I didn’t see this posted here….wonder why?

[one_muggle]

Econ 101 – future supply (low for N. County Coastal) vs future demand (seems to be holding strong.) Does this boost the simple argument?

What you seem to be missing, and is the gist of the many examples here is that the “simple” supply-demand curve relates to price. An analysis by Global Insights, which takes into account the historic desirability of an area, as well as population and salaries, puts SD about 30-40% over its intrinsic value. This belies the idea that population growth will keep RE up.
So does the fact that from 1990 to 2000, the number of >$100k (adjusted for inflation) households has dropped, as a percentage of total population. In 1990 it was around 28%, but in 2000 the percentage dropped to about 16%. This is due in part to a high number of younger, college aged population moving in.

A survey done by (I think) Forbes, showed that a healthy chunk of higher-income college grads all but killed themselves to get into RE in the major markets since around 2001, possibly “stealing” demand from future years. In addition, retiring boomers have begun putting off home sales in metro areas (to move to less expensive locales) in an effort to wait out this crunch. This is fueling pent-up supply. In most major markets, the bulk of For Sale’s are becoming need-to-sell inventory (forced sales, job move, retirement, bought another home, etc).

The fraction of people that can afford the median priced home is less than 10 percent, see:
[img_assist|nid=4186|title=SD and LA Affordability Index: Probability of no crash…small|desc= The chart above shows that less than 2% of LA and 6% of SD can afford a median priced home. |link=node|align=left|width=466|height=360]

With the fundamental firmly against a continued RE boom and the expected value of SoCal RE running negative, the burden of proof is on RE bulls. The sunshine tax did not save Florida and it will not save California.

[johnnyre]

Don’t take Carlsbadmtnbkr seriously…….he or she is clueless

[Duck]

<<<< In most major markets, the bulk of For Sale's are becoming need-to-sell inventory (forced sales, job move, retirement, bought another home, etc). >>>>

I would guess that the majority of For Sale’s for the last 100 years in every market are for one of the reasons you state above. Why else would you move?

[one_muggle]

Why else would you move?

Seriously!? Do you live in California?
People in CA move every three years, on average. Do you really think they all need to move? They move to bigger homes, closer to the beach, further from the traffic, whatever.

People that MUST sell are people that cannot, without serious financial repercussions, keep the property. Which, as I said are forced sales, job move, retirement, bought another home, etc. Many people that were thinking of moving up, can no longer afford the financing, so they choose not to sell, yet. People expecting to use their homes as retirement are now waiting to sell, according to AARP and Money.com. Flippers who cannot sell their places are becoming unintentional landlords, and are waiting to sell. If you can’t tell the difference between “Must Sell (or buy)” and “Want to Sell (or buy)”, I hope your livelihood does not depend on understanding markets.

There are plenty of reasons why people sell homes when they do not NEED to sell, and those people seem to be waiting, for now. Unlike Hovnanian,

http://www.cnbc.com/id/20772628

Hovnanian, struggling like other home builders, is offering six-figure discounts on some of its properties this weekend as it attempts to draw interest in a slumping market. The sales blitz involves dropping prices by more than 20% on some of its prime real estate.

Go buy one, you’ll have an instant couple hundred thousand in equity… because RE isn’t really dropping, it’s all a media conspiracy.

[johnnyre]

Great news first Hovanian, and then I hope that “Blood-Sucking” Lennar Corp goes next….lol Lennar you got it coming at ya…. I remember last year Lennar wanted all their subs to take a %20 across the board cut, or loose Lennars work….hahahah screw u Lennar u greedy bastards
love
Stupid Idiot Renter (aka former drywall sub(illegal alien babysitter).. for Lennar and Hovanian) lol0l0 LOL

[Duck]

Read your post again.

You say “there are plenty of reasons why people sell their homes when they do not need to sell”

Are you drinking, Muggle? In this market? Who would be that stupid?

I have an idea.

[one_muggle]

Duck,

You might try responding without stooping to juvenile veiled ad hominem insults. I really wonder whether you are just being annoying or if, possibly, English is not your first language.

Yes, I said:
there are plenty of reasons why people sell their homes when they do not need to sell

I suggest that you read it again, and maybe the context will help. The point I made is that people that are not under pressure to sell are currently choosing not to sell, stupid or not. This may be creating pent-up demand.

If you don’t understand the sentence, perhaps a few examples will help:
I’ve sold property because I made more on the sale than on the rent, but I didn’t need to sell.
I sold my primary residence because I wanted a better school district. I didn’t need to move, I could have used the current school, or paid for private school, but I chose to move.
I sold an old condo because it was more of a hassle to rent it than it was worth. I did not need to sell.
The idea that one would sell something when one did not need to sell is not that hard. Those with a choice, who are choosing not to sell are increasing in number.
If you need more help understanding this concept, you might hire a tutor.

-one muggle

[CarlsbadMtnBiker]

muggleman … your (long winded) context and overexplaination did not help.

If u sold, u must have needed to sell. If u didn’t, that I guess u didn’t need to.

May I suggest you choose simplicity over condescending others…

[cr]

“… I may rent to you though. I know you are liquid $300K but how’s your rental history/credit? Did you and cooprider14 check out that place in Nestor yet?”

Biker-boi,
I live in LA and do not want to move to San Diego so there goes your argument that everyone wants to live there.

I would consider buying an investment property in SD in 3-4 years when prices are down another 50%.

[Author]

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