no_vaseline_IHB
New member
Given the MBA foreclosure data they reported today that I cited in "Headlines" theres no way in hell I'd buy today. If somebody gave me the money I'd continue to rent.
If you knew this was the bottom!
- Thread starter rickhunter_IHB
- Start date
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freedomCM_IHB
New member
[quote author="rickhunter" date=1228544032]So I should be asking you this question...
Would you like to own for 10 years and have all the benefits that come with it?
Or
Would you like to rent for 10 years and have all the benefits that come with it?
</blockquote>
Well, personally I would like to own a SFR, have a garden, etc...
<strong>
But...I'm not willing to pay an extra $50k/year over rent for the privilege of doing so!</strong>
Would you like to own for 10 years and have all the benefits that come with it?
Or
Would you like to rent for 10 years and have all the benefits that come with it?
</blockquote>
Well, personally I would like to own a SFR, have a garden, etc...
<strong>
But...I'm not willing to pay an extra $50k/year over rent for the privilege of doing so!</strong>
socalhousingbubble_IHB
New member
[quote author="rickhunter" date=1228524834]You can buy the home you would want to stay in for 10 years and still move up.
Your earning power should increase by then.
Your wants and needs should have changed.</blockquote>
Your scenario says the price in 10 years will be the same as it is now. It doesn't say it will remain the same for 10 years.
If one's earning power increases but one is underwater on the home and decides at year 5 needs have changed and a move is necessary, bring money to the table or forget about it.
And said knifecatcher is shackled to the home, which will undermine the ability to relocate to increase earning power.
BAD, BAD idea. Might as well sign a 10-year lease and save the money.
-SCHB
Your earning power should increase by then.
Your wants and needs should have changed.</blockquote>
Your scenario says the price in 10 years will be the same as it is now. It doesn't say it will remain the same for 10 years.
If one's earning power increases but one is underwater on the home and decides at year 5 needs have changed and a move is necessary, bring money to the table or forget about it.
And said knifecatcher is shackled to the home, which will undermine the ability to relocate to increase earning power.
BAD, BAD idea. Might as well sign a 10-year lease and save the money.
-SCHB
rickhunter_IHB
New member
My scenario if for a 30 year fixed 20% down SFR.
You can bring a bad/worst case scenario like losing a job/medical bills into the picture but
At that point, whether you're a buying the home for a 20% or 40% discount, would it even matter?
You might not be able to afford RENT!
[quote author="socalhousingbubble" date=1228546786][quote author="rickhunter" date=1228524834]You can buy the home you would want to stay in for 10 years and still move up.
Your earning power should increase by then.
Your wants and needs should have changed.</blockquote>
Your scenario says the price in 10 years will be the same as it is now. It doesn't say it will remain the same for 10 years.
If one's earning power increases but one is underwater on the home and decides at year 5 needs have changed and a move is necessary, bring money to the table or forget about it.
And said knifecatcher is shackled to the home, which will undermine the ability to relocate to increase earning power.
BAD, BAD idea. Might as well sign a 10-year lease and save the money.
-SCHB</blockquote>
You can bring a bad/worst case scenario like losing a job/medical bills into the picture but
At that point, whether you're a buying the home for a 20% or 40% discount, would it even matter?
You might not be able to afford RENT!
[quote author="socalhousingbubble" date=1228546786][quote author="rickhunter" date=1228524834]You can buy the home you would want to stay in for 10 years and still move up.
Your earning power should increase by then.
Your wants and needs should have changed.</blockquote>
Your scenario says the price in 10 years will be the same as it is now. It doesn't say it will remain the same for 10 years.
If one's earning power increases but one is underwater on the home and decides at year 5 needs have changed and a move is necessary, bring money to the table or forget about it.
And said knifecatcher is shackled to the home, which will undermine the ability to relocate to increase earning power.
BAD, BAD idea. Might as well sign a 10-year lease and save the money.
-SCHB</blockquote>
irvine_home_owner_IHB
New member
[quote author="rickhunter" date=1228547611]You might not be able to afford RENT!
</blockquote>
Please explain.
If you cannot afford to rent, how can you afford to pay your mortgage?
Like I said in my previous post, this depends on rental parity... as long as you can rent an SFR for less than buying it... why would you do otherwise? Especially if the house is going to be worth the same money 10 years later.
</blockquote>
Please explain.
If you cannot afford to rent, how can you afford to pay your mortgage?
Like I said in my previous post, this depends on rental parity... as long as you can rent an SFR for less than buying it... why would you do otherwise? Especially if the house is going to be worth the same money 10 years later.
rickhunter_IHB
New member
I was being dramatic but it's sad at the same time.
Rent or Mortgage, if you lose your job and have huge medical bills, you're SOL.
If you're actually planning this into your equation like SOCAL is, nobody should buy. EVER!
The average person that is.
[quote author="irvine_home_owner" date=1228548005][quote author="rickhunter" date=1228547611]You might not be able to afford RENT!
</blockquote>
Please explain.
If you cannot afford to rent, how can you afford to pay your mortgage?
Like I said in my previous post, this depends on rental parity... as long as you can rent an SFR for less than buying it... why would you do otherwise? Especially if the house is going to be worth the same money 10 years later.</blockquote>
Rent or Mortgage, if you lose your job and have huge medical bills, you're SOL.
If you're actually planning this into your equation like SOCAL is, nobody should buy. EVER!
The average person that is.
[quote author="irvine_home_owner" date=1228548005][quote author="rickhunter" date=1228547611]You might not be able to afford RENT!
</blockquote>
Please explain.
If you cannot afford to rent, how can you afford to pay your mortgage?
Like I said in my previous post, this depends on rental parity... as long as you can rent an SFR for less than buying it... why would you do otherwise? Especially if the house is going to be worth the same money 10 years later.</blockquote>
freedomCM_IHB
New member
But you didn't reply to my assertion:
If house prices don't keep up with inflation over the long term (10y), then buying one is a losing proposition, so long as rent is lower than PITI.
The question is: <strong>How much are you willing to lose per year?</strong>
If house prices don't keep up with inflation over the long term (10y), then buying one is a losing proposition, so long as rent is lower than PITI.
The question is: <strong>How much are you willing to lose per year?</strong>
IrvineRenter_IHB
New member
A bullish thread... I like it.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"
no_vaseline_IHB
New member
[quote author="IrvineRenter" date=1228567773]A bullish thread... I like it.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
Absolutely! Because I am alergic to money!
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
Absolutely! Because I am alergic to money!
No_Such_Reality_IHB
New member
[quote author="rickhunter" date=1228547611]My scenario if for a 30 year fixed 20% down SFR.
You can bring a bad/worst case scenario like losing a job/medical bills into the picture but
At that point, whether you're a buying the home for a 20% or 40% discount, would it even matter?
You might not be able to afford RENT!
</blockquote>
That's where the $160K down payment comes in, it's five years of rent...
That's a long time with no job from layoff, illness or anything else. You just tap that big down payment fund stuffed in the bank that has been earning interest.
It's also $160K that if used for a down payment, can't be used for anything else easily, in the event of job loss, illness or other scenario.
You can bring a bad/worst case scenario like losing a job/medical bills into the picture but
At that point, whether you're a buying the home for a 20% or 40% discount, would it even matter?
You might not be able to afford RENT!
</blockquote>
That's where the $160K down payment comes in, it's five years of rent...
That's a long time with no job from layoff, illness or anything else. You just tap that big down payment fund stuffed in the bank that has been earning interest.
It's also $160K that if used for a down payment, can't be used for anything else easily, in the event of job loss, illness or other scenario.
25w100k+_IHB
New member
[quote author="IrvineRenter" date=1228567773]A bullish thread... I like it.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
Whats "they" though? Are you talking about th median price? Average price per sq ft. in Irvine? National average? Or the specific house i'm thinking about buying today?
My answer would be very different depending.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
Whats "they" though? Are you talking about th median price? Average price per sq ft. in Irvine? National average? Or the specific house i'm thinking about buying today?
My answer would be very different depending.
graphrix_IHB
New member
How about this... I <em>know</em> we are not at the bottom because fundamentals and history tells us so. After the jobs report today on a loss of 533k jobs, with the total broader employment picture going near parabolic, and with the near 2003 job levels that will be seen when the OC jobs report comes out next week, then I wouldn't be thinking about the bottom, but I would be thinking how much further we will have to fall.
http://www.ritholtz.com/blog/wp-content/uploads/2008/12/broader-unempl.png
People need to have jobs to afford housing, and if we are at job levels of 5 years ago, then we will only need a housing stock level of that time. Jobs here in OC increased from 93 to 96, while home prices declined and foreclosures increased. Since we have not seen an increase in jobs yet, then we can assume on an econ 101 basis that is not here yet.
Even with home prices staying flat, then as you make more money than inflation, inflation will only eat away at the value of a home today, and it will become more affordable. But, but there is a threat that rents will go up (which in the last few years has been extremely, but that is quickly dwindling away.All that is left is fear of mortgage rates, but they are at their lowest levels. Despite the did-inflationary dept. Treasuries are taking a beating.
http://www.ritholtz.com/blog/wp-content/uploads/2008/12/broader-unempl.png
People need to have jobs to afford housing, and if we are at job levels of 5 years ago, then we will only need a housing stock level of that time. Jobs here in OC increased from 93 to 96, while home prices declined and foreclosures increased. Since we have not seen an increase in jobs yet, then we can assume on an econ 101 basis that is not here yet.
Even with home prices staying flat, then as you make more money than inflation, inflation will only eat away at the value of a home today, and it will become more affordable. But, but there is a threat that rents will go up (which in the last few years has been extremely, but that is quickly dwindling away.All that is left is fear of mortgage rates, but they are at their lowest levels. Despite the did-inflationary dept. Treasuries are taking a beating.
rickhunter_IHB
New member
So for the example of the home that already went down 20%, we're saying that it went down another 20% from the current price.
1mil -> 800K -> 640K -> 800K
Let's track this possibility for an SFR (in Woodbury? Northpark? Northpark Square? Quail Hill?) that WE WOULD WANT TO BUY and stay in for a long time.
I dont want to call the nations median. Orange County's median. I want to know the specific neighborhood where people are outbidding each other everytime
a great home comes up for sale in Irvine.
[quote author="IrvineRenter" date=1228567773]A bullish thread... I like it.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
1mil -> 800K -> 640K -> 800K
Let's track this possibility for an SFR (in Woodbury? Northpark? Northpark Square? Quail Hill?) that WE WOULD WANT TO BUY and stay in for a long time.
I dont want to call the nations median. Orange County's median. I want to know the specific neighborhood where people are outbidding each other everytime
a great home comes up for sale in Irvine.
[quote author="IrvineRenter" date=1228567773]A bullish thread... I like it.
The headline on the thread is not the argument you are making in the comments. Saying that prices will be the same as today's 10 years from now is not saying that today is the bottom.
I would ask the question this way: "If you knew prices were going to be the same 10 years from now, and if it seemed very likely that they would be 20% cheaper 2 years from now, would you buy today?"</blockquote>
No_Such_Reality_IHB
New member
When the kool-aid runs dry, there aren't going to be bidding wars for tract homes.
In fact, with 1.25 Million jobs lost in the last three months nationwide and a $14 Billion dollar shortfall in the State budget, they will be lucky to get bids at all.
In fact, with 1.25 Million jobs lost in the last three months nationwide and a $14 Billion dollar shortfall in the State budget, they will be lucky to get bids at all.
25w100k+_IHB
New member
[quote author="No_Such_Reality" date=1228609108]When the kool-aid runs dry, there aren't going to be bidding wars for tract homes.
In fact, with 1.25 Million jobs lost in the last three months nationwide and a $14 Billion dollar shortfall in the State budget, they will be lucky to get bids at all.</blockquote>
Haha. Are you kidding me? How long are you going to live in fantasy land man? Its hilarious that suddenly everyone's jumping on the job loss bandwagon. *Thats* what will finally drag houses down 100% in value! First it was subprime, but that didn't really hit irvine at all.
Then it was Alt-A resets, and yeah that dropped things a little, but not anywhere near as much as insane bears like you wanted. So now you run to your next hope that will support your delusional world.
Do you have any idea that you sound just like the kool-aide drinkers two years ago telling everyone houses will go up and up forever and ever? Its pathetic.
Yes, houses will come down a bit more. They'll probably stay flat for a long time once they do hit bottom. But to think that there won't be demand for track homes in OC? haha. wow.
In fact, with 1.25 Million jobs lost in the last three months nationwide and a $14 Billion dollar shortfall in the State budget, they will be lucky to get bids at all.</blockquote>
Haha. Are you kidding me? How long are you going to live in fantasy land man? Its hilarious that suddenly everyone's jumping on the job loss bandwagon. *Thats* what will finally drag houses down 100% in value! First it was subprime, but that didn't really hit irvine at all.
Then it was Alt-A resets, and yeah that dropped things a little, but not anywhere near as much as insane bears like you wanted. So now you run to your next hope that will support your delusional world.
Do you have any idea that you sound just like the kool-aide drinkers two years ago telling everyone houses will go up and up forever and ever? Its pathetic.
Yes, houses will come down a bit more. They'll probably stay flat for a long time once they do hit bottom. But to think that there won't be demand for track homes in OC? haha. wow.
caycifish_IHB
New member
This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.
SoCal78_IHB
New member
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.</blockquote>
LOL!! Eww, I just got statistics all over my white shirt. LOL!
LOL!! Eww, I just got statistics all over my white shirt. LOL!
rickhunter_IHB
New member
So it's an affordability issue for you. Not that you cant "afford" it, but that you want it to be more affordable?
So would you say that if price for the home that you want do not go to the scale of earning/buying power you're at,
you will never buy? Or would you settle for your 2nd, 3rd choice that would make it more affordable?
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote>
So would you say that if price for the home that you want do not go to the scale of earning/buying power you're at,
you will never buy? Or would you settle for your 2nd, 3rd choice that would make it more affordable?
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote>
caycifish_IHB
New member
I'm picky and stubborn and extremely patient. I know what I want and what price I'm willing to pay for it. I also don't want to live in a place that makes me unhappy every day. It's not worth the stress and daily cortisol injection. I'm also a hard-worker and a very diligent about saving. If my down payment goes up, and my salary goes up, and the price of the house stays the same, eventually the two shall meet. Realistically it's not that far away looking at current trends so I don't worry too much about it.
And they lived happily ever after.
[quote author="rickhunter" date=1228625867]So it's an affordability issue for you. Not that you cant "afford" it, but that you want it to be more affordable?
So would you say that if price for the home that you want do not go to the scale of earning/buying power you're at,
you will never buy? Or would you settle for your 2nd, 3rd choice that would make it more affordable?
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote></blockquote>
And they lived happily ever after.
[quote author="rickhunter" date=1228625867]So it's an affordability issue for you. Not that you cant "afford" it, but that you want it to be more affordable?
So would you say that if price for the home that you want do not go to the scale of earning/buying power you're at,
you will never buy? Or would you settle for your 2nd, 3rd choice that would make it more affordable?
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote></blockquote>
graphrix_IHB
New member
[quote author="caycifish" date=1228624066]This thread is starting to turn into yet another one where folks put their stat of choice, whether it be national, California, Southern California, OC, or Irvine stats, all into a blender, and then you hit "Mix" without putting the top on, and then everyone goes running around the kitchen screaming while random stats come flying out and hit random people's shirts.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote>
AAAAHHHHH! I have a shard of chartpr0n stuck in my eye. Quick, someone get IR, awgee or zovall in here, I need someone who understands the difference between the typical shard and the chartpr0n shard. Damn you all for spouting all these different stats, I may never regain sight in my left eye because of it.
And I can assure you that there is very little to no demand for track houses in Anaheim. Irvine, sure.
Would I buy the house I want in Tustin today if I was assured it would stay the same price for 10 years? Nope. I'd wait until my earning/buying power had increased and inflation had eaten away at the price of the house such that the house became affordable.</blockquote>
AAAAHHHHH! I have a shard of chartpr0n stuck in my eye. Quick, someone get IR, awgee or zovall in here, I need someone who understands the difference between the typical shard and the chartpr0n shard. Damn you all for spouting all these different stats, I may never regain sight in my left eye because of it.