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Bubble Meter is a national housing bubble blog dedicated to tracking the continuing decline of the housing bubble throughout the USA. It is a long and slow decline. Housing prices were simply unsustainable. National housing bubble coverage. Please join in the discussion.
the bubble has treated me well - just sold my place in DC for 50,000 over the asking prices and got 7 offers. While everyone on this board is rooting for the crash - I will be laughing all the way to the bank. The market is still strong in DC my friends - you just can't expect 20% price increases each year - if you can accept 5-10% then there is still money to be made.
ReplyDeletelol. Keeping drinking the kool aid. In 2006 we will see real dollar price decline of 5 to 10% in the DC area.
ReplyDeleteSo what if prices drop? Did you laugh when the stock market fell? How about massive layoffs? All pretty funny stuff. What is your point?
ReplyDeleteAre you advocating renting as a sound financial plan? You and alot of others (both bulls and bears) are too focused on a snapshot in time and have no long-term vision.
I am against speculative espisodes.
ReplyDeleteThere are two purposes of this blog:
1) Too fight the housing bubble. I am an economic activist. Informing people of the speculative nature of the housing bubble. The housing bubble is negatively effecting the long term health of the US economy.
2) It is a fascinating topic.
So why did you sell. Why not just accept that 5-10%. Also, why are you on a housing bubble site, Worried?
ReplyDeleteanon 10:09:
ReplyDeleteIf you have such a long term vision, why did you sell and for just $50K?
i sold because i am moving to another city - and no I didn't sell it for $50K - I sold it for $50K over my asking price.
ReplyDeletemy point is while everyone here is waiting on the bubble to pop - there is money to be made. My point was also to show that the market in DC is alive and well. It ain't insane like years past - but good properties in good areas are still appreciating.
my point is while everyone here is waiting on the bubble to pop - there is money to be made. My point was also to show that the market in DC is alive and well. It ain't insane like years past - but good properties in good areas are still appreciating.
ReplyDeleteFacts:
Every day inventory is rising dramatically.
HousingTracker is showing that the past 4 months asking prices have gone down 10k a month.
Renting in the D.C. area and investing the extra money is a better deal when prices are falling.
My monthly rent is less than what friends in the Dulles area pay for heating/gas/driving. My commute on the train is 15 minutes a day. A lot of people drive 2 hours a day.
ReplyDeleteTime is money and that adds up. All the money I save will go straight to principal when I do buy a house.
I bought a house in DC three years ago for 240K - rehabbed from top to bottom for 60K and just solid it for over 550K. You guys can keep renting - all I know is that I made over 200K after expenses while you guys were renting and waiting for the prices to go down. Let's say that you save 2K a month renting over buying - you would have really had to have a kick butt stock portfolio to match what I made on my house. It makes little sense to try and time the market - it has been proven that the markets are irrational and do not always follow common sense.
ReplyDeleteyou would have really had to have a kick butt stock portfolio to match what I made on my house.
ReplyDeleteYou made a lot of money in real estate during the past 5 years and prices are going to keep going up. lame.
I haven't seen much discussion on how the affordability of a house in America will effect America's economic status in the long term.
ReplyDeleteHouses in India and China cost a fraction of what they cost here and IBM, JP Morgan and other's are hiring thousands of workers abroad a day party because of this.
Look out for the new cars coming from China.
Making 200k in the past 5 years on real estate and believing prices will continue to rise is not "lame".
ReplyDeleteBasing your opinion on future real estate values using a small window in time is lame. You are attempting to market time. Long term, owning your home free and clear at retirement is the most prudent plan you can have.
If you are afraid to take the plunge--then don't. But please stop whining about the prices. Real estate is cyclical. Wait if you think you can time it. Good luck.
So what if prices drop? Did you laugh when the stock market fell? How about massive layoffs? All pretty funny stuff. What is your point?
ReplyDeleteOf course I laugh. Because I am evil. Your pain will be my enjoyment.
I truly miss 2001 in Silly Valley when I could easily get a table at restaurants.
you would have really had to have a kick butt stock portfolio to match what I made on my house.
ReplyDeleteHow much did you make? Let's say 1M. It certainly does not take a "kick butt" stock portfolio to beat.
owning a home "free and clear" when you retire may appear to save you a large monthly expense (rent/mortgage), but you fail to add up the taxes, insurance, and especially maintenance and repairs which will only go up as the house ages. ask my mom. "OK, I fixed the water damage in your drywall. That'll be $5,000. Oh yeah, and you need a new roof too". whee. just the kind of thing I wanna deal with when I'm her age.
ReplyDeletescrew that. I'm letting my landlord fix things and pay the taxes and insurance. feh. "American Dream" my ass. and the next idiot who tells me I'm throwing my money away on rent is gonna get it. never assume you'll have equity. ask Miami and Vegas flippers about that this time next year.
If that anon person was so sure of himself he wouldn't be here defending himself or putting others down. More and more of these folks are coming on to the blogs now. They must be getting scared.
ReplyDeleteAnd who ever said we bubbleheads were timing the market?
About timing the market....
ReplyDeleteInventory is up...WAY UP. nvar.com seems to have stopped publishing marketing data and I have my own 'secret' site that I don't want to disclose for fear they will stop publishing numbers. But's it's telling me that January inventory is 400% higher than inventory in the summer. That's crazy. What's even crazier is to not take this into consideration when choosing WHEN TO BUY.
I meant nvar.com seems to have stopped publishing Summary data...I'm still waiting for December Summary data
ReplyDeleteDavid...
ReplyDeleteYour post seems to say that you believe owning a free and clear house will cost the same as renting (due to taxes, ins., maint, etc.). This makes no sense whatsoever. Why would rentals even EXIST if landlords (large and small) weren't making any return.
Tell mom to downsize to a maintenance free condo and bank the rest of her equity (probably 50% - or, hundreds of thousands) to pay the taxes, ins. condo fees etc. Renters will never have this option.
You are kidding yourself if you think most people save and invest their rent "savings" for retirement. What comes in - goes out. A mortgage is forced savings and I don't think this is a bad thing.
I'd like to point out that there are two David's on this board. Confusing? heh.
ReplyDelete"A mortgage is forced savings and I don't think this is a bad thing.
"
Yep. Tangental: Buying in the bubble markets does not make sense.
David
ReplyDeleteYou totally fail to address my point. By the way, why did you not buy before the supposed Bubble?
[I am a new 'anon', not the previously posted ones]
ReplyDeleteThis is my first time posting. Concerning the first anon who implies bubbleheads are wasting their time (and rent)... he/she sounds like a typical stock board troll. Keeps pushing the agenda of the mortgage companies and RE people on a board that threatens that agenda. Smells like desperation.
FYI, I rent a very decent 3br/2ba ranch in San Diego 6 blocks from the beach and 8 miles from work (mucho savings in gas) for $1700 a month. It would cost me around $4000 a month for a mortgage on the same place (which I have no hope of affording) and I don't see how many more 'average' people could afford this either, so how can prices keep going up indefinately? What happens when the ARMS and Zero Int loans convert? What happens when hundreds of thousands of people can't 'afford' their properties that have quit appreciating? (i.e. can't flip them for a profit, much less just get out of the deal).
Not preaching doom and gloom here, just looking at reality.
"Let's say that you save 2K a month renting over buying - you would have really had to have a kick butt stock portfolio to match what I made on my house. It makes little sense to try and time the market - it has been proven that the markets are irrational and do not always follow common sense."
ReplyDeleteYour right, if I could go back to 2001 and buy a house, it would be a good decision. But the time machine is not working, so I have to work with todays fundamentals. Any one who would tell you investing in DC metro area real estate is a good decision now, obviously has some property to sell to you or a commission to earn.
New Anon...
ReplyDeleteI am not desperate or pushing any agenda. I firmly believe in the financial importance of homeownership- always have. I bought my first house at 22 and had three by 25. I love realestate. My goal was to have enough properties by age 30 that I could stop working (as a Real Estate lawyer) and start a family, never go back to "work" and make a good living doing what I enoyed.
Flash forward to age 47. Huge financial success from real estate. I am self-taught and, most importantly, have a passion for it. Not everyone's cup of tea, I realize.
I post on this board ,occasionally ,in an attempt to broaden the discussion. I fear that some people will be frightened enough by what they read here to avoid homeownership.
I really don't have any dog in this race - so to speak. I am not selling any of my 15 properties. I don't have a 1yr or 5yr or 10yr outlook. Again, if you can time the market - go for it. If you believe renting over a lifetime is the best financial path- go for it.
I, personally, would not look to a 25 year-old with no experience for advice.
ReplyDeleteI really don't have any dog in this race - so to speak.
Do you have kids? Do you want their country to be able to compete when the cost of living is 10 times what it is in India and China?
Old annon,
ReplyDelete"Huge financial success from real estate."
Sure you are, sure you have. People with such success don't feel the need to brag about it to try and earn credibility on a blogg.
"I post on this board ,occasionally ,in an attempt to broaden the discussion. I fear that some people will be frightened enough by what they read here to avoid homeownership."
In what way has what you said broaden this discussion? Seems like the same old Realtor speak to me.
"I, personally, would not look to a 25 year-old with no experience for advice."
This is your most narrow minded statement yet. Being older than 25 my self I have learned plenty from people much younger.
Now why not stop talking about what you did in the past, and enlighten us on your future investment strategies.
Please tell me when the rules changed for real estate investment? Why it is now a good idea to pay twice as much to purchase a property then it would rent for?
I bet I could find a 10 year old with a caculator that could figure out why it is not a good idea.
[from 'New Anon']
ReplyDeleteI'm not trying to antagonize you personally, I do see your point, but while you say you don't "have a dog in this race", the small fortune in real estate you've accumulated contradicts that statement. You, in fact, have at least 15 dogs in the race, not to include your career as a RE Lawyer, which I would guess ebbs and flows with the market itself.
I understand the mentality, no one (especially the bulls) wants to see the stream dry up, but when the fundamentals don't add up to justify conditions, how does one keep cheering it on? I know hope springs eternal, but I think reality will win in the long run.
To all Anons from old.
ReplyDeleteI don't have a dog in this race (sorry- hunt) because my properties are all paid for or positive cash flow. No need or desire to sell. If I have to manage them for 10 years for no appreciation - so be it. That time period will pay off all the rest of the mortages, Compensation enough for me.
I do have a child, and thanks to my investment choices
we will not have to tap his college fund no matter where he decides to go. I can even give him a house. Maybe it is not good to "spoil" your children, but he wants to be a school teacher and probably won't be able to afford to buy.
Please bear in mind (no pun intended) that I have been in the real estate market for 25 years - and, no, as was posted by another, I have not practiced law for the past 15 years. Real Estate is my focus - as an investor- and these are the credentials that I bring to the table.
I'm a new anon, though have been coming to this blog for awhile and posting too.
ReplyDeleteIn a nutshell, I am a firm believer in Metro DC RE (well, at lease in and near the beltway). I bought beautiful properties in downtown DC a couple of years ago and I must say its the best investment I made, period. Sure, there are pessimists out there that talk of a bubble, but I'll be financially sound for more than a couple of years (forget the equity and HELOCs, I've got cash up the ying-yang to cover my RE). And if you walk around DC, you might see that people love being here and that lots of people are bullish on DC period.
Of course, there are ARM and Interest only loan people out there that might be squeezed, but I feel that RE is solid in this area because I have been easily increasing my rental rates yearly and there are enough transients (do you know how many capitol hill, university, non-profit associations, interns, etc. have people coming in and out on a yearly basis?) around to keep paying my mortgages for centuries. Some people might get squeezed, but if you buy in the right neighborhood and at an attractive price, its tons better than renting.
All you people who rent- haven't you ever had your rent increased yearly? Short of an anamoly or period of downturn, rental rates keep going up. That's why there are tons of landlords out there like me who love you renters- some of you who are sometimes too lazy to move that you don't even argue at 10-15% increase (okay, not all of you, but enough).
can you smell the fear?
ReplyDeletekeep all the buy now..it always goes up coming ;)
I could swear the MLS inventory for NVa has gone up 500 houses in just 2 days.
ReplyDeleteAnyone else notice this?
Is this blog about "flipping" or owning? You see, they are not the same thing.
ReplyDeletethis blog is about a housing bubble
ReplyDeleteMike....
ReplyDeleteIt is very easy to flip a house without owning it. Too time consuming to explain it here. Read some books.
At some point the flipping has to stop and someone has to 'own'.
ReplyDeleteIOW, they either accept it as a long term investment (if they can afford too)s, or else they cannot. I don't know the numbers, but I will make a guess and say too many people will fall into the latter group.
The buck will stop in someone's lap. Many, many laps.
Mike...
ReplyDeleteI started reading and learning about real estate when I was 22 years old. 25 years later i still read "real estate mail bag" and "Housing Counsel" every saturday in the Post. I know most of the answers, but pick up something every now and then. As I said, real estate is my passion so my routine probably doesn't apply to most.
As for late night infomercials - not a bad MOTIVATOR for some, but basically crap.
By the way, one of the first books we read was called "Nothing Down" because we had nothing to put down.
Mike....
ReplyDeleteYou asked and I told. Of course I'm serious. I don't lie. We even gave that book (nothing down) to my husband's siblings that year.
Some might be taking chips off the table but when I factor in transaction costs and tax liability - better for me to stay in. Also remember that you have to reinvest the money somewhere. Frankly, I am not too comfortable with stocks.
As I have said over and over I am not a short=term holder of real estate.
Mike...
ReplyDeleteYou and I are talking apples and oranges. I have a large rental portfolio and you are a renter. Two completely different situations.
Mike - why do you refuse to say where you are coming from? How can anyone possibly listen to your advice. If you own property - say so. If you rent - say so.
ReplyDeleteMike - Hard as it may be for you to stomach, everything I have said is the truth. Not only am I not a realtor, I would not take advice from 98% of them.
ReplyDeleteStill don't know your qualifications that would give any credence to a word you write.
exactly how do you know the qualifications of any one on an anonymous blog?
ReplyDeleteAnonymous...
ReplyDeleteTruth is, you can't ever know 100% the truth of what anyone says. Read the posts and evaluate the best you can. I don't lie, but obviously that is just my "word" which, I guess, is valueless in this new medium>