New Lunacy Level?

[yooklid]

http://www.usatoday.com/money/economy/housing/2006-06-26-affordable-homes-usat_x.htm

When a young lady has to sell one of her eggs to afford a house you know things are out of control. Particularly when she sees no problem with 70% of her gross income being spent on the house.

What sort of psychological effect can drive people to such extremes? Can people be really such slaves to an inclusiveness factor?

Still, at least she had a downpayment!

How many other people would have bought her place with 100% financing?

[PD]

The article said, “One out of three Americans fear that rising monthly payments — especially property taxes and energy costs — will force them to sell their home and buy a less expensive one, according to a survey to be released today by the National Association of Realtors.”

One out of three is quite a lot. When their home value starts to decline, what will that do to their fear?

[powayseller]

I was quoting this stuff several months ago, and was labeled an extremist. I take that as a compliment, but the point is: even people on this forum don’t fully realize how bad this is going to get.

June sales are off 40% over last year. 30% of listings are vacant. This downward spiral is picking up momentum. But the newspapers won’t carry this story until August or September. By then, we’ll read about a negative y-o-y median price.

Does anyone know the builder cancellation rate in San Diego? That rate needs to be added to the new home sales to get the true new home sales figure.

[Bugs]

I was standing in a subdivision sales office yesterday confirming the details of a pending sale. The sales agent was on the phone with their office. He made several references to “replacing cans” in the conversation. I was trying to tune him out because I don’t want to eavesdrop but the phrase caught my attention because I couldn’t place it as a construction term. Finally I gave up and started listening in (guilty) for content long enough to figure out they were talking about cancellations. Duh.

That subdivision has 37 units and about half of them are already completed, so I’d say that for them to have more than a couple cancellations to deal with at any one time is indicative of a problem for them.

[PD]

I also overheard a conversation yesterday. A young woman was talking to another about the fact that she just graduated from college (maybe grad school?). She was saying that she and her husband were going to move to Michigan as they can’t afford to buy a house here and she wants to own. She did not sound too happy.

Just another slice of the forced outmigration!

[powayseller]

Are builder cancellations published? Is the revised new-home sales figure a result of adjusting for cancellations?

[Lickitysplit]

If anything this shows the extremes that people have and will continue to go to be able to buy (or keep) a house. It is this at-any-cost attitude that got us here in the first place. This is a great city, but $600k for a 50 yr old breadbox 10 feet from the next breadboxes? c’mon.

[kewp]

“This is a great city, but $600k for a 50 yr old breadbox 10 feet from the next breadboxes? c’mon.”

I wonder how ‘great’ this city is going to be considered when a third of it is dirt lots, unfinshed condo converstions and shuttered small businesses.

[barnaby33]

Well when you put it like that, sheeesh.

Josh

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