Upper MId to Lower High End Market in NCC

[CA renter]

[quote=sdrealtor]CAR
Hate to say it but your response is a pretty stunning reversal from your prior position that this area was always well known and nothing much has changed here. The 150% increase in median income since 1988 is pretty strong evidence that this area has changed quite a bit. I wonder how much the SD County median HH income changed over that time?

update: I found a 1990 median income number of $39,800 for SD County and a 2008 median income of about $64,800. Thats a 62% increase over roughly the same period and nowhere near the 150% increase for 92024. I’d say that is a pretty remarkable demographic shift.[/quote]

I didn’t say that things didn’t change in micro-markets, just that the beach has always been here, and the weather has always been similar, etc. I’ve usually mentioned this in response to SD County as a whole, but it also applies to the sub-markets. These are the reasons given by everyone who claims that it should be expensive here because of the beach.

Do infrastructure and demographic shifts affect prices? Absolutely! I’m just saying that things didn’t suddenly change in 2001 (most of the improvements I mentioned were here by then). It’s not like Encinitas/South Carlsbad suddenly became immune to what was going on in all the other markets across the country and around the world.

It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period. Different areas turn at different times, and some areas will lose value for other reasons while other areas gain value for other reasons. I’m fully convinced that if not for all the stimulus, foreclosure moratoriums/foreclosure avoidance programs, accounting changes, artificially suppressed interest rates, etc. this area would be down at least 25% from where it currently is.

[pemeliza]

“It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.

[pemeliza]

“It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.

[pemeliza]

“It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.

[pemeliza]

“It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.

[pemeliza]

“It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.

[CA renter]

[quote=pemeliza]”It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.[/quote]

If you look at the rate changes, you’ll see that 2001 marked the beginning of the blowoff top in the credit bubble (which, IMHO, began in the 1980s). Housing sales had already slowed, and prices were beginning to drop because we had entered another recession — which we needed in order to clear the excesses and reallocate capital. Greenspan, in his quest to keep us from ever experiencing cleansing recessions, pushed us into the manic period of the credit bubble. See what was going on (esp. the rate of change) from 2000-2001 here:

http://www.ny.frb.org/markets/statistics/dlyrates/fedrate.html
———-

Yes, 1988 wasn’t the top of the previous housing cycle, and things were changing quickly, but it was near the top. Just like around here, some areas were pretty much topped out in 2004, while others continued their stratospheric rise into 2006 (and some into 2007). It’s not necessary to nail the exact year, especially when trying to time tops and bottoms, it’s just important to get *near* tops and bottoms when selling or buying.

As for sdr’s example, I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000 (depending on the area and the other factors mentioned above, it could have reached the previous peak anywhere between 1998 and 2001), then I added the credit-fueled premium from 2001-present to arrive at my approximation.

[CA renter]

[quote=pemeliza]”It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.[/quote]

If you look at the rate changes, you’ll see that 2001 marked the beginning of the blowoff top in the credit bubble (which, IMHO, began in the 1980s). Housing sales had already slowed, and prices were beginning to drop because we had entered another recession — which we needed in order to clear the excesses and reallocate capital. Greenspan, in his quest to keep us from ever experiencing cleansing recessions, pushed us into the manic period of the credit bubble. See what was going on (esp. the rate of change) from 2000-2001 here:

http://www.ny.frb.org/markets/statistics/dlyrates/fedrate.html
———-

Yes, 1988 wasn’t the top of the previous housing cycle, and things were changing quickly, but it was near the top. Just like around here, some areas were pretty much topped out in 2004, while others continued their stratospheric rise into 2006 (and some into 2007). It’s not necessary to nail the exact year, especially when trying to time tops and bottoms, it’s just important to get *near* tops and bottoms when selling or buying.

As for sdr’s example, I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000 (depending on the area and the other factors mentioned above, it could have reached the previous peak anywhere between 1998 and 2001), then I added the credit-fueled premium from 2001-present to arrive at my approximation.

[CA renter]

[quote=pemeliza]”It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.[/quote]

If you look at the rate changes, you’ll see that 2001 marked the beginning of the blowoff top in the credit bubble (which, IMHO, began in the 1980s). Housing sales had already slowed, and prices were beginning to drop because we had entered another recession — which we needed in order to clear the excesses and reallocate capital. Greenspan, in his quest to keep us from ever experiencing cleansing recessions, pushed us into the manic period of the credit bubble. See what was going on (esp. the rate of change) from 2000-2001 here:

http://www.ny.frb.org/markets/statistics/dlyrates/fedrate.html
———-

Yes, 1988 wasn’t the top of the previous housing cycle, and things were changing quickly, but it was near the top. Just like around here, some areas were pretty much topped out in 2004, while others continued their stratospheric rise into 2006 (and some into 2007). It’s not necessary to nail the exact year, especially when trying to time tops and bottoms, it’s just important to get *near* tops and bottoms when selling or buying.

As for sdr’s example, I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000 (depending on the area and the other factors mentioned above, it could have reached the previous peak anywhere between 1998 and 2001), then I added the credit-fueled premium from 2001-present to arrive at my approximation.

[CA renter]

[quote=pemeliza]”It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.[/quote]

If you look at the rate changes, you’ll see that 2001 marked the beginning of the blowoff top in the credit bubble (which, IMHO, began in the 1980s). Housing sales had already slowed, and prices were beginning to drop because we had entered another recession — which we needed in order to clear the excesses and reallocate capital. Greenspan, in his quest to keep us from ever experiencing cleansing recessions, pushed us into the manic period of the credit bubble. See what was going on (esp. the rate of change) from 2000-2001 here:

http://www.ny.frb.org/markets/statistics/dlyrates/fedrate.html
———-

Yes, 1988 wasn’t the top of the previous housing cycle, and things were changing quickly, but it was near the top. Just like around here, some areas were pretty much topped out in 2004, while others continued their stratospheric rise into 2006 (and some into 2007). It’s not necessary to nail the exact year, especially when trying to time tops and bottoms, it’s just important to get *near* tops and bottoms when selling or buying.

As for sdr’s example, I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000 (depending on the area and the other factors mentioned above, it could have reached the previous peak anywhere between 1998 and 2001), then I added the credit-fueled premium from 2001-present to arrive at my approximation.

[CA renter]

[quote=pemeliza]”It was a **credit bubble** that pushed prices up, in the aggregate, in the 2001-2007 period”

I would argue that the “credit bubble” period was more like 2003-2007.

Also, saying 1988 was near the last peak is like saying 2003 was near this peak. While certainly a true statement, things were changing incredibly fast during the 1988-1990 and 2003-2005 time periods.[/quote]

If you look at the rate changes, you’ll see that 2001 marked the beginning of the blowoff top in the credit bubble (which, IMHO, began in the 1980s). Housing sales had already slowed, and prices were beginning to drop because we had entered another recession — which we needed in order to clear the excesses and reallocate capital. Greenspan, in his quest to keep us from ever experiencing cleansing recessions, pushed us into the manic period of the credit bubble. See what was going on (esp. the rate of change) from 2000-2001 here:

http://www.ny.frb.org/markets/statistics/dlyrates/fedrate.html
———-

Yes, 1988 wasn’t the top of the previous housing cycle, and things were changing quickly, but it was near the top. Just like around here, some areas were pretty much topped out in 2004, while others continued their stratospheric rise into 2006 (and some into 2007). It’s not necessary to nail the exact year, especially when trying to time tops and bottoms, it’s just important to get *near* tops and bottoms when selling or buying.

As for sdr’s example, I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000 (depending on the area and the other factors mentioned above, it could have reached the previous peak anywhere between 1998 and 2001), then I added the credit-fueled premium from 2001-present to arrive at my approximation.

[pemeliza]

I agree that 1988 pricing was probably 15% lower than the 1990 peak and that is supported by sales records.

“I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000”

It almost sounds like you are suggesting that the nominal top of the prior 1990 peak would have also been the nominal top of the current cycle around 2000-2001 had it not been for the credit bubble which extended the cycle for an additional 7 years. Why should the top of this cycle (which should have ended in 2000-2001 as you suggest) have been nominally the same as the top of the prior cycle in 1990?

[pemeliza]

I agree that 1988 pricing was probably 15% lower than the 1990 peak and that is supported by sales records.

“I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000”

It almost sounds like you are suggesting that the nominal top of the prior 1990 peak would have also been the nominal top of the current cycle around 2000-2001 had it not been for the credit bubble which extended the cycle for an additional 7 years. Why should the top of this cycle (which should have ended in 2000-2001 as you suggest) have been nominally the same as the top of the prior cycle in 1990?

[pemeliza]

I agree that 1988 pricing was probably 15% lower than the 1990 peak and that is supported by sales records.

“I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000”

It almost sounds like you are suggesting that the nominal top of the prior 1990 peak would have also been the nominal top of the current cycle around 2000-2001 had it not been for the credit bubble which extended the cycle for an additional 7 years. Why should the top of this cycle (which should have ended in 2000-2001 as you suggest) have been nominally the same as the top of the prior cycle in 1990?

[pemeliza]

I agree that 1988 pricing was probably 15% lower than the 1990 peak and that is supported by sales records.

“I figured 1988 was near the top, then figured another 15% or so for the actual top in 1989/1990, then figured it was reached again around 2000”

It almost sounds like you are suggesting that the nominal top of the prior 1990 peak would have also been the nominal top of the current cycle around 2000-2001 had it not been for the credit bubble which extended the cycle for an additional 7 years. Why should the top of this cycle (which should have ended in 2000-2001 as you suggest) have been nominally the same as the top of the prior cycle in 1990?

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