[powayseller]

A replay of today, with two notable exceptions:

1) lack of creative financing, so there was not a noticeable rise in foreclosures even one year after the boom ended
“Few sellers are actually losing money. Except for those who bought at the peak last year and must sell now, most homeowners are still far ahead on paper after the double-digit price increases of previous years. As a result, banks and savings and loan associations in California report no upswing in foreclosures on residences, and most analysts say the state’s financial institutions will weather the slump without any significant damage. ”

2) Housing affordability was 18%, about 6 x higher than today. With such low affordability, we have so far to fall to get back to fundamentals.

Item #1 is the most concerning. The last cycle after one year had no upswing in NODs, but this time, we have a lot. 69% increases in NODs is a very big deal. Although the numbers of NODs remain small, all you need is a few more quarters of 69% increases for those numbers to start looking big, real fast. The Fed kept the rates too low, for too long. They didn’t rein in Fannie Mae or lending guidelines.

On a related note, the sheer fear of a systemic crisis kept the government from slapping any penalties on Fannie Mae. What other reason is there to allow a public traded company to violate SEC regulations that would get any other company delisted from the stock exchange? The government is scared to death of what can go wrong with Fannie, but it is too late to do anything about it. The crisis is already baked into the cake. You can’t remove it, too late.

[powayseller]

Their reputations and future salaries depend on the accuracy of their forecasts. If so, by 2008, these people will be working at Walmart; after all, what kind of job exists for an economist who can’t make forecasts with the data right in front of him? Heck, I even correctly pegged he SD economy back in December 05, and I’m just a housewife.

This dire lack of accurate forecasts is so obvious, that I realized it is a void screaming to be filled. For this reason, I am starting a consulting company, specializing in the San Diego economy. We need accurate news, analysis, and forecasts for San Diego, not just the fluff coming from Nevin, Gin, Gregory Smith, Christopher Thornberg, and possibly SANDAG. SANDAG is pretty good, but they don’t come right out and say there is a bust coming. They have a dual responsibility, to support our economy. I will be completely independent, so I can speak freely. My website will be a compliment to piggington, not a competition. I want to build further on what Rich has done, by expanding into employment and forecasting. I have tons of great ideas, but the most important, how to make money, is not yet fleshed out.

Does anyone have any ideas or comments about what is missing in San Diego’s economic forecasting? What would you be willing to pay for? Realize that Alan Gin is biased because he is paid by the real estate industry. If you want an unbiased economist, like Roubini or Baker, who would pay this person? If the person is paid by a company, their reports are slanted to promote that industry. What services would a forecaster provide for a fee, to allow her to stay independent? Or does everyone think everything internet related should be free? Would any of you pay a monthly access fee for pigginton? How much?

[powayseller]

Thanks for the link, edna-mode. Can you please post it as a link? Instructions for making links were just posted on the main piggington page. I swear, it takes only a couple minutes to learn, and with the “enable rich-text” option, no excuses to make us copy and paste anymore…

[powayseller]

A guy like Lee Sterling will never admit real estate is a bad deal. The lower prices get, the more he’ll be convinced bargains abound. By the time we hit the bottom, he will finally be right. He is like those gold bulls, who were wrong for years, and are now vindicated.

Just curious, how can a realtor’s wife insist on holding 3 rental properties? Does she like owning property more than making money? She feels more financial security holding real estate than holding cash?

[powayseller]

doofrat, your last post was a joke, right? If you didn’t mean it, you could go back and edit your post. No harm done in your comment. I heard on the local news today that the del Coronado is selling hotel rooms for vacation visits; you can stay max 25 days at a time, and only one owner per unit.

[powayseller]

Great interview, Rich. The moderator was very good at controlling the interview. She never did get to the exotic loan comments, so I hope there will be another interview coming up? Lee Sterling interrupted too much, and that made him appear worried; it’s as if he couldn’t bear to let any of Rich’s comments go on the record. Thanks to Brooke for providing the links.

[powayseller]

Bugs and all realtors, I am specifically interested in coastal properties, even up to 5 miles inland, so semi-coastal. How are they holding up now, and how did they do in the last downturn? I see lots of NODs and foreclosures, but have not followed the auctions and selling prices.

[powayseller]

I’m just teasing y’all. I’m way too old, none of you would be interested for a second…

[powayseller]

Rich’s reports would be so much better if he would get MLS access. I’ve suggested several times that he team up with a realtor. Can you imagine SD Realtor and Rich teaming up to make some graphs, or prep for an interview? It’s amazing how much data he’s come up with, not having MLS access. But imagine the power of his data if he utilized it.

[powayseller]

I am against illegal activities of all kind. I am torn with realizing that we whites are becoming a minority. But maybe it serves us right; we took this country from Indians and Mexicans, so perhaps by going back to a brown majority we are simply returning to our roots. When I learned in elementary school that the whites killed the Indians, I was shocked. Now it’s payback time.

One item that I can’t reconcile is Bush’s statement that Mexicans do jobs that Americans wont do. I think he is right. The news has been covering the shortage of agricultural workers, resulting in crops rotting in the fields. CA ag workers are paid an average of $10.12/hr, but this year the shortfall in workers is higher, due to stricter border enforcement.

What is the solution for getting farm workers? Why won’t Americans pick strawberries for $10.12/hour? Don’t we have unemployed prisoners, retarded people, teens, welfare recipients? That salary is well above minimum wage. Why is it so hard to fill those jobs?

In the end, this is another example of wage inflation. The farmers will end up paying more money for this, and the price of strawberries will go up.

[powayseller]

This attitude has permeated this board for some time. I was surprised when no one rushed to defend docteur and Alan Gin from my reprimands. As tired as you are of the permabulls, I am tired of the real estate professional permabulls, those in the business who should provide leadership and direction, but instead are in denial and try to convince themselves housing prices will keep rising.

[powayseller]

David, read the Bubble Primer. Get yourself a basic understanding of the housing bubble and historical San Diego housing cycles. Then come back and post.

[powayseller]

I met a realtor today while he had a realtor open house, and he told me the U-T is a foe of realtors. They only print sensational stories: housing frenzy on the way up, housing bubble on the way down. He wonders why the realtors even bother advertising with the U-T. Answer: because they are “the only game in town”.

[powayseller]

How to choose, how to chooooose, oh yeah, I’m married…. keep forgetting that part 🙂

[powayseller]

Thanks for the link.

I think people are forgetting Rich’s request to use markup text. Either use the rich-text editor, or read the instructions at the very bottom of the Reply screen, “more information about formatting options”. That’s where I learned how to do it.

It’s pretty easy to do, and it’s a lot more user friendly to the people that you are giving the links to.

(a href=”http://www.rgemonitor.com/blog/roubini/142759/”) Roubini Link(/a)

looks like this if you use the “greater than sign” in place of ( and the “less than sign” in place of ).

Roubini Link

I love Roubini. Thanks for the update on his blog. I will check it out right away. I would give anything to have a blind date with him…. Oh, forgot, I’m married…

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