Feel like I was on the winning superbowl team

[anxvariety]

So does anyone feel ready to take a vacation now that the collapse is being picked up by mainstream… I feel like I can relax now.. all my friends who thought I was crazy are finally starting to wake up now that the mainstream media is reporting on the great collapse… It’s almost like I was baby sitting and the parents(media) finally came home… now I can leave and let the parents take care of the kids and their naivety and questions.. I can go enjoy my free time..

Will it be any fun talking about the crash now that it’s here? I sure felt compelled to evangelize this housing stuff, but I think I may have lost it!

Much credit goes out to Rich and the watering hole/ammo he provides.. stuff that I often used to spray my friends with facts and trends.. After all, I’ll continue to visit piggy, but in my offline life I’ll be quieter I think… I’m looking forward to the new piggy audience, the ones that got hammered in the market after being musical chair preachers. Maybe by the time those people get here this site will be all boarded up with the ghosts of bubbles past.. Heck, the s&p might even be at 600!

[LA_Renter]

I agree that this last round in the housing bubble drama has gotten people’s attention. I used to be happy when the MSM even mentioned the possibility that this is a housing bubble. The narrative has now turned into “crisis” reporting. The media loves that stuff. I have a feeling we will be hearing alot from the “it’s not that bad” crowd. I found this quote on socalbubble regarding the opposite camps argument;

“The subprime sector is too small to have such a big impact, according to Robert Froehlich, who is chairman of the investor-strategy committee at DWS Scudder, a division of Deutsche Bank AG.
“For all this to occur, the subprime-mortgage collapse has to be big enough and important enough to set the wheels in motion. And the fact is that it isn’t,” he wrote in a market commentary Monday. “It will be the most hyped disaster that never occurred since Y2K.”
Froehlich said Monday that, like Y2K, investors are worrying too much about a subprime-fueled disaster that probably won’t happen.
“The subprime-mortgage market is big, but it’s not big enough to push the U.S. economy into a recession by causing a credit crunch,” he added.
During the peak of the industry’s growth in 2004 and 2005, about 3.2 million homes were purchased with a subprime loan, Froehlich estimated. That’s about 2.8% of total U.S. households, he wrote.
If 30% of those subprime homeowners fail to make their payments, fewer than 1 million households would be “out of luck and out on the street,” Froehlich projected.”

Personally I like to call this the “It’s only a flesh wound” argument. But I’m sure you will be hearing a chorus sing (spin) this tune. IMO they will not be able to spin their way out of this. The last series of events are hitting like a freight train. As I mentioned this has Joe Sxipack’s attention. This could be a critical turning point in market psychology. I agree with Bill Fleckenstein and anticipate a market freeze over the next three to six months. it’s definitely getting interesting.

[Cow_tipping]

No … dont leave … the parents may have come home, but you might want to be around to watch the kids get a spanking. :-)).
In any case, many cities are inflating the bubble. Charlotte for example. 98-02 RE went down, in non inflation adjusted dollars. Houses that sold in 96 for 202K went for the same 202K in 02. Then It slowly crept up with inflation till ~2006. After which nothing was available for under 320K.
Can you say humongo bubble … and we are still pumping it up … booya.
Cool.
Cow_tipping.

[sdduuuude]

Interesting thought – well said, anx.

[(former)FormerSanDiegan]

Do it like the pros …
relax, go to Disneyland, get yourself a ring, get into some off-season mischief.

[LookoutBelow]

Very good anology with the babysitting !!

 

I am going to take a well deserved break also, maybe go surf and fish for a few months so as not to be an eyewitness to the bloody carnage that is going to follow.

My work is done here…On to the next industry that needs our clear type thinking ! Being able to see through the smoke and listen through the static is an art that anyone with a brain can do…..BUT you must first take the "Red Pill"…that requires balls….. and to also turn off "American Idol"

Believe 1/2 of what you read and NONE of what you see on TV

 

[(former)FormerSanDiegan]

Believe 1/2 of what you read

I agree. But which half ? 🙂

[DaisyDuke]

Don’t leave the party! It’s not over. Wonder what bubble will develope out of this bubble? A foreclosure purchasing bubble ??

I casually ask people I know so, what have you heard in the news about the housing market and they say they have heard NOTHING. Nice to know the media has now found it newsworthy.

I am really happy that people won’t think I need psychological counseling for selling my great home any longer. They were looking at me like I was nuts! Okay, maybe I am nuts and I need psychological counseling, but not due to selling my house.

Vindication is sweeeeeeet.

[Bugs]

No, now what happens is we continue waiting for the bottom and carefully follow the indicators until they turn in favor of investing again. The idea is to always lead, never follow.

[SD Realtor]

Well said Bugs… Don’t believe the industry is not going to go down without a fight. Once things start touching Fannie and Freddie I honestly do not see the government sitting on the sidelines and watching. What better way to enter the political season then to help those poor souls who lost their homes then to come up with a program to help them out? Sorry but I am just so pissed at our government considering a bailout for them…

More to the point, we need to see all of this inventory to hit the market before we can make any headway downward. Many sellers and even REO properties are still stubborn with pricing. Personally I am still seeing certain markets performing pretty darn well. Of course the one I want to buy in is still white hot… however many many others are not. Again condos are getting hit harder then homes, lower income neighborhoods are also depreciating faster then mid/higher ones and neighborhoods with good schools. Also buyers are looking for more value, less MR and HOA, etc…My guess is that once we move into the dog days of summer we could see a repeat of the summer of 06. We need inventory to move up… Geez we are 2 weeks away from April and definitely off of the 06 inventory levels. Spring is going by quick.

The thing this year is, although we may not come close to approaching the 06 levels, the sellers will now have a higher percentage of banks and lenders then the 06 inventory did.

That is a very good thing.

[kewp]

Yeah, a barometer I use for any meme is it hitting the front page of cnn.com, which the housing bust did yesterday. The great market psychology shift begins.

I’m not patting myself on the back about it though, as I felt it was inevitable. Kind of like speculating that the sun will set, the only question in my mind being the details of the process.

I’ve always felt arguing with the perma-bulls as counter-productive, as I’m *sure* some portion of them realized this was a bubble and were just blowing hot air before cashing out. Kind of like the pump&dump stock scams.

[poorgradstudent]

I won’t feel triumphant until we buy a home, 3-5 years from now when the market has bottomed. Until then, as someone who has only rented so far in his life, for me personally it’s all just paper ups and downs right now.

[CDMA ENG]

CDMA ENG…

Ok… So the followers of this blog know now that they are correct but I would almost have rather been wrong. This whole situation spells tough time ahead for this country and our friends and nieghbors will, invariably, lose thier jobs and maybe thier homes. OR maybe it will be you. Don’t do the victory dance so soon. Caution in everything…

[anxvariety]

Plenty more excitment to come.. most of my relief and joy is that now there will be attention on this stuff in the media all the way til it hits the bottom… People will be more aware on ths subject through this coverage and we won’t have to spend as much energy in RE 101 and debunking myths(hopefully)… We all know how hard it can be to convince the sheeple of things, at least until the they’ve heard it from their TV then they open up..

[sdrealtor]

I don’t understand what everyone is celebrating about. It is way to early to claim victory on anything. Sure the subprime market took a big hit and the low end is struggling but nice properties are selling much better this year than last albeit at slightly lower prices. If you aspire to a condo/townhome or a lousy property in a less than prime area you are starting to see some price deflation but I don’t see this group aspiring to that.

Also, the idea that 1st time buyers drive the market while valid is vastly overstated IMHO. 1st timers generally start in condos/townhomes here and progress to starter single family homes but above that the connection is not so direct. Many “Move-up house” buyers come from outside the area and many are actually move down buyers.

If I were to buy a new home I would not sell my current home as it would generate about $1,000/month positive cash flow. I could easily put 20% down and afford the payments on whatever I wanted. An extra $1,000 cash flow certainly wouldnt hurt either.

Here’s more proof, in the first 2 weeks of March 2006, 97 $1M+ homes went into escrow. If you consider that homes went down at least 5% over this time last year and look at home for $950,000+ you get 152 homes. Even if you dont adjust the price you get over 130 homes this year.

If you look at homes between $600K and $800K, in the first 2 weeks of March 2006, 229 homes went into escrow and sold. If you consider that homes went down at least 5% over this time last year and look at homes between $570K and $760K you get 244 homes. Even if you dont adjust the price you get flat sales numbers this year.

I just sense that folks are a bit too anxious to reap some sort of reward for recognizing the bubble which reminds me of the folks who were too anxious to reap some reward not recognizing the bubble. Human psychology is fascinating.

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