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Reality
Participant[quote=Eugene]According to Zillow, my house has gone up 150K in the last two months, and it stands at 210K above what I paid in January.
I keep an eye on comps and I can say with certainty that there’s zero chance of my house appraising or selling for what Zillow thinks it’s worth. But it’s a nice feeling nonetheless.[/quote]
It is nice to fantasize sometimes.
Participant[quote=Eugene]According to Zillow, my house has gone up 150K in the last two months, and it stands at 210K above what I paid in January.
I keep an eye on comps and I can say with certainty that there’s zero chance of my house appraising or selling for what Zillow thinks it’s worth. But it’s a nice feeling nonetheless.[/quote]
It is nice to fantasize sometimes.
ParticipantAre they stupid?
ParticipantAre they stupid?
ParticipantAre they stupid?
ParticipantAre they stupid?
ParticipantAre they stupid?
Participant[quote=urbanrealtor]
That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
Participant[quote=urbanrealtor]
That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
Participant[quote=urbanrealtor]
That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
Participant[quote=urbanrealtor]
That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
Participant[quote=urbanrealtor]
That is not realistic.
At 15 GRM, people still go bananas even in crappier pockets. It is possible that this will change but it seems unlikely. If I could buy a place and the revenue could equal the full purchase price in 10 years (where I, the borrower, still get 30 to pay the bank), then everybody would jump in and the effective demand would drive the grm right back up.The only places you see a grm that low is where rents are really high and interest rates are too.
Again, if rates spike (like to 15%) then that may happen.
But that seems an unrealistic projection as of today.[/quote]
Why do you think they “go bananas”? It’s not logical to buy a house that costs WAY more to buy than rent. If it doesn’t pencil out as a rental then why the demand?
To me it’s just bubble conditioning. People think buying at 30% or so off the peak is a great deal. Never mind that it’s still double the price of 12 years ago.
Participant[quote=CA renter][quote=zzz]Trust me, if you walked into this house and looked at it, you would not think it had been fixed up nicely. It looked like someone did some cheap remodeling. The living room looks like an add on and someone threw that on. You would have thought, this looks like an apartment but everything is super crammed in there.
Super loud street and you have no yard. The couple who sold the house had a small child and you would not let your child play in that front yard, its a super busy street.[/quote]
It looks like they used floor tiles on the kitchen counters, no?
From what I saw in North County, prices were very soft or down from 2006 to 2007. Look at the premium they paid in 2007 over the 2006 price. Then, some idiot came in and paid even more!!!!
We are also witnessing the same kind of insanity in North County — people paying MORE than peak prices in a number of cases. Is nobody paying attention to what’s going on, or do we live in a different dimension now?
Oh, and I couldn’t agree more with what you’ve said, HLS.[/quote]
Some folks are panicking right now, trying to get that $8,000 before it gets rescinded or buy before rates go up. It never dawns on them that that $8,000 could very well cost them $100,000 if/when prices go down, and higher interest rates = lower prices.
But not everyone is a financial wizard.
Participant[quote=CA renter][quote=zzz]Trust me, if you walked into this house and looked at it, you would not think it had been fixed up nicely. It looked like someone did some cheap remodeling. The living room looks like an add on and someone threw that on. You would have thought, this looks like an apartment but everything is super crammed in there.
Super loud street and you have no yard. The couple who sold the house had a small child and you would not let your child play in that front yard, its a super busy street.[/quote]
It looks like they used floor tiles on the kitchen counters, no?
From what I saw in North County, prices were very soft or down from 2006 to 2007. Look at the premium they paid in 2007 over the 2006 price. Then, some idiot came in and paid even more!!!!
We are also witnessing the same kind of insanity in North County — people paying MORE than peak prices in a number of cases. Is nobody paying attention to what’s going on, or do we live in a different dimension now?
Oh, and I couldn’t agree more with what you’ve said, HLS.[/quote]
Some folks are panicking right now, trying to get that $8,000 before it gets rescinded or buy before rates go up. It never dawns on them that that $8,000 could very well cost them $100,000 if/when prices go down, and higher interest rates = lower prices.
But not everyone is a financial wizard.
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