Will this Fall be brutal?

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25w100k+_IHB

25w100k+_IHB

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Its interesting to try and guage the psychology of the market. I've noticed a lot of the homes i'm tracking have actually <i>raised</I> their prices lately, i'm assuming in anticipation of the summer 'buying frenzy'.



The thing is, I don't think a summer buying frenzy is coming. Things have picked up again, but it seems only the really rich or the bargain hunters are biting. There are a lot more forclosures in the works too...



So, my wishful thinking is that once summer comes and goes, all those people that were wishing and dreaming for higher prices are going to have to face 'reality' and just sell at market value. Not to mention the banks, (who seem more inclined to dump properties).



Or does everyone else continue to see a really <i>gradual</I> (stretch that word out for emphasis) declines over the next 4 years?
 
I had lunch with a couple of guys on Friday. Somebody described it as "a crack in Hoover Dam, starting out with a trickle, and then accelerating with ever frightening results".



IMO, I see it accelerating. So much so as I'm just about done watching the housing market for a while. The fix is in now, and the bottom will be long and drawn out (like it always is after an overheated market). The metrics are so far out of wack, the buyer pool exhausted, the lending more difficult, I just don't know how it turns out any different. There was an article on calculated risk recently where CR essentially agreed.



<a href="http://calculatedrisk.blogspot.com/2008/06/existing-home-sales-turnover-will-slow.html">http://calculatedrisk.blogspot.com/2008/06/existing-home-sales-turnover-will-slow.html</a>



Anyway, the data is depressing, people I know who should of known better are going to be financially (and maybe personally) ruined, and the permabear trolls are no longer entertaining because they are just in denial perma morons. "Dumb money gambling on stuff they could never afford" as my buddy on another fourm called it.



I think I'm going back to playing tournament poker, reading books (I think I'll do religion this time), knocking off another 40 pounds (20 down so far), and working on my race car. I may go do charity work. Somewhere between May 1 and Tim Russert passing away yesterday, my resovior of pity for the terminally stupid ran out, and now I'm just sad.
 
I assess things the same way as 25w100k+. House sales and prices normally rise in the first part of the year and fall in the second. We're currently seeing that pattern superimposed on an overall decline. I expect the price falls will resume with a vengeance this fall, just like they started last year. Sales won't fall so much because of the foreclosure flood but that flood will ensure prices collapse like they did last fall.
 
I see at the lower end, the banks are getting much more aggressive in their pricing on REOs in the last month. Most of the banks seem to be listing the REOs at around 60% of the last sale. I suspect that they have figured out that they need to get out while the getting is *possible* (not just good), and are trying to unload inventory as fast as possible.



The sales i've seen recently were mostly REOs of things that formerly sold for 700-900, selling now for 450-600.



I think the market is going to tank very soon. The pool of buyers who have been saving and waiting for the past few years is small and will exhaust fast.
 
If the banks are going to sell anything at anywhere near a decent price--say

50-60% off, they are going to have to finance these sales.



Don't go away no vas!!!



Just read the funny threads for a while.
 
[quote author="lawyerliz" date=1213515303]If the banks are going to sell anything at anywhere near a decent price--say

50-60% off, they are going to have to finance these sales.



Don't go away no vas!!!



Just read the funny threads for a while.</blockquote>


I'm not going away, Liz. Just a little less active.



Thank you for the kind words.
 
[quote author="no_vaseline" date=1213521536]

I'm not going away, Liz. Just a little less active.



Thank you for the kind words.</blockquote>


I feel for you no_lube, as well as the others basically forced into renting in OC. I can not imagine renting again, or becoming hopelessly buried as a home debtor. Thus our DINK, hyper-commuter lifestyle, which sucks hard by the way, but separates us from the intoxication. I do indeed think OC is going to crash brutally.



Looking forward, I do not see a clear path toward settling in OC over the next few years. There will be plenty of foreclosures, but there are going to be as many or more that bought too high and are upside down and can still service their debt. This latter group will not take a loss in a sale, but will be a slave to their personal financial hell for many, many years waiting to break even, which they never will.



I have wondered more than once over the past few months I have read IHB what the motivation is for committing to OC. The weather is nice, especially in the evening, but the total package is a mixture of strong pros and cons. My interest in Irvine stems from employment, but like many others in mid career situations, things change. Living a middleclass lifestyle in OC is expensive, and life as a whole can be stressful compared to other places.



I have not seen a lot of data suggesting a mass exodus of professional people or jobs from the area, and for those actually from OC and know it as home, dealing with this housing mess is taken in stride.
 
Hey, no vas, if you want to read religion books, try some from Alan Watts.



There's a Robin somebody who writes on the bible.



You could read the epic of Gilgamesh, whence came the flood

story.



There's a book called Doubt which is interesting.



If your tastes run to ancient Greek mythology, try Edith Hamilton.



You could read Hereclitus ready quickly, there's only like 200 or

less sentences extant. However, each one of them could be treated

like a zen koan.
 
My wife is a big Karen Anderson fan. so I'm going to read hers. Most of her books are on the history of religion. I'm planning on reading Myth, Islam, and then History of Religion, which will be a good basis for my further planned study of the Jesuits (the ultimate goal).



I played in a 18 person two table tournament on Friday night (first time out playing in about 2 months), which I won. I went to Hollywood Park and played 20/40 EO last night. It was a bit of a was a streach (it's a long way from here, and I've never played that big before) but the game was insanely juicy because the people in it were, for the most part, just horrible players.
 
The Jesuits, eh?



I had a Jesuit teacher in college once.



They were formed to counter Protestantism.



They can be extremely and wonderfully tricky



If you find a good book on them with no axe to grind, or

only a small axe, let me know.
 
Correction, It's Karen Armstrong, not Anderson. That's somebody else.







<a href="http://www.newadvent.org/cathen/14081a.htm">The Catholic Encyclopedia disagrees with Liz - re: the formation of the Jesuits.</a>



<a href="http://www.jesuit.org/SocialJustice/default.aspx">Why I'm intested in modern day Jesuits.</a>
 
That's what I recall learning in Catholic school; but, that was

a looooonnng time ago.



Have the Jesuits fallen off in numbers like the rest of the priesthood/monks/nuns?
 
I was so over Catholic-ed that I can't even be polite to

a priest or nun. I'd like to debate with a Jesuit; they'd

at least give me a run for my money.



I always hit'em with my best shot: what about the problem of evil?



The only religious answer which makes an internal sense is the

one described by Watts. God got (in effect) bored with eternity,

and separated him/her/itself from himself in part. So the universe

is God's dance with himself, and the worse things are the harder

God is dancing with himself.



In the real world sense, this has no equivalence to fact, but it's

better than the idea of Original Sin, in which mankind's booboo

polluted the entire universe prospectively and retrospectively,

everywhere and for a time. Nutz.



I have been of late musing about the possiblity of some sort of

morality, any sort of morality in the light of Darwin. I rather

think that justice and morality are art concepts. Which is not to

say I don't take them seriously. If morality were consistant with

Darwin, morality and justice would already be florishing. It's

not, obviously.
 
[quote author="lawyerliz" date=1213584921]The Jesuits, eh?



I had a Jesuit teacher in college once.



They were formed to counter Protestantism.



They can be extremely and wonderfully tricky



If you find a good book on them with no axe to grind, or

only a small axe, let me know.</blockquote>


I went to a law school run by Jesuits. Given that reputation, I went to the right place!
 
As the Immortial Clubber Lang, "My Prediction ... PAIN!" :)



It will be horrible, i'm estimating 75-100 per sqft. Of couse the interest rates will be credit card like.



as for Morality and Darwin, i tend to agree with you, they are more like an art concept to me. I think

morality is more of an evolution of conscious though. Really you don't see it in many lower evolved

life forms. Once life forms start to evolve to recognise "self" with consistent thought given over higher

wants (than needs) and of course interaction with fellow life forms you'll get a "morality". What that is

will probably be pretty different.



good luck

-bix
 
[quote author="biscuitninja" date=1213613004]As the Immortial Clubber Lang, "My Prediction ... PAIN!" :)



It will be horrible, i'm estimating 75-100 per sqft. Of couse the interest rates will be credit card like.



as for Morality and Darwin, i tend to agree with you, they are more like an art concept to me. I think

morality is more of an evolution of conscious though. Really you don't see it in many lower evolved

life forms. Once life forms start to evolve to recognise "self" with consistent thought given over higher

wants (than needs) and of course interaction with fellow life forms you'll get a "morality". What that is

will probably be pretty different.



good luck

-bix</blockquote>


I spoke with a nice man who bought a house that is located VERY near the water in a beach city in SoCal this weekend.



He bought his 892 sq ft place as an investment (2nd home) in 2005 for $990,000.



A unit on his street that is about 10 houses down and at the END of the road (ON THE WATER WITH THE FULL OCEAN VIEW) just sold for $985,000... and it's 50 years newer and 3000 sqft in size.



He paid almost $1100 a sq/ft. for his house. The comps put it at around $360 a sq/ft if he's lucky.



Pain is a proper word.
 
[quote author="biscuitninja" date=1213613004]As the Immortial Clubber Lang, "My Prediction ... PAIN!" :)</blockquote>


<img src="http://static.flickr.com/122/272235490_ea99970576.jpg" alt="" />
 
[quote author="biscuitninja" date=1213613004]

It will be horrible, i'm estimating 75-100 per sqft.

</blockquote>


wait, your saying 75-100 per ser sqft <I>by this year</I>???



If so...I'll bet you $100,000 dollars it won't be there.







[quote author="Masterofdamoney" date=1213627198]

A unit on his street that is about 10 houses down and at the END of the road (ON THE WATER WITH THE FULL OCEAN VIEW) just sold for $985,000... and it's 50 years newer and 3000 sqft in size.



He paid almost $1100 a sq/ft. for his house. The comps put it at around $360 a sq/ft if he's lucky.



Pain is a proper word.</blockquote>


Uhm, really? 3000 sq ft. newerish house with a full ocean view? I kinda find it hard to believe...
 
Bix thinks that's going to be the stone bottom, not this year. I'm inclined to believe him if we get 10% interest rates.



ModM is solid, but I read that post in disbelief.



Insommnia is a bitch.
 
[quote author="25w100k+" date=1213628264][quote author="biscuitninja" date=1213613004]

It will be horrible, i'm estimating 75-100 per sqft.

</blockquote>


wait, your saying 75-100 per ser sqft <I>by this year</I>???



If so...I'll bet you $100,000 dollars it won't be there.







[quote author="Masterofdamoney" date=1213627198]

A unit on his street that is about 10 houses down and at the END of the road (ON THE WATER WITH THE FULL OCEAN VIEW) just sold for $985,000... and it's 50 years newer and 3000 sqft in size.



He paid almost $1100 a sq/ft. for his house. The comps put it at around $360 a sq/ft if he's lucky.



Pain is a proper word.</blockquote>


Uhm, really? 3000 sq ft. newerish house with a full ocean view? I kinda find it hard to believe...</blockquote>


1989... sorta new. The guys was built 1950. :) They are not on the sand or anything, just looking out at the water.



Exact difference in $ per sq/ft paid is $1091 vs $391 for those two.... ouch!
 
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