Seller declined my offer

[gold_dredger_phd]

Wait until a recession and job losses to start before buying any real estate. After all, one of the jobs lost might be yours!

[powayseller]

That’s right. One of the jobs lost might be yours. It’s foolish to buy a house now, not knowing if our job is secure. Even governments lay off. My husband, whose company did work mainly for the Navy, was laid off from his job last week. Thankfully, he is excited about other prospects, but we are facing an uncertain time right now. Those who are not yet laid off: how do you know that you won’t be?

[an]

The problem is no job is ever secure except for government jobs. So if you base buying a house on that criteria, then you’ll never buy a house. A job might be secure for 5-10 years, but no one can ever say their job is secure for 30 years, the duration of their mortgage.

[Anonymous]

Sorry about your husband’s job loss, ps. Hope that he finds something interesting and that pays well soon.

It’s only my gut sense, but my read of the economic tea leaves in the U.S. and worldwide is that things are going to be really tough beginning in ’08/’09, after lots of asset-backed securities collapse, leaving thousands of folks/entities pointing fingers at each other for counterparty risk assumption and proceeds.

Yes, an, one can’t count on a job lasting 30 years. That’s why sane/logical folks save, to get them through the inevitable downturns. That’s clearly been my approach since graduating from college 21 years ago.

Rent, repent, save, and arm.

[Anonymous]

It’s great practice to make “dry runs” at sellers now as it prepares you for later in the market.

A couple of things to add to your action plan:
1) The best time to make an offer is the 2nd Tuesday of the month. The seller has gone through another weekend with no offer and yet another mortgage payment.
2) Make your offer as a “multiple buying offer”….same crap the sellers did in the frenzy. If anyone is interested, I’ll post the verbiage.

[PerryChase]

PS, I’m also sorry about your husband’s job loss. May he find a better job this new year. I hope you’ll keep on posting your thought provoking comments on Piggington. Best wishes to you and your family.

A friend of mine owns a company that does work for the military. He’s happier then ever because the war in Iraq is causing our government to spend money with him. The orders are keeping him very busy. He’s renting.

I too think that we’ll have a global crisis of some sort. However, we’ll find a way to get through.

[an]

jg, that’s my exact point. You can’t count on a job lasting 30 years, so you have to save, even when you buy a house. Which mean you should not stretch to own a home. That’s why rent is a supporting fundamental.

[BuyerWillEPB]

Stan – What is a “multiple buying offer?”

I’ve never heard that term.

[Anonymous]

Makes sense what you say, an.

[lostkitty]

Powayseller-
So sorry to hear about the lay-off – the week before Christmas?! It is stressful, even with cash reserves. I hope he can find new work quickly.

We’ve been there, as you know. My husband was hired back to his airline pilot job after only six months laid off, but he realized upon his return that some of the companies he interviewed for were actually better than the big airline job. Fast forward three years, and he is out of the airlines and into a small local company. He loves it, says it is like stepping back into the 60’s working for this company… Hams and Turkeys given out at the holidays, hefty bonuses, often, and for all, not just the top dogs (although he is one of the top 5 dogs).
The company took a huge hit after 9-11 as well, and lost a giant project building a significant portion of a new military aircraft a few months later, however, they did not layoff a single employee. they cut back on hours, but everyone remained employed.

Interestingly, this company opened a San Diego branch about ten years ago, and it was eventually closed due to “cultural work issues”… meaning, they wouldnt work very hard out there. Couldnt produce the same amount and there was all kinds of whining and carrying on.
The weather is gorgeous, and it is my hometown, but leaving there was the best thing we ever did. Things are just too messed up.
Anyway, leaving San Diego probably isnt an option for you with kids in highschool, but certainly the layoff could end up being a good thing for you… so GOOD LUCK to you and your husband. I wish you the best.

[mixxalot]

I had a lucrative contract with the Navy in Ventura that was supposed to last 3-5 years. However, for some queer reason, the manager (a female) did not like me and canned me from the project. No valid reason was given and it was not performance because all work was completed accurately and on time. It was political and since I was a contractor and not government employee they were able to can me on the spot. I hated Ventura anyways. Well fast forward to now. It took me 2 months to find another technology job and fortunately I was able to keep my place in San Diego while away in Ventura and move back to my apartment. I start the new job next week so should hopefully be more stable. Just shows no job is secure and one must have savings in layoffs and terminations. I wont buy a place for several more years until market corrects as the fundamentals do not support current inflated prices. After all, how can a family or household with 90k income pay half a million for a sandbox? It does not add up.

[balasr]

Lostkitty, layoffs happen almost always before Christmas, especially late Nov-early Dec. I have seen this happen many times over the 10 years I have been working (even during the go-go days of the late 90s). I work in the tech area (not IT). It’s all about balancing the books for the next quarter, and being able to take a “charge”. Depressing, but true.

[powayseller]

Thanks for the well wishes. In my husband’s case, the war in Iraq strained the military budget from its other projects, so they were cutting back. There are also lots of competitors, and when you spend 6 months of payroll vying for a 10 year contract and end up not getting it, eventually it cuts into your profits. I was expecting to take a hit from the recession, but didn’t think it would happen so soon.

The reason I would not buy a house now is that our unemployment rate is certain to double. So while no job is ever secure, the insecurity right now is heightened. Anybody working in any way on projects related to consumer spending (making chips, software, TVs, etc.) should consider their job on the line. The highest security now is in health care and government jobs. But even government jobs will be cut drastically when property tax and sales tax and income tax revenue drops during the recession. Teachers, firefighters, police officers, clerks the county office, are not exempt. In short, this is the time to save extra hard, not take on new spending.

an, I hope your job is safe, but what if it isn’t? Couldn’t you survive a lay-off better as a renter than as a homeowner? Only you can decide if this is a risk you are willing to take.

[an]

When I refer to government jobs, I mean actually working for the military as a civilian. My dad is an Engineer for the Navy. I know that if you work for the military, your job is 100% secure unless u do something really stupid. If the base close, they will relocate you somewhere else, but you’ll never be fired. My wife is a nurse, so I think her job is pretty safe. Regarding my job, I think I’m safe for at least a year or two. After that, who knows. But I think I’m flexible enough that I can do something else. It really all depends on when you bought. I know people who bought at the bottom of the last crash and they too advantage of the low rate, now their mortgage payment is only around $800/month. So if you buy a house at a price that’s supported by fundamental, then you can weather the storm better as a buyer.

[PerryChase]

That’s the problem with our government. It’s bloated. Like in business, under-performing units should be closed so the resources can be better allocated elsewhere.

I’m a social liberal, but I very much support the conservatives ideas of starving the beast. I hope very much that those ideas will come back.

[Author]

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