distorted RE market

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GlacierPoint_IHB

GlacierPoint_IHB

New member
I have been waiting on the sideline in the hope that the RE will get to the "normal" fundamental level someday. It is frustrating to see the government in full force to prevent deflating the bubble by distorting RE market through various means:



- manufactured low interest rate

- tax credit

- postponing the foreclosures

- ...



When and upon what conditions will the government leave RE alone and let the market forces work. any inputs are welcomed.



I doubt that government, or for that matter banks, is preparing for the worse. They are too short-sighted.

I guess I will rent longer than I had expected.
 
[quote author="GlacierPoint" date=1255589064]I have been waiting on the sideline in the hope that the RE will get to the "normal" fundemental level someday. It is frustring to see the goverment in full force to prevent deflating the bubble by distorting RE market through various means:



- manufactured low interest rate

- taxs credit

- postponing the forclousures

- ...



When and upon what conditions will the goverment leave RE alone and let the market forces work. any inputs are welcomed.



I doubt that goverment, or for that matter banks, is preparing for the worse. They are too short-sighted.

I guess I will rent longer than I had expected.</blockquote>
You are not alone, all my buyers who are ready to buy are very frustrated. If not it's getting overbid by several other buyers, then it's banks who wouldn't accept their highest offer and go with the 5th highest offer which is an all cash deal. It is a crazy market out there mainly due to the lack of REAL inventory. Until the inventory of homes for sale increases dramatically, I wouldn't expect price to fall more than 3-5% from current levels. There's a lot of demand for Irvine homes out there even at the current price levels.
 
But why is Irvine so stubborn?



When I first talked about this, I said that Irvine would be sticky but everyone called me crazy and I eventually was convinced to sell before I was upside down. A year later... a house similar to mine sells for more (significantly more).



I don't regret my actions... but everyone said Irvine is like everywhere else where clearly it is not. Is it the FCBs?
 
[quote author="irvine_home_owner" date=1255591131]But why is Irvine so stubborn?



When I first talked about this, I said that Irvine would be sticky but everyone called me crazy and I eventually was convinced to sell before I was upside down. A year later... a house similar to mine sells for more (significantly more).



I don't regret my actions... but everyone said Irvine is like everywhere else where clearly it is not. Is it the FCBs?</blockquote>


School system refugees looking for a new home in a cutbacks era?

<A href="http://headlines.ocregister.com/news/high-42746-semifinalists-irvine.html">http://headlines.ocregister.com/news/high-42746-semifinalists-irvine.html</A>
 
[quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.
 
[quote author="no_vaseline" date=1255639891][quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.</blockquote>


I am starting to agree with you. i have my rent down to <10 percent of my gross. I joke with my wife that we've become accidentally green as our PG&E bills are <$100/mo (gas and electric) as the house we rent up here is half the size of our house we sold back East.
 
[quote author="no_vaseline" date=1255639891][quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.</blockquote>
Interesting. Just the opposite for us. Things are looking better and better all the time. I see the knifecatchers creating a buying frenzy that will collapse the lower end market when it stops, and stop it will just like all buying frenzies. The higher end market selling has come to a standstill and prices are starting to fall accordingly. Interest rates are still low and have only one way to go. Trillions have been spent on stimulus and the only thing those trillions have done is overinflate some home prices, overinflate the equities markets, and create huge bonuses for bank executives.
 
[quote author="no_vaseline" date=1255639891][quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.</blockquote>


As long as renting costs less, I will keep renting. Mobility is the extra bonus as well. On the other hand, with a given budget, one can rent nicer place.

Interest rate is of a less concern than the price, specially if you pay lots of cash and you can refinance the loan later on.
 
Its just totally insane. I have gotten to the point of really pissing off RE people

when I meet them. I feel like they are the guys at a Carnival Midway trying to sell you

something thats a total scam. A Lower form of life than a used car salesman.



I have basically resigned myself to being happy, as a renter.

As long as the IAC keeps coming down on my rent. (And in 3 years it has come down

almost 20%) I might as well stay put. Buying and taking on all that debt ? No thanks.

Looks like even my dividend and royalty incoming is coming back as well.

THANK GOD I DIDNT BUY a Home!



Went to my sons house warming party last Sunday.

I was amazed at how nice of a place he just rented with another 3 friends in Laguna Niguel.

They each are paying $ 500.00 a month and have a great older home with a pool.

It belongs to an older couple and is paid off.



It is a great time to be a renter.
 
[quote author="awgee" date=1255642679][quote author="no_vaseline" date=1255639891][quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.</blockquote>
Interesting. Just the opposite for us. Things are looking better and better all the time. I see the knifecatchers creating a buying frenzy that will collapse the lower end market when it stops, and stop it will just like all buying frenzies. The higher end market selling has come to a standstill and prices are starting to fall accordingly. Interest rates are still low and have only one way to go. Trillions have been spent on stimulus and the only thing those trillions have done is overinflate some home prices, overinflate the equities markets, and create huge bonuses for bank executives.</blockquote>


Maybe I should expand a little.



As I posted on the front blog, I'm likely only a SoCal resident for the next 3-4 years. Even if the metrics were conducive to purchasing vs renting (and they still aren't) I wouldn't do so because I am concerned what the market looks like at my exit window (my primary concern is interest rate risk and what rising rates do to underlying values of leveraged assets that were priced at todays never to be seen again rates), and even then, is it worth the hassle to save a couple of hundred bucks a month if I accidentally turn into an absentee landlord at the end of it?



Pass. A year ago, I erronously thought I was going to get to stay here. I was wrong.
 
[quote author="no_vaseline" date=1255658481][quote author="awgee" date=1255642679][quote author="no_vaseline" date=1255639891][quote author="USCTrojanCPA" date=1255590235]You are not alone, all my buyers who are ready to buy are very frustrated.</blockquote>


I, for one, have completely given up. I have come to the conclusion that I will rent my SFR in perpetuity becuase it's the only thing that seems sane for right now.</blockquote>
Interesting. Just the opposite for us. Things are looking better and better all the time. I see the knifecatchers creating a buying frenzy that will collapse the lower end market when it stops, and stop it will just like all buying frenzies. The higher end market selling has come to a standstill and prices are starting to fall accordingly. Interest rates are still low and have only one way to go. Trillions have been spent on stimulus and the only thing those trillions have done is overinflate some home prices, overinflate the equities markets, and create huge bonuses for bank executives.</blockquote>


Maybe I should expand a little.



As I posted on the front blog, I'm likely only a SoCal resident for the next 3-4 years. Even if the metrics were conducive to purchasing vs renting (and they still aren't) I wouldn't do so because I am concerned what the market looks like at my exit window, and even then, is it worth the hassle to save a couple of hundred bucks a month if I accidentally turn into an absentee landlord at the end of it?



Pass.</blockquote>
Just between you and I, if I was planning on moving in the next 3-4 years, I would <strong>NOT</strong> even be thinking about buying a home. We are in the top of the fourth inning.
 
[quote author="bltserv" date=1255655897]Its just totally insane. I have gotten to the point of really pissing off RE people

when I meet them. I feel like they are the guys at a Carnival Midway trying to sell you

something thats a total scam. A Lower form of life than a used car salesman.



I have basically resigned myself to being happy, as a renter.

As long as the IAC keeps coming down on my rent. (And in 3 years it has come down

almost 20%) I might as well stay put. Buying and taking on all that debt ? No thanks.

Looks like even my dividend and royalty incoming is coming back as well.

THANK GOD I DIDNT BUY a Home!



Went to my sons house warming party last Sunday.

I was amazed at how nice of a place he just rented with another 3 friends in Laguna Niguel.

They each are paying $ 500.00 a month and have a great older home with a pool.

It belongs to an older couple and is paid off.



<strong>It is a great time to be a renter</strong>.</blockquote>
Yes it is. I really believe that the price of owner to renting has increased for the worst. Rents have dropped about 10-15% while prices are firming. I actually enjoy the flexibility of being a renter. It may be different for a family with children, but for someone single like myself renting makes the most sense.
 
[quote author="awgee" date=1255658624] [Just between you and I, if I was planning on moving in the next 3-4 years, I would <strong>NOT</strong> even be thinking about buying a home. We are in the top of the fourth inning.</blockquote>


I had to call my landlord on something last week and discussed staying another three or so years. He said he was okay with it, so that's that.



BK posted a couple of months ago that I could find no peace in the city. And that got me thinking - maybe he's right. Soon enough I'll find out.
 
I've totally given up for now as well. I'm just not willing to spend my hard earned money at these prices.



I just love the fact that I know 2 people in Orange County who are living rent free in houses that the banks refuse to take back and sell to me.
 
[quote author="bltserv" date=1255655897]Its just totally insane. I have gotten to the point of really pissing off RE people

when I meet them. I feel like they are the guys at a Carnival Midway trying to sell you

something thats a total scam. A Lower form of life than a used car salesman.



I have basically resigned myself to being happy, as a renter.

As long as the IAC keeps coming down on my rent. (And in 3 years it has come down

almost 20%) I might as well stay put. Buying and taking on all that debt ? No thanks.

Looks like even my dividend and royalty incoming is coming back as well.

THANK GOD I DIDNT BUY a Home!



Went to my sons house warming party last Sunday.

I was amazed at how nice of a place he just rented with another 3 friends in Laguna Niguel.

They each are paying $ 500.00 a month and have a great older home with a pool.

It belongs to an older couple and is paid off.



It is a great time to be a renter.</blockquote>




Your son had a house warming party for a house he is renting with three other dudes? lol!!
 
[quote author="Minimorty" date=1255688075]Your son had a house warming party for a house he is renting with three other dudes? lol!!</blockquote>


C'mon. Can you think of a better reason to have a kegger and invite the old man?
 
What's next for No_Vas? His, uh, 18th career? The Pretender has nothing on you (or am I the only person that watched that show?).
 
[quote author="no_vaseline" date=1255658481]As I posted on the front blog, I'm likely only a SoCal resident for the next 3-4 years.



. . .



A year ago, I erronously thought I was going to get to stay here. I was wrong.</blockquote>


:down:



Although, I know what you're saying. We're looking around at other far away places too. While there is some money to be made in the next several years, I think the typical career trajectory is out. That means little opportunity in our prime years - and, I think, an increasing tax burden - making it that much harder to get ahead here. If you can't make a lot of money, you might as well go have fun. We are very seriously pursuing working for a friend of Prof's.
 
[quote author="Minimorty" date=1255688075][quote author="bltserv" date=1255655897]Its just totally insane. I have gotten to the point of really pissing off RE people

when I meet them. I feel like they are the guys at a Carnival Midway trying to sell you

something thats a total scam. A Lower form of life than a used car salesman.



I have basically resigned myself to being happy, as a renter.

As long as the IAC keeps coming down on my rent. (And in 3 years it has come down

almost 20%) I might as well stay put. Buying and taking on all that debt ? No thanks.

Looks like even my dividend and royalty incoming is coming back as well.

THANK GOD I DIDNT BUY a Home!



Went to my sons house warming party last Sunday.

I was amazed at how nice of a place he just rented with another 3 friends in Laguna Niguel.

They each are paying $ 500.00 a month and have a great older home with a pool.

It belongs to an older couple and is paid off.



It is a great time to be a renter.</blockquote>


Your son had a house warming party for a house he is renting with three other dudes? lol!!</blockquote>


A couple and another guy in a 3 bedroom. If you need to know.

All the parents showed up too. Good food and drink.



I am going to guess you have not raised any kids to adulthood yet.
 
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