[(former)FormerSanDiegan]

It is not a sellers or a buyers market. It is a renters market.

Playing devil’s advocate and taking a stance analogous to the original post, isn’t it really a landlord’s market, not a renter’s market. ?
There are many landlords out there who bought their property in the mid-80’s for 125K. They are charging $1800 / month rent, grossing 25% on their investment. Even worse, they are only spending $300 a month for the place and sticking it to the renter for an additional $1500 per month.

I say it’s a landlord’s market, not a renter’s market.

[(former)FormerSanDiegan]

The biggest monkey wrench IMO is that increased inflation could dampen the nominal drop in housing prices. There would still be real (adjusted for inflation) losses in home prices. Problem is that the accompanying interest rate increases would dampen the housing market. Who would be the winners in that scenario ? Historically in inflationary times it is best to own hard assets (e.g. property) and even better to have locked in a low interest rate to increase leverage in that investment. Not saying it’s gonna happen, but it’s a scenario that throws a monkey wrench in the plans of bubble sitters.

[(former)FormerSanDiegan]

asianautica –

You took the words right off my fingertips. By lendingbubbleco’s definition it’s always a sellers market for people who bought 10+ years ago. Under virtually ALL conditions.

However, regardless of semantics I think the majority here would agree on the following:
1. Now is not a good time to Buy. Regardless of what the market is called.
2. Buyers have control in negotiations (traditionally called a “buyers market”).
3. Sellers who price their properties appropriately and purchased years ago are still making a decent profit, and in some cases tremendous profits
4. The Earth is not flat.

[(former)FormerSanDiegan]

lostkitty – I have to agree with you that it is a mistake to pay for about 99% of web services.

I have paid for ConsumerReports web content in the past, though.

[(former)FormerSanDiegan]

cow_tipping –

I agree from a pragmatic standpoint. But the market belongs in the hands of those with strength. Whether it’s buyers or sellers. Right now it’s the buyer’s… and if the buyers choose to wait that is how they are exercising their upper hand.

[(former)FormerSanDiegan]

After reviewing some of the pertinent discussion several pages back, I’ve taken another look at Robert Campbell’s market calls. I have come to the conclusion that his buy signals look pretty good in retrospect and are usually either close to the bottoms or at least far enough from the peaks to make out pretty well.

My initial thoughts (prior to actually reading his book) : for a simple method for timing : Buy when Campbell says to buy …
… and never sell.

[(former)FormerSanDiegan]

TheBreeze –

I have to agree with your monkey comment. That’s why I periodically post a market update on this thread. Although I anticipate some pullback/correction in stocks (Thanks Chris for providing some more insight from a traders’ perspective) the original notion of predicting a 50% drop in S&P 500 because of a 50% drop in a housing index solely based on the fact that they are correlated is both naive and mathematically incorrect. Simply because things are correlated, does not mean that there is a 1:1 translation of one factor to another.
If life were only that simple.

[(former)FormerSanDiegan]

Not really … at least in the SD market.

Nice try REIC, but…when a seller can cut his/her asking price by 20-40% and still walk away with an enormous profit, they are still in the driver’s seat.

When a seller has to cut their prices to meet the demands of the buyer, when the seller has to offer incentives, when the buyer can place all contingencies and get an offer accepted it is NOT a sellers’ market.

What market are you talking about ?

What planet are you on ?

[(former)FormerSanDiegan]

When facing a cliff, being one step ahead is not where you want to be!

Now that’s a classic !

[(former)FormerSanDiegan]

Monthly Market Update:

As of Jan 5 2007 S&P 500 is at 1409. We need a greater than 50% drop in about 3 months to hit 700 by Spring.

That’s only about 10 points per trading day. It could happen, right ?

[(former)FormerSanDiegan]

Perry – I have to agree with your last statement. I currently live in West LA and the market here seems to be just reaching a price peak in the last few months. About 9-12 months behind San DIego in my opinion.

I follow West LA and SD closely since I live in LA and still have a rental in SD.

[(former)FormerSanDiegan]

meadandale –

It is a good idea to run the numbers for your particular situation before jumping in and selling. Also, it depends on your other assets outside your home and how comfortable you are in absorbing losses. Same goes for buying.

Last year I contemplating selling my remaining rental property in SD. I’m into my 5th year on it, so it cash flows. When I computed costs for selling, as well as Taxes (never lived in the house) it would have been about 18% of the price. I chose to keep it with the possibility of a greater loss, but perhaps balanced by rent creeping up at 3% per year rather than take the guaranteed 18% hit.

[(former)FormerSanDiegan]

I second PerryChase’s recommendation on spending a lot of your spare time on the ground while you rent for 6 months to a year. That’s exactly what I did when I moved to SD in the mid 1990’s. You can learn a heck of a lot about a local market by looking at listings on-line, driving through the neighborhoods and getting a feel for them at different times of day/night and seasons.

Once you are in tune to the area, I’d recommend finding a few areas that you really, really like and can afford (conservatively: fixed-rate loan). Make sure you want to actually stay in the area for a few years and that if current jobs fall through there are sufficient opportunities in your field. Then buy a house you like in a location you love.

[(former)FormerSanDiegan]

We rely on Rich and Piggington as a reporter, analyzer of facts, and stimulator of independent thinking.

I also value contributions from other folks (including PS) when they provide useful information that we can analyze and come to our own conclusions.

Whether someone made a correct call (e.g. shorting the stock market in the latter half of 2006) or publishes their victories and losses should not be relevant.

So, I made 10x my money in real estate. So what ?
What if I actually made more and didn’t disclose it for personal reasons ? Does that make my call that SD SFRs will drop a nominal 19.3675% to 26.4285% in the current cycle any more valid than the next guy ? I think not.

When one reveals too much information about their personal exploits or failures it invites others to shoot the messenger rather than focus on the message. I applaud Rich for resisting.

Keep giving us the plain old boring facts Professor Piggington … And thanks for not trying to create a cult of personality about yourself.

[(former)FormerSanDiegan]

The initial admin response was more than enough to back-up the claim. The badgering for more info is ridiculous and adds zero information and insight to the situation.

So … PS made a measly 530% profit on her downpayment for the home she held for 6 years. That pales in comparison to the 1100 % profit on the downpayment for the property I bought in 2000 and sold in 2005. That’s on top of the 1300% I made on the property I bought in 1996 and sold in 2001.

Niener, niener, neiner !

[Author]

Posts