way too many disgruntled people here

[NotCranky]

Alex..
You might try addressing specific people that you have a problem with rather than making what is pratically blanket accusations. There is a variety of experience and knowlege manifested in the posts here. I have checked out other housing bubble blogs and some are full of sore losers, chicken littles and outright sociopaths. This one is balanced to a pretty fair degree. You are proping up your logic in the most faulty of ways. Using other people’s errors on the timing of the market doesen’t rule out or rule in anything. I think even Rich Has admitted to being surprised at the staying power of the boom and this is one smart guy.
At the very least you could try to get out of the past and analyze what is apparent in the market currently. By the way, I timed the market perfectly this time for what it is worth. No, I used the market pefectly,in a small way for the last 12 years.Then timed it and made adjustments.If I were a genius like you apparently expect everyone to be….well…could’ve should’ve would’ve never caught a mouse… I think the perfect place to be is on the sidelines unless you are bullet proof with equity and or cash and(not or) love having your own place or hate renting. In any case there doesn’t look to be much upside to starting now. The only thing good about the market is fixed interest rates. I do hope they last forever and thats probably just wishful thing too.

[Bob G]

Alex,

You need to study the data. Housing prices are sticky, you’re correct that they won’t drop by half overnight. Based on historical data it will probably take two to five years for the correction in prices to work through.

I make a great income, and could buy a crappy house for 1/2 a million now. I just refuse to do so.
Signed,
Dumpsh_t

[(former)FormerSanDiegan]

I have no problem with someone taking another side of the argument. I am often one of the more bullish people in many threads on this board.

However, some TACT is useful.

It’s like showing up to a Weight watchers’ meeting and saying, “geez, most of you folks are pretty fat”

[NotCranky]

Former, You sound like someone we need back in San Diego!
My kid says I am fat…Can you talk to him?

[(former)FormerSanDiegan]

Rustico –
If I were to talk to your kids I’d simply tell him that you are too short for your weight.

[kev374]

Housing is not going to crash without something horrific happening.

Most of the spike up in home prices were caused due to loose lending and speculation. The horrific situation you mention is payment shock for all those who financed under teaser rates and the speculators who cannot unload their homes and have to take a loss on it.

There is just way too much money in San Diego today, lots of Orange County wannabees are down here with large trust funds and endless cash.

You’re completely dellusional about this.

The people who have “way too much money” bought their homes long time ago and don’t contribute to new demand. They are not in the market to buy new homes. It’s completely irrelevant.

The key point is how much money a first time homebuyer has, the market is chained in that if a entry level buyer cannot afford a home then the upgrade buyer cannot move up because he can’t sell and so on and so forth.

.I read these articles about the bubble popping, sub prime etc… but then I look around at open homes, sales releases etc… and business is still booming.

The news is completely bogus and fabricated, it’s your choice to believe it. I have friends in the mortgage business and who are realtors. They all tell me the market is hopelessly DEAD. There has been a small uptick in activity because it’s spring right now but compared to a typical spring selling season it resembles as Roubini would put it “ARCTIC WINTER” !!

On this board we’re not disgruntled but practical, we’re looking at the various factors and discussing the direction of the market. Right now there are a HUGE number of factors that very strongly indicate that a good size decline is going to happen. Being in denial is not going to stop that.

As I mentioned in the previous posts buyer psychology has to change in a BIG way. That takes a long time, people have been fed with the “home is the key to big wealth” brianwashing for so long that even now some believe that they should do absolutely anything and everything to own. This psychology has to change and it has to become widely accepted that owning a home in this market is financial suicide.

[cr]

So many opportunities to rip this argument to shreds, and so little time.

In that case I will just say…

No more disgruntled than those scared that we might be right, and certainly less disgruntled than those same people when we ARE right.

It’s a matter of time buddy…

[NotCranky]

Former,
Thanks so much but I am 6’5″ on a good day!

[gn]

I notice a “pattern” about the posters at Piggington.

1. Those who are knowledgeable about real estate. These people generally assert that there will be a major price correction. And this correction will be slow, so patience is the key. Most importantly, these people base their outlook on their knowledge & understanding.

2. Those who don’t know much about real estate or are still in the process of learning more about RE. These people base their outlook on their “FEELING” (which is to be expected, if you don’t have the knowledge, all you have is your GUT FEELING).

Sorry to say this, Alex_angel belongs to the latter group.

Knowledge is power ! Keep studying 🙂

[Anonymous]

It is people who purchased real estate based on “feeling” rather than common sense that cause this mess to begin with.

[4plexowner]

Alex – some of us mis-timed the market and STILL made the million that you seem to think is so important

What’s your point?

[no_such_reality]

Thanks so much but I am 6’5″ on a good day

Is that height or width?

😉

[NotCranky]

Perry Chase If you are still checking this thread…excuse me for being nosey..But.

I have been reading this blog for more than a year.You make lots of comments like this…..Referring to timelines…

I have a long horizon (7 to 10 years from today before I buy anything) and I’m having fun watching the market…

You also talk about being willing to buy fixer’s. Do you intend to actually break a sweat or have someone else do the work? In any case I have seen guy’s who can spot opportunity and make sacrifices, myself to a degree included, get ahead of the curve a bit. I know its still practically out of the question now …but I have learned not to make a rigid plans with Real Estate. My worst mistake,for example, was to say “I won’t ever buy anything that would not rent positive.” you know where that got me. Don’t shoot yourself in the foot is what I am saying. You seem like a real smart guy. It helps me that I am a General Contractor, Draftsman, with a Real estate license,not paying third parties(or letting them waste my time)is a huge part of it for me.However, believe me I just picked those things up along the way as tools. I have a friend who has none of those things, a very balanced portfolio, (unlike yours truly) and he is almost always doing something right with real estate in small ways.With exception of his long term rentals and his family home he is on the sidelines now but he keeps the ideas flowing.

[no_such_reality]

I’ll admit, I am a little bitter.

It completely chafes me to look at run of the mill 2500 sq. ft. tract homes in OC pushing a million. Can I afford one, yes. Should I buy one?

I realize it’s not an apples to apples comparison, but if I buy a home, I’ll get an SFR, at present, a small 3/2 needing work in an okay neighborhood is $750K. In a good neighborhood, $850K. I can rent a townhome for $1800. No maintenance, no HOA, no taxes, no mello-roos.

I’d like the SFR, but even after taxes, renting is costing 1/2 of owning with little risk in the short run.

So yes, I’m bitter as I wait for the guy that grabbed a million dollar home by outbidding the other family or was realtor or one of their friends looking to flip for a quick $50-$100K by fianancing it 100% no-doc loan with a neg-AM feature of paying $450/150K borrowed to finally bust out because they can no longer sell it for the $1.1M they need to break even and can’t float the loan any longer because the payment is not $5600 instead of $2800.

And I feel sorry for the 1/2 of buyers that needed or wanted to finally get a home and got suckered into paying the overextended prices because the realtors and NAR chronically harped about the run up and pushed the fear buttons of being priced out.

So yes, I’m a little bitter, dealing with people in the housing market is like dealing with an alcholic family member. It’s all BS and lies and going to end badly before it starts to get better. And it’s because people all wanted to make a quick buck.

[PD]

I’m certainly not bitter either. I could buy but choose not to even though I much, much prefer owning to renting. For me, logic trumps emotion. Although the bubble was good to me (sold 05), I really wish it had not gotten so crazy. Even though I would have less money, I would be comfortable buying right now, which is what I want to do. So I am resigned to renting. I look at it as though it is my job. I’m paying myself to put off the gratification of ownership.
If prices go up less than what I’m making on my money, I win.
If prices stay steady, I win.
If prices go down, I win big time (and they already have gone down in most SD areas).

Is owning right now worth an onerous mortgage payment and giving up the return I’m making on what would be my downpayment? No way.

[Author]

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