Forum Replies Created
-
AuthorPosts
-
PerryChase
ParticipantThe price of food is going up.
———————
Perhaps we'll eat less junk stuffed with corn oil or whatever other additives. Better to burn the calories in the cars than lock them up in our bodies.
Did you hear Jay Leno's joke about Al Gore? Somethink like if he'd loose some of his fat, he could power a fleet of cars. 🙂 Jay Leno shouldn't be the one talking, ha.aha.ha.
ParticipantI tend to think that if the collapse that some of the posters foresee, happens, then both renters and homeowners will be in alot more trouble then any of us care to admit.
———————–
Think of the 1990s. It was painful then but we got on fine. It'll be more painful this time around but we'll get on fine.
Think of Japan. In many cases the prices dropped by 2/3. In the suburbs of Tokyo prices are not even back up to 1989 levels. The great depression didn't hit. Japan had a "lost decade" but people got on fine. The Japanese standard of living is still one of the highest in the world and Japanese companies are still some of the most productive. Some companies were inefficient and were acquired by foreigners. The French bought 40% of Nissan.
Think of Hong Kong where, in many developments, real estate prices collapsed by 50%. Borrowers were under water. But now, thanks to the influx of Mainland Chinese, the economy is booming again. And Hong Kong per capita GDP is now higher than England's.
In the coming RE downturn, we'll do fine. Many will loose their jobs and move away like they did in the 1990s. But we'll do fine. It won't be the great depression.
If you think in economic terms, the RE crash, will cleanse our economy of structural inefficiencies and misallocation of resources and return us to more productive endeavors — a very good thing.
ParticipantAmerica won’t invade Iran. We don’t have enough soldiers to do that even if we wanted to. If there’re any attacks, they’ll be limited to airstrikes. In which case, we’ll pay by having even more violence in Iraq.
The Brits are pulling 3000 men out of Iraq leaving about 4000 Brits in Iraq. We’re now pretty much on our own in Iraq and the situation in Afghanistan is deteriorating.
No wonder we had to deal with Korea. The Bushies gambled everything on a misguided strategy and now America is running out of options.
As rich as we are, America can’t forever live in a state of siege. That will bankrupt us just like it bankrupted the Soviet Union.
ParticipantHere’s a sample graph. You can download the excel spreadsheet and see how they do it.
To post a graph, convert to jpg and upload.http://mysite.verizon.net/vodkajim/housingbubble/san_diego.html
Participantfarbet, give it a rest. MLS# is very revealing. Once you have MLS#, you have the address. Once you have the address you can ID the owner.
ParticipantI remember the peak of the last RE boom to be 1989. In 1990, builders started shaving 20% off of prices but the median went up. It felt very painful because like-for-like house dropped about 30% in many case from 1989-1992. The median held because people were spending the same amount but they were getting a lot more for their money.
My guess is that owners had the wherewithal to hang-on for a few years but when the recovery did not materialize, they gave up. That’s why the median didn’t drop meaningfully until 1993.
In order to get the best deal, you have to wait until owners “give up.” The psychology now is that we are “taking a breather but prices have nowhere to go but up.” I don’t expect the psychology to turn decidedly negative until 2010.
One of my idiot friends just bought a Downtown LA condo, even though his DC condo is vacant. We’ll see how long it takes him to regret his decision. He can rent-out and hang-on to the DC condo but it will bleed him dry for years. Not fun.
http://mysite.verizon.net/vodkajim/housingbubble/san_diego.html
ParticipantBugs, you make an interesting point about boomers helping prop-up the SD market. If you’re right, then the SD downtown market should be quite healthy in the future.
I’m wondering if San Diego will attract many millionaire retirees. Middle class retirees are better-off somewhere in the South.
If boomer-retirees start leaving the less desirable climates in droves for California, would the resulting cheap prices in those areas not convince many more to remain?
I was talking to an immigrant friend yesterday. His old sister and brother-in-law who are in their mid 50s just immigrated to Orange County and were lamenting the high cost of living. They have no money, need to learn English and have to start over.
I suggested that they move to Houston where there’s a large employment base and where brand-new houses can be had for $120k. They can work hard in the next 15 years to pay off the house then live-off of savings and social security.
ParticipantThanks for posting the sales progress of your house. I guess your house will be the Piggington guinea pig for how sales are picking up in the Spring. Hope it turns out to be a golden pig.
ParticipantAlthough I follow the OC market, I don’t pay as close attention to it as San Diego’s.
I know someone who, at the 1990 peak, bought a 2800sf house for $380k in Penasquitos. It’s on the hill with a view. He could afford the house and rode-out the downturn. He lost subtantially on that house without realizing it.
Look at this 3400sf house below in Carmel Valley. It sold for $399k in Sept 1997 — a bigger house in what I would say is a better location closer to the coast.
5131 RUETTE DE MER, SD – Carmel Valley, CA 92130**
List Price: $1,097,500 – $1,097,500
Bedrooms: 5
Full Baths: 4
Partial Baths: 0
Square Feet: 3,439
Lot Size: 4,356 Sq. Ft.
Year Built: 1998
Listing Date: 02/22/07
On Market: 1 day
Type: SFR
Status: ACTIVE
MLS #: 076014910http://sdlookup.com/PropertyDetails/tabid/53/pid/4376BC4E/Default.aspx
http://www.ziprealty.com/buy_a_home/logged_in/search/my_home_detail.jsp?listing_num=076014910&property_type=SFR&mls=mls_sandiego&cKey=pvt3kc7z&source=SANDICORAs Chris pointed out, the median does not reflect price movements of like-for-like houses. The downturn is a great apportunity to get move value for your money. It happens only one in a couple of decades so take advantage of it.
FormerSanDiegan, by stagnate, I mean increase sporatically at or below inflation and often times not at all, depending on the neighborhood. That’s what I observed in the last downturn. Even with small price appreciation, the transaction costs would eat up any gains.
Someone mentioned on another thread that, within 10 years, the baby boomers will begin retiring. That will dampen any future recovery or prolong the downturn.
ParticipantI tend to agree with Chris when it comes to the median.
However, I believe that overall prices would’ve dropped 30% by Q1 2010 in OC and stagnate for another 10 years from that time. It’ll be about 1 year earlier in San Diego.
The real estate economy feeds on itself. Once the appreciation and price support are gone the fundamentals aren’t there to justify the prices. Even at 30% off, houses would still be very richly valued.
ParticipantGreat post, ocrenter. I like your style 🙂
ParticipantI think that there’s no need to get too fixated on whether to use a Realtor or not. If you’re an able buyer, just calculate an all inclusive price you’re willing to pay. Let the agents work it out amoung themselves — kinda like negotiating an out-the-door price on the purchase of a car. You don’t care how they work the sales taxes and registration fees so long as you get your out-the-door price.
I know that real estate is more complicated than buying a car but the same principle applies.
February 22, 2007 at 1:20 PM in reply to: California Coastal Housing Market Will Not Collapse #46013ParticipantYeah, I know some people who would rather have more land, and more freedom to do whatever they want on it without the constraints of HOA or uppity neighbors — like tinker on old cars that don’t run or have room for trailer and RV parking.
If you look at the map of San Diego County, Santee, is smack in the middle and that area has a lot of appreciation potential in the next 1/2 century as the region develops — perhaps like the Pasadena area in LA.
February 22, 2007 at 10:07 AM in reply to: Realtor Buddy wants to list my home at an inflated price to meet potential clients #46004ParticipantAfter reading the comments, I too would say that if it’s within standard industry practices, then it’s perfectly fine.
Do you guys think that once a house has been on the market, sits and doesn’t sell, it may have a harder sell in the future because of history? A good realtor, would do a thorough search and inform his client of the true DOM.
-
AuthorPosts
