[LA_Renter]

There will be monthly fluctuations but I believe if you look at YOY comparisons they are down 25% to 30%.

[LA_Renter]

This is from United Van Lines;

The other “high-outbound” states in this year’s study were: • California (55.7%) – 2005 marks the first time the state has seen a high outbound number since 1995

I wonder how 2006 is shaping up so far?

[LA_Renter]

Housing Bubble Bloggers being reported on in the MSM is definitely a distinct phase in the bubble. Much like the Time magazine cover with dollars bellowing out that house. I think we are at that moment where Joe Sixpack senses “somethings up” with this RE thing. It’s nice to see both Rich and Ben get some ink lately. They and others have provided an invaluable service to many. For those who read and participate in these blogs I think it is safe to say we have all learned from each other.

[LA_Renter]

Contagion,

I have to admit you had me a little confused there. : )

[LA_Renter]

I brought this up because I was reading exactly how much total RE $ transactions are down in So Cal, and the whole state for that matter. Home sales were down about 35% to 40% in July. There are pockets in LA that are down 80%. Thats a pretty big contraction to one of the states largest employers which is RE. Their are alot of hungry realtors, mtg brokers, etc out there. According to the UCLA Anderson forecast it takes about 4 to 6 quarters for this contraction to be felt in the economy. Now you throw a potential oil shock on top of this which is both contractionary and inflationary. When I discovered this BP fiasco would hit the west coast the hardest my gut reaction was Wow! that could really be the straw that broke the camels back. Right now they are saying this could take months to fix. This could fade into a no big deal story or this may be the tip of the iceberg. I guess we need more info. If its a real big problem than IMO it plays directly into the busting of this RE bubble.

[LA_Renter]

Good article from Reuters

http://www.turkishdailynews.com.tr/article.php?enewsid=50701

“True, the immediate U.S. market reaction to the European and UK rate hikes, which came alongside similar moves from Denmark and South Africa, was relatively muted.

But longer term, market experts contend a transition to higher rates in Europe and Asia that happens while U.S. borrowing costs stay put could have wide-ranging implications for financial markets. Most believe the dollar would be the first to take a hit.

“The U.S. rate cycle is nearing its end, whether or not the Fed pauses next week, and that comes with more pronounced tightening to come in Europe and Japan,” said Alex Beuzelin, senior market analyst at Ruesch International in Washington, D.C. “That opens the door for the dollar to trend lower over the final months of 2006.”

When it does, other assets like stocks and bonds denominated in dollars could also get hurt. But even more worrisome is the prospect that the carefully calibrated efforts of global central banks could be based on erroneous measurements

Policy-makers themselves are quick to admit that interest rates are a blunt tool. Overshooting tends to be the rule rather than the exception, although in the case of the United States, economic growth is usually sufficiently resilient to prevent a prolonged slump.

But this strength is untested in a truly interlinked world economy where geopolitical risks abound.

With most central banks around the world tightening monetary policy simultaneously — one analyst cited a ratio of nearly five rate hikes for every rate cut so far this year — the risk that the global economic behemoth will stumble to a halt is perhaps larger than ever before. The hangover from a prolonged period of easy money could be a rough one this time.”

[LA_Renter]

I posted this on the Pause or No Pause thread

If the Fed pauses, doesn’t the story then become about the dollar. I was reading the Bank of Italy post and it looks like they are dumping their US Treasuries in anticipation of the the FED coming to the end of its tightening. Now won’t that put pressure on the long bond pushing up yields and mortgages? Right now the 10 yr is yielding about 4.9% down from about 5.22 last month so obviously traders are pricing in an economic downturn. At what point will a weakened dollar begin to impact US Treasuries? Point being this “pause’ could push mortgages higher.

[LA_Renter]

If the Fed pauses, doesn’t the story then become about the dollar. I was reading the Bank of Italy post and it looks like they are dumping their US Treasuries in anticipation of the the FED coming to the end of its tightening. Now won’t that put pressure on the long bond pushing up yields and mortgages? Right now the 10 yr is yielding about 4.9% down from about 5.22 last month so obviously traders are pricing in an economic downturn. At what point will a weakened dollar begin to impact US Treasuries? Point being this “pause’ could push mortgages higher.

[LA_Renter]

“Check out monster.com”

Monster is a joke! How many of those are real jobs?

[LA_Renter]

EVERBANK

Here is the link; http://www.everbank.com/main.asp?affid=eb

You can invest in a wide variety of world currency accounts.

[LA_Renter]

My beer is raised.

[LA_Renter]

OC Renter,

I also wrote an e-mail to the U-T. That statement really struck a nerve, I noticed on Bens Blog there were about five to six seperate threads all going WTF? It really does show the value of these blogs educating people on the current market wtih both opinion and just cold hard data. I know that Rich makes the point that there is not a conspiracy among the journalist covering RE so lets just hope this is a bit of laziness on the part of the U-T, but there is no way anyone can back up that statement from Ms. A-Y.

[LA_Renter]

Show him the invnentory build on bubbletracking.blogspot.com. Also look at the equation on patrick.net housing crash page;

“There are great tax advantages to owning.”
FALSE. It is now far cheaper to rent a house in the San Francisco Bay Area than it is to own that same house, even with the deductibility of mortgage interest figured in. It is possible to rent a good house for $1800/month. That same house would cost about $700,000. Assume 6% interest we can see that a buyer loses at least $4,936 per month by buying. Renting is a loss of course, but buying is a much bigger loss.
Renting:
Rent: $1,800
———————-
Monthly Loss: $1,800

Buying:
Property Tax: $486 ($729 per month at 1.25% before deduction, $486 lost after deduction.)
Interest: $2,333 ($3500 per month at 6% before deduction, $2333 lost after deduction.)
Other Costs: $450 (Insurance, maintenance, long commute, etc.)
Principal loss: $1,667 (Modest 3% yearly loss on $700,000. Reality will be much worse.)
———————-
Monthly Loss: $4,936

This is obviously for the Bay Area and interest rates are actually higher now. But do this equation before purchasing. Right now with inventory building home prices flattening and beginning to fall the finacial cost of owning is throwing away money. I am in your shoes and this data helps greatly.

[LA_Renter]

Here is a tool you can use to track rents. Rentslicer.com. They have a trend and graphs page that monitor rents in many cities including San Diego and LA. You are right avg rent is up in both LA and San Diego. This is sheer speculation but it seems that a growing number of people cannot or won’t purchase homes right now which is evident in the data which does increase demand for rentals. There are empty properties on the market that have not found their way to being rentals just yet. The population decrease while true is still minimal.

According to OCRenters bubbletracking 30% of properties are vacant right now. That makes this housing market insane IMO. Home prices are too high for anybody to purchase increasing the renter population meanwhile 30% of homes on the market are sitting vacant. Points to a MAJOR CORRECTION doesn’t it!

By the way the trends and graphs page on rentslicer only goes to April but the current avg rent is on the first page of the city report. So you can still calculate the difference.

[LA_Renter]

This will throw a wrench at the So Cal market. Does anybody have any info on how many piggyback loans were made in SO Cal over the last three years?

[Author]

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