[ltokuda]

First, I would ask if the house is owner occupied. If not, then I would view the property as a business investment.

Next, I would ask if the owner had the income necessary to service the mortgage payments (after any teaser rates expire) when he purchased the house. If not, then the owner was either betting that the house would appreciate in value or that he would somehow earn more money in the future. Either way, its speculative.

[ltokuda]

First, I would ask if the house is owner occupied. If not, then I would view the property as a business investment.

Next, I would ask if the owner had the income necessary to service the mortgage payments (after any teaser rates expire) when he purchased the house. If not, then the owner was either betting that the house would appreciate in value or that he would somehow earn more money in the future. Either way, its speculative.

[ltokuda]

Rich, thank you very much for creating this site. There’s so much mis-information floating around and being passed off as “common knowledge” that its very easy for people to get confused. I used to be one of those confused individuals. I had a feeling (back in 2003) that we were in a real estate bubble, but couldn’t get my head around all the conflicting information. The issue remained very hazy for me until I stumbled onto your site (in 2005) and read the Bubble Primer. That was the key. The Primer didn’t try to simply tell me what to believe. Instead, it provided me with the data and the analysis to discern what information was true and what information was false. Clarity, at last!

I got married in the summer of 2006 and decided not to buy a house just yet. I could have made a huge financial blunder back then but this site helped me to forsee the housing crash to come.

I’m currently renting a house that I love in a location that I love for much cheaper than it would cost to buy. Eventually, when the price is right, I’ll buy a house. Thanks to you, I’ll have a better understanding of when the price is “right” for me.

[ltokuda]

Rich, thank you very much for creating this site. There’s so much mis-information floating around and being passed off as “common knowledge” that its very easy for people to get confused. I used to be one of those confused individuals. I had a feeling (back in 2003) that we were in a real estate bubble, but couldn’t get my head around all the conflicting information. The issue remained very hazy for me until I stumbled onto your site (in 2005) and read the Bubble Primer. That was the key. The Primer didn’t try to simply tell me what to believe. Instead, it provided me with the data and the analysis to discern what information was true and what information was false. Clarity, at last!

I got married in the summer of 2006 and decided not to buy a house just yet. I could have made a huge financial blunder back then but this site helped me to forsee the housing crash to come.

I’m currently renting a house that I love in a location that I love for much cheaper than it would cost to buy. Eventually, when the price is right, I’ll buy a house. Thanks to you, I’ll have a better understanding of when the price is “right” for me.

[ltokuda]

Rich, thank you very much for creating this site. There’s so much mis-information floating around and being passed off as “common knowledge” that its very easy for people to get confused. I used to be one of those confused individuals. I had a feeling (back in 2003) that we were in a real estate bubble, but couldn’t get my head around all the conflicting information. The issue remained very hazy for me until I stumbled onto your site (in 2005) and read the Bubble Primer. That was the key. The Primer didn’t try to simply tell me what to believe. Instead, it provided me with the data and the analysis to discern what information was true and what information was false. Clarity, at last!

I got married in the summer of 2006 and decided not to buy a house just yet. I could have made a huge financial blunder back then but this site helped me to forsee the housing crash to come.

I’m currently renting a house that I love in a location that I love for much cheaper than it would cost to buy. Eventually, when the price is right, I’ll buy a house. Thanks to you, I’ll have a better understanding of when the price is “right” for me.

[ltokuda]

Rich, thank you very much for creating this site. There’s so much mis-information floating around and being passed off as “common knowledge” that its very easy for people to get confused. I used to be one of those confused individuals. I had a feeling (back in 2003) that we were in a real estate bubble, but couldn’t get my head around all the conflicting information. The issue remained very hazy for me until I stumbled onto your site (in 2005) and read the Bubble Primer. That was the key. The Primer didn’t try to simply tell me what to believe. Instead, it provided me with the data and the analysis to discern what information was true and what information was false. Clarity, at last!

I got married in the summer of 2006 and decided not to buy a house just yet. I could have made a huge financial blunder back then but this site helped me to forsee the housing crash to come.

I’m currently renting a house that I love in a location that I love for much cheaper than it would cost to buy. Eventually, when the price is right, I’ll buy a house. Thanks to you, I’ll have a better understanding of when the price is “right” for me.

[ltokuda]

Rich, thank you very much for creating this site. There’s so much mis-information floating around and being passed off as “common knowledge” that its very easy for people to get confused. I used to be one of those confused individuals. I had a feeling (back in 2003) that we were in a real estate bubble, but couldn’t get my head around all the conflicting information. The issue remained very hazy for me until I stumbled onto your site (in 2005) and read the Bubble Primer. That was the key. The Primer didn’t try to simply tell me what to believe. Instead, it provided me with the data and the analysis to discern what information was true and what information was false. Clarity, at last!

I got married in the summer of 2006 and decided not to buy a house just yet. I could have made a huge financial blunder back then but this site helped me to forsee the housing crash to come.

I’m currently renting a house that I love in a location that I love for much cheaper than it would cost to buy. Eventually, when the price is right, I’ll buy a house. Thanks to you, I’ll have a better understanding of when the price is “right” for me.

[ltokuda]

Do you feel that the avg. buyer is educated enough to see these numbers and not start to get a bit itchy?

No, I think the average buyer is NOT educated at all about the economics of buying a house.  I work with a lot of engineers (who are good in math) and even they don't understand how to value a property.  There's so much mis-information floating around that its easy to get confused.  I was completely lost until I stumbled upon Piggington's.  And even after 2 years of studying this, I still feel like there's a lot more to learn.

From my observations, the average home buyer makes their decision to buy based on emotions.  They want to buy a house first, then they convince themselves that its the right thing to do.  So if the average person saw a home they wanted going for 20% off the peak and they were able to get financing for it, there's a good chance they'll take it.

I see the increased buying activity on the lower end as a natural process: prices go down, demand goes up.  If prices go down more, demand will go up more.

 

[ltokuda]

Do you feel that the avg. buyer is educated enough to see these numbers and not start to get a bit itchy?

No, I think the average buyer is NOT educated at all about the economics of buying a house.  I work with a lot of engineers (who are good in math) and even they don't understand how to value a property.  There's so much mis-information floating around that its easy to get confused.  I was completely lost until I stumbled upon Piggington's.  And even after 2 years of studying this, I still feel like there's a lot more to learn.

From my observations, the average home buyer makes their decision to buy based on emotions.  They want to buy a house first, then they convince themselves that its the right thing to do.  So if the average person saw a home they wanted going for 20% off the peak and they were able to get financing for it, there's a good chance they'll take it.

I see the increased buying activity on the lower end as a natural process: prices go down, demand goes up.  If prices go down more, demand will go up more.

 

[ltokuda]

Do you feel that the avg. buyer is educated enough to see these numbers and not start to get a bit itchy?

No, I think the average buyer is NOT educated at all about the economics of buying a house.  I work with a lot of engineers (who are good in math) and even they don't understand how to value a property.  There's so much mis-information floating around that its easy to get confused.  I was completely lost until I stumbled upon Piggington's.  And even after 2 years of studying this, I still feel like there's a lot more to learn.

From my observations, the average home buyer makes their decision to buy based on emotions.  They want to buy a house first, then they convince themselves that its the right thing to do.  So if the average person saw a home they wanted going for 20% off the peak and they were able to get financing for it, there's a good chance they'll take it.

I see the increased buying activity on the lower end as a natural process: prices go down, demand goes up.  If prices go down more, demand will go up more.

 

[ltokuda]

Do you feel that the avg. buyer is educated enough to see these numbers and not start to get a bit itchy?

No, I think the average buyer is NOT educated at all about the economics of buying a house.  I work with a lot of engineers (who are good in math) and even they don't understand how to value a property.  There's so much mis-information floating around that its easy to get confused.  I was completely lost until I stumbled upon Piggington's.  And even after 2 years of studying this, I still feel like there's a lot more to learn.

From my observations, the average home buyer makes their decision to buy based on emotions.  They want to buy a house first, then they convince themselves that its the right thing to do.  So if the average person saw a home they wanted going for 20% off the peak and they were able to get financing for it, there's a good chance they'll take it.

I see the increased buying activity on the lower end as a natural process: prices go down, demand goes up.  If prices go down more, demand will go up more.

 

[ltokuda]

Do you feel that the avg. buyer is educated enough to see these numbers and not start to get a bit itchy?

No, I think the average buyer is NOT educated at all about the economics of buying a house.  I work with a lot of engineers (who are good in math) and even they don't understand how to value a property.  There's so much mis-information floating around that its easy to get confused.  I was completely lost until I stumbled upon Piggington's.  And even after 2 years of studying this, I still feel like there's a lot more to learn.

From my observations, the average home buyer makes their decision to buy based on emotions.  They want to buy a house first, then they convince themselves that its the right thing to do.  So if the average person saw a home they wanted going for 20% off the peak and they were able to get financing for it, there's a good chance they'll take it.

I see the increased buying activity on the lower end as a natural process: prices go down, demand goes up.  If prices go down more, demand will go up more.

 

[ltokuda]

The OC Register has some information which shows what’s going on.

Banks are offering about 20% less than last year for foreclosed properties:

http://mortgage.freedomblogging.com/2008/05/13/banks-offer-20-off-foreclosed-homes-in-oc/

Lower priced homes are experiencing the most distress:

http://mortgage.freedomblogging.com/2008/05/19/supply-of-oc-distress-homes-for-sale-up-again/

Lower priced homes are seeing the most buying activity:

http://lansner.freedomblogging.com/2008/05/19/where-did-aprils-surge-in-home-sales-come-from/

Lower priced homes are seeing the shortest market time:

http://lansner.freedomblogging.com/2008/05/19/cheap-home-rush-cuts-oc-supply-under-6-months/

So the basic story is that people are buying where the discounts are. In markets where there aren’t as many discounts, there isn’t as much buying.

[ltokuda]

The OC Register has some information which shows what’s going on.

Banks are offering about 20% less than last year for foreclosed properties:

http://mortgage.freedomblogging.com/2008/05/13/banks-offer-20-off-foreclosed-homes-in-oc/

Lower priced homes are experiencing the most distress:

http://mortgage.freedomblogging.com/2008/05/19/supply-of-oc-distress-homes-for-sale-up-again/

Lower priced homes are seeing the most buying activity:

http://lansner.freedomblogging.com/2008/05/19/where-did-aprils-surge-in-home-sales-come-from/

Lower priced homes are seeing the shortest market time:

http://lansner.freedomblogging.com/2008/05/19/cheap-home-rush-cuts-oc-supply-under-6-months/

So the basic story is that people are buying where the discounts are. In markets where there aren’t as many discounts, there isn’t as much buying.

[ltokuda]

The OC Register has some information which shows what’s going on.

Banks are offering about 20% less than last year for foreclosed properties:

http://mortgage.freedomblogging.com/2008/05/13/banks-offer-20-off-foreclosed-homes-in-oc/

Lower priced homes are experiencing the most distress:

http://mortgage.freedomblogging.com/2008/05/19/supply-of-oc-distress-homes-for-sale-up-again/

Lower priced homes are seeing the most buying activity:

http://lansner.freedomblogging.com/2008/05/19/where-did-aprils-surge-in-home-sales-come-from/

Lower priced homes are seeing the shortest market time:

http://lansner.freedomblogging.com/2008/05/19/cheap-home-rush-cuts-oc-supply-under-6-months/

So the basic story is that people are buying where the discounts are. In markets where there aren’t as many discounts, there isn’t as much buying.

[Author]

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