Are high-end homes immune or less affected from housing decline?

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[quote author="IrvineRenter" date=1208588587][quote author="CalGal" date=1208588121]I'm not debating - I'm just asking - so don't jump all over me. Wouldn't the west coast and the east coast appreciate more than say the midwest. I believe (choosing my words) that some states like Michigan, Indiana, Texas, etc. hardly appreciate at all. Wouldn't these states skew the numbers for the national figures? Just curious how this works.</blockquote>


Areas that experience above average wage growth experience above average appreciation, but the relationship between wages, rents and ultimately home prices is immutable. Home prices will deviate from these fundamentals due to irrational exuberance, but they always return. Think about what would happen if this were not so. After enough time, it would take all of someone's income just to support a housing payment. Japan tried to sustain artificially inflated asset prices, and it cost them a decade of economic growth.</blockquote>
IrvineRenter,



With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked.
 
[quote author="catchmeifyoucan" date=1208591226][quote author="IrvineRenter" date=1208588587][quote author="CalGal" date=1208588121]I'm not debating - I'm just asking - so don't jump all over me. Wouldn't the west coast and the east coast appreciate more than say the midwest. I believe (choosing my words) that some states like Michigan, Indiana, Texas, etc. hardly appreciate at all. Wouldn't these states skew the numbers for the national figures? Just curious how this works.</blockquote>


Areas that experience above average wage growth experience above average appreciation, but the relationship between wages, rents and ultimately home prices is immutable. Home prices will deviate from these fundamentals due to irrational exuberance, but they always return. Think about what would happen if this were not so. After enough time, it would take all of someone's income just to support a housing payment. Japan tried to sustain artificially inflated asset prices, and it cost them a decade of economic growth.</blockquote>
IrvineRenter,



With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked.</blockquote>


OMG catch, are you blind?! Do you not understand the language that IR writes in?! IT COSTS MORE TO OWN VS. RENT... DUE TO THIS, PRICES WILL FALL DRAMATICALLY. IT IS NOT A SMART FINANCIAL DECISION TO BUY AT THIS TIME AS A RESULT.



I paraphrased IR a bit but those are the jists of 99% of what he is communicating. Why would someone that "could be a CFO for some bank" willingly pay more for something via a purchase when they could rent it for less AND not expose their capital to depreciation risk.



Sheez man, if you are going to hang around and read this stuff, you should at least think about what you are seeing... Nice of you to compliment IR but "Why are you still renting?" has got to be the stupidest question you could ever ask the man. You'd have been better off with something like "boxers or briefs?".



I must depart to bang my head against the wall. Nude, over to you for continuation...
 
As Profette once said . . .



Alright class, it?s time for a review. There will be a quiz...

<a href="http://www.albion.com/netiquette/corerules.html">THE CORE RULES OF NETIQUETTE </a>
 
[quote author="catchmeifyoucan" date=1208591226][quote author="IrvineRenter" date=1208588587][quote author="CalGal" date=1208588121]I'm not debating - I'm just asking - so don't jump all over me. Wouldn't the west coast and the east coast appreciate more than say the midwest. I believe (choosing my words) that some states like Michigan, Indiana, Texas, etc. hardly appreciate at all. Wouldn't these states skew the numbers for the national figures? Just curious how this works.</blockquote>


Areas that experience above average wage growth experience above average appreciation, but the relationship between wages, rents and ultimately home prices is immutable. Home prices will deviate from these fundamentals due to irrational exuberance, but they always return. Think about what would happen if this were not so. After enough time, it would take all of someone's income just to support a housing payment. Japan tried to sustain artificially inflated asset prices, and it cost them a decade of economic growth.</blockquote>
IrvineRenter,



With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked.</blockquote>


Ipoplaya's somewhat colorful answer is essentially correct. If I were to purchase right now, I would fall underwater just like everyone else is. When prices reach rental parity, I will buy because I am saving money versus renting, and I believe prices will not fall much below that level.
 
<blockquote>IrvineRenter,



With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked.</blockquote>


i love the assumption that successful people in irvine shouldn't mind overpaying for housing, because you know, they're rich. every time i take the beemer to my mechanic, i'm outraged at his pricing. i say, "brother you should charge me at least 110% of what the dealer charges, because as a bmw owner i WANT to pay top dollar!"

dammit don't give me that 99 cent value meal pricing. i will pay you the FULL dollar because i am a wealthy shady canyon resident!
 
<blockquote>With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked. </blockquote>


Catchmeifyoucan, I know of a number of people who contribute to this website that have a high salary and could easily afford to buy a house. Heck, a lot of them could even afford to purchase a house with cash and wouldn't even have to take out a mortgage. But, as IrvineRenter pointed out, it wouldn't be a wise financial decision in this declining market. Why lose money if you don't have to? Put your money towards rent and save the rest for a downpayment, retirement, college education for your children, etc.
 
A lot of wealth that one has is because it is saved and not spent. My mother-in-law gets so frustrated with us because we always rent an economy car when we go home to visit. She thinks we should rent a premium car just because we are doing well. I try to explain to her that it would be a waste of money to spend that additional $300 just for a nicer rental car to get us from point A to point B. She doesn't understand - and that's also why she doesn't have any money. She wastes every penny she gets.
 
Here's a great book to read: <a href="http://www.amazon.com/Millionaire-Next-Door-Surprising-Americas/dp/1567315682/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1208570990&sr=8-1">The Millionaire Next Door</a>.
 
Thank you for all responses.



When the housing market in Orange County hits the bottom in next few years or so, shall the price in high-end homes in Huntington Beach (10-year-old communities within 2 miles from beach) or Irvine (Turtle Rock) drop the same % as other close-by cities i.e. Santa Ana, Orange, Costa Mesa,...? or the % shall be less than? or more than?



Any thoughts?
 
[quote author="CalGal" date=1208595763]<blockquote>With all these knowledges and good articles from home pages, you should be at least a CFO for some banks and be making 7 digit income.

Why are you still renting? You dont mind if I asked. </blockquote>


Catchmeifyoucan, I know of a number of people who contribute to this website that have a high salary and could easily afford to buy a house. Heck, a lot of them could even afford to purchase a house with cash and wouldn't even have to take out a mortgage. But, as IrvineRenter pointed out, it wouldn't be a wise financial decision in this declining market. Why lose money if you don't have to? Put your money towards rent and save the rest for a downpayment, retirement, college education for your children, etc.</blockquote>


Good point. Yes, lots of people here have high salary holding important jobs that they seem to be on this site at least 10 hours a day. Way to go.

I have not checked this website for a few days and it just amazed me how those "high salary" people apparently have nothing to do at work so they make a post once every 30 minutes.



I guess the saying "the higher you are, the more busy you get" is full of crap or these guys are so good at their works that they only work 2 hrs a day and the rest for surfing the web.



Never mind. Let's get back to the original topic of this thread. I dont want to take away precious time from people doing important works.



Just my 2 cents.
 
[quote author="catchmeifyoucan" date=1208611322]I have not checked this website for a few days and it just amazed me how those "high salary" people apparently have nothing to do at work so they make a post once every 30 minutes.</blockquote>


Did you realize catch that this forum software shows who is logged in at any particular time? Yes sir, technology sure is nifty. Someone remarked just yesterday that they had noticed you in fact had been logged in over the past few days but hadn't posted anything... It caught their attention as they thought maybe Nude and I had scared you off.



Not checked this website huh? Yeah right. Must be someone else with more time on their hands logging in as you huh? If you want lurk, at least have the smarts to NOT login as yourself. You can keep up on the happenings here anonymously. Hilariously sad that you told a tall tale, then tried to spin that into a left jab, only to have the feeble attempt exposed.



If only you'd listen to ole IPO, I could teach you a thing or two. I have achieved a moderate level of success that provides for a decent level of compensation and yes, time to surf the web all day. It's called senior managment baby and it's the result of many a year of 50-60 hour work weeks, some stellar interviewing, a good bit of luck, and a pinch of BS. As long as I hire, train, and maintain my staff well, my job almost does itself, only requiring a few hours a day to keep things moving in the proper direction. You should aspire to that. It really is much more pleasant than busting your hump all day long...
 
[quote author="catchmeifyoucan" date=1208611322]

Good point. Yes, lots of people here have high salary holding important jobs that they seem to be on this site at least 10 hours a day. Way to go.

I have not checked this website for a few days and it just amazed me how those "high salary" people apparently have nothing to do at work so they make a post once every 30 minutes.



I guess the saying "the higher you are, the more busy you get" is full of crap or these guys are so good at their works that they only work 2 hrs a day and the rest for surfing the web.



Never mind. Let's get back to the original topic of this thread. I dont want to take away precious time from people doing important works.



Just my 2 cents.</blockquote>


catchme -- i understand you've taken your share of hits -- some of it undeserved and unfair. i was one of many who obviously disagreed with you on the woodbury condo but i also commended you for sticking around and continuing to post. even though the bulls (or lesser-bears) get a hard time here, we all admittedly value the differing opinions and also have a good time ribbing each other.



having said that, and maybe its our fault for creating the catchme monster, but you are starting to reach. not to mention your posts suggest a major napoleon complex -- having to share with everyone every other post about your nifty job at your nifty company with a <a href="http://www.irvinehousingblog.com/forums/viewthread/1968/#46280"> description that sounded and looked like a realtor wrote it</a>. also name dropping the company's ceo doesn't give you any extra credibility. it just makes you sound pretentious. maybe we should all keep repeating it over and over so this forum shows up as #1 on google anytime someone searches your company and ceo name. i'm sure the company will just love that.
 
"Ban him!!!!" screams the angry mob, "BAN HIM! We want Barabbas!" Ha! catch, if i were you, i'd retire your scream name. ipop "catched" you



What's the definition of a high end home? During the bubble, I admittedly didn't consider $1M to be a high end home anymore. After the paradigm shift, I'm thinking a $500K is a high end home or at least should be the price of a high ender.



Also, on the stock appreciation average, what ever the average appreciation is, it's skewed by broker fees, mgmt fees and loaded funds. Go fidelity and vangaurd!
 
[quote author="Kali" date=1208632259]I smell a troll, he adds no value.

Ban his ass!</blockquote>


Nah....let cmiyc stay. You can't stop someone from being foolish; they have to learn on their own. He/she wasn't being offensive.
 
[quote author="lendingmaestro" date=1208649556][quote author="Kali" date=1208632259]I smell a troll, he adds no value.

Ban his ass!</blockquote>


Nah....let cmiyc stay. You can't stop someone from being foolish; they have to learn on their own. He/she wasn't being offensive.</blockquote>


We only ban people for foul language and name calling. An open forum should be a free expression of ideas and viewpoints. If you start censuring ideas, the conversation quickly degrades into an echo chamber.
 
[quote author="IrvineRenter" date=1208651777][quote author="lendingmaestro" date=1208649556][quote author="Kali" date=1208632259]I smell a troll, he adds no value.

Ban his ass!</blockquote>


Nah....let cmiyc stay. You can't stop someone from being foolish; they have to learn on their own. He/she wasn't being offensive.</blockquote>


We only ban people for foul language and name calling. An open forum should be a free expression of ideas and viewpoints. If you start censuring ideas, the conversation quickly degrades into an echo chamber.</blockquote>
Besides, we have the handy-dandy "ignore" feature now, so we can blithely skip over posts by people like cmiyc :cheese:
 
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