[greensd]

92104 is one of those funny San Diego neighborhoods that has a lot less economic segregation than we’re used to the US. I live at 30th and Juniper — on my lot and the ones right around me, we’ve got 30+ small cheap rental units. They’re terribly maintained, there’s huge tenant turnover, and the cops are here a lot. Across the alley, though, is Burlingame, with pink sidewalks and $million-plus houses. Fifty feet away and it’s another world.

People drive through here and can’t figure out whether it’s Mission Hills or City Heights… actually, it’s both. It works out great for me and my kids, but that’s because we’re poor. I can see why the rich might prefer to have a little more homogeneity in their neighbors, but I guess the area has compensating charms.

[greensd]

I’m confused about who we’re supposed to feel sorry for. It seems to me there are three different kinds of homeowners who are “suffering” in this downturn.

People like beachlover and cashman, as far as I can tell, don’t actually have any problems. They’re sitting on a ton of equity and/or cash and have lots and lots of attractive options open to them. They’re frustrated that the market isn’t generating even more equity and/or cash for them right now, but that’s not exactly a societal crisis.

Then there are the “homeowners” who never actually owned anything that are falling into foreclosure. They’ve got no equity in the houses anyway, so they’re not really losing much. Sure, they’ll have to rent for awhile, maybe even for a long while, but those of us in the Priced Out Forever generation know what that’s like, and, frankly, it’s just not that big a deal. So, again, not much sympathy.

And then there are the mini-Trumps and Casey Serins out there, like the guy who tried to tell me I was abusing my children by not borrowing as much money as I could to buy property (I was denying them a future of financial security just so I could selfishly enjoy a little cash flow now). Those guys are going to suffer the most, but, them’s the breaks.

What am I missing?

[greensd]

I’m confused about who we’re supposed to feel sorry for. It seems to me there are three different kinds of homeowners who are “suffering” in this downturn.

People like beachlover and cashman, as far as I can tell, don’t actually have any problems. They’re sitting on a ton of equity and/or cash and have lots and lots of attractive options open to them. They’re frustrated that the market isn’t generating even more equity and/or cash for them right now, but that’s not exactly a societal crisis.

Then there are the “homeowners” who never actually owned anything that are falling into foreclosure. They’ve got no equity in the houses anyway, so they’re not really losing much. Sure, they’ll have to rent for awhile, maybe even for a long while, but those of us in the Priced Out Forever generation know what that’s like, and, frankly, it’s just not that big a deal. So, again, not much sympathy.

And then there are the mini-Trumps and Casey Serins out there, like the guy who tried to tell me I was abusing my children by not borrowing as much money as I could to buy property (I was denying them a future of financial security just so I could selfishly enjoy a little cash flow now). Those guys are going to suffer the most, but, them’s the breaks.

What am I missing?

[greensd]

Get back to me when you’re done.

Yeah, I’ve read those, and more (just finishing Traders, Guns, and Money). Now I’m convinced that at least in the short-term the markets are basically rigged. The individual investor has no chance going up against the big guys. Sure, LTCM exploded, but I doubt they ever had to cut back on their hookers and blow. It’s everyone else who pays the cost. I do statistical pattern analysis for a living, and even so, I buy and hold index funds. I can make more money analyzing time series in other domains as a consultant than I could screwing around trying to predict the market.

[greensd]

I wouldn’t do it. Besides the risk of foreclosure, he’s probably got no idea what it means to be a landlord. Being a landlord (landlording?) is a business. Done properly, it’s not just “passive income”. He’s probably going to see you as someone to keep the squatters out of the place and cover part of the mortgage until the market turns. He’s not going to see you as someone that he has a responsibility to. I rented from an investor once, but never again. She cut every corner possible on repairs, raised the rent with gusto every chance she got, stuck us with inflated water bills, and then chiseled us out of the cleaning deposit when we finally bailed. From now on, I’m sticking with professional property owners/managers.

[greensd]

No offense, Neeta, but if you’ve got a half million dollars to invest, why are you asking for anonymous advice on the Internet about a probably shady deal that pays a measly 12.5%? Don’t people like you have better options than that?

[greensd]

Another thing relevant to this is the growing number of new houses built with two master suites. There was a fuss awhile back about how this is a sign that married couples don’t share bedrooms anymore, but I think it’s really more that you’ve got more non-related adults living under one roof. If you’re single and can’t buy a house with one income, then pool your income with a friend to buy a place. Rather then draw straws for who gets to be the “master”, you can buy a place with two master bedrooms. Once prices come back down to reasonable levels, I wonder who’s going to want all those conjoined-twin condos?

[greensd]

Just for the record, I more or less agree with golfgal, and I didn’t mean to imply otherwise. I made some bad choices… if only I could go back and slap some sense into my 19-year-old self! But, I’d also like to point out that both men and women sometimes marry people who turn out to be no damn good, and both men and women sometimes wind up embittered by what follows.

[greensd]

I don’t get it… is this a joke? Has she rented before? This stuff sounds pretty much standard. Some of it should have been resolved before she moved in (like whether there’s grass in the yard or whether the lease allows cats). Some of it is just maintenance issues that the landlord really has no choice about fixing (like leaky plumbing and no smoke alarms) — a letter from a lawyer or maybe even a chat with the housing inspector should resolve that if the landlord is refusing to move on it. The rest of it is pretty much just how most people live. Paint on the porch? Missing chandelier crystals? Door doesn’t close right? Sorry, that doesn’t make it uninhabitable. The crew who painted my current place before I moved in seem to have just set off a paint-filled bomb in the middle of the house. They painted the stone fireplace, they painted the lightbulbs in the light fixtures, they even painted over dishes the last tenants left in cupboards. Eh. It’s not my investment they’re devaluing. The rent’s right and I like the neighborhood, so I stay.

As a life-longer renter, I’ve seen lived in a lot of rental units, and while some are nicer than others, they all have the kind of cosmetic issues you list (and no, none of them have been section 8 or public housing of any kind). Unless you’re paying $3000/mo in rent or something, that’s just life. (I’m told owner-occupied homes aren’t always perfect either, but having been priced out forever, I wouldn’t know first-hand.)

Of course, that said, she’s got a month-to-month lease, so if it bugs her every time she comes home, she should just move. As a tenant, you need to remember that you’re the customer. If you don’t like how your landlord handles things, take your business elsewhere. And she should also remember to take a couple of those crystals with her when she leaves…

[greensd]

http://forums.prosper.com/index.php?showtopic=23358

[greensd]

There’s lots of money to be made lending to the desperate and the needy. After all, loan sharks and pawn shops seem to do okay.

EDIT: I just looked at the website… This isn’t about making money from the desparate and needy — it’s about making money from the rich and gullible. Stay away from them! Unless, of course, you are them, in which case this probably isn’t the best forum to shill on.

[greensd]

greensd – since the perspectives are sometimes asymmetrical, are you the husband or wife in the divorce?

Husband and sole breadwinner. My ex is talking about going back to school, but hasn’t and hasn’t gotten a job either. So, yeah, I write a huge check every month. I’m just saying, by any objective measure my divorce was a financial catastrophe for me, and it still beats having to spend the next forty or fifty years with that woman. Just like people don’t usually decide to get married just for the money, I don’t think the choice to split up is very often made on purely economic grounds. Sure, plenty of divorces turn into fights over money in court, but that’s not what it’s really about.

[greensd]

I’m in the middle of a divorce now… it’s definitely put a dent in my material standard of living, but that wasn’t really a factor in deciding whether to leave or not. The situation was intolerable, and if being out of it means I have to rent an apartment and drive a used car, well, that’s a small price to pay. Compared to everything that goes along with a family breaking up, the money part is not that big a deal. It reminds me of a character in a novel I read years ago who was an insurance adjuster. He rationalized denying claims from policyholders who had suffered some disaster by saying that if money could fix it then it wasn’t really a disaster. My bet is that your buddies who say they’d leave their wives if it weren’t for housing costs just aren’t ready to leave. If it wasn’t housing, it would be something else.

[greensd]

Please don’t look down on me because I was smart enough to save money during my lifetime and have comfortable options now.

I’m not looking down on you because you make more sitting on your ass than most people can bring home with two jobs. I’m not even looking down on you for your need to brag about that fact on the Internet. I’m looking down on you for putting your boasts in the form of a complaint about your lifestyle, when you know full well that you live better than the vast majority of people in SoCal, let alone the world. Besides, if you really were “smart” and a “doer”, the state of the housing market wouldn’t matter — you’d have no problem thinking of something to do with $2mil besides buy houses and wait for the market to go up.

[greensd]

Can’t set up your home theater system? Wow, that must really suck… And don’t you hate it when you can’t get to your Rolls because of the huge piles of money in your garage?

[Author]

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