Friends thought he was nuts when a Times reporter sold his home and started to rent in 2005. But for him, the warning signs were just too hard to miss.
By Peter Y. Hong, Los Angeles Times Staff Writer
January 20, 2008
Our friends said we were crazy. Relatives asked whether we were in financial trouble. But in April 2005, my wife and I bailed out of the American dream. We sold our two-bedroom Pasadena condominium and became renters again. ¶ We got nearly three times what we had paid for the place nine years earlier. It seemed to us like a staggering profit — and a sign that the market had been pumped up beyond reason. ¶ That’s why we decided to rent instead of buying another house right away. We wanted a place with a yard and a third bedroom, but we weren’t willing to pay the sky-high price or take out an exotic mortgage to buy something our income did not justify. ¶ So our plan was to take our profit and wait for prices to return to Earth. The madness had to end, we thought. ¶ For a while, we wondered whether we would prove to be the crazy ones as home values in Southern California overall continued rising through last spring. But a closer inspection of real estate sales data shows that signs of trouble were already appearing when we sold……
