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Posted: 3/3/2006 4:35:36 PM EDT
As goes Kalifornia so goes the nation...
 Looks as though it is cooling off, damnit! I was hoping I could squeeze 3 more months before I pulled stakes and moved east.  ------------------------------------------------------- www.kcal9.com Home Sales in LA and Orange County Plunge in January (Los Angeles, CA) -- Economists stopped short of using the phrase "bubble bursting" to describe the sharp decline in home sales across Southern California in January. But, economist Leslie Appleton-Young with the California Association of Realtors said, "The real estate market is beginning to experience the soft landing that we expect to be the underlying dynamic driving the housing market this year." The "Los Angeles Business Journal" reports that sales of median priced homes in the LA area plunged 23.5-percent in January from the previous year and about 19-percent from December. The median price for a home in LA County rose slightly from December to 560-thousand-740-dollars. That's nearly 18-percent higher than the median price in January, 2005. In Orange County, the median price for a home is nearly 700-thousand-dollars, which is 10-percent higher than a year ago. Home sales in Orange County fell 24-percent in January compared to a year ago. |
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Posted: 3/3/2006 4:38:03 PM EDT
[#1]
I don't want to hear that. I plan on selling my house in the summer. Either way I will have made nearly $200K in equity. HAAAAA Charley Murphyyyy!!!!!!
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Posted: 3/3/2006 4:39:12 PM EDT
[#2]
It is expected to bust here in the Tampa FL area also. Glad I waited on buying here.
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Posted: 3/3/2006 4:39:21 PM EDT
[#3]
we're in the same boat! sell. run. hide. 
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Posted: 3/3/2006 4:41:58 PM EDT
[#4]
The problem in Tampa now, though, is that anywhere within 100 miles it is getting too damn expensive to get insurance! Some people have had their insurance go from $800 a year to $3400 a year even though they had NO claims. Insane. |
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Posted: 3/3/2006 4:45:30 PM EDT
[#5]
Okay, everyone panic and put your house on the market NOW. Drop the price, deal down, take any offer you can get. Why watch a bubble burst when you can actually cause it? |
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Posted: 3/3/2006 4:48:47 PM EDT
[#6]
Glad I plan on staying here, as long as the plant remains open, right now, that is my concern.
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Posted: 3/3/2006 4:49:53 PM EDT
[#7]
It isn't poping and it is not going to pop.
It is simply slowing down. Also, it is January. No one want to move in January. The kids are in school, its the middle of the school year, it typically is colder, just after the holidays. Just wait till May, June, July roll around. Things will perk up. |
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Posted: 3/3/2006 4:50:56 PM EDT
[#8]
Drop like a rock! Woo hoo!
(Renting while socking away piles of cash for land/construction loan) |
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Posted: 3/3/2006 4:52:05 PM EDT
[#9]
Tampa is for sure changing.. many many homes are for sale that have price reduced signs attached to them. Also a lot of For Sale Buy Owners are sitting on the market a long time. People think they can still ask these outragous prices and get it. New tampa is going to take a MAJOR hit because as many as 30% of the homes in the new neighborhoods were bought buy investors who have been trying to sell them. One condo dropped its prices 40k to sell the remaining units. Imagine paying 220k for a condo then the last few sell for 180. You just took a 40 k loss.
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Posted: 3/3/2006 4:52:36 PM EDT
[#10]
Never-trust-someone-with-a-hyphenated-name. Could it just be people that are willing to take a small loss to move from Kalifornia to America??? |
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Posted: 3/3/2006 4:53:01 PM EDT
[#11]
so the 350K condos in the shitty neighborhoods now will cost 300k????
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Posted: 3/3/2006 4:56:31 PM EDT
[#12]
Housing bubble...
Burst -> bad for the economy overall... good for people with good credit looking to buy a house.... |
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Posted: 3/3/2006 4:57:10 PM EDT
[#13]
It will not perk up like in years past. Sure it will go up but the mortgage rates are nowhere as attractive as they were a few years ago. The market is overpriced in many places and has been for years. Thats all well and fine until taxes, Interest, and inflation begin to chip away at the demand. And demand has been slipping for more then a few months. The worst part for many is the time it takes to sell in a saturated market. It puts all your plans on hold until it sells. |
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Posted: 3/3/2006 5:09:25 PM EDT
[#14]
I'm not arguing that point. I am simply saying to say the buble is bursting, akin to the stockmarket bust brought about by the internet downturn, won't happen. Sure, prices will drop. There has been a huge run up. But for to say the sky is falling, and I'm not saying you said it, but I have heard it around, I think is silly. |
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Posted: 3/3/2006 5:11:12 PM EDT
[#15]
Thats what I was going to post. Great Post BTW! 
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Posted: 3/3/2006 5:31:14 PM EDT
[#16]
I don't buy the bubble argument. When people are shopping for a home, they don't look nationwide; they shop in a rather small area. The cost of housing in CA has nothing to do with housing costs in Toledo.
I suggest that housing costs are always dropping somewhere and increasing other places. Also, the demise of unit banking laws keeps lenders from being too much at risk from local housing markets. If housing costs drop in one area, that is important for that area. The whole housing bubble scare is pure liberal/media fiction. The liberals want to scare the ignorant into thinking the next Great Depression is just weeks away. The Media....hell, those people are stupid. |
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Posted: 3/3/2006 5:31:33 PM EDT
[#17]
I agree that the sky will NOT fall, however, with 2nd, 3rd, and lord knows how many "improvement" loans on some of these houses already because of debt there will be a very high number of forclosures, and a softening of the market because of peoples blind faith that their house WILL go up in value and bail them out. I see it every day. It is pretty bad in MI in some places. Since I have to do power/gas turn offs for eviction [change of utility and ownership to bank ect. is very easy to spot a forclosure]I know there are a LOT more housing problems then a lot of people want to let on. Sure, some are your typical shitbox slum houses that have not had any upgrades in 50 years but many more then you think are middle class and higher places that are pretty darn nice. Between the ARMs and property tax increases along with CC debt and all the rest it just becomes to much. Every forclosure will be a drop in the bucket to weigh down the market as Banks will end up eating most of them because of the debt load. It's not like most people pay off houses anymore. They keep on moving up until they "retire" still oweing house notes. No frikkin wonder why they want the rest of us to buy their Meds for them. Their Meds money is going for a damn house payment. Americans can be flippin stupid sometimes.................. |
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Posted: 3/3/2006 5:36:59 PM EDT
[#18]
You obviously never lived thru the late 70s did you? My dad bought a 200K house for less then 100K because of NO takers in over 2 years. He had the money from a settlement [part of it anyways]of a MC injury. 14% interest killed the market in housing for several years. If utility costs continue to rise steeply who the hell wants a house that'll cost 600 to 1000 bucks a month to heat? Sooner or later it'll hurt. Maybe not everyone, but enought to cause problems. |
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Posted: 3/3/2006 5:39:18 PM EDT
[#19]
More like a slow leak than a burst.
The eceonomy is otherwise very strong, this will cushion the fall considerably. |
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Posted: 3/3/2006 5:46:24 PM EDT
[#20]
I hear things are down 20% in some areas of the Bay Area as well.
But it's not about price -- it never has been. It's about monthly payments and how much you can afford to pay each month. Home prices go up as interest rates decline. When interest rates increase, home prices decline. I would suspect that the monthly payments are still the same, even as home prices decline. |
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Posted: 3/3/2006 5:47:18 PM EDT
[#21]
I absolutely agree with this. If the economy was doing poorly [Michigan  ] You'd see what the hell it's doing. Damn Berkely Canadian bitch Gov. Lets give a few more billion to the welfare queens along with "free" contraceptives.
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Posted: 3/3/2006 5:50:24 PM EDT
[#22]
Don't see it slowing in many states for a while....all the old people need to buy property somewhere warm so they can die. As the nation grows older so will the retirement community states (increasing demand). (Which coincidentally happen to be red states too!)
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Posted: 3/3/2006 5:56:00 PM EDT
[#23]
as i understand it, it's not really "bursting", and has alot to do with where you live.
luckily living in an area constantly ranked in the top 10 places to live in the nation, property prices are doing ok here. though southern california it's not....... |
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Posted: 3/3/2006 5:58:53 PM EDT
[#24]
My dad is a builder, he's indicating that he's had about a 50% drop off in sales/traffic since the begining of the year. He's in Northern Jersey.
Locally, homes are staying on the market for a lot longer than they were. Some people are going to get really hurt if we get a bad recession, |
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Posted: 3/3/2006 6:06:02 PM EDT
[#25]
I wish the bubble would burst here in Seattle............
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Posted: 3/3/2006 6:09:00 PM EDT
[#26]
I hope it does burst and burst big big big, I am stuck in CA a few more years and would like to get a nice condo... a bad economy could help this along and I have a job that does not depend on the economy at all.
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Posted: 3/3/2006 6:11:48 PM EDT
[#27]
"There is no such thing as a bad market, only different ways to operate within any given market."
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Posted: 3/3/2006 6:17:09 PM EDT
[#28]
the "housing bubble" is a media myth that could (but probably won't) become a self-fulfilling phrophecy.
what it refers to investment real estate in ISOLATED areas. kalifornia has always had higher than normal property values/prices and comparatively less investment for turnover takes place there. miami on the other hand has seen explosive property value hikes based on an equally explosive building frenzy done by people who were market shy and took their money from stocks and put it in real estate. most of those people are leaving now and as supply outweighs demand, economics dictate that prices will fall accordingly. this is purely cyclical though. people in the "fly-over states" needn't worry too much because property hasn't been artificially hyper-inflated like it has on the coasts. i wouldn't even give this lip service --the more the media talks about it, the more people are willing to buy into the concept and before too long trouble could be afoot. |
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Posted: 3/3/2006 6:34:40 PM EDT
[#29]
I know what you mean.. I've got some friends in the Ft Myers area, They bought some property north of town(about halfway to Punta Gorda) and wanted to build out there, They found out the flood insurance for the house they wanted to build would cost them $6000 a year. They shopped around too, $6000 is the going rate where they're property is..They gave up, and are now selling the property, and plan on selling their house (insurance on house skyrocketed) They're looking at northern Georgia now.. |
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Posted: 3/3/2006 6:40:35 PM EDT
[#30]
You can't buy a decent house here in Chicago for less than $150K, and the condos? Forget it.
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Posted: 3/3/2006 6:54:42 PM EDT
[#31]
It's only "bursting" in those areas that saw huge increases like the 55% they saw in San Diego. There's no bubble in the northwest, we're still seeing increases in value, in my area last year we saw 27% increase in value with only 4% growth in number of homes sold. Last month in my market we saw listings decrease and sales prices rose as a result. Time on market is extended by about 30 days or so, that's all. The national media will play this for all it's worth however.
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Posted: 3/3/2006 7:00:57 PM EDT
[#32]
I think this correction is going to be extremly slow. People have a tendancy to hold tight to their investments, they are not easily going to part with the "equity" but will instead hold fast where they are.
my .02 |
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Posted: 3/3/2006 7:01:38 PM EDT
[#33]
This is correct. Over the past 15 years we have seen historically low interest rates, combined with very liberal banking policies, and a ready supply of money. Remember way back in 1999, you had to have 3 to 5 percent cash to put down on your loan? In the last 2 years, 80/20 loans have become the norm. 80 percent traditional home loan, combined with a 20% home equity load. People who could not afford it before are currently in the market, and even those who could afford to put money down are going with the 80/20 because the rates are so low, and the interest is deductable anyway. I bought a 300,000 house for literally no money down. If inflation outpaces your 6% loan, you have free money and a tax break.  However, the prices now have finally gotten to the point where even a dual income family cannot afford a home. The prices will have to pull back at least a little. Of course, the real danger is the herd mentality. Everybody trying to cash out now while they still can. I don't think there will be any major correction as long as the economic fundamentals and the market hold up. |
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Posted: 3/3/2006 7:13:48 PM EDT
[#34]
Here's an example of the problem. The house next to me sold for 350K a year and a half ago. A house up the block, almost identical to the one next to mine, sold for 320k a month ago. More than likely my new neighbors are in the hole for 30k.
Add a recession and you've got people with negative equity in their homes. Anyone in texas in the mid 80's will remember what a nightmare this scenario was. When the oil collapse happened, there were folks going to closing and paying money to get out of their homes. Some just sent the lender their keys. I don't want to see that again. ever |
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Posted: 3/3/2006 7:14:24 PM EDT
[#35]
Woot, lets hear it for rural Missouri! 5 acres and a two story house for $62,000 a couple years ago. Don't expect to lose too much if the bubble bursts, LOL! The people in SoCal paying millions for an apartment might have to worry though... |
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Posted: 3/3/2006 7:16:30 PM EDT
[#36]
The ones who got an interest only loan at the top of the bubble are really going to be screwed if they have to sell. A lot of them will probably just walk away. |
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Posted: 3/3/2006 7:22:30 PM EDT
[#37]
So basically you want all the rest of us to suffer so you can get a fucking condo? WTF is wrong with you? You want something that bad then you get second job or more education. You don't wish harm on others for your own wants. karma is a real bitch once you attract her attention. |
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Posted: 3/3/2006 7:24:37 PM EDT
[#38]
The bubble areas are a large part of the overall market. California, MA, DC, FL, AZ--once you add all that up there's a pretty good chance the place you're looking is over valued. Also, the high home prices in the bubble areas have caused runups elsewhere. There are a lot of people who bought in rural areas of the West with home equity from their place in California. If the California prices drop the other areas are going to get hit, too.
Prices tend to be sticky down; people can often live in their home while hoping for a rebound. But in some of the areas, like Las Vegas and FL, a substantial fraction of the market is held by investors and flippers, and they could all decide or be forced to exit fast and cut their loses. Also, in the last few years a lot of people have bought who are on the ragged edge. IO loans, ARMs with small down payments, house payments that are 50% or more of their income, or cashed out their equity with a HELOC. A drop of 10-20% in home prices would hit those people hard. My guess is about a 25-30% drop in prices over 3-5 years, and a lot of people getting their asses handed to them. |
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Posted: 3/3/2006 7:29:55 PM EDT
[#39]
From our "friends" at the NY Times:
Hoping for Best in Home Sales, 2 Sides Sit Tight
Graphic: Housing Still Going Strong |
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Posted: 3/3/2006 7:43:05 PM EDT
[#40]
I think the classic signs of a market top are there. Inventory is way up, average time on market is way up, number of sales is down, and in many places a small price decline has kicked in. Buyers aren't buying, and affordability indexes are in the single digits in some places. There are no big new groups of buyers that are going to come into the market. For now sellers are trying to hold out and hoping for a rebound in spring, but I don't think the cavalry is going to show. Once that realization kicks in the prices will begin the serious drops.
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Posted: 3/3/2006 8:07:58 PM EDT
[#41]
OK, i'm asking for a free evaluation.
I'm buying a 3-4-year-old doublewide, in New Mexico. I"m paying 42k for it; it's a FHA foreclosure. 1/3 acre, nice neighborhood (meaning: relatively crime-free). 0% down but there are about 2k closing costs, which I have in the bank. The house across the street has sat for 6 months, priced at $56k. The local municipal airport is expanding to accept commercial traffic. Businesses are growing in the area. The town I'm in has 2 major economies: its a major railroad hub and it is also largely agricultural. The only drawback seems to be my commute: 30 miles each way, good highways. How am I sitting? |
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Posted: 3/3/2006 8:18:54 PM EDT
[#42]
Yep yep, seems to me the only people that say or hope there'll be a burst are the ones that don't own anything, as if they have something to gain at the expense of home owners, and are sitting on the sidelines rubbing their hands with glee. I predict that if there IS a correction, your lazy ass still wouldn't buy shit. So whose fault is it that you live in CA, make the CA income, and still can't afford to buy something? People that worked hard, saved money, tightened their belts and bought a condo or home without any help from their parents or relatives? It takes more than just money to buy and keep a home: dedication, perseverance and discipline. Does anyone think home prices dropping actually means they'll be scoop one up more easily? When home prices drop, there are other effects too that may prevent you from buying even at lower prices. |
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Posted: 3/3/2006 8:19:47 PM EDT
[#43]
It sounds to me like you're OK. You don't have much downside risk because it sounds like it's priced close to what people would pay just to have a place to live. As a quick check, compare your costs of buying (principal, interest, insurance, taxes) to that of renting a comparable place. My guess is that at that price they're going to come out pretty close. It would be good to have more money in the bank, though; try to have six months of expenses saved up.
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Posted: 3/3/2006 8:48:18 PM EDT
[#44]
Oh c'mon you guys, this is the American way. Capitalism. If you were on the outside looking in and couldn't afford a home at todays inflated prices you'd want the bubble to burst also. Shit, I remember watching in the 70's as all the boomers were buying up houses like crazy and I was in the service. Home prices rose way out of my reach and there was nothing I could do about it. It works both ways. Now the home I own is worth a sweet chunk of cash but may drop in value some. But it is all relative. If you have to sell your house for less, know also that you will likely be buying for less. In all honesty I think real estate is overvalued right now and is due for a correction. Same as other things do. It is economically healthy. And it has been apparent that it was coming for some time now. At least 2 years IMO. Or would you rather he do what other schmucks do: Buy high, sell low! In any event, watch the market, liquify some assets if you can while biding your time, and BUY LOW baby! |
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Posted: 3/4/2006 1:35:09 AM EDT
[#45]
The housing market is still rocking here in Northen VA & will continue to as long as people keep moving here looking for jobs.
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Posted: 3/4/2006 1:50:56 AM EDT
[#46]
The economy for many people is in the toilet, how can someone buying a home for the first time even afford 350K for a condo when the starting salaries are Walmart styled. I have an opportunity to move to a cheaper housing market and am just waiting for my release date, I would not be able to afford to live where I live now and it is one of those high priced condos, but the neighborhood is changing and with lower incomes people are getting deeper in debt causing quality of life issues. I bought a long time ago, so my economy is frozen to 18 years ago. I don't see any bubble bursting here in SoFla, in fact I see golf courses and cementarys being dug up, there is not one single family home for less than $450K
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Posted: 3/4/2006 2:09:28 AM EDT
[#47]
Tactical-Jew said:
"As goes Kalifornia so goes the nation..." Sorry, that's crap. Funny how this press release came out the very same day that the State of California announced for the first time in 8 years they have a NET POPULATION LOSS. Surveys are showing people leaving because of oppressive laws, oppressive taxes and hyper-inflated housing. NOTE: for all of you living on the coasts, there is about two thousand miles of cheap housing in- between the California and New England/Florida. Our prices are reasonable, and they are based on the cost of labor, energy and materials...you know, real market principles. P.S. Texas gains two more seats in the Congress next Census. If they don't count the illegals (I know, wishful thinking) California could actually lose one! |
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Posted: 3/4/2006 2:30:33 AM EDT
[#48]
Oy.
My boyfriend is selling his one-bedroom condo here and just bought a 2-bedroom condo. We're in Old Town Alexandria and Arlington. He purchased his condo for $290k and is trying to sell it for $339k. He purchased the 2-bedroom condo for about $50k less than the original asking price. It has been on the market for about 8 months, if I recall correctly. |
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Posted: 3/4/2006 6:20:07 AM EDT
[#49]
That's one of the problems with people buying their first property: unrealstic goals. Too many first time buyers have their hearts set on something well beyond their means, so they actucally can't afford something they want. Here's a simple way to do it: buy something you CAN afford in a nice area. It may not be your dream home, but few of us live in our dream homes. You have to start somewhere and have to live somewhere, you should buy something and put your hard earned money into it where you'll see returns for your effort (tax deductions, equity, etc), instead of waiting for the market to "burst" while wasting money in rent. When the time is right, sell it and take the equity to buy something nicer and bigger, always moving towards your dream home. My first condo: $190K, sold it in a year and got a $300K condo, two years later I sold it and moved into a $620K condo (bought as investment 3 months after I got the $300K unit), meanwhile I also acquired two investment properties. The place I'm in now is worth close to $1M, in another year or so MAYBE I can buy and furnish the home I really want. I hear a prediction that a large perncetage of the next generation (our children) will be in the rental class, and can't afford to buy their own homes until 45 or 50 something. Housing prices have climbed far higher and faster than most people's income, do the math and you'll see the wisdom of getting in the market as soon as possible. |
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Posted: 3/4/2006 6:22:16 AM EDT
[#50]
That's what they call underwriting. The risk spreads among us all. |
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