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December 16, 2010 at 10:22 AM #641293December 16, 2010 at 10:31 AM #640192CoronitaParticipant
[quote=deadzone]FLU, I don’t disagree that such houselholds exist that you describe. But I disagree that it is a major factor. Furthermore, you are talking about discretionary income. Purchasing a house is not a discretionary purchase. A downpayment is necessary as well as the ability to pay a substantial montly mortage payment. These require two things: 1. cash in hand 2. good salary. Rising stock market isn’t going to help most people with these two things.
Your theory appears to be that if the stock market doesn’t crash the housing market will hold up. I think that is absolutely ridiculous because there simply isn’t very much correlation. Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?[/quote]
I don’t think I’m saying if the stock markets hold up that the housing market isn’t going to come down. But in certain submarkets (the ones that said households are actively looking), I don’t see a swift crash coming in the absence if a roaring equity market continue.
[quote]
Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?
[/quote]Yes I know several people who put 30-40% down on a primary home from their stock option/RSU sales. Some use it toward buying property outright.
Just recently, several of my former colleagues (on the order of 15+) who had a boatload of then worthless Intuit stock options have sold this year and capitalized on 100% appreciation…What did these folks do with the money? They bought a bunch of break even or slightly+ cash flow positive condos and homes in Escondido, sdsu area,etc. One lady bought 6 condos this year along…Fully paid off. I asked her if she was crazy. Her response? “At least these homes are tangible assets with utility… What’s to say my options don’t become $0 next year?” Again, most of these people I know aren’t C-level execs.. Just normal enginerd workerbees that’s been doing the same thing over quite some time at the same company.
December 16, 2010 at 10:31 AM #640263CoronitaParticipant[quote=deadzone]FLU, I don’t disagree that such houselholds exist that you describe. But I disagree that it is a major factor. Furthermore, you are talking about discretionary income. Purchasing a house is not a discretionary purchase. A downpayment is necessary as well as the ability to pay a substantial montly mortage payment. These require two things: 1. cash in hand 2. good salary. Rising stock market isn’t going to help most people with these two things.
Your theory appears to be that if the stock market doesn’t crash the housing market will hold up. I think that is absolutely ridiculous because there simply isn’t very much correlation. Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?[/quote]
I don’t think I’m saying if the stock markets hold up that the housing market isn’t going to come down. But in certain submarkets (the ones that said households are actively looking), I don’t see a swift crash coming in the absence if a roaring equity market continue.
[quote]
Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?
[/quote]Yes I know several people who put 30-40% down on a primary home from their stock option/RSU sales. Some use it toward buying property outright.
Just recently, several of my former colleagues (on the order of 15+) who had a boatload of then worthless Intuit stock options have sold this year and capitalized on 100% appreciation…What did these folks do with the money? They bought a bunch of break even or slightly+ cash flow positive condos and homes in Escondido, sdsu area,etc. One lady bought 6 condos this year along…Fully paid off. I asked her if she was crazy. Her response? “At least these homes are tangible assets with utility… What’s to say my options don’t become $0 next year?” Again, most of these people I know aren’t C-level execs.. Just normal enginerd workerbees that’s been doing the same thing over quite some time at the same company.
December 16, 2010 at 10:31 AM #640844CoronitaParticipant[quote=deadzone]FLU, I don’t disagree that such houselholds exist that you describe. But I disagree that it is a major factor. Furthermore, you are talking about discretionary income. Purchasing a house is not a discretionary purchase. A downpayment is necessary as well as the ability to pay a substantial montly mortage payment. These require two things: 1. cash in hand 2. good salary. Rising stock market isn’t going to help most people with these two things.
Your theory appears to be that if the stock market doesn’t crash the housing market will hold up. I think that is absolutely ridiculous because there simply isn’t very much correlation. Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?[/quote]
I don’t think I’m saying if the stock markets hold up that the housing market isn’t going to come down. But in certain submarkets (the ones that said households are actively looking), I don’t see a swift crash coming in the absence if a roaring equity market continue.
[quote]
Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?
[/quote]Yes I know several people who put 30-40% down on a primary home from their stock option/RSU sales. Some use it toward buying property outright.
Just recently, several of my former colleagues (on the order of 15+) who had a boatload of then worthless Intuit stock options have sold this year and capitalized on 100% appreciation…What did these folks do with the money? They bought a bunch of break even or slightly+ cash flow positive condos and homes in Escondido, sdsu area,etc. One lady bought 6 condos this year along…Fully paid off. I asked her if she was crazy. Her response? “At least these homes are tangible assets with utility… What’s to say my options don’t become $0 next year?” Again, most of these people I know aren’t C-level execs.. Just normal enginerd workerbees that’s been doing the same thing over quite some time at the same company.
December 16, 2010 at 10:31 AM #640980CoronitaParticipant[quote=deadzone]FLU, I don’t disagree that such houselholds exist that you describe. But I disagree that it is a major factor. Furthermore, you are talking about discretionary income. Purchasing a house is not a discretionary purchase. A downpayment is necessary as well as the ability to pay a substantial montly mortage payment. These require two things: 1. cash in hand 2. good salary. Rising stock market isn’t going to help most people with these two things.
Your theory appears to be that if the stock market doesn’t crash the housing market will hold up. I think that is absolutely ridiculous because there simply isn’t very much correlation. Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?[/quote]
I don’t think I’m saying if the stock markets hold up that the housing market isn’t going to come down. But in certain submarkets (the ones that said households are actively looking), I don’t see a swift crash coming in the absence if a roaring equity market continue.
[quote]
Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?
[/quote]Yes I know several people who put 30-40% down on a primary home from their stock option/RSU sales. Some use it toward buying property outright.
Just recently, several of my former colleagues (on the order of 15+) who had a boatload of then worthless Intuit stock options have sold this year and capitalized on 100% appreciation…What did these folks do with the money? They bought a bunch of break even or slightly+ cash flow positive condos and homes in Escondido, sdsu area,etc. One lady bought 6 condos this year along…Fully paid off. I asked her if she was crazy. Her response? “At least these homes are tangible assets with utility… What’s to say my options don’t become $0 next year?” Again, most of these people I know aren’t C-level execs.. Just normal enginerd workerbees that’s been doing the same thing over quite some time at the same company.
December 16, 2010 at 10:31 AM #641298CoronitaParticipant[quote=deadzone]FLU, I don’t disagree that such houselholds exist that you describe. But I disagree that it is a major factor. Furthermore, you are talking about discretionary income. Purchasing a house is not a discretionary purchase. A downpayment is necessary as well as the ability to pay a substantial montly mortage payment. These require two things: 1. cash in hand 2. good salary. Rising stock market isn’t going to help most people with these two things.
Your theory appears to be that if the stock market doesn’t crash the housing market will hold up. I think that is absolutely ridiculous because there simply isn’t very much correlation. Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?[/quote]
I don’t think I’m saying if the stock markets hold up that the housing market isn’t going to come down. But in certain submarkets (the ones that said households are actively looking), I don’t see a swift crash coming in the absence if a roaring equity market continue.
[quote]
Do you honestly know people who recently bought a house and the main reason was because their stock or 401K portfolios went up?
[/quote]Yes I know several people who put 30-40% down on a primary home from their stock option/RSU sales. Some use it toward buying property outright.
Just recently, several of my former colleagues (on the order of 15+) who had a boatload of then worthless Intuit stock options have sold this year and capitalized on 100% appreciation…What did these folks do with the money? They bought a bunch of break even or slightly+ cash flow positive condos and homes in Escondido, sdsu area,etc. One lady bought 6 condos this year along…Fully paid off. I asked her if she was crazy. Her response? “At least these homes are tangible assets with utility… What’s to say my options don’t become $0 next year?” Again, most of these people I know aren’t C-level execs.. Just normal enginerd workerbees that’s been doing the same thing over quite some time at the same company.
December 16, 2010 at 11:01 AM #640222zzzParticipantDZ, I actually agree with a lot of what you say about the macro markets and that the overall housing still has a lot of room to trend downward. However, all of the bad news, the charts, the debates on where the market is heading, and various scenarios and their applicability, come down to your individual situation.
We have been looking at buying a primary home to live in for years, and tired of renting. As rents have been going up, buying starts too make sense.
When people I know state “general” stats on how much housing has declined in XYZ state or in the US as whole lately, I remind them that I don’t really care about those examples, because I don’t want to live there. We don’t really care what SD County or the City of SD does as a whole, because there are many places we don’t want to live.
We’re looking in very specific zip codes. Lets take 92103 for example. There is VERY little inventory period, even less when excluding really small homes, and the inventory is not exactly quality. I would say 98% of the homes we’re looking at are equity sales. A lot of sellers are NOT motivated and end up pulling their homes off the market. There are few foreclosures or short sales we’ve seen and have been in terrible condition and need significant structural work, not to mention interior work. .
This year we saw an equity sale, first time in over 20 years because someone died. It was in impeccable condition and the home had 10+ above asking offers in 1 week. The home was priced very low to attract attention and for other reasons, but it sold for almost 15% above asking, although I believe still undervalued. It was in a part of 92103 that is considered very desirable and the lot and location were great.
So for us, EVEN though we don’t believe housing has bottomed or even that 92103 has bottomed, I do believe that when GREAT homes come on the market and rarely turn over, people will pay a premium for those homes and they will defy the trends of what’s going on in the greater zip code, and macro.
To some of the other posters points, the NEW tract homes I think will suffer the most, but in 92103 and 92104, they don’t exist. You can’t create more craftmans or homes built in 1950 by skilled labor so I believe will suffer less. Plus for people who want to live in a more urban area with walking accessibility to bars, restaurants, parks, etc, you’re not just looking at the house itself.
DZ, if you want to buy a home to live in ( versus purely for investment), then start getting specific about the zip codes, and the street within the neighborhood, the demographics. The macro stats and all the bad news will just drive you crazy. The downward price pressure may not affect your desired area as much as you’d like so stick to the specifics.
Good luck!
December 16, 2010 at 11:01 AM #640293zzzParticipantDZ, I actually agree with a lot of what you say about the macro markets and that the overall housing still has a lot of room to trend downward. However, all of the bad news, the charts, the debates on where the market is heading, and various scenarios and their applicability, come down to your individual situation.
We have been looking at buying a primary home to live in for years, and tired of renting. As rents have been going up, buying starts too make sense.
When people I know state “general” stats on how much housing has declined in XYZ state or in the US as whole lately, I remind them that I don’t really care about those examples, because I don’t want to live there. We don’t really care what SD County or the City of SD does as a whole, because there are many places we don’t want to live.
We’re looking in very specific zip codes. Lets take 92103 for example. There is VERY little inventory period, even less when excluding really small homes, and the inventory is not exactly quality. I would say 98% of the homes we’re looking at are equity sales. A lot of sellers are NOT motivated and end up pulling their homes off the market. There are few foreclosures or short sales we’ve seen and have been in terrible condition and need significant structural work, not to mention interior work. .
This year we saw an equity sale, first time in over 20 years because someone died. It was in impeccable condition and the home had 10+ above asking offers in 1 week. The home was priced very low to attract attention and for other reasons, but it sold for almost 15% above asking, although I believe still undervalued. It was in a part of 92103 that is considered very desirable and the lot and location were great.
So for us, EVEN though we don’t believe housing has bottomed or even that 92103 has bottomed, I do believe that when GREAT homes come on the market and rarely turn over, people will pay a premium for those homes and they will defy the trends of what’s going on in the greater zip code, and macro.
To some of the other posters points, the NEW tract homes I think will suffer the most, but in 92103 and 92104, they don’t exist. You can’t create more craftmans or homes built in 1950 by skilled labor so I believe will suffer less. Plus for people who want to live in a more urban area with walking accessibility to bars, restaurants, parks, etc, you’re not just looking at the house itself.
DZ, if you want to buy a home to live in ( versus purely for investment), then start getting specific about the zip codes, and the street within the neighborhood, the demographics. The macro stats and all the bad news will just drive you crazy. The downward price pressure may not affect your desired area as much as you’d like so stick to the specifics.
Good luck!
December 16, 2010 at 11:01 AM #640874zzzParticipantDZ, I actually agree with a lot of what you say about the macro markets and that the overall housing still has a lot of room to trend downward. However, all of the bad news, the charts, the debates on where the market is heading, and various scenarios and their applicability, come down to your individual situation.
We have been looking at buying a primary home to live in for years, and tired of renting. As rents have been going up, buying starts too make sense.
When people I know state “general” stats on how much housing has declined in XYZ state or in the US as whole lately, I remind them that I don’t really care about those examples, because I don’t want to live there. We don’t really care what SD County or the City of SD does as a whole, because there are many places we don’t want to live.
We’re looking in very specific zip codes. Lets take 92103 for example. There is VERY little inventory period, even less when excluding really small homes, and the inventory is not exactly quality. I would say 98% of the homes we’re looking at are equity sales. A lot of sellers are NOT motivated and end up pulling their homes off the market. There are few foreclosures or short sales we’ve seen and have been in terrible condition and need significant structural work, not to mention interior work. .
This year we saw an equity sale, first time in over 20 years because someone died. It was in impeccable condition and the home had 10+ above asking offers in 1 week. The home was priced very low to attract attention and for other reasons, but it sold for almost 15% above asking, although I believe still undervalued. It was in a part of 92103 that is considered very desirable and the lot and location were great.
So for us, EVEN though we don’t believe housing has bottomed or even that 92103 has bottomed, I do believe that when GREAT homes come on the market and rarely turn over, people will pay a premium for those homes and they will defy the trends of what’s going on in the greater zip code, and macro.
To some of the other posters points, the NEW tract homes I think will suffer the most, but in 92103 and 92104, they don’t exist. You can’t create more craftmans or homes built in 1950 by skilled labor so I believe will suffer less. Plus for people who want to live in a more urban area with walking accessibility to bars, restaurants, parks, etc, you’re not just looking at the house itself.
DZ, if you want to buy a home to live in ( versus purely for investment), then start getting specific about the zip codes, and the street within the neighborhood, the demographics. The macro stats and all the bad news will just drive you crazy. The downward price pressure may not affect your desired area as much as you’d like so stick to the specifics.
Good luck!
December 16, 2010 at 11:01 AM #641010zzzParticipantDZ, I actually agree with a lot of what you say about the macro markets and that the overall housing still has a lot of room to trend downward. However, all of the bad news, the charts, the debates on where the market is heading, and various scenarios and their applicability, come down to your individual situation.
We have been looking at buying a primary home to live in for years, and tired of renting. As rents have been going up, buying starts too make sense.
When people I know state “general” stats on how much housing has declined in XYZ state or in the US as whole lately, I remind them that I don’t really care about those examples, because I don’t want to live there. We don’t really care what SD County or the City of SD does as a whole, because there are many places we don’t want to live.
We’re looking in very specific zip codes. Lets take 92103 for example. There is VERY little inventory period, even less when excluding really small homes, and the inventory is not exactly quality. I would say 98% of the homes we’re looking at are equity sales. A lot of sellers are NOT motivated and end up pulling their homes off the market. There are few foreclosures or short sales we’ve seen and have been in terrible condition and need significant structural work, not to mention interior work. .
This year we saw an equity sale, first time in over 20 years because someone died. It was in impeccable condition and the home had 10+ above asking offers in 1 week. The home was priced very low to attract attention and for other reasons, but it sold for almost 15% above asking, although I believe still undervalued. It was in a part of 92103 that is considered very desirable and the lot and location were great.
So for us, EVEN though we don’t believe housing has bottomed or even that 92103 has bottomed, I do believe that when GREAT homes come on the market and rarely turn over, people will pay a premium for those homes and they will defy the trends of what’s going on in the greater zip code, and macro.
To some of the other posters points, the NEW tract homes I think will suffer the most, but in 92103 and 92104, they don’t exist. You can’t create more craftmans or homes built in 1950 by skilled labor so I believe will suffer less. Plus for people who want to live in a more urban area with walking accessibility to bars, restaurants, parks, etc, you’re not just looking at the house itself.
DZ, if you want to buy a home to live in ( versus purely for investment), then start getting specific about the zip codes, and the street within the neighborhood, the demographics. The macro stats and all the bad news will just drive you crazy. The downward price pressure may not affect your desired area as much as you’d like so stick to the specifics.
Good luck!
December 16, 2010 at 11:01 AM #641328zzzParticipantDZ, I actually agree with a lot of what you say about the macro markets and that the overall housing still has a lot of room to trend downward. However, all of the bad news, the charts, the debates on where the market is heading, and various scenarios and their applicability, come down to your individual situation.
We have been looking at buying a primary home to live in for years, and tired of renting. As rents have been going up, buying starts too make sense.
When people I know state “general” stats on how much housing has declined in XYZ state or in the US as whole lately, I remind them that I don’t really care about those examples, because I don’t want to live there. We don’t really care what SD County or the City of SD does as a whole, because there are many places we don’t want to live.
We’re looking in very specific zip codes. Lets take 92103 for example. There is VERY little inventory period, even less when excluding really small homes, and the inventory is not exactly quality. I would say 98% of the homes we’re looking at are equity sales. A lot of sellers are NOT motivated and end up pulling their homes off the market. There are few foreclosures or short sales we’ve seen and have been in terrible condition and need significant structural work, not to mention interior work. .
This year we saw an equity sale, first time in over 20 years because someone died. It was in impeccable condition and the home had 10+ above asking offers in 1 week. The home was priced very low to attract attention and for other reasons, but it sold for almost 15% above asking, although I believe still undervalued. It was in a part of 92103 that is considered very desirable and the lot and location were great.
So for us, EVEN though we don’t believe housing has bottomed or even that 92103 has bottomed, I do believe that when GREAT homes come on the market and rarely turn over, people will pay a premium for those homes and they will defy the trends of what’s going on in the greater zip code, and macro.
To some of the other posters points, the NEW tract homes I think will suffer the most, but in 92103 and 92104, they don’t exist. You can’t create more craftmans or homes built in 1950 by skilled labor so I believe will suffer less. Plus for people who want to live in a more urban area with walking accessibility to bars, restaurants, parks, etc, you’re not just looking at the house itself.
DZ, if you want to buy a home to live in ( versus purely for investment), then start getting specific about the zip codes, and the street within the neighborhood, the demographics. The macro stats and all the bad news will just drive you crazy. The downward price pressure may not affect your desired area as much as you’d like so stick to the specifics.
Good luck!
December 16, 2010 at 11:02 AM #640237AnonymousGuestFLU, good examples. But I am skeptical that there are enough people in that situation to affect the broader RE market trends.
December 16, 2010 at 11:02 AM #640308AnonymousGuestFLU, good examples. But I am skeptical that there are enough people in that situation to affect the broader RE market trends.
December 16, 2010 at 11:02 AM #640889AnonymousGuestFLU, good examples. But I am skeptical that there are enough people in that situation to affect the broader RE market trends.
December 16, 2010 at 11:02 AM #641025AnonymousGuestFLU, good examples. But I am skeptical that there are enough people in that situation to affect the broader RE market trends.
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