Forbes: Housing Woes Hit High End Too

[4runner]

I don’t know what the answer is but having our prime real-estate in the USA lose value is not the answer or good for anyone.

Actually, the best thing for the U.S. would be for a spectacular, quick drop in the price of real estate.

Price real estate as an asset. Homes are currently renting out for a pathetically small fraction of their market price. The rate of return cannot be sustained for the long term and represents overinvestment in a non-performing asset. For example, we sold a condo earlier this year. We could have been $100/month above water at current rental rates ($400 if you count the payments toward principal) on about 200k$ in “equity” in the condo. Guess what– we make more money giving that money to the Feds. Plus, Uncle Sam doesn’t call us when the toilet won’t flush.

This situation is repeated throughout San Diego and California. Hardworking, responsible people are spending wage income paying toward mortgages on houses that have a rate of return that is lower than the rate of return on government bonds. This is not a good situation, especially when most Americans don’t save.

If the price of housing doesn’t drop, it is possible that these people will continue spending a disproportionately large amount of their income on an asset than doesn’t generate a reasonable rate of return. This would be catastrophic for those people and for the U.S.

[CardiffBaseball]

What was the phrase… In God we Trust, all others bring data? I am too lazy to use the search engine.

mgu have you spent much time reading about the fraudulent activity on the bubble tracker? In many neighborhoods “especially Murrieta, home of the giant scam” many houses probably base comps on all the sham sales that went on. This falsely inflated the market with comps out of line with the local economy. If they scamsters added 140K to the sale, and the neighbor (Joe Zinfandel err Joe 6-pack) now think their home is also the same value, who is to say they really lost 140K. Well perhaps put in a better light, the 140K they thought they gained was not due to market forces. Remember many of the nurses in the Murrieta scam had multiple homes, so it’s less hard to feel sorry for them.

Also, as an individual investor, if you want to get into the stock market on margin you have to put a little skin in the game. In housing you show up with nothing down, state your income, and wind up with an 800K loan.

[CardiffBaseball]

What was the phrase… In God we Trust, all others bring data? I am too lazy to use the search engine.

mgu have you spent much time reading about the fraudulent activity on the bubble tracker? In many neighborhoods “especially Murrieta, home of the giant scam” many houses probably base comps on all the sham sales that went on. This falsely inflated the market with comps out of line with the local economy. If they scamsters added 140K to the sale, and the neighbor (Joe Zinfandel err Joe 6-pack) now think their home is also the same value, who is to say they really lost 140K. Well perhaps put in a better light, the 140K they thought they gained was not due to market forces. Remember many of the nurses in the Murrieta scam had multiple homes, so it’s less hard to feel sorry for them.

Also, as an individual investor, if you want to get into the stock market on margin you have to put a little skin in the game. In housing you show up with nothing down, state your income, and wind up with an 800K loan.

[CardiffBaseball]

What was the phrase… In God we Trust, all others bring data? I am too lazy to use the search engine.

mgu have you spent much time reading about the fraudulent activity on the bubble tracker? In many neighborhoods “especially Murrieta, home of the giant scam” many houses probably base comps on all the sham sales that went on. This falsely inflated the market with comps out of line with the local economy. If they scamsters added 140K to the sale, and the neighbor (Joe Zinfandel err Joe 6-pack) now think their home is also the same value, who is to say they really lost 140K. Well perhaps put in a better light, the 140K they thought they gained was not due to market forces. Remember many of the nurses in the Murrieta scam had multiple homes, so it’s less hard to feel sorry for them.

Also, as an individual investor, if you want to get into the stock market on margin you have to put a little skin in the game. In housing you show up with nothing down, state your income, and wind up with an 800K loan.

[temeculaguy]

To my brethren in the OC (patient and scam) I thank you for the support. I had reservations the instant I clicked on the “post comment” button knowing I was on my third generous glass of cabernet and having already taken the sacred vow to never pick blog fights with the drop ins, prefering delicate mocking to brawls. Your comments inadvertantly may have created a bullying montster, who’s next?

[temeculaguy]

To my brethren in the OC (patient and scam) I thank you for the support. I had reservations the instant I clicked on the “post comment” button knowing I was on my third generous glass of cabernet and having already taken the sacred vow to never pick blog fights with the drop ins, prefering delicate mocking to brawls. Your comments inadvertantly may have created a bullying montster, who’s next?

[temeculaguy]

To my brethren in the OC (patient and scam) I thank you for the support. I had reservations the instant I clicked on the “post comment” button knowing I was on my third generous glass of cabernet and having already taken the sacred vow to never pick blog fights with the drop ins, prefering delicate mocking to brawls. Your comments inadvertantly may have created a bullying montster, who’s next?

[Sandi Egan]

I don’t know what the answer is but having our prime real-estate in the USA lose value is not the answer or good for anyone.

The answer is, people should learn to take responsibility for their actions. When the prices were skyrocketing, all those “hard-working guys” were proud of their “smart” investments in RE. Today they are not investors any more, they are victims, mislead by greedy and dishonest lenders…

Our laws are already extremely mild: one can get an astronomical loan on a pathetic piece of property, then refi hundreds of kilobucks out of it and when the music stops just walk away with only a scar on his credit record. I think everybody should be obliged to repay any loan they take to the last cent, no matter what.

[Sandi Egan]

I don’t know what the answer is but having our prime real-estate in the USA lose value is not the answer or good for anyone.

The answer is, people should learn to take responsibility for their actions. When the prices were skyrocketing, all those “hard-working guys” were proud of their “smart” investments in RE. Today they are not investors any more, they are victims, mislead by greedy and dishonest lenders…

Our laws are already extremely mild: one can get an astronomical loan on a pathetic piece of property, then refi hundreds of kilobucks out of it and when the music stops just walk away with only a scar on his credit record. I think everybody should be obliged to repay any loan they take to the last cent, no matter what.

[Sandi Egan]

I don’t know what the answer is but having our prime real-estate in the USA lose value is not the answer or good for anyone.

The answer is, people should learn to take responsibility for their actions. When the prices were skyrocketing, all those “hard-working guys” were proud of their “smart” investments in RE. Today they are not investors any more, they are victims, mislead by greedy and dishonest lenders…

Our laws are already extremely mild: one can get an astronomical loan on a pathetic piece of property, then refi hundreds of kilobucks out of it and when the music stops just walk away with only a scar on his credit record. I think everybody should be obliged to repay any loan they take to the last cent, no matter what.

[mgubnyc1]

The fiscally conservative were punished for years and now they will be rewarded

why is that you think the only people that didn’t buy home’s were fiscally conservative? What about the fiscally conservative people that saved money in retirement plans that have lost thousands of dollars? what about you and I that will see our tax’s increase to help pay for the bail outs? is this how you like to be rewarded?

Temeculaguy we agree any many issues, except for maybe how you will profit from this downturn. I only hope you get your wish and your able to buy that 800k mcmansion in Temecula for 400K, so what, in ten years from now it will still be worth 380K ITS TEMECULA! IT WAS NEVER WORTH THE 800K TO BEGIN WITH!

and I really don’t care about the nurses or the idiots who took a toxic loan and now are losing the home, they made the choices now they have to live with them.
BUT THERE ARE HUNDREDS OF THOUSANDS OF PEOPLE THAT COMMITED FRAUD INCLUDING THE LENDERS and contrary to what alot of people think nothing will happen to them.

What pisses me off is why these people were able to get these loans in the first place. In other countries you can’t just borrow what ever you want, even if you have hundreds of thousands of dollars in equity! If you can’t prove to the lender you could make the payments they won’t give you the loan no matter how much intrest you’re willing to pay!
The problem wasn’t the nurses or the idiot’s it’s the lenders!!

[mgubnyc1]

The fiscally conservative were punished for years and now they will be rewarded

why is that you think the only people that didn’t buy home’s were fiscally conservative? What about the fiscally conservative people that saved money in retirement plans that have lost thousands of dollars? what about you and I that will see our tax’s increase to help pay for the bail outs? is this how you like to be rewarded?

Temeculaguy we agree any many issues, except for maybe how you will profit from this downturn. I only hope you get your wish and your able to buy that 800k mcmansion in Temecula for 400K, so what, in ten years from now it will still be worth 380K ITS TEMECULA! IT WAS NEVER WORTH THE 800K TO BEGIN WITH!

and I really don’t care about the nurses or the idiots who took a toxic loan and now are losing the home, they made the choices now they have to live with them.
BUT THERE ARE HUNDREDS OF THOUSANDS OF PEOPLE THAT COMMITED FRAUD INCLUDING THE LENDERS and contrary to what alot of people think nothing will happen to them.

What pisses me off is why these people were able to get these loans in the first place. In other countries you can’t just borrow what ever you want, even if you have hundreds of thousands of dollars in equity! If you can’t prove to the lender you could make the payments they won’t give you the loan no matter how much intrest you’re willing to pay!
The problem wasn’t the nurses or the idiot’s it’s the lenders!!

[mgubnyc1]

The fiscally conservative were punished for years and now they will be rewarded

why is that you think the only people that didn’t buy home’s were fiscally conservative? What about the fiscally conservative people that saved money in retirement plans that have lost thousands of dollars? what about you and I that will see our tax’s increase to help pay for the bail outs? is this how you like to be rewarded?

Temeculaguy we agree any many issues, except for maybe how you will profit from this downturn. I only hope you get your wish and your able to buy that 800k mcmansion in Temecula for 400K, so what, in ten years from now it will still be worth 380K ITS TEMECULA! IT WAS NEVER WORTH THE 800K TO BEGIN WITH!

and I really don’t care about the nurses or the idiots who took a toxic loan and now are losing the home, they made the choices now they have to live with them.
BUT THERE ARE HUNDREDS OF THOUSANDS OF PEOPLE THAT COMMITED FRAUD INCLUDING THE LENDERS and contrary to what alot of people think nothing will happen to them.

What pisses me off is why these people were able to get these loans in the first place. In other countries you can’t just borrow what ever you want, even if you have hundreds of thousands of dollars in equity! If you can’t prove to the lender you could make the payments they won’t give you the loan no matter how much intrest you’re willing to pay!
The problem wasn’t the nurses or the idiot’s it’s the lenders!!

[bsrsharma]

having our prime real-estate in the USA lose value is not the answer or good for anyone.

True; but the side effects are very good indeed. It will inculcate a new value system when debt is feared and not loved. We are importing $2B per day of capital from overseas for consumption. Left untreated, this addiction is surely going to take us down. Remember what happened to Brazil or Argentina. US is not immune to laws of economics.

 

[bsrsharma]

having our prime real-estate in the USA lose value is not the answer or good for anyone.

True; but the side effects are very good indeed. It will inculcate a new value system when debt is feared and not loved. We are importing $2B per day of capital from overseas for consumption. Left untreated, this addiction is surely going to take us down. Remember what happened to Brazil or Argentina. US is not immune to laws of economics.

 

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