way too many disgruntled people here

[(former)FormerSanDiegan]

Alex, dude. Mellow out. Get a grip. Some of us actually own property.

Take a deep breath.

Print out your original post.

Take it home with you.

Hand it to your best friend, your spouse, your minister, your domestic partner, whomever, someone you trust. ANd do so without adding any verbal comments.
Ask them to rate the disgruntlement on a scale of 1-10.

[(former)FormerSanDiegan]

People all say wait a year or two to buy. I have heard this since 2000

So, did you take their advice and buy in 2002 🙂

[The-Shoveler]

Nor_LA-Temcu-SD-Guy

No anger here, If I get priced out of costal SD, I could not afford it anyway (and still live life with a little free spending money). Anyway I do go out to open houses all the time (it’s a weird hobby the wife and I got) (most are vacant and have been for months seems about 70% of them).

Good luck to you though.

[calidesigner]

I think it’s fair to say that many, if not most, people buying into the current housing market at or near its peak genuinely can’t afford what they are buying, but the lure of easy money (i.e. ARM’s and the like) clouds people’s judgement. My logical deduction is that incomes can’t support current prices, therefore current prices are unsustainable. Increasing foreclosures, due to ARM resets are validation of that deduction (not all out proof, but the link seems logical to me). People who contribute to this blog, who are being accused of being “disgruntled” are not really that, I would instead offer that they/we are a bit frustrated, perhaps, not even at the housing market, because it is what it is, but more so at the combination of incredibly loose lending standards, artificially low interest rates and the like which have fed and fueled the speculation resulting in our current unsustainably high home prices.

calidesigner

[23109VC]

I’ve been on this site for over a year now…and I think our friend here has it partly right.

I think most of us here frequent this sight b/c many of us feel the market is going to drop…for me…it was a place to gather information and educate myself on the market. Not being in the RE business – I have found the wealth of information on this site to be invaluable. I also do agree that there is a sentiment among the “core” peole here that the market is going to TANK hard. Obviously, that opinion is not shared by the entire population – or ntohign would be selling. Less is selling, but stuff still sells.

I have also been doing a lot of going out to “look” like Alex Angel suggests we do – and I have to admit – when I go to new housing developments and walk around the models – there are a lot of people looking. the little “map” things in the slaes offices that have the “sold” and “available” pins on them – show lots of sales. I have been to some developments over and over to look repeatedly, and I see homes taht were available, be removed from the list. I’ve called and pretended to be ready to come in and put a deposit on the house that was listed and they tell me it’s in escrow..and these were homes that were listing for almsot $500k in temecula an dmurrieta…so stuff is selling.

it’s just not selling at the volume it was.

now i wonder if the NEW homes are selling better than the resales b/c the builders can undercut the resales. I have seen a LOT of that. you go to a new development that is on say phase 10 of 10. and some poor guy who bought in phase 2 or 3 has his house for sale. he bought it stripped for $550-600k. he has linoleum, no backyard landscaping, plain white ceramic tile on his kitchen, plain white cheapy appliances, cheapy everything. it’s stripped.

the builder now has standing inventory, they have a hard time selling b/c it’s slow, so they reduce the price to $500-550 and they load the house up. extensive hard wood flooring, tiling, landscaping, s/s appliances, granite, jacuzzi tub, window coverings..etc.

you can buy a loaded house for $500 or the stripped one for $600 that has been lived in.. hmmm.. so the builder still keeps selilng but at less of a profit and the poor homeowner who’s ARM is resetting, has no equity, and can’t sell walks away and his house goes into foreclosure or maybe he can arrange a short sale…

bottom line is the housing prices ARE coming down. I”ve seen it. I rent ah ouse that sold for $450k. some of the later phases and resales within the same development sold for close to $500k. the owner is willing to sell it to me for $350k. i see another one down the street advertised as a short sale for $400k. prices are LESS than they were a year ago. period. at least up here in tem/murrieta they are.

will they keep going down and HOW LOW will they go is the magical question taht no one truly knows the answer to.

many here wish and believe that it will go down much much lower. some think it will go lower but not that much…

i’m NOT an expert…but from what i’ve educated myself on..i think prices will still go lower. but i don’t think they will bomb down to actual 2000 or 2002 dollar values. they may get to those levels but adjusted for inflation..

so that house that cost $250k in 2002 will sell for 300-325 in a year or two…… but to think that a house that is now listing for $500k will suddently be wroth $200k is fantasy land.. at least to me.

as long as the interest rates stay low the prices won’t drop off the map. i’d like them to, but i dont think they will. maybe i’m wrong… and the people here who say 50% drops will be right.

only time will tell. but i do think when you have website like this where everyone thinks alike, and you mostly agree about somethig, you tend to get more reinforcement of your own opinions. put a bunch of conservative republicans together in one room, have them discuss politics and they all agree, and reinforce one another. put liberal dems in another room and same thing happens.

here we have a person from the opposite camp dropping in on our “room”…we ought to listen, be polite, educate, and exchange info. not bash. we may end up being right and the market wil explode over the next few year…and maybe it will sort of slowly deflate and while we see true drops when you factor in the drops and inflation..but we might enver see a “crash”…no one knows until it happens.

anyway… off the soapbox. 🙂

[PD]

the anger you all are throwing towards me further validates the disgruntlement among you. Calling people names for buying today is grade school behavior. Why hate people who can afford something?

First, no one hates you or anyone who is buying. In general, we think those people either don't understand what is about to happen, are sheeple who will follow the crowd over the cliff, are financially stupid, are financially secure but have chosen to enter the market with knowledge that it will go down because they can ride it out, or are complete and utter idiots. Which are you, Alex?

Second, you are the one who sounds desperate. You must be either a home owner or employed in real estate (or both). You are clearly trying to rationalize your financially suicidal home purchase. Buy in 05 or later, did you?

Third, most the people here CAN afford to buy a house but are showing restraint until prices reduce, as they must, either through inflation or outright depreciation.

Fourth, I bet you have big car payment and a new vehicle with shiny rims in your driveway.

[PerryChase]

Go ahead, BUY and feel positive all you want. No one is stopping you.

I have a long horizon (7 to 10 years from today before I buy anything) and I’m having fun watching the market. To me, watching the market psychology unfold is more fun than prime time TV. I don’t have any emotions at stake so it’s always fun to see others go emotional once in a while.

History is always a good guide. But we are condemned to repeat it (at least some of us).

[sdduuuude]

To the original poster:

I like your post, but here are some non-disgruntled thoughts for you – hope we can have a civil discussion here.

Have you ever heard of the concept of the boiling frog?
Supposedly (but I don’t think they’ll prove this one on Mythbusters) if you put a frog in boiling water, he’ll leap out immediately. However, if you put a frog in cold water and slowly heat it up, you can basically boil it without it getting out. This is the best description of how this housing market is going. Buyers are getting boiled slowly and they don’t even realize it.

I agree too many people here expect the market to drop, like a stock market crash. In fact, it will continue to slide slowly down for a long, long time.

This makes it difficult to see the past, present and future deflation of the bubble. Looking at the current status will always show the market isn’t too bad. It isn’t dropping too fast. There are always some buyers who will need to buy a home.

I do think your post lacks data at all. Check out the tagline at the bottom of this forum “In God We Trust. Everyone Else Bring Data.” Going out into the field is interesting, but because the market varies so much by neighborhood, it is not a good way to gauge the county-wide market. Such anecdotal evidence is exactly the kind of thing that the founder of this forum wanted to avoid.

I won’t say that the market now is really bad. What is bad is the foundation on which the market is riding. It is looking pretty crumbly.

The growing months of inventory, rising foreclosures, the tightening of the credit markets, dropping price per square foot, outmigration, retail sales crash in April. What conditions do you see that will keep this market healthy? Answer me that one.

The boiling frog looks at the current state of the market.
The smart frog looks at the underlying conditions that suggest how the market will be in the future.

I bought in Clairemont 8 years ago. The home has tripled in value. By stopping at “for sale” signs, regularly, I see prices have been pretty stable this year – only down a couple percent.

[sdduuuude]

By the way, it is really annoying when people presume your identity by what you post.

i.e. “realtor”, “home owner or employed in real estate”, etc.

That is soooooooooo powayseller, and more often that not you get it wrong and just look stupid.

Also, it just validates his point that there are a bunch of disgrutled people here. Answer the guy’s questions and present your argument. Presuming his profession and/or financial status doesn’t convince anyone of anything.

The guy just has a different view of the market – chill out.

[Anonymous]

Overpriced apartment? If you think your apartment is overpriced, then what about the homes around here? Go ahead an buy a house, knock yourself out. Just be prepared to watch your home value plummet..

[blahblahblah]

Housing prices are falling all over Southern California; sellers are kicking cash back to the buyers in many sales. That’s not recorded at the county and is a hidden bias that you can’t see. Also, new homes are giving more upgrades for the same cost — again it’s effectively a price drop not reflected in the sales price. I think you’re seeing a gradual awakening of the public to the fact that homes (for most of us) are things to live in, not speculative investments. This sentiment is going to grow and grow and it will help prices slowly come down over the next few years. Dollars are going to become worth less and less over the same time, so the average home might still be $400K or so. I don’t think people here are disgruntled, we just like watching the market and discussing what’s going on. It’s fun!

[Alex_angel]

There have been numerous posts by people looking to buy and the typical response has been “wait a year or two” Now what data is this being based on? The ever so accurate crystal ball?

Now I don’t own and can’t afford anything in this city anymore. I make a great income which still puts me into a shitty situation with San Diego real estate. I am not going to buy only because I can’t afford it. What I am saying is that there is too much reinforced negativity towards an ultimate crash. The fact is there is a lot of rich people that moved here over the last couple years. I agree with 23109VC that it does suck for those that bought a bare walled home a couple years ago and that today people can get a fully decked out home for the same price. The key is SAME PRICE. I couldn’t afford a $800k bare walled tract home 2 years ago and I can’t afford a $800k filled to the gills tract home today.

This waiting for the right moment is absurd in that the moment may never come.

I am not stupid to realize that if a $800k home all of a sudden went on sale for $400k that there would be a lineup around the block and someone with lots of money would swoop right in and run the bid up to $600k and take it.

The market here sucks and it is not depreciating as fast as other parts of this country.

[PerryChase]

Now, who’s disgruntled?

[blahblahblah]

Patience Alex, this is gonna take time. Also don’t forget that there is still a lot of quasi-legal monkey business going on in the form of seller kickbacks. These kickbacks distort the sales price data, making it appear as though housing prices aren’t falling when in fact they really are. And of course there are still bad loans being made and bad appraisals being done to “make the numbers work” as they say in the biz. Someone much smarter than me once said that “markets can stay irrational longer than you can stay solvent”. It’s not going to crash overnight. My prediction is a 2-3% decline YOY for a loooong time, combined with dollar devaluation. People watching nominal values won’t think things have fallen that much but the real dollar figures will be on the order of a 25-30% discount from todays prices.

[Anonymous]

The market here sucks and it is not depreciating as fast as other parts of this country.

RE is not like the stock market. Psychology is huge; and in the case of RE, it takes a lot of time for psychology to shift. Even when it does, since the market is so illiquid in comparison to stocks, it takes time for prices to go down. Couple that with the fact that there will always be people buying even in the worst market and you can see that it will take lots of time.

Also, different parts of the country will have reactions of different intensity and at different times to the madness of the last few years.

[Author]

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