Thursday, November 30, 2006

How Much Influence Do The Housing Bubble Bloggers Have?

Responding to my post about how the National Association of Realtors was way off in their Sarasota - Bradenton report, one of my regular commentators, Lance, commented blamed the bloggers for the price correction:
As the whole idea of blogs is so new, it's doubtful that Lereah's calculations would have taken into account the drops in value incited by these "panic-inciting" blogs.

Like someone yelling FIRE! in a crowded theater, the blogs are sure to have an effect ... Albeit a temporary one as people realize the predictions are based on falsehoods.
Prices have dropped not because of some blogger 'incited' panic, but rather because in the bubble markets prices have become divorced from the fundamentals (price to rent ratio, income etc). It is flattering to think us housing bubble bloggers have that much power. Many of us housing bubble bloggers have received a bit of mainstream press.

Yes, we are a having a small effect and we made the housing decline start just a bit sooner. But, the bubbliciousness was unsustainable and was inevitably going to burst due to its own absurdity.

58 comments:

  1. Blogs does not have, never have had, and will never have any significant effect on housing prices.

    It is delusional to believe that blogs have anything to do with the housing market correction.

    The current price correction is caused by interest rate hikes, affordability issues, and related psychology.

    ReplyDelete
  2. If it wasn't for the bubble and economy blogs I would be sitting on a resetting ARM in northern VA, for a house that is now worth less than I paid for it.

    Real Estate Agents are panicked, and home owners think things will turn around in the spring. Just wait to see what will happen to the market come May, its only going to get worse...

    Its a great time to rent, brand new 5 Br. homes for less than $1700/mo. Try and tell me how that owning that overpriced home is better than renting in this market.

    ReplyDelete
  3. David, I hold you, Ben and Patrick
    personally responsible for this mess we are facing...If it werent for you guys, realestate would be up another 25% this year.

    ReplyDelete
  4. Woohoo! You KNOW the bubble has fully burst when the biggest cheerleaders on the way up start blaming the adults for telling the truth about it once it starts down.

    Go back and read what the "Really, it's different this time." Internet-era bubble folks said when rational and sane people pointed out that businesses with no cash flow or profits and no legitimate plans to get them weren't worth bubble prices.

    Same shit, different bubble. Desperation time is coming, and soon.

    ReplyDelete
  5. Just an fyi, there's nothing wrong with yelling Fire in a crowded theater if there actually IS A FIRE!

    ReplyDelete
  6. Don't let Lance get to you. He's a troll.

    ReplyDelete
  7. Ignoring for the moment that it is a poor analogy, yelling FIRE! in a crowded theater is a good idea when there actually is a fire.

    ReplyDelete
  8. Lance is still around?!?

    I thought he'd be in a fetal position sucking on his thumb.

    Lance, PLEASE tell us you'll be posting in the spring when the wheels come off and this gravy train falls off a cliff. (Enough metaphors for you?)

    ReplyDelete
  9. Isn't Lance just the DC version of David Lereah?

    Has Lance ever admitted to anything being wrong with the housing market?

    Why would Lance spend countless hours trying to protest everything we say?

    If Lance put up a cheerleading housing blog, would anyone read it?

    ReplyDelete
  10. And one more thing Lance... it's not Harry homebuyer that's reading these blogs. I read my server logs for voyeuristic fun, and it's mainly real estate agents, industry watchers and investment types that are reading these blogs. I've seen everyone from the Federal Reserve Board to Banks in Japan in my logs. And, if you were to stand outside Walmart in Southern Maryland and take a poll of who's ever heard of my blog, or better yet, ever read it, the number of people answering yes wouldn't move a couple fingers on one of your hands if you were using them as counting devices...

    There's really a simple explanation for your housing market going to hell Lance... you've exceeded the buying power of the middle class, and totally priced out the first time homebuyers that allow the middle class to move up. Neither God, or more exotic financing can save you now!

    ReplyDelete
  11. David,

    You just don't know your power. Don't you know your blog was able to:

    1. Get Ford employees to accept a buyout for 38,000 hourly workers (45% of the workforce).
    2. Cause the Midwest purchasing index to drop below 50 (indicating economic contraction)
    http://biz.yahoo.com/ap/061130/wall_street.html?.v=15
    3. Create 47 months of inventory in Palm Beach county.
    4. That 18% drop in Sarasota.
    5. 7 months of home inventory in California.


    It couldn't possibly have anything to do with mortgage payments are at a record fraction of income? Naaa... People couldn't be in financial distress due to overbuying, speculation, or HELOCs...

    Its got to be blogs and our influence over the media. ;)

    Neil

    ReplyDelete
  12. Flattering idea...Do you think if we close our eyes really tight and twinkle our nose twice we could change the world's economy. Let's all plan to meet at 9 am tomorrow and try.

    What an idiot!!

    ReplyDelete
  13. Source: Freddie Mac "Mortgage applications for home purchase in November have remained healthy, due largely because of the drop in mortgage rates and a softening in home prices in some areas."

    ReplyDelete
  14. Lance needs to realize that it cuts both ways. If hype on blogs can cause the value of real estate to fall below a reasonable level, then media hype over the past five years could equally have caused real estate to increase above a reasonable level.

    Who's right? That's the rub.

    Term_X

    ReplyDelete
  15. The blogs surely have an effect, but fundamentals are out of whack.

    In the past, there was no one to stand up and tell people. Yes, someone standing up telling everyone fundamentals are out of whack has an effect, but bloggers only point out the obvious truth to those too blinded by greed to see it or admit to it(Lance, REIC).

    ReplyDelete
  16. My new theory:

    How to tell a townhouse neighborhood that is owned by people over their heads.

    Check how many have the optional deck built.

    ReplyDelete
  17. Lance said...
    “As the whole idea of blogs is so new, it's doubtful that Lereah's calculations would have taken into account the drops in value incited by these "panic-inciting" blogs.”

    Everyone, please send robert Ten dollars least he smite thee!

    If this blog is as powerful as Lance indicates, I’ll be a billionaire by Christmas.

    ReplyDelete
  18. from Ben @ O-side

    Well if these blogs did have an influence (which I don't personally believe), it would only show how fragile and precarious the market was anyway.

    ReplyDelete
  19. somebody said: "In the past, there was no one to stand up and tell people."

    And that is the truly great thing about David's and others' blogs. They are an excellent vehicle to spread the truth and to allow for discussion among those who see it differently than the REIC.

    People I've referred to bubble blogs and other great sources of housing data have (almost) literally gotten the Hershey squirts when they realized what was really going on (prices disconnected from fundamentals, prices actually dropping, DOMs way up, inventory way up, builders slashing prices, every other buyer stretching to buy with toxic loans, etc.)

    So for that, I give a big thanks to the Hershey-squirt-inducing bubble blogs. And who knows, it's possible that some of the few remaining perma-bulls are actually pounding down the Imodium A/D's to prevent that symptom as we speak.

    ReplyDelete
  20. The flutter of a butterflies wings can be the catalyst to start a hurricane.
    I ask you though, do readers come here and David gives them a new opinon. Or, do they come here because they have a similar opinion. The latter my friends, the latter.

    ReplyDelete
  21. The only influence of Blogs will be as an adjunct to MSM and to perhaps accelerate what is a normal cycle in real estate. Blogs won't increase or decrease the ultimate result of such a cycle. Instead of a more drawn out period of decline and stagnation, information technology will speed the process.

    The correction will happen quickly and the bottom won't last long. That is my opinion anyway.

    In addition, we may be headed to a lower percentage of home ownership. This would be more acute in the higher priced areas. I would not be surprised to see rates of homeownership trend downward over the next 10 or 20 years.

    ReplyDelete
  22. Give David some credit. He has been mentioned in the Post Express several times. A lot of people read that, and might have checked out the site. I don't know what kind of traffic the site gets.

    Having said that, a few blogs against all the newspapers and news stations and silly "flip this house" shows probably don't amount to much.

    I bet these blogs have been more useful to people like myself and other bubble believers. I have been able to argue with bubble skeptics on these sites, and also hear from fellow bubble believers, and I have rarely heard much that I could believe from the skeptics, whereas some believers have had some very interesting thoughts and anecdotes.

    So I continue to believe there is a bubble, and have had my views reinforced. But I would not have found anything like the debate here in the mainstream media until very recently, when it might have been too late. People who trust the mainstream media and bought a DC area property in mid-late 2005 are basically now Ned Beatty looking down the barrel of that redneck's shotgun, and hearing that banjo twang.

    A Redskins fan

    ReplyDelete
  23. Of course, blogs have had an effect on the change in the housing market. Many buyers are using all the tools available to them to determine as best they can what the market is at any point in time. Yesterday's methods of reading a newspaper or news magazine to understand the direction of the market now take a back seat to electronic communications. I think it does actually contribute to the acceleration of the change, but that is something we will all have to adjust to.
    A buyer

    ReplyDelete
  24. Va_Investor, as usual, you are right on. The only part where we may not be in full agreement is that I believe that with the increased speed of the cycle (as facilitated by blogs and other instant communication), the swing of the pendulum will be higher ... on both ends. I.e., just like prices may have gone a a bit higher than they would have in previous times, they will also drop a bit lower (i.e., why Lereah didn't predict the depth of the average median price fall that we have experience.) But I am in full, full, agreement with you that the bottom won't last long. And THAT is where we are in full disagreement with the BHs who think this is only the beginning. Additionally, you prediction that percentages of homeownership will be lower (especially in high-cost areas like here) falls very much in line with my beliefs that the anomally we witness since the second world war of almost universal home-ownership is quickly receeding. Over the course of history, most people have been renters ... not homeowners.

    ReplyDelete
  25. Lance is PO'ed because he believes so much in the new economy and wants to perpetuate it. The new economy I speek of is emotional economics, or more sisinctly, behavioral economics. If everyone would just constantly believe that prices can go up forever, then the sky's the limit.

    This is nonscence. Reality always intervines.

    ReplyDelete
  26. Wow...
    I agree with lance. The pendulum is swinging faster. I believe the downturn will be short. Perhaps only 30 more months rather than the 6 years of the last downturn.

    But the indicators are still noting a acceleration in the downward trend. Due to the low pass nature of real estate... we have to wait out a cycle or two of foreclosures.

    I'm amused by the house flipping show references... nothing we blog will get 1% of the audience of those shows. :)

    Don't expect a spring bounce, the indicators just aren't there.
    Neil

    ReplyDelete
  27. Lance,
    you and Va_Investor argue "the bottom won't last long". That may very well be true. But it appears that you infer from that statement that we're already *at* or near the bottom. ("we are in full disagreement with the BHs who think this is only the beginning.")

    Is it possible that this *is* only the beginning, that the is 1/3 or 1/4 through, and that when we do hit bottom, it'll go back up quickly?

    -kevin

    ReplyDelete
  28. Wannabuy - Yep, spot on. Faster information will cause the cycle to compress. Hell, Lance may even be right about the overshoot.

    But that just means what was usually a 6-8 cycle will compress to a 3-4 year cycle. And as you say, the fundamentals just aren't there. It doesn't take much to see the household debt overhang, stagnation of 80% of society's incomes, and the Fed quietly pumping massive amounts of short term capital pumping up M3.

    Where Lance goes wrong is seeing the changeover in the economy to handing most of the gains to about 1,000 familes, and extrapolating an entire future based on it. Over simplistic, and ignores way too many variables. In addition, his speculation is usually self-contradicting.

    This is what happens when people with Econ 101 knowledge try and theorize.

    ReplyDelete
  29. I'd love to hear the timeframe Lance has for the market's bottoming out.

    I wonder how thrilled he is to see 3br/2ba townhouses similar to his with 120+ DOMs and 17% reduction in asking price.

    ReplyDelete
  30. We are not a housing peak nor will we see a housing valley. What I believe we have is a housing plateau. I agree with almost every commentator on this blog housing prices have become detached with economic fundamentals in most of the more expensive areas in the US. Here in the SF Bay Area we still have falling sales when interest rates are declining. Talk about an inverted curve. If the market was healthy sales would be picking up in the face of declining borrowing costs but they are not. Prices have become so high even if interest rates were to return to 5.5% there still isn't a big enough pool of people who can afford to buy anymore to resurrect the market. So we have a plateau where prices will decline slowly or remain flat for an extended period of time.

    ReplyDelete
  31. Think about it, The NAR optimal outlook for the last several years, and the scare tactic - buy it now or you may never catch it...

    Like someone yelling FIRE! in a crowded theater, the NAR are sure to have an effect ... (They yell louder than normal people) Albeit a temporary one as people realize the predictions are based on falsehoods.

    ReplyDelete
  32. anon 8:35,

    What's your timeframe for the market bottom? And, to join you in throwing out gratuitous crap, how thrilled are you to have missed the 200% price increases over the past few years?

    ReplyDelete
  33. David, just a slight clarification. I never "blamed" the bloggers for the "price correction." What I said was that because the bloggers either "invented" or at least "widely disseminated" the idea of a bubble to the mainstream media --- who in turn disseminated the idea to the public in general --- that the "pendulum would swing faster and farther." I.e., you say that Lereah's predictions were wrong because he didn't predict as fast or as deep of lowerings in prices. I say that based on the past he it wouldn't have made sense for him to do that. BUT that the bloggers have increased the speed of the flow of information which in turn increases the speed of the pendulum. So, yes the drop will be lower than in the past, but it will also be over quicker than in the past. And, in the end the result will be the same ... i.e., continuing increases in home values after a short interruption ... an interruption which you are a homeowner you probably wouldn't even realize ever happened.

    ReplyDelete
  34. I hope that some broken-hearted bankrupt realtor/specuvestor sues the pants off one of the bubblebloggers. Not because I think the bubbleheads have done wrong, it would be amusing and entertaining.

    ReplyDelete
  35. Lance,
    It is really hard to watch as you now say that all along you have been predicting a normal cyclical downturn in prices. In reality you have said no such thing. In fact you have not even predicted a moderation of rates of appreciation. On 22 June, when asked to predict valuation of a hypothetical Bethesda SFH valued at that time at 500K for three points in the future, you predicted,
    2007- 600K
    2009- 700K
    2016- 1.2m

    So, there it is. Your actual prediction was for 20% appreciation from 2006 to 2007. I'll grant that, since we aren't there yet, this is still possible, though it is starting to look pretty unlikely. Please stop trying to misrepresent your past opinions, it really detracts from the value of any current ones.

    An interested observer.

    ReplyDelete
  36. David,

    There's a very relevant to our discussion article in the Post today.

    The Median Is the Message

    www.washingtonpost.com/wp-dyn/content/article/2006/12/01/AR2006120100018.html

    ReplyDelete
  37. The market here in Norther Virginia and the D.C. area falls under the Crispy Cream category. All hype and lots of underlying economic problems. There was such a whipped up frenzy to by Crispy Cream stock that the hype created a beautiful market, but the company had so many fundamental problems. The accounting practices finally bubbled up and the market for the stock fell apart.

    Krispy Creme stock was trading at $50 a share in mid-2003 it is now trading at $9.43 and had at one time dropped to about $4.5

    Housing prices are gonna fall like the sugar high after a Key Lime Pie Crisy Cream and a Coke.

    ReplyDelete
  38. anon 835 said:
    "I'd love to hear the timeframe Lance has for the market's bottoming out.

    I wonder how thrilled he is to see 3br/2ba townhouses similar to his with 120+ DOMs and 17% reduction in asking price."

    Market will bottom out during the winter months as it always does. With the coming of Spring it will stablize. There may not be much real appreciation then, but prices also won't be dropping. As for my house ... Residential real estate prices in my zip have risen 20%+ since I bought in 2005. They're not rising at the moment, but they're not dropping either. And if you'd really understood any of my posts you'd know that I really don't care whether my home's value goes up, down, or sideways. It all comes down to (a) am I getting out of my home what I want to get out of it on a day to day basis? and (b) can I afford the monthly costs. Homes aren't an investment but an expense, whether you are renting or buying. And over the longrun it is ALWAYS much cheaper to own than to buy. If you are into buying houses as as an investment, then my posts don't apply to you. Investments have to be subject to quick turnarounds when necessary. (I.e.,You need to be willing and able to sell an investment based on strategies related to making money ... and not based on your housing needs.)

    ReplyDelete
  39. Anonymous said...
    "Lance,
    It is really hard to watch as you now say that all along you have been predicting a normal cyclical downturn in prices. In reality you have said no such thing. In fact you have not even predicted a moderation of rates of appreciation. On 22 June, when asked to predict valuation of a hypothetical Bethesda SFH valued at that time at 500K for three points in the future, you predicted,
    2007- 600K
    2009- 700K
    2016- 1.2m

    So, there it is. Your actual prediction was for 20% appreciation from 2006 to 2007. I'll grant that, since we aren't there yet, this is still possible, though it is starting to look pretty unlikely. Please stop trying to misrepresent your past opinions, it really detracts from the value of any current ones.

    An interested observer."

    You conveniently forgot to mention that we were talking about properties that had dropped in price from something like $550K to $500K ... and my prediction of $600K was reflecting a return to normal apprection (from the $550K) after the bottom had played itself out ... i.e., after the swing of the pendulum pushed hard by irrational fears had swung back to normal.

    ReplyDelete
  40. Interesting story in the post.

    Borrowing From A Mom and Pop
    By Martha M. Hamilton
    Sunday, December 3, 2006; Page F01

    www.washingtonpost.com/wp-dyn/content/article/2006/12/02/AR2006120200086.html

    In many societies around the globe, this is how one's first home is bought. Not co-incidentally, in these societies homeownership is not widespread ... and not for the average person. As I've asked before, I'll ask again. Are the recent, almost incomprehensible, house price increases of the last 10 years really solely due to the big bad real estate industry folks? ... or are they possibly reflecting more basic and fundamental economic shifts occuring here that are bringing us more in line with the rest of the world?

    ReplyDelete
  41. Lance,

    I think it's fine and dandy that the couple in the article had parents fortunate enough to get them out of this particular bind, but the fact remains that they chose to "leverage" themselves into a hole. They admit to this in the article. Why don't people buy what they can afford and go from there. So, Lance, I guess your position is that we'll all be going back to the days of extended families where entire groups of folks had to pitch in to buy a home. (I realize a lot of people are currently already doing this) I hope not..but then some other people might enjoy the nostalgia of such a proposition. I suppose those who don't have well off parents who they can borrow money from will remain renters and shame on them for being born to middle income earning folks. Sarcasm aside...how do you believe the inherent decrease in ownership will affect the economy? A reduction in ownership means less people pulling out equity for purchases..et cetera et cetera...

    ReplyDelete
  42. I think the blogs help people understand what is going on out there. I am trying to help speed up the process, by letting californians know I don't want them coming to my town anymore.If you want to take part stick one of these on your car.
    http://www.cafepress.com/nomoreoutsiders

    ReplyDelete
  43. Lance said...
    “i.e., after the swing of the pendulum pushed hard by irrational fears had swung back to normal.”

    You continue to suggest that this is a “normal” real estate cycle, and by normal, I assume you’re looking at historical data. Historically, this swing has been huge. So, are you calling for drastic price cuts? Or, are you redefining “normal”?

    http://www.bubblepic.com/displayimage.php?album=9&pos=4

    ReplyDelete
  44. Robert,

    Look at your own chart ... the one you keep bringing out ... and you'll see there have been other periods shown on that chart where prices have increased dramatically and NOT gone back done. And THAT is normal.

    ReplyDelete
  45. OrginalDCer said:
    " A reduction in ownership means less people pulling out equity for purchases..et cetera et cetera..."

    Why? Just because wealth (and home equity) is concentrated in fewer hands doesn't mean it doesn't get spent spent, re-invested, etc. at the same (or higher) levels. In case you missed it, my point is that BHs keep taking it as an assumption that until all median income households can purhase a median priced home, then the market is not in equilibrium. I ask why? Aren't markets elsewhere in the world where there is little home ownership by median income earners in equilibrium? I'm not saying this is a good thing. I don't think it is. I'm only pointing out that one of the BH's main arguments for falling prices --- that prices must fall for the market to return to equilibrium --- isn't a valid one.

    ReplyDelete
  46. Borrowing From A Mom and Pop
    By Martha M. Hamilton
    Sunday, December 3, 2006; Page F01
    www.washingtonpost.com/wp-dyn/content/article/2006/12/02/AR2006120200086.html

    “Two years ago, they found a four-bedroom, 2 1/2 -bath brick Colonial far enough out in the suburbs of Boston to be affordable, though just barely. "The only way we could break into the market as a young family was to leverage ourselves to the hilt," said Tom, who grew up in Silver Spring.”
    “And leverage themselves they did, with mortgage payments fixed for seven years and an adjustable-rate home-equity line. Affordable at first, the equity-line payments more than doubled as interest rates went up, straining the young couple's resources.”

    Anyone care to guess what that four-bedroom, 2 1/2 -bath brick Colonial might be worth nowadays?

    http://business.bostonherald.com/realestateNews/view.bg?articleid=169540

    ReplyDelete
  47. I love Lance...and a correction, it isn't even Econ 101 he spews. Its actually a self-contradictory mess.

    Some Lance classics...

    Rental vs Buying cost variance.

    1. The difference will be made up by a HUGE increase in costs. Look at the condo conversions! Rental units are vanishing!

    2. Condo costs will be mitigated by reversal of condo conversions, and conversion of late condo developments into rentals, reducing inventory.

    3. People will rent units rather than sell.

    4. See #1. Repeat.

    Affordability.

    1. The economy is changing! Some folks are just priced out. Look at other countries...we're just moving to their model! Relatively few people can afford to buy in other countries.

    2. Prices will stabilize. 70% of Americans own homes....American want to own homes! They'll rush back in!

    Give Lance his due. It's not easy to keep utterly contradictory views in one's brain and argue both sides.

    ReplyDelete
  48. Anon 7:08, It looks like you are having great difficulty differenciating between what I actually said and what you have read into what I've said. Don't feel bad though, that is a common trait I've noticed here among the BH's. You come into this discussion with such pre-conceptions about the big bad real estate industry people and the coming depression, that you really can't understand what the rest of us are saying. It's like your religious mantra blinds you from understanding the message ... and you can do no more than take words out of context (as your example above shows) and paste them back together in such ways that just don't make sense. Robert takes this even a step further ... After doing exactly as you have done, he then shifts the argument in mid-stream and quotes things you've said about one issue and says they were about a totally different issue ... interspersing the whole argument with his own assumptions. It's no wonder you guys are still trying to "time" a home purchase. I'd be doing the same if I had such great diffulty keeping conversations and issues straight as you all apparently do.

    ReplyDelete
  49. Lance said...
    Robert,

    "Look at your own chart ... the one you keep bringing out ... and you'll see there have been other periods shown on that chart where prices have increased dramatically and NOT gone back done. And THAT is normal."

    Please elaborate and show where they have not gone back down. For every spike, there’s been a decline as significant, if not more so. From the 1950’s until ~1996, prices have hovered ~10% over the benchmark, and with any deviation, came corrections.

    So, it’s different this time? Or, are you redefining normal?

    ReplyDelete
  50. It's called cognitive dissonance, anon 7:08. It addles the grey matter as does the coming-into-focus reality for Lance that all the king's ambassadors and all the king's GS-15's won't be able to put Humpty Dumpty together again.

    ReplyDelete
  51. The housing market is not done correcting, but a median household income will not be able to afford a median priced home unless we get close to 100% home ownership. This analysis is way too simplistic, but lets say there is a 70% home ownership level (which is historically high) and the other 30% cannot afford to buy. Median income would only be around 20 percentile points into the group of homeownership. Only the top 35% of the household incomes would be at median home price and above.

    ReplyDelete
  52. Robert said:
    "Please elaborate and show where they have not gone back down."

    early '40s to mid '50s ... coincidental to a shifting global economic landscpate and the US's new role in that landscape?

    www.bubblepic.com/displayimage.php?album=9&pos=4

    ReplyDelete
  53. Lance said...
    “Robert takes this even a step further ... After doing exactly as you have done, he then shifts the argument in mid-stream and quotes things you've said about one issue and says they were about a totally different issue ... interspersing the whole argument with his own assumptions.”

    Lance, I continue to post dates and times for your reading pleasure. Your rants are archived and can be followed up by anyone. You simply contradict yourself over and over, and I try to keep any new reader up to date with your inconsistencies. You have yet to post real numbers or data (inventory/foreclosures/ARM resets ect.), and furthermore have said in the past, that these data points mean “ABSOLUTELY NOTHING” (forgive me for not posting a data/time for that one, if need be, I’ll provide it later). Your argument above all other arguments is:

    Lance said...
    “that there is never a bad time to buy”
    July 22, 2006 8:04 AM

    “It's no wonder you guys are still trying to "time" a home purchase.”

    Lance, If you haven’t noticed, waiting to buy has already paid off. Sales and prices are down and continue to decline. We don’t have to time the bottom of the market. Even I will concede that when I buy a home, I’ll probably be under water for a certain period after purchase. I just want to mitigate that time under water. I’d rather be underwater for one year than two, two years rather than five, or five years rather than ten. Furthermore, and recent history has confirmed this, why buy a house for $500K when in 3-6 months, I can buy it for $450K. Why buy a house for $250K when in 3-6 months I can buy it for $225K.

    “I'd be doing the same if I had such great diffulty keeping conversations and issues straight as you all apparently do.”

    Lance, as seen by your sometimes conflicting statements, it is you who is having the difficulty. And these “issues” (foreclosures/inventory/RE Fraud/ARM resets/Liar loans/ect..ect..ect..) are all interrelated and have a direct/indirect affect on the issue at hand-Real Estate. But, with a “no bad time to buy” mantra, these “issues” have little or no merit, correct?

    ReplyDelete
  54. Anon 2:49,
    Not everyone who does not own does so because they cannot afford to do so. Many people rent due to the transient nature of their job. This is particularly true in DC. Military members seldom have visibility of where they will be living of greater than 2 years. Political staffers and appointees as well as contractors are often in the same boat. As the economy moves to greater outsourcing and greater mobility of the work-force, this could be a factor in favor of lower home-ownership. In the end, my point is that I don't think it is fair to lump all of the non-owners into the lowest income groups in your analysis.

    ReplyDelete
  55. I mention how Robert takes others' words out of context and uses them in points un-related to the original subject that they were spoken about ... And what does he immediately do? He illustrates for all the world to see how he twists and turns what others have said! Good job Robert! and oh, btw, 6 months ago you were saying properties were worth 70% less than what people were asking for them ... and that you'd never pay over $200-something-K ... and now you're saying you might be interested in something that went from $500K to $450K? ... Get your story straight! Next (after you miss the bottom which we're currently close to experiencing) you'll be saying you're willing to look at something $50K more than what it was selling for last year ... Of course, in the end, you'll still be looking. You've missed out on low prices before ... like as recently as 3 yrs ago ... You'll hesitate this time too ... always looking for that elusive "better time to buy". You just don't get it that there is NO bad time to buy, since any smart person can buy well under any market conditions. I guess you can't and that's why you can't understand the concept that there is no bad time to buy ... Just people who don't know how to buy ... and are waiting for the golden deal to just fall in their laps ... And let's not forget the BH mantra "there's gonna be a depression and everyone except for ME will have to sell and I will be able to then buy for cheap!" Watch, Robert will now take THAT quote out of context and say that "Lance thinks he's gonna get a house for cheap when a depression hits" ... THAT's the kind of manipulation Robert does with others' posts...

    ReplyDelete
  56. Lance said...
    “I mention how Robert takes others' words out of context and uses them in points un-related to the original subject blah blah blah blah”

    Fellow BH’s, readers and guest. It seems I have awakened the beast. It’s not pretty, and I do apologize.

    ReplyDelete
  57. If a market can't stand on its own feet let it fall, proves speculation if bloggers have any affect on the housing market.

    The media pumped this market up now they are helping to push it down, extreme on the upside, we haven't seen the bottom yet people....

    When you think the market is going higher time to cash out, when you think the market has hit bottom wait, when have the people you work with know of someone loosing a house only then should you consider a purchase..

    ReplyDelete