attacking me and have not read my post objectively
for the tentrh time I said FL AZ and CA are NOT the whole country,, and youre talking florida which is among the most overspeculated and overpiced states on average in comparison to incomes, you are doing the excxt overgeneralizing i talked about
so go back and read my post im talking natl trends, not simply florida or az or ca or whatever other worst case scenarios come up again and again,
thanks
david in jax,
what you should say is that its not a good time in MY area to buy as income is 1/6 of price,,id agree ith you there
so why do you attack my posting regarding national supply and demand of which these out of whack areas are only a small part
i NEVER told you to buy anything in an area where things are so speculative and whacky,, so cant you have a more reasonable and unbiased discussion, you dont have to hate me im not some realtor who is telling you to buy any home in Jacksonville
Just so you know my background is ex institutional trader in many markets- so Ive seen market behavior and often had to trade against bullish /bearish sentiment and anecdotes by sticking to supply demand and economics-
and the economics of jacksonville is not typical of the whole country in housing /price wages ok??
Anonymous said...
david in jax,,
did I ever say that All areas are going up and that none are overvalued??...
&
Anonymous said...
david in jax,
what you should say is that its not a good time in MY area to buy as income is 1/6 of price,,id agree ith you there...
To anonopuss #1 and anonopuss #2. I'm not attacking your posts, you attacked mine after I said I like to read blogs to get a perspective outside of the MSM. And please, think before you post. If your going to attack my posts please read them. I said on all of them IN MY AREA. That is Jacksonville, Florida. I didn't say anything about the rest of the country.
I'm telling you. The worse things get for the REIC the more the REIC trolls come on this blog and post as Anons.
david,
then why are we arguing- we arent disagreeing on anything then
and Im not some reic troll, really
Im an ex trader,, traded volatility in the otc fx markets and used the firsrt FENICS sytem back then when i started to value volatility of options when pc's were a novelty- since then have traded institutioonal fixed income and now am retired, thats all just know markets if not much else, housing is a market
said this so you know im not kidding you thats really my background
come on lets chill-
I wish you luck in Florida, but dont assume anyone with a slightly different viewpoint is some reic troll as you say , makes you sound bitter or biased and im sure your not...
Oh, I am so sorry anon., let me pull my head out of my anecdote loving ass and accept your bold statement now that Chicago represents the entire midwest. Speaking of over generalizing...Oh wait, or not objectively reading a post.
Or in language that you might understand:
i be soorry to sey that I lkie anecdtos and you are so smaart, i am an emotional twit. Chicaog is the wordl!
Please have the desency to proofread if you are going to post.
I think Greg Swann is most of the anon comments. His blog is completely dead now so he has nothing better to do when he's not wanking off than come here to troll
nope sorry, not gregg swann
im an ex trader that doesnt have to work anymore, and my house is paid off
again not trying to fight just trying to add some food for thought which may not support the straight down from her view
go ahead attack the typos now,, come on lighten up
is this something terrible to do or something???
and chicago does not represent the entire midwest, I picked the most EXPENSIVE city in my area so as not to be attacked for picking some cheap area,, most of the midwest is MORE affordabel, jeez
liosten if you just want to rah rah each others views, fine , but be upfront ablut it
I would be the first to say that housing would slow down when supply increasing and mortgage apps decreasing nationwids, now thats changing a little thats all
also, im the first to say that SOME places are out of whack with incomes in that area,, but am bringing to your attention the fact that all areas are not the same in this ratio
sorry thats how i made money in the trading markets, and would often look at both sides of an issue and assume the prevailing view may be wrong, thats all im doing here
so why attack, can assure you am decent friendly person just sharing some dissenting view
is that not allowed here or can we discuss things civilly without being called the "dreaded" realtor or something- im not, just a finance person, really...
Anon 7:06:46, 7:15:25, 7:47:42, etc…,
Nobody is personally attacking you here, but not everybody agrees with everything you say, either.
If your feelings get hurt that easily, you need to grow a thicker hide. This place is a free for all.
And yes, you do need to pick a handle.
hi mammoth,
thats cool, i would never attack someone or be disrspectful for dissenting with a reasoned argument , just would expect the same
and maybe i will get a hndle today or tomor0w, sorta got sucked into this board, LOL
ps I think you and othersfor example have had some real thoughtful posts , its all good
1. What is the MSM? I know what it stands for, but what do you consider it it to be? If you expect the NY Times to profile JAX R/E than yeah the MSM is ignoring the story. But I'll bet anything your local Channel 5 newsteam has mentioned everything you say the MSM is keeping quiet.
2. Everything you mentioned the MSM isn't telling you about JAX it is telling me about Las Vegas. There isn't a nightly newscast without a story about the market tanking.
3. 2005 population of FL according to the census was 17,789,864. In 2000 it was 15,982,378. Some quick math comes out to 990 new people a day during those 5 years.
Or do you also believe the census people are in on the MSM/realtor/mortgage company company scam?
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David in Jax said :
OK, for the record. Here is some information on my area that is not published in the MSM and can only be found by reading blogs and linking to the information.
1. Jacksonville has a 24 month supply of homes on the market.
2. Median price without incentives has dropped over 10% YOY.
3. Sales are down over 50% YOY.
4. Sales and prices are continuing to decline.
What the MSM tells you.
1. It's a great time to buy.
2. This is a temporary price decline.
3. Buy now or be priced out forever.
4. 1000 people a day are moving to Florida (proven to be incorrect).
Okay, since anon understands economics so well and is swayed more my stats, here's website I want you to take a look at: irrationalexuberance.com. Go to the link where you see an excel data sheet charting national home prices, population, etc and take a look-see. Shiller is no moron; he correctly predicted the tech stock bubble earlier this decade, a very unpopular view at the time. I'd be interested in your take on his findings.
Those who forget history are condemned to repeat it, I believe is the saying...
My den is right beside my home gym. So I have a snack/get hydrated while I read, then work out.
But I agree totally with anonymous who wrote "Basically validating that I'm not the only contrarian around."
ill take a look at some point at the website irrational exuberance when i get a few minutes- thanks
You guys don't have to lie. We know you come here to read what Honica Jewinski has to say.
hi,
saw the irrational exuberence website and chart, and would agree hes no idiot, thats for sure
maybe Im not smart enough , but the chart to me doesnt show me more then the fact that housing prices have accelerated thats for sure at a faster pace then say most of the century..
but there are a lot of other factors that would have to be considered... ie what was wage growth,, and access to credit,, and household net worth etc to see how unaffordable the new housing prices would be... and is this an average that is skewed by the tremendous wealth and huge mansions built and sold for the mega rich over the last 20 years.. if 1000 people can pay 25 millinon cash for a new york penthouse etc,, and they can afford it ,,you cant say this effects the rest of us, but it would skew the chart
I think you still have to look at wages/price (and consider relative interest rates as well as this effects how much of wage is used) in each particular aarea to get a better idea of over /underbvaluation in Working areas ie aspen may be different , money already made
so i guess im sort of neutral to the chart it raises an eyebrow, but doesnt tell me tha t all housing will crash from here,, just that there are certainly more expensive homes when aggregated
thanks for the heads up..
and of course i could be missing something here, ill be the first to say...
1) Shcadenfreude for the IO Option ARM bunch
2) Shcadenfreude for the renter bunch that one day want to own.
3) Because it makes me feel like a financial genius for timing the market to buy a home. 2002. 5.375, 30 year fixed ZERO DOWN baby.
"but there are a lot of other factors that would have to be considered... ie what was wage growth,, and access to credit,, and household net worth etc to see how unaffordable the new housing prices would be... and is this an average that is skewed by the tremendous wealth and huge mansions built and sold for the mega rich over the last 20 years.. if 1000 people can pay 25 millinon cash for a new york penthouse etc,, and they can afford it ,,you cant say this effects the rest of us, but it would skew the chart
I think you still have to look at wages/price (and consider relative interest rates as well as this effects how much of wage is used) in each particular aarea to get a better idea of over /underbvaluation in Working areas ie aspen may be different , money already made
so i guess im sort of neutral to the chart it raises an eyebrow, but doesnt tell me tha t all housing will crash from here,, just that there are certainly more expensive homes when aggregated"
Shiller's real home price index accounts for inflation (hence rising wages, etc). And he has said that there are some exceptional areas that will have their value protected (you mentioned Aspen, a good example). He has tracked interest rates, and even during this whole boom we weren't at never-seen-before-lows. So in other words, you make good points, but I do believe Dr. Shiller has accounted for all this. See his paper, "Long-Term Perspectives on the Current Boom in Home Prices" for some light reading ;)
In your defense, Shiller does acknowledge that there are theories of a "soft landing."
Anon, I would agree that there are some of us on this board who are in overpriced, bubblicious areas who have skewed viewpoints. When we all get together on these boards and swap stories, it's reassuring if we're not homeowners in an vastly overpriced market. We are angry that nationwide, home prices are out of reach for a majority of would-be homeowners entering a particular geographic market. This is America, for crying out loud! People have financed their homes in ways that would make our depression-era relatives cringe (this is America!! LOL). Homes have gotten bigger, families smaller. We spend more on our incomes on taxes than ever before, leaving less for us to spend to live.
Little of this makes logical sense, especially when building costs have not risen proportionately, and to me economics was always very logical. It leaves me scratching my head: how are people seemingly getting away with it? How long can this all last? Since history and fundamental economics point to cycles, I am justified in assuming that a downturn is ahead. The damage remains to be seen.
Shiller has said that this whole housing boom has a strong psychological component. We've seen that here and other blogs, where sometimes people resort to name-calling if someone doesn't agree with them. That certainly helps no one if we can't talk about it rationally.
I see many of your points, and I understand where you're coming from. It would be nice for many people if the landing were cushy, although I've always tended towards a bearish view. I think we'd both agree that time will be the true litmus test.
I read this blog to help me keep my resolve to live on a budget that is well within my means. Also, most of my real-life friends don't ever talk about real estate or finance - even the smartest ones. I get alot of anecdotal evidence of what is really going on and I can learn from other peoples mistakes. I get to hear peoples real opinions and not just safe party chatter. I may not always like it. I may not alway agree with it but I defend your right to express it ;-)
Anon 134,
thanks for the FRIENDLY response, I think its totally rational to look at shillers views, and we have a lot of common ground
I think the biggest thing is to note that SOME areas are out of whack, others arent
you hit the nail on the head when you said that many seem to be in the most bubbled areas here, and thats why they are so biased one way- ive just been trying to keep a cool head and look at the broader natl picture
thanks for the nice comments- I think we agree 80% on things...
Im gonna post this below,, but you gotta note that new purchase mortgage applications released today are up 8.7%!! and now at 11 month high-- I cant ignore this with my background as an ex institutional trader,, these are the sort of discrepencies in a berish market that one looks for in reversals..
cheers..
hi all-
gota note again that new purchase mortgage applications were released today, they went up AGAIN (8.7) and now at an 11 month high (last week 7 month high)
so I was called an idiot last week for even thinking this could be a changing supply'demand picture- well if youre ignoring this now I dont see how you can see your unbiased, this is not congruent with the view that things nationally are dropping off the cliff now, in fact the opposite could be true..
Hello again from "anon 134" -- I think we do agree on most things. Yes, I can't deny that there are some signs that one MIGHT interpret as a short term "reversal," but the housing market is slow-moving in general. We do have to look long term. It's not like the stock market where things can turn on a dime. If morgage apps continue to rise, home prices, inventories, etc. stabilize over *many months* (even a year or two), then perhaps it's time to re-evaluate my stand.
Give this a year, and we might all see more clearly....
BTW, Keith, love your blog for the laughs (and I mean that in a respectful way)...
Here's to tactful debate and rational thinking!!
hey anon 134,,
your a cool dude- im sure we could get along great in person- and I think you have a well thought out view, and good heart
so well have to see, my view is that nationally in a year from now natl medain is higher, of course could be wrong but thanks for respecting another viewpoint and letting me bring up some recent numbers as food for thought w/o personal attacks-- thats just my training as an ex trader , gotta call it like i see it without personal emotion if possible
anyway , more importantly merry xmas and blessings for the year to come to you and yours
thanks..
one housing thought - the reason i think it may not be short term reversal but perhaps something more substantiall is that the numbers have reversed in a very bearish environment,, obviously many are entering the market while being inudated with scary housing stories on a regualr basis,,and thats even more bullish in my market experience
cheers...
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