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Stu949
ParticipantTo a buyer, $10,000 usually won’t make or brake a deal. To the builder, it gives the impression that prices are increasing – “get in before you’re priced out!”
I do know from inside sources that some builders put sold signs on houses in their developments to give the appearance that the product is moving.
A price increase can be another tactic. If someone who has been looking at 4S for a while (going once a month to see if there are more price drops) sees that prices have now changed course, then this could scare some people into buying. I actually think it is a decent tactic that many people would fall for… They’re hope is to scare the people who have “fallen in love” with their homes – as we’ve heard before, NEVER fall in love with a home.
As jeeman stated, he’s checking prices, but he isn’t “in love.” I laugh on the inside when I hear the same crap in south Orange County. I actually know some executives for a big public builder in Irvine. They’re budgeting for 15% price decreases over the next year – what they think is a worst case. If it comes to it, they’ll be able to drop 15% and still make a profit – albeit a slimmer one. I’ve been tracking some new developments in Talega (a “master planned” community in San Clemente). I recently saw a house that was priced at 1.6 million in February currently listed for 1.1 million as of three weeks ago. Still over priced? Yes, but not a bad adjustment – 1.6 was pre subprime implosion, and 1.1 is the current price. I haven’t checked back to see if it has sold.
Just some thoughts…
ParticipantTo a buyer, $10,000 usually won’t make or brake a deal. To the builder, it gives the impression that prices are increasing – “get in before you’re priced out!”
I do know from inside sources that some builders put sold signs on houses in their developments to give the appearance that the product is moving.
A price increase can be another tactic. If someone who has been looking at 4S for a while (going once a month to see if there are more price drops) sees that prices have now changed course, then this could scare some people into buying. I actually think it is a decent tactic that many people would fall for… They’re hope is to scare the people who have “fallen in love” with their homes – as we’ve heard before, NEVER fall in love with a home.
As jeeman stated, he’s checking prices, but he isn’t “in love.” I laugh on the inside when I hear the same crap in south Orange County. I actually know some executives for a big public builder in Irvine. They’re budgeting for 15% price decreases over the next year – what they think is a worst case. If it comes to it, they’ll be able to drop 15% and still make a profit – albeit a slimmer one. I’ve been tracking some new developments in Talega (a “master planned” community in San Clemente). I recently saw a house that was priced at 1.6 million in February currently listed for 1.1 million as of three weeks ago. Still over priced? Yes, but not a bad adjustment – 1.6 was pre subprime implosion, and 1.1 is the current price. I haven’t checked back to see if it has sold.
Just some thoughts…
ParticipantAliso Viejo, CA
I’m renting a 2 bedroom 2 1/2 bath townhouse in Aliso Viejo for $1750 a month.
Comps are somewhere around the $500,000+ range, but I haven’t been keeping track lately.
Participantyeah, I’m in the same boat.
my wife and I were looking to buy our first house, but I ran the numbers. after considering the tax “benefit”, we actually come out negative by about $10,000 to $12,000 a year. add to that, we would probably get hit with AMT – we make over $200,000 a year.
we make too much, according to the government, but we can hardly afford a piece of crap condo in south OC!
you can quote me on this: “only the uneducated have and are buying!”
“if people really understood, they wouldn’t have bought!”
ParticipantFat_Lazy
Amazing, you figured everyone out – Good job!
What category do I fit in?
Mid 20s, just got married, my wife’s income just jumped (she’s now a Controller), so our combined income just went from the mid $100,000s to the mid $200,000s in the last month.
Usually it went that after you got married, you saved for a down payment and eventually bought a house – to live in, not to make you a millionaire overnight.
These days, and living in south OC, $200,000 will hardly get you into a 2 bedroom townhouse. We’re told by everyone that we could afford more. Just cause we can get into IO/ARM/or Option ARM doesn’t mean we can actually afford the current prices.
Are we bitter? I don’t know? We just want a house to live in – we’re not looking for appreciation (like 99% of the buyers who bought the last couple of years), but we are looking for a place to live. Imagine that, people who just want to buy a home to actually live in, not to live off of… I guess that makes us sour pusses!
ParticipantOkay,
I did it. I emailed CBS, ABC, and NBC nightly news programs.
They probably won’t give it a second look, but I think stories about the rampant fraud in the lending/housing industries would be interesting.
Oh well, we’ll see!
ParticipantHeck, if a enough of us notify the newspapers, perhaps this guy will get “ding’d”.
If you want the authorities to take a look at it, get it in the newspapers or during a nightime news segment.
We should send this story to Katie Couric; the American public needs to get an idea of what’s going on.
I know of other instances like this where 20 somethings have applied for million dolloar loans – saying they’re making $40,000 a month – and they have received funding. This kind of thing has been happening more than the general public thinks.
ParticipantThey really tore that guy up!
Funny how everyone told the young chap that he is going to prison.
Nothing could be further from the truth. Our justice system doesn’t have the resources or the time to even give this guy a second thought.
Funny how the general public thinks our justice system has the ability to prosecute the majority of criminals. Prosecuters target people who will be highly publicized; aside from that, many folks out there get away clean.
Have a lot of people done the same thing as this young’n? Absolutely! So much so that nothing will happen to the thousands of people who committed bank fraud by lying on their loan applications.
August 27, 2006 at 11:40 AM in reply to: Biggest Drops in 2007 and 2008; housing will fall 50% nominal terms #33515ParticipantI also agree that the worst is yet to come; however, I’ve been surprised at how quickly things have changed just recently. Quotes from the CEOs of Countrywide, DR Horton, Toll Brothers, etc. have surprised me. The fact that these guys are making references to “this is worst I’ve seen it in 30+ years”, should make people step back and think. Part of me thinks this may accelerate down more quickly than the last downturn. Do I know for sure? Nope, but we just witnessed probably the biggest world wide real estate bubble ever! This time it is different – however, I think the fallout will be quicker and more painful.
The Fed will try to do something to stop this, but I don’t know what rabbit they’ll pull out of there hat. They may be able to stall it, in which case I will be wrong, but they will just make the coming correction that much worse!
ParticipantGood points all around! I read the Mauldin article as well. People need to make a contious decision to remain objective at all times – most people don’t even know that they are fooling themselves. It’s a very difficult thing to do…
ParticipantI agree with a couple of people on here. I’m going independent or libertarian. I feel there is no hope for the two major parties at this point!
Some may feel that my vote will be wasted; however, I march to my own drum. When I listen to others, I become as miserable as them.
ParticipantJust wanted to say thanks to everyone for the feedback!
My initial thought was that it isn’t worth buying a rental property just for the tax break, and I think I will stick with that line of thinking.
At this point, who is worse? The government or Mr. and Mrs. homeowner who don’t deserve the profit on their house? I’d almost say that I would rather give the government more money.
I can’t justify handing over a huge profit to these unreasonable homeowners! Besides, I think we will run out of bigger fools – I’ll be stuck with anything I buy!
ParticipantJust wanted to say thanks to everyone for the feedback!
My initial thought was that it isn’t worth buying a rental property just for the tax break, and I think I will stick with that line of thinking.
At this point, who is worse? The government or Mr. and Mrs. homeowner who don’t deserve the profit on their house? I’d almost say that I would rather give the government more money.
I can’t justify handing over a huge profit to these unreasonable homeowners! Besides, I think we will run out of bigger fools – I’ll be stuck with anything I buy!
ParticipantZeal is a pretty good investment newsletter. They will be a good source of information for the next 5 to 10 years.
Foreign currency, gold/silver, and commodity stocks will be it for the next few years. When you hear CNBC talk about how gold is now done with it’s run, it is time to buy. Don’t let all these fools in the investment world tell you that the commodity bull run is over. This is the next investment; it will run up like real estate has. Gold should surpass $2,000 eventually – buy on the dips. A good time to buy gold will probably be early fall of this year.
At this point, preserving your wealth from losses and inflation will be just as important as getting a decent return!
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