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February 17, 2009 at 4:23 PM #348731February 17, 2009 at 4:40 PM #348207
carlsbadworker
Participant[quote=CA renter]Ultimately, since housing costs are the largest portion of most families’ fixed expenses, if we can bring down those costs, we have more money left over for savings and other uses. The economy would ultimately be much stronger.
[/quote]This is beautifully illustrated. Ultimately, that is the rain that we all hoped for that will bring out more rabbits in TG’s rabbit/coyote analogy. The government is really out of their mind to come up with all the stimulus package that will pop up the real estate price. Bring the price down and there you have our best economy stimulus plan!
February 17, 2009 at 4:40 PM #348525Participant[quote=CA renter]Ultimately, since housing costs are the largest portion of most families’ fixed expenses, if we can bring down those costs, we have more money left over for savings and other uses. The economy would ultimately be much stronger.
[/quote]This is beautifully illustrated. Ultimately, that is the rain that we all hoped for that will bring out more rabbits in TG’s rabbit/coyote analogy. The government is really out of their mind to come up with all the stimulus package that will pop up the real estate price. Bring the price down and there you have our best economy stimulus plan!
February 17, 2009 at 4:40 PM #348643Participant[quote=CA renter]Ultimately, since housing costs are the largest portion of most families’ fixed expenses, if we can bring down those costs, we have more money left over for savings and other uses. The economy would ultimately be much stronger.
[/quote]This is beautifully illustrated. Ultimately, that is the rain that we all hoped for that will bring out more rabbits in TG’s rabbit/coyote analogy. The government is really out of their mind to come up with all the stimulus package that will pop up the real estate price. Bring the price down and there you have our best economy stimulus plan!
February 17, 2009 at 4:40 PM #348675Participant[quote=CA renter]Ultimately, since housing costs are the largest portion of most families’ fixed expenses, if we can bring down those costs, we have more money left over for savings and other uses. The economy would ultimately be much stronger.
[/quote]This is beautifully illustrated. Ultimately, that is the rain that we all hoped for that will bring out more rabbits in TG’s rabbit/coyote analogy. The government is really out of their mind to come up with all the stimulus package that will pop up the real estate price. Bring the price down and there you have our best economy stimulus plan!
February 17, 2009 at 4:40 PM #348777Participant[quote=CA renter]Ultimately, since housing costs are the largest portion of most families’ fixed expenses, if we can bring down those costs, we have more money left over for savings and other uses. The economy would ultimately be much stronger.
[/quote]This is beautifully illustrated. Ultimately, that is the rain that we all hoped for that will bring out more rabbits in TG’s rabbit/coyote analogy. The government is really out of their mind to come up with all the stimulus package that will pop up the real estate price. Bring the price down and there you have our best economy stimulus plan!
February 17, 2009 at 7:08 PM #348382Participant[quote=Scarlet]Good point Carlsbadworker, I had not factored that in. Yes EVERYTHING costs more today and our wages have stagnated for decades.
[/quote]Just want to clarify one more thing. “Our wages have stagnated for decades”, really? The inflation adjusted wage has stagnated for the last decade, but the nominal wage has risen 25% since the the real estate bubble starts. Besides, the interest rate dropped from 7-8% at that time to below 5%. That almost equals to 15% price drops by itself.
My point is not that Temecula real estate price may not continue to drop and everyone should buy right now. My point is that if you look at the fundamental, the current price is definitely justified in town like Temecula. Either by looking at things historically, or by making buy v.s. rent trade (my PITI is almost three hundred dollar less than the rents of a similar house, even though the rent has dropped over $300 recently as well). Well, to CA renter’s point, I lowered my fixed monthly cost to buy v.s. rent, not to mention the additional tax benefits.
Would the price continue to drop? I think it is likely given the hidden inventory that you mentioned and the prospect of the depression. But then you are arguing about when is the best time to buy to capture the last bit of price drop v.s. whether the current price is fundamentally sound.
I choose to buy because it fits my personal circumstance and I would rather not wait for the last bit of price drop. Your situation may vary. But if you are just fundamentally hate Temecula to flame against buying there, I think there is no point of argue further.February 17, 2009 at 7:08 PM #348699Participant[quote=Scarlet]Good point Carlsbadworker, I had not factored that in. Yes EVERYTHING costs more today and our wages have stagnated for decades.
[/quote]Just want to clarify one more thing. “Our wages have stagnated for decades”, really? The inflation adjusted wage has stagnated for the last decade, but the nominal wage has risen 25% since the the real estate bubble starts. Besides, the interest rate dropped from 7-8% at that time to below 5%. That almost equals to 15% price drops by itself.
My point is not that Temecula real estate price may not continue to drop and everyone should buy right now. My point is that if you look at the fundamental, the current price is definitely justified in town like Temecula. Either by looking at things historically, or by making buy v.s. rent trade (my PITI is almost three hundred dollar less than the rents of a similar house, even though the rent has dropped over $300 recently as well). Well, to CA renter’s point, I lowered my fixed monthly cost to buy v.s. rent, not to mention the additional tax benefits.
Would the price continue to drop? I think it is likely given the hidden inventory that you mentioned and the prospect of the depression. But then you are arguing about when is the best time to buy to capture the last bit of price drop v.s. whether the current price is fundamentally sound.
I choose to buy because it fits my personal circumstance and I would rather not wait for the last bit of price drop. Your situation may vary. But if you are just fundamentally hate Temecula to flame against buying there, I think there is no point of argue further.February 17, 2009 at 7:08 PM #348818Participant[quote=Scarlet]Good point Carlsbadworker, I had not factored that in. Yes EVERYTHING costs more today and our wages have stagnated for decades.
[/quote]Just want to clarify one more thing. “Our wages have stagnated for decades”, really? The inflation adjusted wage has stagnated for the last decade, but the nominal wage has risen 25% since the the real estate bubble starts. Besides, the interest rate dropped from 7-8% at that time to below 5%. That almost equals to 15% price drops by itself.
My point is not that Temecula real estate price may not continue to drop and everyone should buy right now. My point is that if you look at the fundamental, the current price is definitely justified in town like Temecula. Either by looking at things historically, or by making buy v.s. rent trade (my PITI is almost three hundred dollar less than the rents of a similar house, even though the rent has dropped over $300 recently as well). Well, to CA renter’s point, I lowered my fixed monthly cost to buy v.s. rent, not to mention the additional tax benefits.
Would the price continue to drop? I think it is likely given the hidden inventory that you mentioned and the prospect of the depression. But then you are arguing about when is the best time to buy to capture the last bit of price drop v.s. whether the current price is fundamentally sound.
I choose to buy because it fits my personal circumstance and I would rather not wait for the last bit of price drop. Your situation may vary. But if you are just fundamentally hate Temecula to flame against buying there, I think there is no point of argue further.February 17, 2009 at 7:08 PM #348850Participant[quote=Scarlet]Good point Carlsbadworker, I had not factored that in. Yes EVERYTHING costs more today and our wages have stagnated for decades.
[/quote]Just want to clarify one more thing. “Our wages have stagnated for decades”, really? The inflation adjusted wage has stagnated for the last decade, but the nominal wage has risen 25% since the the real estate bubble starts. Besides, the interest rate dropped from 7-8% at that time to below 5%. That almost equals to 15% price drops by itself.
My point is not that Temecula real estate price may not continue to drop and everyone should buy right now. My point is that if you look at the fundamental, the current price is definitely justified in town like Temecula. Either by looking at things historically, or by making buy v.s. rent trade (my PITI is almost three hundred dollar less than the rents of a similar house, even though the rent has dropped over $300 recently as well). Well, to CA renter’s point, I lowered my fixed monthly cost to buy v.s. rent, not to mention the additional tax benefits.
Would the price continue to drop? I think it is likely given the hidden inventory that you mentioned and the prospect of the depression. But then you are arguing about when is the best time to buy to capture the last bit of price drop v.s. whether the current price is fundamentally sound.
I choose to buy because it fits my personal circumstance and I would rather not wait for the last bit of price drop. Your situation may vary. But if you are just fundamentally hate Temecula to flame against buying there, I think there is no point of argue further.February 17, 2009 at 7:08 PM #348952Participant[quote=Scarlet]Good point Carlsbadworker, I had not factored that in. Yes EVERYTHING costs more today and our wages have stagnated for decades.
[/quote]Just want to clarify one more thing. “Our wages have stagnated for decades”, really? The inflation adjusted wage has stagnated for the last decade, but the nominal wage has risen 25% since the the real estate bubble starts. Besides, the interest rate dropped from 7-8% at that time to below 5%. That almost equals to 15% price drops by itself.
My point is not that Temecula real estate price may not continue to drop and everyone should buy right now. My point is that if you look at the fundamental, the current price is definitely justified in town like Temecula. Either by looking at things historically, or by making buy v.s. rent trade (my PITI is almost three hundred dollar less than the rents of a similar house, even though the rent has dropped over $300 recently as well). Well, to CA renter’s point, I lowered my fixed monthly cost to buy v.s. rent, not to mention the additional tax benefits.
Would the price continue to drop? I think it is likely given the hidden inventory that you mentioned and the prospect of the depression. But then you are arguing about when is the best time to buy to capture the last bit of price drop v.s. whether the current price is fundamentally sound.
I choose to buy because it fits my personal circumstance and I would rather not wait for the last bit of price drop. Your situation may vary. But if you are just fundamentally hate Temecula to flame against buying there, I think there is no point of argue further.February 17, 2009 at 7:18 PM #348402North County Jim
ParticipantYou know that when you walk away, you are essentially shafting all the people that told you not buy in the first place?
If you reread his post, he’s not walking away. He’s simply using his leverage to extract a better deal from his lender. I don’t have a great problem with that, morally speaking.
If I were underwater, I wouldn’t blame lenders, agents, the government or anyone else for that matter. I’d be thinking about the next step to improve my balance sheet. If walking away makes the most financial sense, then you must consider it. Same goes for loan mods.
These are called business decisions and they are made every day.
In 23109VC’s case, it’s definitely in his interest to squeeze the lender for concessions. It is also in the bank’s interest to give up those concessions.
Paramount, on the other hand…
February 17, 2009 at 7:18 PM #348719ParticipantYou know that when you walk away, you are essentially shafting all the people that told you not buy in the first place?
If you reread his post, he’s not walking away. He’s simply using his leverage to extract a better deal from his lender. I don’t have a great problem with that, morally speaking.
If I were underwater, I wouldn’t blame lenders, agents, the government or anyone else for that matter. I’d be thinking about the next step to improve my balance sheet. If walking away makes the most financial sense, then you must consider it. Same goes for loan mods.
These are called business decisions and they are made every day.
In 23109VC’s case, it’s definitely in his interest to squeeze the lender for concessions. It is also in the bank’s interest to give up those concessions.
Paramount, on the other hand…
February 17, 2009 at 7:18 PM #348838ParticipantYou know that when you walk away, you are essentially shafting all the people that told you not buy in the first place?
If you reread his post, he’s not walking away. He’s simply using his leverage to extract a better deal from his lender. I don’t have a great problem with that, morally speaking.
If I were underwater, I wouldn’t blame lenders, agents, the government or anyone else for that matter. I’d be thinking about the next step to improve my balance sheet. If walking away makes the most financial sense, then you must consider it. Same goes for loan mods.
These are called business decisions and they are made every day.
In 23109VC’s case, it’s definitely in his interest to squeeze the lender for concessions. It is also in the bank’s interest to give up those concessions.
Paramount, on the other hand…
February 17, 2009 at 7:18 PM #348870ParticipantYou know that when you walk away, you are essentially shafting all the people that told you not buy in the first place?
If you reread his post, he’s not walking away. He’s simply using his leverage to extract a better deal from his lender. I don’t have a great problem with that, morally speaking.
If I were underwater, I wouldn’t blame lenders, agents, the government or anyone else for that matter. I’d be thinking about the next step to improve my balance sheet. If walking away makes the most financial sense, then you must consider it. Same goes for loan mods.
These are called business decisions and they are made every day.
In 23109VC’s case, it’s definitely in his interest to squeeze the lender for concessions. It is also in the bank’s interest to give up those concessions.
Paramount, on the other hand…
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