[PerryChase]

Sign up on ziprealty.com (free) and see the resale listings for yourself. There are plenty of upside-down sellers at 4S. Combine your research on ziprealty.com with zillow.com and sdlookup.com. If you peruse the listings every week until this time, next year, you’ll get a good feel of market and no builder or seller will be able to pull a fast one on you.

[PerryChase]

I find it hard to believe that the difference between buy and rent is only $7k per year on a 700k house. There’s something wrong.

Give us the rent and buy numbers and your tax rate and I’m sure that posters here will find what you’re missing.

Don’t trust the online calculators. Design your own spreadsheet.

[PerryChase]

Good video. We need a journalist that’s artistically minded to do a show on San Diego.

[PerryChase]

OK, I had a break and re-read the posts. powayseller posted about a NY Times article on ARMs by giving her post the title “1,460,000 ARM defaults expected.”

NY Times reported that “According to Christopher Cagan, an analyst with First American Real Estate Solutions, a housing consultancy in Santa Ana, Calif., about 19 percent of the 7.7 million ARM’s taken out in 2004 and 2005 are at risk of defaulting.”

Posters then ganged-up on her because they felt that of the 1.46M ARMs that were “at risk” certainly not all will default. Posters had issues with powayseller’s use of the word “expected.”

Well, if the CRL turns out to be right, then “2.2
million borrowers will lose their homes.” Quite a number!

I’m willing to let time be the judge but that 2.2 million number might turn out to be low.

[PerryChase]

Here’s the NY Times article mentioned by Nor_LA-Temcu-SD-Guy on the Center for Responsible Lending report.

http://www.nytimes.com/2006/12/20/business/20home.html?ref=business

Talking about semantics, the CRL report says “we project that one out of five (19 percent) subprime mortgages originated during the past two years WILL end in foreclosure.” But the NY Times translates it as: “About one in five subprime mortgages made in the last two years ARE LIKELY to go into foreclosure, according to a report released yesterday, ending the dream of homeownership for millions of Americans.”

Then NY Times then goes to go say: “At that rate, about 1.1 million homeowners who took out subprime loans in the last two years will lose their houses in the next few years, the report said. The foreclosures will cost those homeowners an estimated $74.6 billion, primarily in equity.”

[PerryChase]

There are the three old threads in question. It looks like people we upset at powayseller’s for equating “at risk of default” with “expected to default.” In essence, posters were upset at PS for making it sound like millions of FBs “will” default rather than “may” default.

This new report clearly predits that “2.2 million borrowers will lose their homes.”

I haven’t had the time to re-read the threads and compare the predictions.

http://www.piggington.com/node/1689

http://www.piggington.com/cagan_said_1_million_people_will_default

 

http://www.piggington.com/cagan_13_of_recent_arm_buyers_likely_to_default

[PerryChase]

Also, as you know, when a leader allows himself to panic, he immediately has difficulty thinking.

jg, you’re my kind of conservative — with a good sense of humor. 🙂 I’m picturing a clock going tick, tock, tick, tock, as that leader thinks.

[PerryChase]

I think that 2007 will be worse than 2006. In nominal terms, I vote for 7% Median decline in SD, since you asked about Median.

Like-for-like houses will decline another 15%. But since nobody tracks those, we’ll never know. But by this time next year, perhaps some Realtors will update us on their “feel” of the market.

[PerryChase]

I agree that most FBs will walk away without batting an eyelash. That’s the reason why I don’t believe that consumption and the general economy will really hurt. We’ll have a recession but after that, things will move along.

I can’t picture people who are used to purchasing all kinds of junk tighten their belts, stay home, drive old cars and make other sacrifices to afford the mortgage payment. No, they will give their houses to the bank and keep on consuming as usual. Housing will stagnate but consumption will not.

[PerryChase]

jg, should we add Rice, Gates, Cheney and Bush to the people having tough jobs? If the White House is not telling us the truth about Real Estate, I wonder if they are telling us the truth about other things….

I’ll surely remember Lazear’s comments this time next year.

Does being in a position of responsibility mean hiding the truth so the citizenry is left unprepared for the what’s to come?

[PerryChase]

What you are suggesting is exactly what happened in Japan, especially in the commercial sector. What did it get them? 15 years of stagnation (the lost decade).

We lectured Japan for years to bite the bullet and write off the bad debts, sell them and move on. From an economic standpoint, it’s better to let the market cleanse itself without intervention.

I hope that our regulators will have better sense than to permit such monkey business.

[PerryChase]

That was a good screenplay, mrquoi.

Perhaps we should bring back the dowry.

Given enough money, a man, no matter how ugly he is, can find a wife. A woman needs beauty and charm above all, if not, perhaps a big dowry would help. 😉

Did you guys read the SD Union article? Even the White House is now telling use that the worst of the housing slump may be over.
————

http://www.signonsandiego.com/news/business/20061219-1157-bush-economy.html

In terms of the crumbling housing market “most of the action has already played out,” Edward Lazear, chairman of the White House’s Council of Economic Advisers, told reporters.

Still, weakness in the housing sector will be probably visible in the months ahead, he said. “But hopefully that will end in the relatively near future and we’ll be able to move back to a period of positive economic growth in the housing sector,” he added.

The White House expects the economy to log fairly solid growth for all of 2006 – just over 3 percent – despite the cooldown in the once- sizzling housing market this year. Next year, the Bush administration believes that economic growth will slow slightly to around 2.9 percent and then pick up the following year.

Of the housing slump, Lazear said, “it looks like the precipitous decline that we saw earlier is not going to occur in 2007.”

He also struck a hopeful note that energy prices will be more stable next year. Surging energy prices in the spring of this year were a factor in belt tightening by consumers and businesses, which slowed overall economic activity. Later in the year, energy prices dropped but have since crept up a bit.

The volatility in energy prices this year was “an anomaly” that Lazear said he didn’t expect to be repeated next year.

Looking ahead when the Democratic-controlled Congress, convenes in early January, Lazear said the White House will continue to press lawmakers to make Bush’s tax cuts permanent. Asked whether tax increases could plunge the economy into recession, Lazear replied “absolutely” and said he would be concerned about their “very detrimental effects.”

[PerryChase]

Don’t worry. There’ll still be plenty of credit to be had.

It used to be that credit cards were only give to the rich. But now everyone has a dozen of them. Lax lending is here to stay. Lenders will use computer models to spread the risk to borrowers.

I believe that the smaller developers are more at risk. But they are also least likely to offer concessions simply because they don’t have as much wiggle room.

Condo converters such as Premier Coastal are most at risk.

If you want a SFR for $200-$300 you have some time wait. I don’t have a crystal ball but $350k (with some years of stagnation) might be as low as it goes.

[PerryChase]

Regardless of whether you believe in the 9/11 conspiracy theory or not, it seems clear that the crashes have not been thoroughly investigated. The crash sites were promptly cleaned up to “get them behind us.”

We blamed Bin Ladin for the attacks but do we have 100% proof that he was directly linked? Or were the attackers only loosely related to Bin Ladin. If that was the case, killing Bin Ladin would not reduce future threats.

If a fervent worhipper committed murder or molested a child, are the Bishop and the whole congregation guilty because the perpetrator attended mass at that church everyday?

This tragedy needs to be investigated further. Like the supporters of the Patriot Act said “you don’t have anything to worry about if you didn’t do anything wrong.”

Maybe that’s why Ann Coulter was pissed at the 9/11 widows for demanding a better investigation.

[PerryChase]

cabinboy, I believe that PS’ advice was directed SD homeowners, not homeowners all over the country.

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