Consider that O.C. homesellers outnumber buyers by 14-to-1 (at least, by the math of Steve Thomas at Re/Max.) That must meansome property owners must be getting pretty antsy about their chances to sell a local home. I’ve sliced the world of “motivated” sellers in this town into four broad groups. It’s your guess who is most desperate.
Most aggressive sellers are ...
E. All of the above?
Let’s see.
1) NOT Families with rising mortgage payments, they have credit cards.
2) NOT Investors with poorly timed flips, by definition they are called speculators or gamblers.
3) NOT Bankers with foreclosures, a quick look at Wells Fargo and Countrywide’s REO page shows their houses are the most expensive in the area.
4) Not Builders with excessive inventory, they keep cranking out houses (they have to, it’s what they do for profit).
Hmmm, can’t be the Chinese and Canadians they are the buyers.
Oh, I know, the uneducated herd that took an online class to get their real estate or mortgage license. No offense to any real estate or mortgage industry employee that had the personal integrity to be honest with their clients over their own greed. I mean, there had to be someone out there that was honorable enough to say, “This is wrong” before the bubble burst, right?
did anyone see the report of a 500 home auction on the news?
i missed it. anyone got a location? tried to stay up but this daylight savings thing makes me tired.
Dear Reader,
You are not allowed to post your opinions here unless they agree with others you see.
Despite the best intentions of Mr. Lansner, this forum has been hijacked. In the past, there have been many balanced opinions expressed here. Over time, that has ceased to be the case. There are many regular posters here who have berated, insulted or otherwise harassed posters holding opposing views into leaving. As a result, the opinions expressed here have become completely one-sided.
This group has one goal in mind – to drive the market down so that they may profit from it personally.
While Mr. Lansner had a lofty goal with this forum, it now serves another purpose altogether.
truthiness…
started out bragging about buying homes at 10 times their annual income…
drinking $300 bottles of wine and $500 green fees…
owning airplanes…
we are discussing affordability…
saving money…
protecting our family’s assets…
making sound financial decisions…
the blog will continue because we understand were the real wealth resides…
realitycheck, everyone already knows you are lying. Please show us where I said those things of myself.
You are living, breathing proof that my warning it true.
From 2000 to 2006, we witnessed irrational exuberance in the Orange County real estate market, and now that the market has finally faced the moment of truth, the bulls are blaming everything except market forces.
to truthiness
The primary reason why “balanced opinions” have ceased in this venue, is because the bulls have lost their argument. If you’re tired of reading one-sided opinions, then don’t visit this blog anymore.
As for Jon’s blog, I suspect it will become more crucial & pivotal in reporting the local news in the coming year/s, mainly due to real estate playing such a large role in our local economy.
I love the way Truthiness prefers to speak on so many peoples’ behalf.
Truthy: You’re not mature enough to be a baby boomer. I’m convinced that you’re simply some young, uneducated, broke, laid off mortgage broker or RE agent with nothing better to do with your time.
Truthy - At the very least, you definitely insinuated that purchasing at 10X income was not unusual and still possible. You wrote about drinking expensive bottles of wine - but then claimed you were speaking about y our friends. Same thing with owning airplanes.
Do the masses a favor and seize the BS and talking through both sides of your mouth.
You are a long way from earning respect on this blog, my friend. Considering the start you have made, I can see how the lack of self-respect can translate to such immature posting.
Truthiness,
There are plenty of intelligent posters who were on the bull side of the fence. Why are they gone? Because they are smart and understand the market. If you don’t like the info here start reading the Wall Street Journal, the New York Times, Forbes, Businessweek…….. you’ll see that the information is all the same….. and this blog just portrays what is going on in the Market.
Dear Readers,
See what I mean?
Truthy,
There may be a few realtor blogs left that cater to your information desires…………… most of those have evaporated though….. like the Credit market and US Bank Valuations on Wall Street.
Thanks for proving my point. This is going to be fun.
I really do enjoy reading this blog as I watch this RE disaster unfold. There are alot of good things that will come out of it — RE agents back to waiting tables, home prices become affordable again, etc. Also many bad things — family’s with no home, BK’s, etc. For the most part, the REIC cheerleaders who argued that houses really are worth 700k seem to be gone as reality comes into focus al ittle more each day. But still, every so often there is one that pops up with comments like “10x income home price” and we are reminded of how it used to be.
Can someone please posts a realtor blog Truthy can start reading?
I really want Truthy to find a good match….. so Truthy can be happy again….. where the information lines up with Truthy’s own financial needs and desires.
Truthiness Says:
November 5th, 2007 at 5:58 pm
What a stupid thread. I can buy any home I want tomorrrow morning at 10 times my income, with or without a large deposit. Ignorant bears think everyone’s poor. As for Central Park West - dream on. Just like The Irvine Company, they’ll wait instead of donate. Pick a less desirable place for your fantasies.
I spent the weekend in St. George, UT. Met several friends of friends. All have second homes there. All of us are chomping at the bit to pick up properties. Baby boomers rule. They will snap up what’s worthy - and leave the scraps for the rest. Sorry, you will have to get up early in the morning and pay your dues for years and years and years to compete with us.
Truthiness Says:
November 5th, 2007 at 6:17 pm
Mav, I could apply in my pajamas and be approved for anything I want,. That’s what you don’t get. Work hard and play by the rules and over time you’ll get to this place. You dismiss my story from my weekend at your peril. Do you think baby boomers are all poor and clueless? Hell, 20% of my friends have planes. And I’m not talking billionaires. Just savvy boomers. And you would poop your pants at how many of us there are - and what risk we’re willing to take on. You might find a deal here and there - if you’re faster than us!
Truthiness Says:
November 5th, 2007 at 6:51 pm
Mav, Mav, Mav, the planes are for lifestyle, not investment. So is the $200 bottle of wine with dinner and the $500 greens fees (for non-members). You’re quite funny. One day you will see. Work hard and play by the rules. Keep your nose clean and your head down.
i apologize. $200 bottle of wine.
Here is what WaMu had to say today. I guess Truthiness knows more then the CEO of Washington Mutual
“We expect today’s challenging housing market conditions to continue throughout 2008,” CEO Kerry Killinger said, sending shares of mortgage lenders and homebuilders reeling.
Good Job RealityCheck. Yeah, take that Truthiness, you’re a dumbass. NO CREDIBILITY!
Reading comprehension classes anyone? That’s a theme here - no powers of discernment.
I love all the personal attacks - you seal my argument as fact.
Arthur Jensen, you are a breath of fresh air.
Truthy,
Yet another prediction has come true!! I said a couple of days ago you and Arthur could get along great inventing alternate realities in RE. I had no idea that you and him were the same person!
Ah ha! Truthiness and Ninja and Arthur Jensen! Your AKA’s are endless!
Truthiness,
You should be of good cheer when attacked by the nattering nabobs of negativity on this blog. They operate from fear and hate. Fear that their lives maybe ultimately meaningless and hate for those they view as the cause of their misfortune. They hang onto every scrap of bad news as if they were ravenous curs pouncing on carrion. When all their specious arguments are confounded they resort to the last arrow in their debate quiver, the ad hominem. When they berate you and make scurrilous attacks against your character just know that you have forced them to a corner and a cornered rat will bite. This blog is all they have, this is where they exist. Property owners may lose equity during the correction, but once the news turns against these poor unremarkable souls and the market begins to turn positive, as it will, they may lose their Raison D’Erte.
Ninjarthuriness
Type fast. They’re coming with the straight jacket as you next group session is starting. Fresh meds!
truthiness, dont let these A-holes (Rants, Bill, not buying it, Lee etc.) get you down. You hit the nail on the head. They all missed the boom and want nothing more than to drive prices down so they can take advantage of some poor soul about to lose his house. They are sick og sitting in their studio apartments.
To the bulls,
I just rented a 2150 sq. foot condo in HB for $2600 per month that is a nice area with all the amenities(guard, pool, spa). There are people in the area trying to sell the similar units for $800K.
Explain to me why I should buy as opposed to rent.
Here are the numbers:
If I buy and put down 20 % my mortgage would be $640,000 wich would be about $4160 per month and the taxes would be about $1,000 per month. After my tax break my mortgage and taxes would be reduced to $ 3612 per month. Then add HOA and insurance of $400 per month and my cost would be $4012 per month.
So should I pay $2600 per month or $4012 per month.
If you factor in the potential 5% interest that I can get on my $160,000 if I keep it in the bank thats another 400 dollars per month(after tax amount).
So now it is:
$2600 per month versus $4,412 per month.
Help me out here bulls what is wrong with my math ?
When I see someone say “they operate out of fear and hate”, referring to the other side of an arguement, then I know they have ABSOLUTELY NOTHING to go on themselves and a ‘converstation’ is not even worth the time.
I enjoy differing perspectives/points of view, but bulls like Arthur, Truthy, etc. aren’t giving any meaningful or supporting points at all. I don’t think it’s even worth responding b/c I think they are just trying to get a ruse out of people. There is simply not much left for a bull to say, b/c the fact that they are wrong is playing out right before your eyes (I know $~11B write-downs of bad loans by major banks is just a small blip).
What I am interested in now is learning how long/how bad this is going to be? I’m assuming a bull will argue a shorter time frame, but I’d like to know why, given all the evidence. I personally pulled out of the market a year and a half ago b/c things were just WAY too far out of wack. (what few comps in my area are down roughly 15% or $85K, and that number is dropping fast) I want to get back in so I have a house for my family to live in, but only when the numbers make sense (vs renting and/or vs. other investments). That is what I think we should be discussing now. So bulls, please tell my WHY the downturn will end in ‘08 vs. ‘09 or ‘12….
It’s funny to watch the degradation of the quality of Bulls on this site.
There was a time when Bulls gave value added oppinions and information content…… those intelligent Bulls have realized the market reality and are enjoying life….. afterall the housing market isn’t everything in life…… there are always new ways to make money.
Watching the degradation in quality of post from Bulls is kind of like watching the decline in house prices in the OC…….. it makes sense that there would be a co-relation…… as the housing market dives deeper with no near term end in sigh…. so does the IQ level of the few remaining supporters……. I will give Credit to Jimmy as he seems to be last bull with a real argument…. I appologize if I am leaving out a bull or 2 who still adds some value from time to time.
all that is left is Truthy……. what is the next evolution of Bullish post on this site? that’s a scary thought.
Truthy single handidly is a self fulfilling prophetic entity on where the Market is going.
jj
I think you can time the bottom by looking at historic comparisons of realistic payments to realistic rents. Look at basic housing, nothing expansive just your basic 3/2 house in decent area. When a 15% down payment and a 30 year fixed loan have the same payment as to what the home will rent for, historically you would know the bottom will be in. You still have to pay property taxes and repairs as an owner so it is still more expensive to own, but the pricing should increase from that point because of fundamentals will be back to norm. We’re not there yet, but all things are coming toward this number. What is interesting about this number is it isn’t just about price. It is about rent prices and interest rates also.
Greg,
I agree with you… but I would add that the payment for the house (30 year fixed) has to still be higher than rent….. because rent is not fixed and will go up……… where as the housing payment is 30 years fixed
I would guess that the monthly payment would have to be aligned with what you could estimate as rent 5 years from now……… or some time in the future.
jj,
I gave up relating articles and information to this site because it was met with such antagonisim and vitriol (driven by hate and fear)it proved to be a exercise in futility. If you have the inclination you could find articles that would support a turn in the first half of 2008. But I doubt you will. I can tell you that many large Hedge Funds and Equity Funds are buying distressed projects by the handful. They will be the winners when the market turns and they count on adverse news to keep markets supressed as they circle like vultures. When Wall Street is ready the news will begin to turn positive and the psycology wil change.
Rants,
Don’t forget to breathe and don’t pound on your keyboard so hard, you’ll break it. I have told you before that you and I agree on that point, however, the Fed is going to do it again. Barnake has no choice. Wall Street has kicked the independent Mortgage companies to the curb and have picked up the pieces, now they need to make loans and they want more rate cuts. Bill Gross is right, Wall Street needs a Fed Rate of 3.5 to 3.75 to have the kind of margin they need to make profitable loans at the low interest rates customers have come to expect. But I must retire from this blog now, it is time for my morning ablution.
Using current interest rates, (6.5) and realistic rent (2500) median price should be approx 465k
Remember this number can go up if market rents increase and rates decrease. Where markets get skewed is when they deceive themselves with unrealistic short term financing.
Mav
Also when you were thinking back to your 2000 situation, did you factor in the 15% down?
why is wallstreet withholding this news?
why isn’t the real estate industry reporting this trend?
wallstreet and these real estate investors are intelligent when they invest their money wisely…
but if the bears wait to make sound financial decisions, we are labled doom sayers.
please get your clients straight… wallstreet and real estate investors do not go to realtors to make money…
educated and qualified buyers are all you got…
if we find the right property, negotiate a fair price and get a mortgage that we are comfortable with… we will buy.
When you mean 15% down do you mean the interest you can gain on that 15%? I did not included because I figure long term housing can get a return similar to what you could get at a bank.
No I meant it as a down payment number only. It reduces the mortgage payment only and I don’t use it for anything other than that.
465 price less 70k down (15%) leaves 395 loan. Payment on the 395 is what should be equal to rent.
Greg,
I use 20% for the downpayment…….. so my number is a little higher.
That said I see the bottom somewhere between 450K - 520K as the median OC home.
The big question is the timing on that 450 - 520K…. the longer it takes to reach that bottom….. the worst off the correction is, when you factor in inflation and the time value of money.
I agree that how long it takes to get there is an unknown. RE markets move in terms of months and years not days so if you want in you’ll have plenty of opportunity. The other thing that I think will happen is that as prices fall, I think rates will fall also trying to stimulate the economy. That is unless measurable inflation stops the fed from lowering rates. The question is how you measure inflation. No one wanted to say we were in an inflationary cycle when home prices were increasing at ridiculous rates. Now these same people want to say we are in a deflationary cycle because home prices are falling. Doublespeak if you ask me.
Greg,
totally agree on the slow nature of the timing….
if you ask me, it’s much better to buy when the market first starts going up than to try to catch the bottom
FORCLOSED PROPERTY!
I cannot believe that people think Laguna Beach is not affected by the mortgage crisis, I am watching the market very closely and I have seen at least 20 homes go to either the bank ,foreclosure or short sale ,in this QTR. I also have seen prices drop from 400,000 to 200,000 ,less and still sit with no offers ( for at least a year).
You guys don’t get it yet. Real estate is not in trouble. The banks are in trouble. YOUR bank is in trouble. Look at the stock market. Maybe we should be talking stock here? The dollar is in trouble along with the whole economy. How much longer do you believe your sole financial security (job) will be insulated from this?
My real estate is doing just fine, thank you. But, I’m really worried about my bank.