Question for all of the Nostradamus’s on here

[Ricechex]

Alex, it doesn’t take a brain surgeon (and I can guarantee you I am not one!) to figure out that the housing market is dropping and continues to do so. I am not nearly as financially savvy as the rest of these posters, and I suspect my income is quite meager compared to the rest of these guys.

However, I started to watch the market, and check housing prices constantly beginning in 1996. Because I have difficulty making decisions and taking risks with money, it was not until 2001 that I finally bought a small house in the hood, cause that is all I could afford with a 30 year fixed mortgage. It was obvious that there was a frenzy going down. I bought the house so I would have a place for myself and my dog, and I saw rents skyrocketings and people getting booted for condo conversions. This was happenning at an unprecedented pace.

So, all these years, I continue to watch the market. Just search the MLS listings on sdlookup.com, and you will see….many of these homes were bought in 2004-2005 and the listing price is considerably less than the sales price of those years. Furthermore, I see PLENTY of short sales, and prior to these last 6 months, I was unfamiliar with the term. (Now I know what it means)

That suggests that there is trouble in paradise. I see houses in my neighborhood taking months to a year to sell, and that was not what I have been seeing in the last 5 years.

And, yes I thought people were totally stupid buying on those crazy “creative” mortgages these last couple of years. What were they thinking? Didn’t they want to know the terms? How could they think they would be able to pay when their ARMs reset? Were they expecting to inherit a windfall of cash or win the lottery? Didn’t their parents teach them common sense? Not the sharpest tools in the shed.

If I recall correctly, I remember first hearing about the interest only mortgages in 2003-2004, which makes sense now, as it is 3 years in, and the ARMs are re-setting, and guess what, they cannot pay. Thus, the short sales, foreclosures. Since those ARMs continued into late 2006, that brings us to 2009 for the rest of them to go under.

Have some lunch downtown. See all the empty condos. See the for rent signs. Something is awry. The news is mostly bogus, I pay little attention to it….just LOOK AROUND. The market is crashing.

If it walks like a duck and talks like a duck, then it is a duck.

[(former)FormerSanDiegan]

Rocket science – I think you were referring to my graph. Not Alex’s. Pleeze don’t confuse me with him.

I pulled the chart from a discussion we had a couple months ago. In that discussion I plotted both on linear and logarithmic scales. (linear plot below).

In that discussion someone asked what “normal” growth rates are. Well, that’s anyone’s guess. FOr these plots I tried to put a growth rate that intersected the bottom of the market in 1996-1997.

I made a half-assed projection based on the same percentage decline as the last housing bust, then extending it for several years further at the peak rate of decline.

I came up with an optimistic correction of a nominal 20% decline through 2012. Adding about 3% inflation that is a 41% real decline. This is the optimistic range of what I expect. When take more conservative growth rates (e.g. 5% from a “fair value” price in 1998) it’s a bit worse as you indicate in the 40-50% range, depending on how quickly it happens.

Sorry I didn’t have the entire explanation. I was too lazy to look up the entire thread. Just wanted to show Alex that some of our guesses on the market are based on analysis rather than being pulled completely out of thin air.

As a rocket scientist you should appreciate the log scale. A constant growth (or decline) rate shows up as a line on a log scale. Some people have a problem seeing the linear scale go exponential.

[img_assist|nid=3596|title=another half-a$$ed projection|desc=|link=node|align=left|width=466|height=349]

[(former)FormerSanDiegan]

Rocket science – I think you were referring to my graph. Not Alex’s. Pleeze don’t confuse me with him.

I pulled the chart from a discussion we had a couple months ago. In that discussion I plotted both on linear and logarithmic scales. (linear plot below).

In that discussion someone asked what “normal” growth rates are. Well, that’s anyone’s guess. FOr these plots I tried to put a growth rate that intersected the bottom of the market in 1996-1997.

I made a half-assed projection based on the same percentage decline as the last housing bust, then extending it for several years further at the peak rate of decline.

I came up with an optimistic correction of a nominal 20% decline through 2012. Adding about 3% inflation that is a 41% real decline. This is the optimistic range of what I expect. When take more conservative growth rates (e.g. 5% from a “fair value” price in 1998) it’s a bit worse as you indicate in the 40-50% range, depending on how quickly it happens.

Sorry I didn’t have the entire explanation. I was too lazy to look up the entire thread. Just wanted to show Alex that some of our guesses on the market are based on analysis rather than being pulled completely out of thin air.

As a rocket scientist you should appreciate the log scale. A constant growth (or decline) rate shows up as a line on a log scale. Some people have a problem seeing the linear scale go exponential.

[img_assist|nid=3596|title=another half-a$$ed projection|desc=|link=node|align=left|width=466|height=349]

[(former)FormerSanDiegan]

Rocket science – I think you were referring to my graph. Not Alex’s. Pleeze don’t confuse me with him.

I pulled the chart from a discussion we had a couple months ago. In that discussion I plotted both on linear and logarithmic scales. (linear plot below).

In that discussion someone asked what “normal” growth rates are. Well, that’s anyone’s guess. FOr these plots I tried to put a growth rate that intersected the bottom of the market in 1996-1997.

I made a half-assed projection based on the same percentage decline as the last housing bust, then extending it for several years further at the peak rate of decline.

I came up with an optimistic correction of a nominal 20% decline through 2012. Adding about 3% inflation that is a 41% real decline. This is the optimistic range of what I expect. When take more conservative growth rates (e.g. 5% from a “fair value” price in 1998) it’s a bit worse as you indicate in the 40-50% range, depending on how quickly it happens.

Sorry I didn’t have the entire explanation. I was too lazy to look up the entire thread. Just wanted to show Alex that some of our guesses on the market are based on analysis rather than being pulled completely out of thin air.

As a rocket scientist you should appreciate the log scale. A constant growth (or decline) rate shows up as a line on a log scale. Some people have a problem seeing the linear scale go exponential.

[img_assist|nid=3596|title=another half-a$$ed projection|desc=|link=node|align=left|width=466|height=349]

[lendingbubblecontinues]

“I predict that Alex_angel won’t be back until at least 8/16/07.

Nostradumbass”

It seems I was right…Alex_angel has reappeared in the “contrarian view of CFC” topic. Today’s date: 8/16/07.

Could this be an accurate foretelling of the future or merely a coincidence? I will never tell.

Nostradumbass’s’s’s’s’s’s’s’

[lendingbubblecontinues]

“I predict that Alex_angel won’t be back until at least 8/16/07.

Nostradumbass”

It seems I was right…Alex_angel has reappeared in the “contrarian view of CFC” topic. Today’s date: 8/16/07.

Could this be an accurate foretelling of the future or merely a coincidence? I will never tell.

Nostradumbass’s’s’s’s’s’s’s’

[lendingbubblecontinues]

“I predict that Alex_angel won’t be back until at least 8/16/07.

Nostradumbass”

It seems I was right…Alex_angel has reappeared in the “contrarian view of CFC” topic. Today’s date: 8/16/07.

Could this be an accurate foretelling of the future or merely a coincidence? I will never tell.

Nostradumbass’s’s’s’s’s’s’s’

[Alex_angel]

Can you feel the love tonighhhhht. Where is the love. Ha. I love how you are calling each other NostraDumbasses. I didn’t go that low. I just called you guys NostraDomus’s. I’m glad the juvenile crowd took it upon themselves to insult the piggington members that post here. For shame. Tsk Tsk.

Here is my prediction.

None of you are happy. Your life sucks so you hope the same on others. You pray for the crash to affect people so that you can laugh at their lost and beleive that is makes your worthless existence mean something. Pathetic people!

[Alex_angel]

Can you feel the love tonighhhhht. Where is the love. Ha. I love how you are calling each other NostraDumbasses. I didn’t go that low. I just called you guys NostraDomus’s. I’m glad the juvenile crowd took it upon themselves to insult the piggington members that post here. For shame. Tsk Tsk.

Here is my prediction.

None of you are happy. Your life sucks so you hope the same on others. You pray for the crash to affect people so that you can laugh at their lost and beleive that is makes your worthless existence mean something. Pathetic people!

[Alex_angel]

Can you feel the love tonighhhhht. Where is the love. Ha. I love how you are calling each other NostraDumbasses. I didn’t go that low. I just called you guys NostraDomus’s. I’m glad the juvenile crowd took it upon themselves to insult the piggington members that post here. For shame. Tsk Tsk.

Here is my prediction.

None of you are happy. Your life sucks so you hope the same on others. You pray for the crash to affect people so that you can laugh at their lost and beleive that is makes your worthless existence mean something. Pathetic people!

[gn]

Here is my prediction:

As a consequence of Alex’s lack of real estate knowledge/understanding, he will become increasingly baffled by the housing market.

Alex will become increasingly confused and exhibit a split personality, bordering on schizophrenia.

Eventually, he will give up & pull the trigger (buy a house). He will end up being a “knife catcher” & got cut badly 🙂

[gn]

Here is my prediction:

As a consequence of Alex’s lack of real estate knowledge/understanding, he will become increasingly baffled by the housing market.

Alex will become increasingly confused and exhibit a split personality, bordering on schizophrenia.

Eventually, he will give up & pull the trigger (buy a house). He will end up being a “knife catcher” & got cut badly 🙂

[gn]

Here is my prediction:

As a consequence of Alex’s lack of real estate knowledge/understanding, he will become increasingly baffled by the housing market.

Alex will become increasingly confused and exhibit a split personality, bordering on schizophrenia.

Eventually, he will give up & pull the trigger (buy a house). He will end up being a “knife catcher” & got cut badly 🙂

[SD Realtor]

Alex, some of us replied to your post in a rational manner with no name calling. I agree with you that name calling is not appropriate.

Would you care to address my response to your post?

SD Realtor

[SD Realtor]

Alex, some of us replied to your post in a rational manner with no name calling. I agree with you that name calling is not appropriate.

Would you care to address my response to your post?

SD Realtor

[Author]

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