Sunday, August 06, 2006
Traveling To Bubblicious Southern California
It travel time for me! I am off to bubblicious southern California. I am really excited to go as I'll be able to see the extreme bubbliciousness that makes it a bubble market. After southern California, I am off to the windy city for a few days. I'll be gone from Sunday August 6 till the 14th. During that time, posts will be infrequent. I will be reporting bubble findings while traveling. :-)
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If you want evidence of bubbles in SoCal, the best spot to look is Palmdale/Lancaster desert area. And I live in San Diego!
ReplyDelete"Southern California." About a specific as saying "Eastern Seaboard." I would take two days of driving to just expose yourself to every climate zone we have. LAX to downtown Los Angeles gives about as much SoCal perspective as JFK to Manhattan would about the Adirondacks. Where in Southern California is a critcally important question in relation to your bubble observations.
ReplyDeletejesus christ, let the man go on his f'ing vacation without berating him about his exact location.
ReplyDelete"let the man go"
ReplyDeleteman ?
man-child, at best.
"Where in Southern California is a critcally important question in relation to your bubble observations."
ReplyDeleteSo you're saying that locality is "critically important in relation to"..."bubble observations"?
But, but the bubblehead creed dictates that the retail residental housing market is national in character! Perhaps even international in nature, like the NYSE.
Come on, everyone knows that the median household income and median price for a SFH in suburban Toledo OH are directly related to housing prices in San Diego, CA.
The California housing market is a main indicator of the direction that the national market follows.
ReplyDeleteHas been and always will be.
"Has been and always will be."
ReplyDeleteEven more so now that Arnold is Governor. His actions will directly affect the economies of Peoria, IL and Osh Kosh, WI.
Clear validation of renting as a lifestyle: all the smart money in Dallas-Fort Worth is interested in studio rental apartments:
ReplyDeleteRental demand up in D-FW
Rental demand is expected to rise throughout the summer, according to a report by Rent.com.
Apartment rental rates already have risen 4 percent higher in the first quarter of 2006 compared to the same period last year, the report said.
According to Rent.com data, the most searched-for rental unit in Dallas-Fort Worth is the studio, making up 66.4 percent of all apartment rental searches on Rent.com.
The average reported monthly rent in Dallas-Fort Worth was $679 during the first quarter of 2006.
http://www.bizjournals.com/dallas/stories/2006/07/31/daily21.html
Apartment rents heading higher in '06
ReplyDeleteForecasts show biggest jump since 2000 as buying homes becomes harder; increased demand stems from higher mortgage rates, home prices.
"It's going to be a broad-based increase in rents, not just limited to a few markets," Hessam Nadji, who manages research for Marcus & Millichap, a real estate firm in Northern California, told the newspaper. "Renters are already facing higher energy prices and relatively moderate wage growth. This is going to really squeeze a lot of households."
http://money.cnn.com/2006/05/30/real_estate/rents/index.htm
All across Tempe, apartment rental rates are on the rise - and the trend doesn't seem to be slowing down any time soon.
ReplyDelete"As fewer and fewer people are able to purchase homes, we are really seeing rental rates go up," said Kent Gagon of First USA Realty.
All across Tempe, apartment rental rates are on the rise - and the trend doesn't seem to be slowing down any time soon.
All across Tempe, apartment rental rates are on the rise - and the trend doesn't seem to be slowing down any time soon.
All across Tempe, apartment rental rates are on the rise - and the trend doesn't seem to be slowing down any time soon.
http://www.asuwebdevil.com/issues/2006/08/01/news/697184
David,
ReplyDeleteWelcome to my neck of the woods. I'd like to meet you. However, I could only really take time off on Tuesday. But that assumes you're somewhere near LAX...
As to where to look... San Diego, Irvine, Palmdale/Lancaster are indeed mega bubble markets. But I know a coworker is shocked that his "prime West Hollywood" condo building has a half dozen units for sale... And Redondo beach is filling up with for sale signs...
The bubble is indeed national. But some areas are showing it more than others.
Unfortunately, my beloved So-Cal is about to get an economic spanking. Hollywood has cut production ~50%, aerospace is getting ready for layoffs, banking is laying off... and soon so will the builders, appraisal offices, etc. Next to go will be the ad agencies and other white collar work that needs a strong economy to justify keeping the work here in LA.
Neil
Wow, with all those rents going up, then I guess the smart money should buy REITs instead of houses.
ReplyDeleteLet's all get together for bubble poping at Mccormick and Schmicks near land of $1M 5000 sq ft lots called Manhattan Beach. Full of rich kids making Movies and Deals.
ReplyDeleteLocation and Map: http://www.mccormickandschmicks.com/index.cfm?fuseaction=content.display&pageid=96&id=42
Their bar menu is a bargin at $1.50 (even affordable w/o a HEL): http://www.mccormickandschmicks.com/media/Bar_Menu.pdf
Pick a date. 10 minutes from LAX.
Where is all this blather coming from about nationally rising rents? They're not rising by that much. If anybody is going to make a claim, they should justify it with numbers.
ReplyDeleteAre rents increasing by 25% this year?
15%?
10%?
OK, how about 5%? That would put rents rising barely above inflation, and I think that's more like it.
I'm a renter, and I've kept a close eye on the rental markets. In fact, I am the primary lessee of the home I live in, and I keep at least one other room in the house rented out to a housemate to help pay the rent. I am also in a major bubble market (Orange County, CA). But I don't see my own rental rates increasing much, and I see plenty of places around the neighborhood (gotta knock down the for-sale signs to see the for-rent signs behind them) for rent at quite reasonable rates.
The apartments I track locally have only seen modest rental increases over the last several years, this year included.
I keep in touch with renter family members around the country (most of them in bubble markets) and they have definitely _not_ reported large increases in rents.
If anything, I suspect "asking" rental prices may be going up, but that's only bad for those who refuse to negotiate or shop around, or who give up their bargaining power by "falling in love" with a specific place. Or, landlords are attempting to jack up rents on reliable tenants to see how much of a sucker they have. Let me tell you this: set a price you are willing to pay for rent, and if the landlord wishes to exceed this value, tell him/her you will leave at that level. Regain your bargaining power and you will prevail. It works, I know. Look around, there's plenty of rentals available. And many of the rental prices are negotiable. Don't be afraid to bargain!
Does anyone know how rents are tracked, anyway? Do they do it by asking price - or is there another way. The census does it, I think, by asking renters how much they pay.
ReplyDeleteSales are public record, right? WHat about rent?
BTW, I rent and had a $20 increase in spring '05 but flat since then.
Rent increases are 40% of the inflation numbers. Fed funds rate will continue to rise as rents do. Bye bye bubble.
ReplyDeleteRent increases are 40% of the inflation numbers.
ReplyDeleteHuh? Explain please.
And i would have to agree that i am not seeing it - my landlord raises by 3% each year...
"Huh? Explain please."
ReplyDeleteWhat he/she means is rent prices (including owner-equivalent rent) make up 40% of the price index that's used to calculate core inflation by the Fed. For example, if rents increase 10% in a year, and all other prices remain constant, this results in a 4% inflation value.
I am really excited to go as I'll be able to see the extreme bubbliciousness that makes it a bubble market.
ReplyDeleteAre you going to Chicago to see if the Sears Tower really exists?
During that time, posts will be infrequent.
Oh no! Just kidding, have a safe trip and no matter what people say "In and Out Burger" blows.
Welcome to Bubblewood ;-). I'm a real estate agent here so let me know if you want a tour of Bubbleland.
ReplyDeleteRichard Johnston
REMAX ESTATES
http://www.estates.la
Being a Chicago guy I'll be waiting to hear your impressions of the Chicago market when you get back.
ReplyDeleteDavid is a 20-something who rents a group house with some of his pals. His pals are probably some of the more argumentative bubbleheads on this blog.
ReplyDeleteThe fact that he set up a blog does not make him expert in either economics or real estate. YOU can set up a blog here in less than five minutes. Topic du Jour? Rising energy costs.
Set up a blog about rising energy costs, and I'll stop by to ask you all about your impressions of rising energy costs ('cause your blog makes you an expert)
Dick Johnson, your name is the best!
ReplyDeleteKudos to your parents (seriously; cool name :)
Anon at 6:40 am --
ReplyDeleteIf this blog is so worthless, why are you up first thing in the morning reading & posting on it?
David --
Thanks for a great blog & enjoy the trip. Chicago is a great city. I recommend Al's for italian style roast beef.
Because I'm a chroniclly depressed individual, and I seek out dark corners of the world to sate (or feed?) my disfunction.
ReplyDeleteDavid,
ReplyDeleteYou do sound like a 14yr old girl.
Well, let's see, David announces that he is going on vacation & gets several anonymous rips and an insult from a regular poster who manages to run a real estate empire while posting every day on every thread. I expect Lance to chime in with advice that David should have a private jet share, which financially is far better than flying with all those bitter passengers.
ReplyDeleteanon 10:19,
ReplyDeleteI've been away for 5 days. I guess i wasn't missed.
If you want to defend David's level of maturity, have at it.
i'd be willing to bet that we'll see less and less of Lance as the bubble blows wide open!!!
ReplyDeleteHi investor, welcome back. Now that you are rested, I assume you can resume your 12-hour days monitoring this blog.
ReplyDeleteAnyway, thanks for proving my point with your prompt reply.
It's David's blog & he can defend himself. I am still curious as to why posters who not only disagree with the premise of this blog but obviously disrespect his ability (viz 14 year old girl comment) are so concerned as to what goes on here?
anon 10:47/ david's roomate,
ReplyDeleteJust re-read is post. I rest my case.
I do not come on here to listen to anything David has to say. There are a few who can contribute to my knowledge. David is not one of them.
I wouldn't purchase apartment reits because they are overpriced and are returning about 4 percent.
ReplyDeleteBut David can come to Reno, NV and I will show him all the padlocked houses in preferred areas. We are dead in the water, so to speak, with 6000+ houses for sale and less than 500k people, including Carson City.
Bubble is national, as witness by foreclosures in Texas where there was not a huge appreciation. But those folks don't make a lot and were using arms anyway. Bubble is a national credit bubble spawned by an irresponsible fed. I am concerned about the economy, especially since 43 percent of jobs created by the in the dark Bush admin are connected to real estate in some way.
Re-read my post. And the "David's roomate comment" is about at the level of a 12 year old girl. Going for a new record of posts per day?
ReplyDeleteI wish i were twelve again.
ReplyDeleteI like to use :) when I write casual email. Typically when I'm joking, amused, or trying to soften something I've written.
ReplyDeleteI too can't help but feel that it's a tad feminine sometimes. :)
My $0.02.
yes
ReplyDeleteLots of bitter desperate realtors posting here lately. I guess they are worried that bubbleheads will talk the market down and the realtors will have to back to their old jobs bussing tables and working at quick stop.
ReplyDeleteJuan Carlos,
ReplyDeleteYes, I lose sleep over my fear that bubbleheads will talk down the real estate market.
Well you're at it, could you also talk down mortgage rates. Maybe you talk down my wireless plan costs too. My GE and C stock hasn't gone up lately, so if you have some time after talking down the real estate market, could you perhaps talk up GE and C?
Thanks bubbleheads. We're all depending on you, so don't abuse your power to control markets.
va_investor said...
ReplyDelete"I wish i were twelve again."
Congratulations. I think you made it.
Va Investor-
ReplyDeletePUT DOWN THE BOTTLE! LOL
Thanks for the lunch offers. I do need to retain my anonimyty (sp?)
ReplyDeleteHopefully, I'll post later today.
"I do need to retain my anonimyty (sp?)"
ReplyDeleteBecause direct, unvarnished conversation will make David cry.