Solana Beach Oceanview Condo’s Still Expensive

[I would rather be lucky then smart]

Someone please let me know

when a unit like that can be purchased at the “anti-bubble” price of the high $400K’s:

a: never
b: dream on
c: in 200??

[blahblahblah]

Using a generic inflation calculator online shows a value of $437,000 (approximately for this home).

Inflation calculators use the government published GDP deflator figures. Remember, these are the same figures that they use to justify keeping interest rates depressed below what they really should be. If you believe the reported GDP deflator, you might as well believe in Santa Claus and the Tooth Fairy. Real inflation is much, much higher and since the fed quit publishing M3 is probably running at 10%/year or more. Things are getting extremely expensive now and it’s going to get worse.

Home prices will continue to decline in nominal dollars, however IMO they will not get anywhere close to 2000 nominal values. They will drop below 2000 real values back to 1995 real values or less. However, that condo still might cost you $550K in nominal dollars.

For this to happen, salaries of course will have to rise. I think this will start happening in many industries during 2008 and 2009, especially medical, homeland security, military, all of the stuff that’s subsidized by the government, pharma, or insurance industries. I expect the government Keynesian policies to just get more extreme as that’s the only lever they know how to pull. Just spend, spend, spend and print dollars faster and faster. Everyone will just be happy that they have a $150K/yr job in the Homeland Security department looking through people’s email — or a $200K/yr job with a private security contractor, patrolling main street to keep the poor people from rioting — or a $200K/yr job with a big insurance company trying to find ways to deny Aunt Millie’s claims for chemotherapy. We are completing the transition into a full socialist corporatocracy that has been going on for a long time.

Do I want this to happen? Of course not. However, it’s what I expect.

[blahblahblah]

Using a generic inflation calculator online shows a value of $437,000 (approximately for this home).

Inflation calculators use the government published GDP deflator figures. Remember, these are the same figures that they use to justify keeping interest rates depressed below what they really should be. If you believe the reported GDP deflator, you might as well believe in Santa Claus and the Tooth Fairy. Real inflation is much, much higher and since the fed quit publishing M3 is probably running at 10%/year or more. Things are getting extremely expensive now and it’s going to get worse.

Home prices will continue to decline in nominal dollars, however IMO they will not get anywhere close to 2000 nominal values. They will drop below 2000 real values back to 1995 real values or less. However, that condo still might cost you $550K in nominal dollars.

For this to happen, salaries of course will have to rise. I think this will start happening in many industries during 2008 and 2009, especially medical, homeland security, military, all of the stuff that’s subsidized by the government, pharma, or insurance industries. I expect the government Keynesian policies to just get more extreme as that’s the only lever they know how to pull. Just spend, spend, spend and print dollars faster and faster. Everyone will just be happy that they have a $150K/yr job in the Homeland Security department looking through people’s email — or a $200K/yr job with a private security contractor, patrolling main street to keep the poor people from rioting — or a $200K/yr job with a big insurance company trying to find ways to deny Aunt Millie’s claims for chemotherapy. We are completing the transition into a full socialist corporatocracy that has been going on for a long time.

Do I want this to happen? Of course not. However, it’s what I expect.

[blahblahblah]

Using a generic inflation calculator online shows a value of $437,000 (approximately for this home).

Inflation calculators use the government published GDP deflator figures. Remember, these are the same figures that they use to justify keeping interest rates depressed below what they really should be. If you believe the reported GDP deflator, you might as well believe in Santa Claus and the Tooth Fairy. Real inflation is much, much higher and since the fed quit publishing M3 is probably running at 10%/year or more. Things are getting extremely expensive now and it’s going to get worse.

Home prices will continue to decline in nominal dollars, however IMO they will not get anywhere close to 2000 nominal values. They will drop below 2000 real values back to 1995 real values or less. However, that condo still might cost you $550K in nominal dollars.

For this to happen, salaries of course will have to rise. I think this will start happening in many industries during 2008 and 2009, especially medical, homeland security, military, all of the stuff that’s subsidized by the government, pharma, or insurance industries. I expect the government Keynesian policies to just get more extreme as that’s the only lever they know how to pull. Just spend, spend, spend and print dollars faster and faster. Everyone will just be happy that they have a $150K/yr job in the Homeland Security department looking through people’s email — or a $200K/yr job with a private security contractor, patrolling main street to keep the poor people from rioting — or a $200K/yr job with a big insurance company trying to find ways to deny Aunt Millie’s claims for chemotherapy. We are completing the transition into a full socialist corporatocracy that has been going on for a long time.

Do I want this to happen? Of course not. However, it’s what I expect.

[blahblahblah]

Using a generic inflation calculator online shows a value of $437,000 (approximately for this home).

Inflation calculators use the government published GDP deflator figures. Remember, these are the same figures that they use to justify keeping interest rates depressed below what they really should be. If you believe the reported GDP deflator, you might as well believe in Santa Claus and the Tooth Fairy. Real inflation is much, much higher and since the fed quit publishing M3 is probably running at 10%/year or more. Things are getting extremely expensive now and it’s going to get worse.

Home prices will continue to decline in nominal dollars, however IMO they will not get anywhere close to 2000 nominal values. They will drop below 2000 real values back to 1995 real values or less. However, that condo still might cost you $550K in nominal dollars.

For this to happen, salaries of course will have to rise. I think this will start happening in many industries during 2008 and 2009, especially medical, homeland security, military, all of the stuff that’s subsidized by the government, pharma, or insurance industries. I expect the government Keynesian policies to just get more extreme as that’s the only lever they know how to pull. Just spend, spend, spend and print dollars faster and faster. Everyone will just be happy that they have a $150K/yr job in the Homeland Security department looking through people’s email — or a $200K/yr job with a private security contractor, patrolling main street to keep the poor people from rioting — or a $200K/yr job with a big insurance company trying to find ways to deny Aunt Millie’s claims for chemotherapy. We are completing the transition into a full socialist corporatocracy that has been going on for a long time.

Do I want this to happen? Of course not. However, it’s what I expect.

[blahblahblah]

Using a generic inflation calculator online shows a value of $437,000 (approximately for this home).

Inflation calculators use the government published GDP deflator figures. Remember, these are the same figures that they use to justify keeping interest rates depressed below what they really should be. If you believe the reported GDP deflator, you might as well believe in Santa Claus and the Tooth Fairy. Real inflation is much, much higher and since the fed quit publishing M3 is probably running at 10%/year or more. Things are getting extremely expensive now and it’s going to get worse.

Home prices will continue to decline in nominal dollars, however IMO they will not get anywhere close to 2000 nominal values. They will drop below 2000 real values back to 1995 real values or less. However, that condo still might cost you $550K in nominal dollars.

For this to happen, salaries of course will have to rise. I think this will start happening in many industries during 2008 and 2009, especially medical, homeland security, military, all of the stuff that’s subsidized by the government, pharma, or insurance industries. I expect the government Keynesian policies to just get more extreme as that’s the only lever they know how to pull. Just spend, spend, spend and print dollars faster and faster. Everyone will just be happy that they have a $150K/yr job in the Homeland Security department looking through people’s email — or a $200K/yr job with a private security contractor, patrolling main street to keep the poor people from rioting — or a $200K/yr job with a big insurance company trying to find ways to deny Aunt Millie’s claims for chemotherapy. We are completing the transition into a full socialist corporatocracy that has been going on for a long time.

Do I want this to happen? Of course not. However, it’s what I expect.

[HappyHouseHunting]

“Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.”

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Bubble pricing by definition implies that this pricing was created by truly believing in the Easter Bunny or Santa Claus, you know, “real estate always goes up”, “I can always refinance”, “I can sell and take equity out,” etc., etc. and the banks, those bastions of rationality, actually loaned the money to do this.

‘Tis a puzzlement to me.

[HappyHouseHunting]

“Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.”

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Bubble pricing by definition implies that this pricing was created by truly believing in the Easter Bunny or Santa Claus, you know, “real estate always goes up”, “I can always refinance”, “I can sell and take equity out,” etc., etc. and the banks, those bastions of rationality, actually loaned the money to do this.

‘Tis a puzzlement to me.

[HappyHouseHunting]

“Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.”

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Bubble pricing by definition implies that this pricing was created by truly believing in the Easter Bunny or Santa Claus, you know, “real estate always goes up”, “I can always refinance”, “I can sell and take equity out,” etc., etc. and the banks, those bastions of rationality, actually loaned the money to do this.

‘Tis a puzzlement to me.

[HappyHouseHunting]

“Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.”

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Bubble pricing by definition implies that this pricing was created by truly believing in the Easter Bunny or Santa Claus, you know, “real estate always goes up”, “I can always refinance”, “I can sell and take equity out,” etc., etc. and the banks, those bastions of rationality, actually loaned the money to do this.

‘Tis a puzzlement to me.

[HappyHouseHunting]

“Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.”

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Bubble pricing by definition implies that this pricing was created by truly believing in the Easter Bunny or Santa Claus, you know, “real estate always goes up”, “I can always refinance”, “I can sell and take equity out,” etc., etc. and the banks, those bastions of rationality, actually loaned the money to do this.

‘Tis a puzzlement to me.

[blahblahblah]

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Man I wish I knew where this was gonna end. It can’t end well. The only things I know for sure are that a lot of people with way more money and power than yours truly have a vested interest in keeping this charade going as long as possible and that this country is unique in its ability to print currency backed by nothing that everyone else in the world is obliged to accept. Nothing about this scenario is “real” in any sense of the word.

It has been touched on in other threads on this site that the concept of homeowning in this country may become sort of a lifetime rental arrangement from the bank. Meaning, your average “homeowner” will never pay off their mortgage. Note that in many other countries (in south america for example) there are not really mortgage loans as in the US. People pay cash for homes or they don’t get to buy them at all. It used to be that way here in the US, too. For a few decades, mortgages were very effective in allowing a large number of citizens to own property but I’m worried that those days may be over. Remember that the powers that be don’t want you and I to own property. They want us to be indebted for our entire lives. If we’re not paying interest to them, they’re not getting paid. When they’re not getting paid, they get upset. And when they get upset, watch out.

Depressing, isn’t it! Of course I could be wrong. I HOPE I’m wrong!

[blahblahblah]

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Man I wish I knew where this was gonna end. It can’t end well. The only things I know for sure are that a lot of people with way more money and power than yours truly have a vested interest in keeping this charade going as long as possible and that this country is unique in its ability to print currency backed by nothing that everyone else in the world is obliged to accept. Nothing about this scenario is “real” in any sense of the word.

It has been touched on in other threads on this site that the concept of homeowning in this country may become sort of a lifetime rental arrangement from the bank. Meaning, your average “homeowner” will never pay off their mortgage. Note that in many other countries (in south america for example) there are not really mortgage loans as in the US. People pay cash for homes or they don’t get to buy them at all. It used to be that way here in the US, too. For a few decades, mortgages were very effective in allowing a large number of citizens to own property but I’m worried that those days may be over. Remember that the powers that be don’t want you and I to own property. They want us to be indebted for our entire lives. If we’re not paying interest to them, they’re not getting paid. When they’re not getting paid, they get upset. And when they get upset, watch out.

Depressing, isn’t it! Of course I could be wrong. I HOPE I’m wrong!

[blahblahblah]

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Man I wish I knew where this was gonna end. It can’t end well. The only things I know for sure are that a lot of people with way more money and power than yours truly have a vested interest in keeping this charade going as long as possible and that this country is unique in its ability to print currency backed by nothing that everyone else in the world is obliged to accept. Nothing about this scenario is “real” in any sense of the word.

It has been touched on in other threads on this site that the concept of homeowning in this country may become sort of a lifetime rental arrangement from the bank. Meaning, your average “homeowner” will never pay off their mortgage. Note that in many other countries (in south america for example) there are not really mortgage loans as in the US. People pay cash for homes or they don’t get to buy them at all. It used to be that way here in the US, too. For a few decades, mortgages were very effective in allowing a large number of citizens to own property but I’m worried that those days may be over. Remember that the powers that be don’t want you and I to own property. They want us to be indebted for our entire lives. If we’re not paying interest to them, they’re not getting paid. When they’re not getting paid, they get upset. And when they get upset, watch out.

Depressing, isn’t it! Of course I could be wrong. I HOPE I’m wrong!

[blahblahblah]

Sigh. Where does it all end then? We had stupid lending which led to this housing bubble, people getting greedy and buying beyond their means (no fat government salary here), but inflation, the real one, will keep this house and many others at a high level? So are these prices “real?”

Man I wish I knew where this was gonna end. It can’t end well. The only things I know for sure are that a lot of people with way more money and power than yours truly have a vested interest in keeping this charade going as long as possible and that this country is unique in its ability to print currency backed by nothing that everyone else in the world is obliged to accept. Nothing about this scenario is “real” in any sense of the word.

It has been touched on in other threads on this site that the concept of homeowning in this country may become sort of a lifetime rental arrangement from the bank. Meaning, your average “homeowner” will never pay off their mortgage. Note that in many other countries (in south america for example) there are not really mortgage loans as in the US. People pay cash for homes or they don’t get to buy them at all. It used to be that way here in the US, too. For a few decades, mortgages were very effective in allowing a large number of citizens to own property but I’m worried that those days may be over. Remember that the powers that be don’t want you and I to own property. They want us to be indebted for our entire lives. If we’re not paying interest to them, they’re not getting paid. When they’re not getting paid, they get upset. And when they get upset, watch out.

Depressing, isn’t it! Of course I could be wrong. I HOPE I’m wrong!

[Author]

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