[(former)FormerSanDiegan]

I found the following to be a bit counterintuitive:

“There is so much demand. I bet that a lot of people on this forum want to buy but don’t only because they are priced out. Let’s be honest: how many of us would buy if prices were low enough that we could get a 30 year fixed loan, vs. how many of us would buy when the housing market hits bottom?
… The fact is, only a handful of people in this country even understand the housing bubble. … ”

When the time comes that a sufficient number of people can afford to buy with 30-year fixed rate loans won’t real estate then be based on solid fundamentals ?

SO, do people who are waiting in the wings to purchase a house that they can afford with conservative financing not understand the bubble. I thought that was the premise of the bubble, that prices are out of line with fundamentals. Maybe I’m one of the ones that doesn’t understand the script for how the bubble plays out ???

[(former)FormerSanDiegan]

Mortgage rates have dropped considerably in the last several months. This has a positive effect on home sales and supports prices. This has helped dampen the slide.

[(former)FormerSanDiegan]

Cycle –
Great points. Anyone else remember the Japanese taking over the world in the early 1980’s ? It was to the end of American society as we know it. They ultimately bought up billions in commercial RE on the West Coast and then we stuck it to them with the early 90’s recession.
I wonder how we’ll stick it to the Chinese ?

[(former)FormerSanDiegan]

OK bubba99 the numbers are tough to make a case, but what if …
they offered a shotgun with home purchase. Then this thing would fly off the shelf, wouldn’t it ?

P.S. – If a guy named bubba doesn’t want this house, it might be a problem selling it in Texas.

[(former)FormerSanDiegan]

Bubba – Several good points, especially the following
… I have not seen anything yet that ties R.E. prices to the “value” of the dollar. If the dollar value is declining on the world market, then asset prices in dollars should increase – much like stocks and other hard assets do as the dollar declines – in theory. If this is true then we should be seeing a 10% increase in R.E. due to currency offsetting bubble declines.

This is why I don’t understand why people who are bearish on real estate, economy, and the US dollar think that weakened dollar and ensuing inflation won’t reduce the depths of a real estate collapse. If we have significant inflation, coupled with a weaker dollar, why won’t the the value of hard assets (RE included) tend to hold their value ?

[(former)FormerSanDiegan]

The “Buy a House… Get a Gun” post reminded me to check on this baby. It is now reduced to 598K from 650K
Maybe they should throw in a shotgun to move this inventory.

[(former)FormerSanDiegan]

And so far the advertisement has not generated negative attention from the anti-gun lobby, she said.

Texas ? Ain’t no anti-gun lobbyin’ there y’all.

[(former)FormerSanDiegan]

All we need is for Congress to repeal the Second Law of Thermodynamics. (Or would that take a Constitutional Amendment – I’m not a political expert). That should have been on the agenda of the lame duck congress. Now that we have gridlock it’s going to get pushed out a couple years or longer. Bummer.

[(former)FormerSanDiegan]

“Studies have shown that people get irrational and emotional when their investments lose money.”

That’s a classic !

[(former)FormerSanDiegan]

lendingbubble….
Another 20%+ and “investors” (by quotes I assume that you mean flippers and speculators) will be selling, auctioning and/or gifting their properties at a discount to investors (without quotes … long-term buy and hold income types).

[(former)FormerSanDiegan]

Yes, people also get mad when we tell them they are getting fat, that they are losing their hair or that they have bags under their eyes … or a few new wrinkles.

Just because they get mad doesn’t mean it’s untrue. It’s simply that it’s a sore subject.

[(former)FormerSanDiegan]

The investors purchasing now are jumping the gun.
For the past 6-7 years I’ve owned a SFR rental in SD. Every few months I look at the market and run the numbers. Last time it made sense was in early 2003 for SFRs.

I agree that condos may appear to get to break-even cash flow first, but the HOA fees and the lack of control over supplemental HOA assessments for unforeseen maintenance and repairs means that the positive cash flow on paper is less likely to happen in reality.

IMO we still have another 10-20% downside for central SD SFRs (don’t know about other areas) before investing starts to make sense … to me.

[(former)FormerSanDiegan]

Too bad. Guess you’ll have to go with a Karl Strauss.

By the way, today’s jobs report is pretty consistent with continued growth above 1%.

Ready that tap jg, then maybe double-or-nothing the same bet for next quarter.

[(former)FormerSanDiegan]

Interesting … 4 out of the 5 moving in from either outlying areas or out of the area. Seems counter-trend to the population exodus we have witnessed.

[(former)FormerSanDiegan]

Housing blogs will also be gone.

Two reasons:

1. The housing bubble will have already deflated, and the topic will be boring and stale.

2. A common belief will arise that once-in-a-lifetime changes in economic and demographic conditions will result in the conclusion that owning real estate is a bad idea once-and-for all.

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