The Tipping Point Is Here

[Anonymous]

The perfect alignment of the real estate planets has past. Consider all the factors that have recently driven up real esate prices: low interest rates, low unemployment, a robust economy, easy credit qualification, 100% financing, money fleeing the financial markets (especially in 2000-2002), no doc approvals on loans (i.e. “liar-liar loans”), and of course red hot speculation. Which of these factors are going to IMPROVE in the forseeable future? I can’t name a single one. Congress is busy passing legislation for tighter requirements on new loan applications (MN already requires full docs), and interest rates have bounced up from 45 year lows. Throw in an unprecedented volume of ARMS that are hitting reset, and no more cheap money to save the day. The planets are moving further from alignment and we may be in for a multi-year cycle for re-alignment.

[Anonymous]

The perfect alignment of the real estate planets has past. Consider all the factors that have recently driven up real esate prices: low interest rates, low unemployment, a robust economy, easy credit qualification, 100% financing, money fleeing the financial markets (especially in 2000-2002), no doc approvals on loans (i.e. “liar-liar loans”), and of course red hot speculation. Which of these factors are going to IMPROVE in the forseeable future? I can’t name a single one. Congress is busy passing legislation for tighter requirements on new loan applications (MN already requires full docs), and interest rates have bounced up from 45 year lows. Throw in an unprecedented volume of ARMS that are hitting reset, and no more cheap money to save the day. The planets are moving further from alignment and we may be in for a multi-year cycle for re-alignment.

[lendingbubblecontinues]

rb_e:

Which is it? COULD it get worse or WILL it get worse?

If even you, fortunate enough to have found this blog, are wavering on this question, obviously my point is crystallizing.

Sentiment has to change dramatically from here. I respectfully disagree that “regular people” have any negative sentiment whatsoever.

I venture that the percentage of people who are truly bearish on the real estate market is statistically insignificant (near 0%) when you really consider all the dolts in this country.

OK, somewhat off topic but I don’t buy the old adage used by realtors either that “time will tell”…

The last realtor who used that line with me lost her flipping house (McMansion in North County) to foreclosure, very recently. Time has spoken bee-yotch!!!!! Loud and clear!!!

[lendingbubblecontinues]

rb_e:

Which is it? COULD it get worse or WILL it get worse?

If even you, fortunate enough to have found this blog, are wavering on this question, obviously my point is crystallizing.

Sentiment has to change dramatically from here. I respectfully disagree that “regular people” have any negative sentiment whatsoever.

I venture that the percentage of people who are truly bearish on the real estate market is statistically insignificant (near 0%) when you really consider all the dolts in this country.

OK, somewhat off topic but I don’t buy the old adage used by realtors either that “time will tell”…

The last realtor who used that line with me lost her flipping house (McMansion in North County) to foreclosure, very recently. Time has spoken bee-yotch!!!!! Loud and clear!!!

[rb_engineer]

lendingbubbleco,

Now you are saying I’m average. I would disagree with that. I probably can’t answer that question because I just don’t know. I hope it goes down a lot, 50-75% (to pre 2000 levels).

I don’t know why you think that you are “special” because you think SD housing is overpriced. Its blatantly clear that it is!

Maybe because most colleagues of mine are well informed. When one of them buys a house now (a contrarian investor, I would say), most of us roll our eyes expressing our disbelief. We say “hey, why didn’t you wait for the ARMs to reset!”

[rb_engineer]

lendingbubbleco,

Now you are saying I’m average. I would disagree with that. I probably can’t answer that question because I just don’t know. I hope it goes down a lot, 50-75% (to pre 2000 levels).

I don’t know why you think that you are “special” because you think SD housing is overpriced. Its blatantly clear that it is!

Maybe because most colleagues of mine are well informed. When one of them buys a house now (a contrarian investor, I would say), most of us roll our eyes expressing our disbelief. We say “hey, why didn’t you wait for the ARMs to reset!”

[lendingbubblecontinues]

I am special. My mommy told me so.

OK…When Would Jesus Buy a House? That’s the real question here.

[lendingbubblecontinues]

I am special. My mommy told me so.

OK…When Would Jesus Buy a House? That’s the real question here.

[Enorah]

Hey! Play nicely on my psychic thread

[Enorah]

Hey! Play nicely on my psychic thread

[cr]

What you’re feeling is the fact that mainstream media is finally accepting that a soft landing is not gonna happen.

Foreclosures and inventories are up, sales and prices are down. People are out of money, equity, and strapped by debt.

It ultimately doesn’t matter what anyone thinks, wants, or feels. The wrecklessness has been sewn, and now the fallout is being reaped.

We’ve just known it for longer than everyone else, so it’s validating when other people see the light.

[cr]

What you’re feeling is the fact that mainstream media is finally accepting that a soft landing is not gonna happen.

Foreclosures and inventories are up, sales and prices are down. People are out of money, equity, and strapped by debt.

It ultimately doesn’t matter what anyone thinks, wants, or feels. The wrecklessness has been sewn, and now the fallout is being reaped.

We’ve just known it for longer than everyone else, so it’s validating when other people see the light.

[Anonymous]

Kevin DePew at minyanville.com has been and is staying all over the financial media propaganda concerning the debt orgy and subsequent asset bubbles it created. Scroll down to his item #3, “Jai Guru Containment” for a black humor look at how the spin meisters are hard at work (photo of great T-shirt) and the “Mr. T Gold Price Indicator is a hoot, too:

http://www.minyanville.com/articles/JPM-BSC-S%26P-CFC-CDO-subprime-AXP/index/a/13446
Minyanville – NEWS & VIEWS-Article

[Anonymous]

Kevin DePew at minyanville.com has been and is staying all over the financial media propaganda concerning the debt orgy and subsequent asset bubbles it created. Scroll down to his item #3, “Jai Guru Containment” for a black humor look at how the spin meisters are hard at work (photo of great T-shirt) and the “Mr. T Gold Price Indicator is a hoot, too:

http://www.minyanville.com/articles/JPM-BSC-S%26P-CFC-CDO-subprime-AXP/index/a/13446
Minyanville – NEWS & VIEWS-Article

[sdrealtor]

Just to clarify my comments on the presence of a tipping point. There is no question that the market has definitely turned. Personally, I felt the beginning of the change around June of 2004 which I think pretty much everyone would agree is far earlier than most of us here. However, the change happens at different times and under different circumstances for everyone. The idea that there is some mystical tipping point out there is utter hogwash IMO.

[Author]

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