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HLS.
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August 4, 2007 at 6:24 PM #9714August 5, 2007 at 4:53 AM #70395
4plexowner
Participantscenario: mother and child standing in checkout line at grocery store – VERY large woman in line ahead of them
child: Mom, look how FAT that woman is!
mom: Now son, we don’t talk about people like that.
child: But mom, look how FAT she is!
about this time the fat lady’s beeper goes off
child: Watch out mom, she’s backing up!
~
this joke has nothing to do with real estate but it did happen in the checkout line
~
it has been an interesting few weeks – I notice that none of the Pollyannas or trolls have created new threads recently – they must be on vacation (or in shock)
August 5, 2007 at 4:53 AM #70471Participantscenario: mother and child standing in checkout line at grocery store – VERY large woman in line ahead of them
child: Mom, look how FAT that woman is!
mom: Now son, we don’t talk about people like that.
child: But mom, look how FAT she is!
about this time the fat lady’s beeper goes off
child: Watch out mom, she’s backing up!
~
this joke has nothing to do with real estate but it did happen in the checkout line
~
it has been an interesting few weeks – I notice that none of the Pollyannas or trolls have created new threads recently – they must be on vacation (or in shock)
August 5, 2007 at 7:36 AM #70399bubble_contagion
ParticipantA few years back, at my work place, everybody was a Real Estate investment expert. Now everybody is a bubble expert and you hear conversations about ARMs resets, mortgage lenders going down, etc. To me, this change in psychology has been the most significant development since I have closely following the San Diego housing market.
August 5, 2007 at 7:36 AM #70476ParticipantA few years back, at my work place, everybody was a Real Estate investment expert. Now everybody is a bubble expert and you hear conversations about ARMs resets, mortgage lenders going down, etc. To me, this change in psychology has been the most significant development since I have closely following the San Diego housing market.
August 5, 2007 at 9:41 AM #70407mixxalot
ParticipantProof in pudding
and my hat off to Rich and all my fellow piggintons here who forecast the downturn in real estate. I look forward to buy a place in few years when correction has come full circle. I saw major drops in point loma and ocean beach. One condo down the street listed 440k six months ago now the list price was crossed out with a 419k list price so just be patient. I think 200k is reasonable price for the 2bedroom/2bath condo not 400k.
August 5, 2007 at 9:41 AM #70484ParticipantProof in pudding
and my hat off to Rich and all my fellow piggintons here who forecast the downturn in real estate. I look forward to buy a place in few years when correction has come full circle. I saw major drops in point loma and ocean beach. One condo down the street listed 440k six months ago now the list price was crossed out with a 419k list price so just be patient. I think 200k is reasonable price for the 2bedroom/2bath condo not 400k.
August 5, 2007 at 10:19 AM #70419HLS
Participant“Change in psychology” is the primary force in any market of any product.
The same people were probably stock experts in the late 90’s.
What else has changed ? Not much. The homes still look the same, they havent moved them. Loans are (mostly) still available. People are still breathing.
Prices dropping didn’t cause the change. The change in thinking is what is causing prices to drop, and then falling prices scare people further.
This is true in any market, esp a bubble. The party is over, the bubble has burst.
Why didn’t people buy a house 5 years ago that could have ?
The psychology was different.Nobody KNEW in 1996 that prices would triple in 9 years, many people just got lucky.(Some think that they were just smart) Those who bought in 2005 might be unlucky.
Manias didn’t start with tulip bulbs in 17th century Holland.
It’s happened more recently with stocks, gold, silver, coins, stamps, beanie babies, baseball cards, etc.Something that was “worth” $500 at one time, might be pennies today. Fear and greed rules markets.
When markets are HOT for anything, people cannot imagine there being no buyers, thinking that prices can only drop a few %. Nothing is further from the truth.
When the psychology shifts, watch out below.
Where are all the RE investors that attended seminars ? They wanted to buy homes 2 years ago. They are cheaper today, why aren’t they buying ?? Psychology changed.
The most sobering thing in the world is trying to daytrade stocks.
Some people can never accept that the higher price just seconds ago means nothing anymore, and it may never ever be that price again. Everybody should try this at least once…
Some people are still clinging to stocks that tanked 7-8 years ago, still waiting to get even.It’s the same thinking that many people have today that their house WAS “worth” $1 million in 2005, so that IS what it’s worth, and it will be back there soon, even though it’s only $800,000 today…….
August 5, 2007 at 10:19 AM #70495Participant“Change in psychology” is the primary force in any market of any product.
The same people were probably stock experts in the late 90’s.
What else has changed ? Not much. The homes still look the same, they havent moved them. Loans are (mostly) still available. People are still breathing.
Prices dropping didn’t cause the change. The change in thinking is what is causing prices to drop, and then falling prices scare people further.
This is true in any market, esp a bubble. The party is over, the bubble has burst.
Why didn’t people buy a house 5 years ago that could have ?
The psychology was different.Nobody KNEW in 1996 that prices would triple in 9 years, many people just got lucky.(Some think that they were just smart) Those who bought in 2005 might be unlucky.
Manias didn’t start with tulip bulbs in 17th century Holland.
It’s happened more recently with stocks, gold, silver, coins, stamps, beanie babies, baseball cards, etc.Something that was “worth” $500 at one time, might be pennies today. Fear and greed rules markets.
When markets are HOT for anything, people cannot imagine there being no buyers, thinking that prices can only drop a few %. Nothing is further from the truth.
When the psychology shifts, watch out below.
Where are all the RE investors that attended seminars ? They wanted to buy homes 2 years ago. They are cheaper today, why aren’t they buying ?? Psychology changed.
The most sobering thing in the world is trying to daytrade stocks.
Some people can never accept that the higher price just seconds ago means nothing anymore, and it may never ever be that price again. Everybody should try this at least once…
Some people are still clinging to stocks that tanked 7-8 years ago, still waiting to get even.It’s the same thinking that many people have today that their house WAS “worth” $1 million in 2005, so that IS what it’s worth, and it will be back there soon, even though it’s only $800,000 today…….
August 5, 2007 at 4:25 PM #70532cr
ParticipantI agree HLS. The psychological effects are just starting to take root. The public is only starting to realize what most here have been saying for years now. They may not expect a 50% correction like some do, at least in some areas. They probably expect 10-15%, but the game is over.
The damage is done, and things are different this time. This time, consumers have no savings, are maxed out on credit, both parents are already working, loans are getting harder to get by the day, inventories and foreclosures are at all time highs, the negative effect on jobs is just starting, and so on and so on. All in all I’d say it’s far worse than the last downturn, both in scale and in factors contributing to the decline.
As these factors take hold people will be more hesitant to buy, drive prices further, and if it’s anything like the last two downturns, prices may go lower than they were when this started 4-5 years ago. That is of course unless incomes across the board double in the next 6 months. I forget, did that happen last time?
August 5, 2007 at 4:25 PM #70624ParticipantI agree HLS. The psychological effects are just starting to take root. The public is only starting to realize what most here have been saying for years now. They may not expect a 50% correction like some do, at least in some areas. They probably expect 10-15%, but the game is over.
The damage is done, and things are different this time. This time, consumers have no savings, are maxed out on credit, both parents are already working, loans are getting harder to get by the day, inventories and foreclosures are at all time highs, the negative effect on jobs is just starting, and so on and so on. All in all I’d say it’s far worse than the last downturn, both in scale and in factors contributing to the decline.
As these factors take hold people will be more hesitant to buy, drive prices further, and if it’s anything like the last two downturns, prices may go lower than they were when this started 4-5 years ago. That is of course unless incomes across the board double in the next 6 months. I forget, did that happen last time?
August 5, 2007 at 4:25 PM #70632ParticipantI agree HLS. The psychological effects are just starting to take root. The public is only starting to realize what most here have been saying for years now. They may not expect a 50% correction like some do, at least in some areas. They probably expect 10-15%, but the game is over.
The damage is done, and things are different this time. This time, consumers have no savings, are maxed out on credit, both parents are already working, loans are getting harder to get by the day, inventories and foreclosures are at all time highs, the negative effect on jobs is just starting, and so on and so on. All in all I’d say it’s far worse than the last downturn, both in scale and in factors contributing to the decline.
As these factors take hold people will be more hesitant to buy, drive prices further, and if it’s anything like the last two downturns, prices may go lower than they were when this started 4-5 years ago. That is of course unless incomes across the board double in the next 6 months. I forget, did that happen last time?
August 5, 2007 at 4:57 PM #70540davelj
ParticipantAt times like these I like to reference the old explorer’s wisdom (when bad things happen) that, “the mountain doesn’t know or care that you’re climbing it.” Likewise, your house doesn’t care that you own it, and neither does that stock you bought the other day. They don’t know, don’t care and the prices will move accordingly with the commensurate degree of sympathy and understanding.
August 5, 2007 at 4:57 PM #70637ParticipantAt times like these I like to reference the old explorer’s wisdom (when bad things happen) that, “the mountain doesn’t know or care that you’re climbing it.” Likewise, your house doesn’t care that you own it, and neither does that stock you bought the other day. They don’t know, don’t care and the prices will move accordingly with the commensurate degree of sympathy and understanding.
August 5, 2007 at 4:57 PM #70644ParticipantAt times like these I like to reference the old explorer’s wisdom (when bad things happen) that, “the mountain doesn’t know or care that you’re climbing it.” Likewise, your house doesn’t care that you own it, and neither does that stock you bought the other day. They don’t know, don’t care and the prices will move accordingly with the commensurate degree of sympathy and understanding.
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