That picture would bleak to me if homes weren’t being bid on beyond asking and weren’t selling. If there was no population growth out here, I’d be a bit more pessimistic. If these homes were still outside the range of what people actually earned, then yes I’d be worried. If this was the picture and we were in 2006 and I just paid $500k for a home, yes I’d be shitting myself.
But the reality is that you are looking at the aftermath. Homes have and will be foreclosed, people will continue to purchase. We aren’t cliff diving like we did in 2006, 2007. Prices won’t increase but you also won’t see large scale price declines (in my opinion).
ARM resets. Maybe. 3 of my neighbors bought after the collapse and are in traditional loans (or so I assume since exotic products are a thing of the past). My two immediate neighbors both bought at initial build, before the bubble and were all cash (according to them). How many HELOCs and refinances they have? No clue, but I don’t see signs of excess (cars, designer clothers, etc). Purely anecdotal I know but there is very little worry or doom and gloom on my block (I guess they don’t read Piggs??).
The guy that bought 6 months ago? Who knows. I’m the guy that bought 4 months ago and recent comps show me up $40k. I take that with a grain of salt however, just as I take the RealtyTrac images and your pessimism with a grain of salt.
Let rents go down. If rents drop to the point where I don’t cashflow taking into account the tax benefit then we’ll all have more serious problems to worry about. I don’t see that type of collapse happening, even with all the poor economic news. But hey, what do I know, right? I’m young and I’m going on what I’ve learned, read, evaluated and planned for over the last 10 years. One thing I do know however, things are never as bad as folks online tend to make them out to be and everyone has an agenda.
What’s your agenda?
I’m here to enjoy life, learn as much as I can and provide my experience and opinions to the community that helped me. Piggs, CR, IHB, etc probably saved me lots of money by opening my eyes to what was happening in the market in 06. I learned a lot about fundamentals, prices, incomes, etc. I’ve applied that knowledge to make a rational and personal choice. I’ve studied several different areas that I find desirable and decided on Temecula/Murrieta as my home.
You’re offering your perspective which is interesting and I am countering with my experience and outlook. We can both twist the data to fit our own agendas but it all comes down to being honest and accurate. You are providing your data as a warning and I provide my data as a counter. It is what it is.
