San Diego Housing Bubble News and Analysis

Hahahahaaaaa !! I got a kick out of that one ! Its not fairrrr.....Hahahaa

Im sure these schmoes think its PERFECTLY "fair" that they triple their money in 3 yrs though.....Im going to enjoy this meltdown, most of these new homeowner clowns in this country believe that you can get something for nothing.....NEWS FLASH COMING....

LOL. But I stared the devil straight in the eye and he promised me he would never do this. LOL. But,but,but I paid more. Wawwwwwwwwwwwwwww.
What a bunch of losers.

I love the lady who says "they promised us they wouldn't sell them for less than market". Well duh, but "market" is not what it used to be. A room full of hundreds of bidders means they did sell for market. What idiots.

It won't be long now that the grumpy guy in that video gets out the lighter fluid and matches for his insurance claim.

"You've gotta be kidding me dude. That's not FAIR!"

It's all fair when you are making money on overinflated housing but god forbid the market corrects....

I love it when the lady says -- "They promised they wouldn't sell these below the fair market value!" Guess what -- they kept their promise. The FMV has just changed.

You are the weakest link. Goodbye!

I can't wait to see that happen here. I'll bid 300k for that Pienza home in 4S Ranch please.
Can you imagine the hostility in that neighborhood for years to come. The new buyers(lucky) vs old buyers(screwed). That one "Dude" looks like he'll be part of the welcome wagon for the new buyers.

It is likely to be the same hostility new owners have towards people who have been in their house since prop 13 and are paying very little in property taxes for the same public services.

liver, I disagree on the Prop 13 comment. Property taxes largely go to schools. Since your argument is based on pay-for-use, long time owners don't generally have school age children (at least not anymore), therefore it's fair for them to pay less in taxes under prop 13. They use much less public services because they don't use the schools.

I'm a progressive thinker and think that we should pay taxes regardless of the services we use as a way of contributing to society. BUT since the general mentality is "why should I pay for something that's of no benefit to me?" then I think that Prop 13 is fair.

Personally, I think there should be some nominal tuition for schools, like $500 to $1000 per year. People should think long and hard before they have kids, rather than pop them out after a marital fight.

PC,
People should think long and hard before they have kids, rather than pop them out after a marital fight.

So true!

You almost sound conservative. Has someone stolen your handle??!! ;^)

-one muggle

I would be upset too, but when people take light of the most important purchase of their life there's nobody to blame but themselves.

People today think nothing about what they spend money on, just look at the bling passing for cars these days. A friend's niece recently installed a 20 inch LCD display in her SUV so passangers in other cars can drool over it. The average population today is so stupid it's scary.

PC-
I think prop 13 is very unfair, though I understand the arguments for it. Don't assume the school thing justifies it because not all new people to an area are young couples with kids and use the schools...how can they be with house prices so high?

Also you can pass the house down to your kids so you have people who are using the schools who are paying their parents property tax rates. Additionally, you have a lot of people who choose to send their kids to private school because they perceive public schools as being bad, so they aren't getting their money's worth for their property taxes either.

I am also progressive in that I think everyone should pay taxes, I just don't think we should separate tax payers into groups based on age or time lived somewhere or race, sex, creed or any other majority rules basis.

Prop 13 helps homeowners that are on a limited income retire and stay in their homes. If it wasn't for prop 13 the government can impose tax hikes anytime they want. This law was made to prevent the government from raising your taxes more then 2 percent annually. It wasn't meant to separate the new buyers from the old buyers. It's the unprecedented run-up in prices that have done this. It's also the builder's that pass on obligations from the city to the buyers through mello roos. Anyone can take advantage of prop 13. It does not discriminate a buyer in any way. It is a hard pill to swallow when your neighbor may be paying 1/2 of what you are, but it also allows you to do the same if you stay long term. With all this new tax revenue I don't understand why the city is still in financial trouble. I also think when prices double like they did in 3 years, there should be some kind of tax reduction for new buyers to make it fair, maybe a max of 10% increase annually.

Prop 13 limits fluidity in the marketplace and is bad for all of us. It's like rent control- it may seem like a good idea at first glance, but it results in people who can't afford to move and landlords who charge higher rent to everyone else to make up for the ultra low rent a few tenants enjoy. Similarly, Cities charge very high taxes to some people to make up for the pittance others pay.

We need to get rid of these artificial barriers to a truly free market in housing. Without these barriers, people would be freer to adjust to changes in their income or family situation, rather than being "locked in". The bubble would pop sooner if it weren't for market hinderences like Prop 13.

Ah rent control I remember when I lived in San Francisco starting out and was paying more than half my take home pay in rent. Guy across the hall from me paid about 1/5 of what I paid and used the place to see his mistress. It was so great watching him pull up in his Benz with his girlfriend and use the place for a couple hours each week while eating my ramen noodles...
And try to get the landlord to fix anything was always fun, since he wanted people to move out so he could charge more to the next person.

Of course rent control was sold as a way to keep little old ladies off the street (sound familiar) but the result was a lot of misused housing, a black market in sublets, little upkeep of property and very low supply of rentals but as long as it was better for 51% of the population it was a great thing.

@Ash Housewares

Are you actually a homeowner? It seems unlikely.

Even with prop 13, the government has had a WINDFALL of higher property taxes over the last decade and they are STILL IN THE RED!!! Would you like to risk your capital investment in a home if you thought that greedy politicians viewing higher property taxes as a cash cow would raise your taxes to a level that you couldn't pay potentially pushing you out of your house (and causing you to lose your investment)??

Prop 13 is flawed. There's just some good points to prop 13. As far as rent control, I totally hate it. It just seems that the Government always taxes people when they buy. They take advantage of the fact that yor are willing to pay higher taxes so you can have your dream home. They also take advantage of people when buying new cars. For example your vehicle registration. You are already taxed (sales tax) for buying the vehicle, but on top of that they want you to pay a higher registration fee based on purchase price. Your new vehicle is probably more eco friendly and safer. You're not going to use the existing infrastructure any more then when you had your old car. I think you should pay based on vehicle weight and mileage and get reductions for driving eco friendly vehicles/motorcycles. I think the government knows you are willing and able to pay taxes when you buy large ticket items. That's why they take advantage of the situation.

Prop 13 Discussion - Why not open a new thread.

I hate Prop 13.

1) It was caused by mismanagement by the State Legislature and Ron Reagan. In 1967 he said, "Taxes should hurt".

2) Property tax funds many things besides schools. Some of the longest time property owners (LTPO) are also the most needy and demanding of local servcies.

3) The artifically low assesed values of the LTPO's reduces their liability to pay for new bonds and assesments, yet they have the same voting power to approve those new bonds.

4) Paying the fair share of property tax should be condidered a basic owner's expense. When the owner cannot afford the expense, they should move. I have observed many, many large homes occupied by LTOP's empty nesters. These houses should be filled with childeren, not the elerly waiting to die. Why should the rest of us subsidize them to live in a big house they don't need anymore.

Government taxes when when we buy. But why are we still buying like there's no tomorrow? You'd think we'd save more.

--------

On ideals alone, I agree that prop 13 is unfair (I was just arguing the pay-for-use point). But since I benefit from prop 13, I won't protest too much. :) It's the pocket book issue, you know.

All you prop 13 haters should read this:

http://www.hjta.org/content/ARC000024B_P...

And, if you feel like paying more taxes, feel free to break out the checkbook and send some extra dollars to Arnie and the boys in Sacramento. If you aren't willing to do that than you have no credibility with the "taxes aren't high enough" song and dance.

No meadandale, I don't own a house (finished college in 2004, too late to catch the ride). But my personal situation doesn't have anything to do with the impact of Prop 13. I stand by my statement that Prop 13 is a hindrance on the housing market. It slows turnover since people don't want to lose their low basis.

Just one of the many reasons I am in the long slow decline camp.

All you prop 13 haters should read this

FYI, the correct spelling is now "haterz". Speaking of which, it looks like the Casey Serin-haterz have driven him into exile!

Prop 13 slows property turnover?

I guess that's why we are at the tail end of a housing frenzy that saw a large portion of existing housing change hands causing it's tax basis to be reassessed.

My next door neighbor is in his eighties. He bought that house when it was new in 1954 for about 15k. Should he be paying the same amount in tax as me? That'd mean that he was paying more than 25% of his original cost for the house in taxes every year. Would that make you feel better? Of course, that'd probably mean that he and his wife wouldn't be able to live there anymore since they are on fixed incomes and they'd probably have to be put in a home, which would be paid for with YOUR tax dollars? Still feeling better?

Last time I checked my property tax bill, the largest majority of the money was paying for school bonds; funny, because I'm single and don't have any kids yet I'm subsidizing the schooling of everyone else's. Yet apparently I'm the one not paying their fair share?

Yup, seems right to me....

I can't wait to see that happen here. I'll bid 300k for that Pienza home in 4S Ranch please. Can you imagine the hostility in that neighborhood for years to come. The new buyers(lucky) vs old buyers(screwed). That one "Dude" looks like he'll be part of the welcome wagon for the new buyers.

Uh recordkeeper, it's definitely going to be a Kodak moment when homes like this are $300k,  but interest on the mortgage will be like 15-20% with tighter lending rules, higher inflation, and stagnant wages. Can you imagine the hostility in that neighborhood for years to come? 

...Some of old buyers(screwed). 

...Most of the new buyers (still screwed on affordability/attainability).

...A few of the sideliners tha can buy a $300k-400k home in cash(lucky).

Relaxed financing and low interest was a blessing for those that could have managed their finances. If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant.You think average salaries are going to rise at the same rate as inflation to keep pace, or that interest rates are going to stay below 6.25%? You might be in for a rude awakening yourself.

if you're doing what most people are doing which is keeping your funds in a CD/government bond/and or money market. It's like 5.5%-6% right now tops. Is this keeping up with inflation? Nope. You willing to take the plunge into stock market and risk a downturn to try to beat inflation?

I'm not wishing a demise for the house industry. Because either way, most average joe's will get screwed too..If you're not going to be able to do a near cash-and-carry, affordability/availability is still going to be an issue.

Like my dad always said "Sucker born every minute"

Sincerely, Contraman

Dude where is my "equity"?

recordsclerk, thats a total red herring. There are lots of ways to keep people in their houses that don't involve unfair taxation policies. First of all, how long someone has lived in a place has little to do with what infrastructure maintenance costs.

Second prop 13 is a bold faced lie, its an attempt to starve the beast, not save little old ladies. If you don't like the way govt spends your money, vote for a govt that will do so responsibly. Don't try and short circuit the taxation collection when its really the spending people object to.

All prop 13 really does is shift the burden from long time residents to newer ones, regardless of age. Does the little old lady next door use the roads less? How about ambulances, police and fire? I bet she uses more of those, but doesn't pay her fair share.

Josh

Prop 13 has its merits and problems, but is not nearly as insidious as Mello-Roos(MR) taxes. For Mello-Roos, the existing residents vote a tax on new residents who cannot yet vote in the elections. It is truly a tax without any representation to those actually paying it. In one city in Northern California, the underlying bonds have been paid off due to higher than anticipated MR revenues, but the city plans to keep collecting for the life of the "planned" payoff period. IT is this type of unfair taxation that created prop 13.

The way i look at it. Renters should pay prop taxes to support the "infrastructure" where they are using too. Don't they get a free ride?

"The way i look at it. Renters should pay prop taxes to support the "infrastructure" where they are using too. Don't they get a free ride?"
This would be double taxation since the property owner already pays the taxes. Renters pay the rent which goes towards the carrying cost for the landlord or profit. But since we are trying to be fair, why not let the renters pay their fair share.