[(former)FormerSanDiegan]

So, you have a deal for 250K. If the appraisal came in low the buyer can cover the difference (not likely since it’s about 15% of the original price), or cut a new deal, or simply cancel the deal (assuming the proper contingencies were in place).

Does the $215K make sense to you based on the current market in your area ? Or is the buyer using a buddy appraisal to try to get a better deal on the property ?

… just a thought.

If the 215K is reasonable, then I would consider making an offer to split the difference at 225 or so, depending on the buyers’ ability to make a down payment.

[(former)FormerSanDiegan]

Did RE/MAX merge with the WWF or what ?

[(former)FormerSanDiegan]

Land prices.
Labor costs.
Regulations.

[(former)FormerSanDiegan]

All this genuflection and beer talk reminds me of one of my favorite T-shirt quotes :

“… because without beer, things do not seem to go as well …” – Diary of Brother Epp, Capuchin monastery, Munjor, KS, 1902

http://store.freestatebrewing.com/frstorteesh.html

[(former)FormerSanDiegan]

Super, but what about the beer !

“FSD, I graciously accept your curtsey/genuflection”

A small price to pay for a beer.

I thought you expected less than 1% …

http://piggington.com/we_meant_to_say_2_2?page=1

Submitted by jg on February 15, 2007 – 10:10pm.
FSD, I wager you a beer on Q1 GDP: I say it’s coming in below 1.0%. Consumer spending for Jan. came in at 0% growth, and with the spike in gasoline prices (man, did they jump quickly over these last two days), folks are going to be in no mood to spend like mad.

Big spike upward in initial unemployment claims, today. Surprisingly good NY state manufacturing data offset by surprisingly bad Philadelpha manufacturing data.

I’m guessing that the housing starts and building permits for January, announced tomorrow, won’t be pretty.

Cheap bets are fun (but I’ve been on the losing for three straight now; today, I had to treat a guy to a cheap lunch for going with my heart, and not my mind, and the Bears).

[(former)FormerSanDiegan]

“Basically, your investment money would have been better off in precious metals than in housing since 1999/2000”
So, in RE bubble era, housing has actually declined, relative to precious metals !!

[(former)FormerSanDiegan]

CDMA ENG – I couldn’t agree more.
The original post is either hype or hope, and no substance.
Sure tech may rebound and bring some decent jobs here in the future, but there is no evidence of it yet that I have seen.(other than some pretty solid Venture capital investment in bio-tech)

[(former)FormerSanDiegan]

Andy – This was a good point …
Exactly. Check out this – the Dow graphed in currencies other than the USD:
http://www.financialsense.com/fsu/editorials/2007/0416.html

… now what if we plot housing prices with respect to Gold or Foreign currencies ???

[(former)FormerSanDiegan]

“I really hope that is not true. There is this little thing called inflation that would more than offset any advantages of that strategy. Once the jeanie gets out of that bottle we have some real problems.”

Those guys in the smoking room can’t be thinking that we could inflate ourselves out of our deficit problems could they ?

[(former)FormerSanDiegan]

“We’re averaging 9,000 Californians a month changing their [driver’s] licenses to Arizona. To me, that’s a phenomenal number.”

Wow, maybe they should convert the I-8 to East-bound-only once you pass Alpine.

[(former)FormerSanDiegan]

The Dow will hit 6,500 by Spring 😉

[(former)FormerSanDiegan]

cow_tipping –

I agree that 1.5-2.5% is very low inflation. But even under those circumstances from 2000 to 2007 the end result was 16%. (That’s not accounting for food and energy… how much was gas in 2000 ?).

Your rule of thumb for long interest rates of 5% plus inflation is probably pretty close to reality for moderate ranges of interest rates (e.g. 6-10%). But I don’t believe the market is reflecting what inflation is currently. It reflects anticipated inflation over the course of the term of the bond looking forward, not current or past inflation.

My real point regarding inflation is that I think people forget that even a little inflation does a lot of damage. That’s why I have not bought in to the belief of a 40-50% decline in nomimal house prices. 40% in real terms, sure, but not nominal. If this occurs over 8 years of relatively low inflation that’s 20-30% in nominal prices and 20% due to inflation. If inflation is higher maybe its 25% due to inflation and 20% due to nominal price declines.

Inflation happens.

{Clarification: I started at 2000 with an amount of 100, so I only accounted for 7 years of inflation in my example: 2001-2007. If I start at 1999 and take year 2000 inflation of 2.7% into account I get 19% cumulative over 8 years. IN either case a bit over 2% on average over that period}

[(former)FormerSanDiegan]

Not to tip a sleeping cow, but …

1. Food and energy does factor into inflation. The government reports both top line CPI and Core CPI (excluding food and energy) because those components are volatile, not because they don’t count.

2. A conclusion you made is the opposite of what one would infer from the data you posted …

Inflation may have been a factor 01-02-03 but after that its not only down, its pretty much wiped out the gains from 01-02. Look at rents and look and costs of essentials and always they exclude energy because that is influenced by too many externals.

But the data you posted later on says the opposite. Core inflation actually declined from 01-03 and picked up again after that.

I took the liberty of plotting the data you provided.
A clear decline from 01-03 and a pick-up from 03 on. Exactly the opposite of what you said.

[img_assist|nid=3235|title=Core Inflation (excl. food & energy)|desc=|link=node|align=left|width=466|height=349]

I also took the core inflation numbers and computed the cumulative impact of CORE inflation from 2000 to 2007. Guess what ? Excluding food and energy, things have gone up by a cumulative 16% since 2000. 16 > 0. People tend to underestimate the erosion effect of even mild (< 2%) inflation on the costs of things. [img_assist|nid=3236|title=Cumulative effect of inflation 2000-2007|desc=|link=node|align=left|width=466|height=349] This thread has taken a diversion from the original point. All I was trying to do was to point out a pile of BS that was not backed by data. When the data is provided, it contradicts the BS.

[(former)FormerSanDiegan]

Cow_tipping –

The inflation components I plotted above are National Numbers not San Diego. Prices are up nationwide.

“01 to now wages are not up. In fact they are down.” This is not correct.

U.S. Median Family Income in 2000: 50,046
….. in 2005: 55832
That’s a 11.5% increase (nominal dollars)

U.S. Median Rent in 2000: 602
…. in 2005 : 728
Thats a 21% increase (nominal dollars)

“Inflation may have been a factor 01-02-03 but after that its not only down, its pretty much wiped out the gains from 01-02. ”

On the contrary, core inflation was declining from 01-03 and increasing thereafter. On average it’s about the same for the period from 01-03 as 04-06.

I think surveyor is on to something… Maybe the problem is that something special is happening in North Carolina that affects your perspective ?

NC had below average wage growth in 2000-2005
NC Median family income in 2000: 46,335
…. in 2005: 49,339

Only 6.5% wage growth in North Carolina in that period. This lagged the US by nearly a factor of two. If you believe the inflation numbers of about 1.5-2% during that period, that’s negative wage growth in real dollars in North Carolina. Ouch….

Now, I understand your perspective. But, nationwide, inflation is real and is not zero.

[(former)FormerSanDiegan]

In God We Trust. Everyone Else Bring Data.

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