The Psychology of Home Pricing or Behavioral Econ and WTF Pricing

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<em> "it's the best way into the market and prices will only go up."</em>





I am amazed at the persistence of that belief. I was watching the Today show and they had a realtor talking about the price declines. His tone was that of a historian talking about the declines in the past tense <em>as if they are over with</em>. There was the general attitude of "prices only go up -- from here." Sometimes the idiocy of realtors makes me angry, but then I document a few more huge losing properties, and my schadenfreude makes me feel better again.
 
"There was the general attitude of "prices only go up -- from here. Sometimes the idiocy of realtors makes me angry..."



If only it were just the realtors that believed this! I'm in Sacramento for pete's sake. I've been to Irvine and the Newport Beach area. I can understand why prices are higher than most other areas of the country. San Diego? San Francisco? Manhattan? Absurd prices can be justified. But Sacramento???? We were on the leading edge of the bubble bursting so why - a full year after the implosion of local legend Casey Serin - does the average joe homeowner still think I'd be better off paying a $2500 mortgage for a house I can rent for $1600? Why????



Again - I walk away from conversations convinced that people really believe they deserve to drive a Lexus, have a swimming pool and spa, own a Sub-Zero fridge and jet off to Hawaii every Christmas. I'm completely convinced that this hard core denial is going to make this recession a very long, very drawn out nightmare. The sense of entitlement has just taken root way too deeply as far as I can see.
 
Bluemoon, are you reading this? I am sure you are. Alittle frustrated because you can't participate? You can always run home and borrow your momma's computer. You nitwit.
 
And one last thing, bluemoon. For someone who's reaching 40. Your postings from last night was more immature than a crying toddler. Your parents ought to be ashame of a son like you. Yeahh...you....knucklehead.
 
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