July 28, 2007

HousingPANIC Stupid Question of the Day


Question for HP'ers: Did HP and the other bubble blogs help save you from doing something really really stupid?

Here's a great and inspiring letter over at the always excellent
housingdoom. Some people ask why I do HP. This is why. I imagine all the other bubble bloggers would say the same. To help our fellow man, and to get the word out about the corrupt REIC (realtors, mortgage brokers, lenders, appraisers, builders) who screwed America.

52 comments:

David in JAX said...

No. The signs of the upcoming housing crash in late 2005 were so obvious that we put our house up for sale before finding this blog. I still do not see how people could not have seen what was coming.

But, from many readers comments, I think that this blog has helped a lot of people get off the fence and decide not to buy a home during the crash.

TheUsher said...

Yes, well that and seeing what a huge mortgage payment was going to buy me. But between this blog and that other one that showed the prices of houses that were completely ridiculous because they were complete crap. (I really miss that site, one day it just no longer existed)

Then again I don't see any prices moving on Long Island so...I guess I just have to wait it out and see.

Me said...

You have helped me - thank you - I know this takes time and effort - please keep doing what your doing you are making a difference.

anonymous wimp said...

I knew that home prices were unreasonable and that buying was not a good idea, but this blog and others have shown just how widespread and to what heights the irrationality of the current market is and how it extends to many areas of the economy and high finance.

Anonymous said...

I don`t know if this counts or not, but I did get out of the stock market a couple of weeks ago when I ran into this blog. I`ll admit that I was setting on the fence at the time, but when I found this site, the S&P had just came clean about the subprime crap, and the bloggers were all yelling "GO ALL CASH NOW!", and guess what, I did. My broker thought I was a raving lunatic when I mentioned the housing crash and the CDO problems, plus the overall credit bubble. I bit the bullet and cashed out anyway. Thanks. Even if the market does manage to rally back to 14000 on monday, I`m still glad I`m out of there. Now I just have to figure out my next move. (P.S. To whomever it was that posted "GO ALL CASH NOW!", thanks, even if you wrote that in jest.)

Anonymous said...

I agree, this as well as several other blogs motivated me to cut to the chase slash the price and get my place sold instead of holding out for the "market price". I had just taken a new job in another city and did not want to carry rent & a mortgage nor did I want to be a long distance landlord. I was in a new development that was starting to become unravelled. The developer was going full steam ahead, but flippers were turning into floplords, nearby landowners were holding out for premium prices, the city was jacking up the assessments and the we were about to be specially assessed by the HOA for something the developer should have included.

It hurt but its sold and almost every single other home on the market in the plan in the fall of 06 is still on the market with a slight price decrease. Several have never been lived in, and the few that are not on the market are being rented out with negative cash flow and the floplords likely financed using toxic loans which in a few years will cause additional problems!!

THANK YOU HP!!

Shakster said...

YES-I had my reservations about a construction loan to begin with,so I went looking for input.I get tons of information here,and pass it on to others all day long.

Anonymous said...

The End of the Financial World as We Know It?

Anonymous said...

Shortly after the stock market had recovered from its sharp decline in February of this year, I began a serious search to purchase my first house in Dallas. Frustrated with how expensive the houses were in the desirable neighborhoods, I vaguely remembered hearing a while ago the phrase "real estate bubble".

I then did a google search for the term "real estate bubble" and found patrick.net which also led me here. Needless to say, what I found on the Internet regarding this subject astonished me and spooked me into selling most all of my holdings in the stock market for cash.

I have since learned that the Dallas market is actually not that bad for buying a house... that is, in relative comparison to the big bubble areas such as California, Phoenix, Vegas, etc. But, nonetheless, I still cannot force myself at this time into buying a large box that could depreciate relatively quickly in the coming months and years.

I am perfectly content to keep renting for now and watch what happens to the market.

Yes, I am grateful for blogs such as this... but sometimes I wonder if my thinking has become so skewed to the extreme that I will be too scared to make the leap into buying a house when things finally change for the better.

Anonymous said...

The Dow Jones Industrial Average dropped 735 points in the past 6 trading days, continuing at that rate the DJIA would be at zero before the end of 2007.

Anonymous said...

Same here, I was about to buy again, my god I would have lost it all....Everytime I feel the urge to own , I read this blog and Patrick's. The daily remember, the daily sanity check. Thanks you all.

Anonymous said...

Drunk astronauts now that should take the heat off the housing...

Who Knew? said...

OMG - our bubble popping is just beginning

Anonymous said...

"Despite making only $14,000 a year, strawberry picker Alberto Ramirez managed to buy his own slice of the American Dream. But his Hollister home came with a hefty price tag, $720,000."

http://tinyurl.com/yugssl

So thing are not that bad - The dream - can happen.

TulipBoy said...

It did help me. I live in Edmonton, Alberta (yes...Canada) and could not understand why I felt like buying a house was the worst idea in the world...while everyone here was going nuts driving the prices up 50% a year (buying everything in sight). I'm no stranger to bubbles, but there was absolutley no dissenting opinion. Now I can see we are only a little bit behind some of the bubble cities in the US.

I was irritated some of my offers got beat out by other buyers...now, I thank god and HP!

Anonymous said...

I moved to Florida in '05, I had been working in the Engineering world in Afghanistan. I had no knowledge of the impending implosion and had planned to buy my first home in Tampa. This site, as well as the lender implode site and a few others saved me from making the biggest mistake in my life to this point as a twenty-something young professional. Thank you to everyone here who added to the collective knowledge and saved me from doom.

Anonymous said...

The so-called ‘surprises' of history have emerged not because others did not have the information, but because they refused to believe it.

wawawa said...

12 month ago, these blogs help me to sell short home builders and now I am enjoying the result of it. I am still short :)

Anonymous said...

Anonymous said...
The so-called ‘surprises' of history have emerged not because others did not have the information, but because they refused to believe it.

July 28, 2007 5:09 PM
-----------
BINGO, this should be the response to every POS troll that post the bull that is nothing more than evidence of willful blindness!! Thank you.

Anonymous said...

the guy who does this blog, housing panic, should recieve the freedom medal for public service

Anonymous said...

sold my house in seattle king county july 2006 after 19 years ,and am now renting,with the money in the bank.Thank you housing blogs,you saved me thousands and thousands of dollars and my fianancial future

resisting husband said...

Unfortunately, buying a house isn't a wholly financial decision. For me, it's one of my life goals, you know the whole "get married, settle down, have kids, etc..." I have used this site, combined with my understanding of math to resist my wifes nesting instincts (these are very strong in women....only incredible amounts of math and logic can overpower them)

Now that we both have our HP tatoos, we are going to keep renting our cheap place, save for five years, let ARMs galore reset, and pickup a place in 2011 and 2012 with a hefty down payment, and probably at a great price. i even got her to realize we should have ittle kids while renting, that way they fuck up somebody else's place!!!!

Keyser Soze said...

No, however, I was beginning to think I was the only sane person in the Universe who thought housing was too expensive...until I read this blog. It was the first 'blog' I ever read...and like a bad nickel....I keep coming back.

Anonymous said...

Great picture even the sock puppet couldn't lay off the blow

Anonymous said...

I knew the bubble started in 2001 after Greenspan dropped the Fed Funds rate eleven times in that year alone to offset what happened to the stock market. We sold in late 2002 which looking back was too early, but I didn't think the REIC would continue to prop up the market for as long as they did.

I take my advice from Warren Buffet, who says he made his money by always selling a little early. It sounds so simplistic, but when you think it through, it's brilliant!

Out at the peak said...

In summer of 2005, I was getting really suspicious of house prices. If I couldn't afford to repurchase my house (my income was envied by too many people), who the heck could?

I was able to confirm suspicions when I came upon Ben's blog. Then I was in a rush to sell. I was lucky and sold higher than my wish price. My manager at work did the same. We are happy we did ever since.

HP has great perspective. The more we can spread the knowledge, the faster this thing can be over. Hopefully only three years instead of five.

Anonymous said...

No. I thought there was a bubble back in 2002. We decided to buy anyways. We bought a small home on a lot of land in a very non-bubble area, paying less than we were on rent for twice the square footage.

Of course, I wouldn't have been able to do that in California, most of Florida, Phoenix or Las Vegas.

I prefer owning to renting, and I actually do both since we spend our summers in another state.

Anonymous said...

Anonymous said...
The so-called ‘surprises' of history have emerged not because others did not have the information, but because they refused to believe it.

July 28, 2007 5:09 PM

You, my friend, are a genius. Are you related to rj?

Out at the peak said...

"Yes, I am grateful for blogs such as this... but sometimes I wonder if my thinking has become so skewed to the extreme that I will be too scared to make the leap into buying a house when things finally change for the better."

You will know to get back into real estate when most of the ARM resets have kicked in. The majority of people think you were so smart that you rented and are now doing the same. Or when prices touch 2000-2001 (depending on location) levels.

Hitting 2 of the 3 criteria might be sufficient, but don't expect appreciation.

area 51 said...

Have to say YES, HP and other blogs helped open my eyes to the giant housing mess. Else after I sold out in Aug 2006 due to relocation, I might have bought back in. Now renting and glad I did. Bankroll is getting fat.
Great job.

Anonymous said...

I already saw the bubble in 2002-2003. Sold my house Aug 2005. Tried to convince my Dad to sell his. He kept claiming "He wasn't ready to sell"...finally...he was convinced thanks to Keith and HP putting it all in perspective, not to mention my angry tirades. He finally put it on the market a couple months ago and he just got an offer. I don't think he'll take it but I railed on him to negotiate and take what he can because it might be his last chance.

I'm quite confident that he will make the wrong choice as usual.

Even Ex-Corporate CFO's can be dumbfu##s also.

Anonymous said...

The bubble blogs alerted me to start shorting the homebuilders and lenders last summer . Thanks a bunch

Anonymous said...

Yes and no.

I sold my rentals, mostly because of Blogs like this one prior to 2006.

I did not jump out of the stock market which over all, is still way up.

I do not believe it is doom and gloom and I do not see a depresion like the 1930's on the horizon.

I am much more careful with my money, but I paid off my mortgage and have no debt, in large because of impending housing crash blogs.

So I am grateful for the blog but take it with a grain of salt.

Anonymous said...

Saved

My

Ass

K.W. - Southern Ca. said...

Why did people not see what was coming? ...

Simple. Greed.

Those that bought late in the game were hoping to make huge profits ... thinking prices would be speculated ever skyward.

Let's hope others get out while they can - it will get more and
more difficult as time goes on.

David in JAX said...
No. The signs of the upcoming housing crash in late 2005 were so obvious that we put our house up for sale before finding this blog. I still do not see how people could not have seen what was coming.

But, from many readers comments, I think that this blog has helped a lot of people get off the fence and decide not to buy a home during the crash.

burn baby burn said...

Yes I remember the day it was about six months ago. I had been halfhearted looking to buy a house. I knew the price seemed way too high and did not make sense but everyone I knew who owned a house was making money so I did not know what to do . I had come home from a party where I was talking to one of those ex striper reltwhores and she was saying a lot of B.S. that did not make any sense. That night I typed housing collapse into Google. Up popped up HP I started reading and the scales fell of my eyes and I could see again. HP is the biggest threat to the world economy because it does not allow the corrupt MSM keep the information hidden. Way to go Keith and thinks. Sometime all it takes is another rational voice to tell you I am not sure I would drink that kool aid when you were thinking that already.

Anonymous said...

I've read & learned from this blog almost every day for a year.
Thanks.

Anonymous said...

You wonder if they talk about this blog at NAR HQ

Anonymous said...

a friend of mine caught the real estate bug starting 3 years back and bought two townhomes and a single family in Montgomery county MD (D.C. suburbs)... at first of course he was happy with the appreciation. a year ago he decided to take a job out of state and had to decide to hold or fold. my advice was that he was way over leveraged and needed to pare down . he sold his single family to two hispanic couples jointly buying (they have since lost the house) and one of the townhomes. he now realizes how close he came to financial disaster.

Macaca

Anonymous said...

YES, YES, YES! Keith and Patrick are my heroes. I am a 26 year old single mom who sold in early 2006. I figure if houses go down substantially in AZ like many claim they will, I will be able to buy a house cash when the bottom hits.

Anonymous said...

I had actually already made an offer on a property, which had not yet been accepted. That very evening, I typed 'housing bubble' into Google, stumbled upon a wide variety of housing blogs, and stayed up all night reading them.

The next morning, I called up my real estate agent and canceled the offer.

Follow up research into the property shows that it's already dropped $40k off the list price, and is still on the market.

Thank you, housing bubble blog community!

Now I'm reading them to see when it's a good time to buy!

james said...

Yep. Was going to buy as condos came down a bit, after this im waiting 6 months, at least.

itchy and scratchy said...

I think most people knew it was a ponzi scheme but with the subprime 100% LTV loans, what did they have to lose? I'm still hearing ads for 100% loans to 540 credit scores. It's still out there folks. Guess who's backing these loans? Our wonderful GSE's Fannie Mae and Freddie Mac. Paulson made that trip to China to try to convince them to buy more subprime MBS from the GSE's. We'll see how it goes.

Anonymous said...

Yep.
HP, CR, Paper $, Big Picture, etc, all helped. We sold in 2006. I wish we had listed 3 months earlir.

stardust said...

My mom made her broker call me after I advised her a couple of weeks ago - GO ALL CASH NOW (at least for a few months to see what's shaking out). He didn't go all cash but moved her into us treasuries and told her I was really smart. Did he make a good move for her? it looks OK so far.

a.creampuff said...

I'm with Keyser Soze. Went a-lookin' and discovered I could only "afford" to live in ugly, dreary, sketchy little shacks - you get the picture. Even before that, I knew it was a Ponzi scheme and had lots of irritating discussions with (ex)in-laws and acquaintances (my friends and immediate relatives are all too rational to get involved in speculation).
So bubble blogs provided a much-needed reality check. Not to mention the humor! If things do get bad, laughter is the best tonic.

p.s. - love the stupid hawk balloon shot.

Shakster said...

Anonymous said...
YES, YES, YES! Keith and Patrick are my heroes. I am a 26 year old single mom who sold in early 2006. I figure if houses go down substantially in AZ like many claim they will, I will be able to buy a house cash when the bottom hits
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
That is Tremendous!Congratulations.
My mother was in the same situation years ago.If she would have known what we know now.

Anonymous said...

While I knew bad things were happening in RE circa 2005 this blog and others helped to re-inforce my feelings. My problem was that it took me to long to get out and all my cash was either in the house or in my 401K. Unfortunately I wasn't able to take advantage of all the great inverse investing insights and profit further, but I'm 1/2 way home. Thanks

retstern said...

Great pictures, great help.

Two years ago my wife started a major addition to our home and I was concerned about house prices rising above a million dollars in upstate NY. So I hedged by shorting HB's, lenders and HOG (fueled by HELOC). After 2 yrs, we are still building and renovating our home and paying with cash earned by shorting the speculative house builders/lenders/HOG's. I enjoy the great irony in this but am becoming concerned as the bubble pop spills into money center banks. America needs new directions to funnel our great potential for producing products that the world needs or wants, products other than the once almighty dollar.

Housing panic is my favorite source, easy and entertaining presentations about the latest develoments in the great american debt debacle.

Joe said...

The articles posting here helped my fight pressure from family members to buy out of my range just because they had a problem with me renting. If I had listened to them, I'd be scraping by on PB&J with a 3 hour commute. Now I live exactly where I want to live and have plenty of money to enjoy life.

Anonymous said...

A few years back I read an article that said joining a club today..lowered the risk of death from disease by 80 percent over the next year, and thus decided to join the club of talkers to, a sock puppet, and found out soon afterward that the sock puppet was a crack head, cocaine junkie, i
kid you not???????????????/

Anonymous said...

I smelled bubble in late 2003, but this site gave me plenty of additional arguments I hadn't thought of myself for why housing was a bad investment, and lots of reinforcement in a time of delusion. The in-laws were convinced I was missing out, but now they're quiet.