Monday, October 15, 2007

Best of The Bubble Sphere

Housing slump affects sales tax collections (Atlanta Journal-Constitution)

8503 2nd Ave in Silver Spring, MD just reduced agains to 589K. See Previous Post

RTC2? Banks in desperate $80 billion scramble to avoid "mark to market" meltdown. Just delaying the inevitable (Housing Panic)

54 comments:

  1. Hey, more big news about prices in your seedy suburb!! Bad news for slobs and poors!

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  2. Manassas is seedy . . . then Silver Spring, then Adams Morgan, then Logan Circle, then everywhere but your house :-) All real estate is local, don't worry. Your life savings didn't go down the tubes . . .

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  3. It really makes you wonder what sort of person would consider this kind of behavior a worthwhile use of their time.

    I suspect what we are dealing with here is someone who has run out of ideas to explain away the bubble but is just too stubborn to allow themselves to just admit that they were wrong all along.

    I mean here is a person who a few months ago was lecturing everyone on this blog about how foolish they were not to have bought at the peak and now they can't think of anything better to do than spend all day trying to insult everyone.

    I hope he doesn't say something mean about me next, that would really hurt my feelings...

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  4. Anon said:
    "I mean here is a person who a few months ago was lecturing everyone on this blog about how foolish they were not to have bought at the peak and now they can't think of anything better to do than spend all day trying to insult everyone."

    Interesting ... so you think there is only one person out there who thinks the BHs don't know what they're talking about? I hate to break it to you, but the vast majority of the world thinks BHs don't know what they're talking about. But of course the BHs will be proved right ... someday. Not yesterday, not today, not tomorrow ... but someday!

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  5. "It really makes you wonder what sort of person would consider this kind of behavior a worthwhile use of their time."


    pot, kettle, black.

    it's about time somebody showed up here to call you guys faggots and smack you around a little. especially NEIL AND BOB - 2 FAGGOTS.

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  6. "nteresting ... so you think there is only one person out there who thinks the BHs don't know what they're talking about?"

    I think there aren't a whole lot of you lance on here lance. Are you and the annoytroll the same person? Maybe, maybe not... but we are dealing with 2-3 people here, not 2-3 dozen.

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  7. Man, what a strong argument. You must've took debate in high school.

    All of our speculation backed by real data, and what we haven't realized all this time is that we're all "faggots" who "don't know what we're talking about."

    Hahahahaha!! :-) :-) :-)

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  8. Hey lance, bernake disagrees with you about the state of US housing.
    http://www.bloomberg.com/apps/news?pid=20601087&sid=a_6erMJbqHYs&refer=home

    bob

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  9. anon 7:12 PM
    is a fag.

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  10. Aw geez, ad hominem attacks anyone. All I know is that it's funny to see the bulls (e.g. lance) start to attack the bears (e.g. almost everyone else) with the claim that EVENTUALLY things will right themselves. Bravo for a brave prediction lance et al.

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  11. Anon 7:44, call me a housing head if you like, but not a housing bull ... Bulls hope to make money by investing in a rising market. Like I've said a thousand times since I first posted here, I don't believe a home should be viewed as a financial investment vehicle and anyone who does is looking for trouble ... And I believe the fundamental flaw of BHs (and their Bubblehead beliefs) is their inability to understand that one doesn't buy and sell the home they live in like it was a stock they were speculating in. And waiting for a market bust is speculating.

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  12. Everyone should sign this petition to change the abusive lending laws, fraudulent SIVs and protect the dolllar.
    Citizens For Financial Responsibility

    http://financialpetition.org/

    pass the word

    Vegas Radar

    ReplyDelete
  13. Housing woes don't have any impact on anything at all and you can keep living in your little bubble of denial and anger.

    Good thing everything's booming and none of our predictions are coming true. ;) Good thing the bulls taunts are showing us the errors of our ways. My, we'll just have to content ourselves with continuing to watch this.

    For those that wonder and haven't realized history is unfolding before your eyes. Read! Read!

    Anyone who doesn't realize that real estate has strong cycles better understand they're speculating too. I've seen top neighborhoods drop 40%; it will happen in DC over the next few years. Most people move every 5 years. Losing multiple years of ones income in that time could be an inconvenience.

    The FUD to buy... has gotten old. Most of us bears want to buy. We just know that when affordability is broken, it returns that is not of anyone's choosing.

    The news on how mortgages are effecting various financial institutions health will unfortunately continue. If housing isn't unafordable, then why are they having trouble selling "high rated debt" that isn't 'sub-prime?'

    You're going to have to do better than 5th grade short bus insults to stop the conversations on housing. It is spreading to conversations on jobs. So act immaturity if you wish; I'm sure those that read these comments but do not post are amused.

    Again, you bulls have started to spread the word on housing's decline far better than us bears.

    Got popcorn?
    Neil

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  14. "But of course the BHs will be proved right ... someday. Not yesterday, not today, not tomorrow ... but someday!"

    Um, Lance, that is happening right now.

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  15. "I don't believe a home should be viewed as a financial investment vehicle and anyone who does is looking for trouble"

    So what do we make of your references on the NOVA blog that with your home purchase you "won the lottery"?

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  16. "I don't believe a home should be viewed as a financial investment vehicle and anyone who does is looking for trouble"

    Well you certainly didn't mind going on and on about all the supposed equity you had gained due to appreciation before someone outed you and it was obvious you were lying.

    For that matter you also went on and on about how housing prices were going to rise to Manhattan levels in DC and how you were SOOO smart for getting in "early."(you know, at the peak...)


    The fact is that a housing is an expense, and a house is both a means to an end, and an investment at the same time. If you can't wrap your head around that concept you ought to be taking remedial classes in personal finance, not trying to give out advice on the internet.

    This is not an either/or situation.

    Even if you choose to view housing as nothing more than an expense... that still doesn't justify overpaying for it.

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  17. "But of course the BHs will be proved right ... someday. Not yesterday, not today, not tomorrow ... but someday!"

    Um, Lance, that is happening right now.


    So true. The treasury secretary wasn't exactly upbeat today:

    I n his most somber assessment of the crisis to date, Paulson said that the housing correction is "not ending as quickly" as it had appeared it would and that "it now looks like it will continue to adversely impact our economy, our capital markets and many homeowners for some time yet."
    http://biz.yahoo.com/ap/071016/paulson_housing.html
    So what do we make of your references on the NOVA blog that with your home purchase you "won the lottery"?

    Now now, the bulls don't like to be held accountable for anything. Certainly not anything they ever typed.

    Judging how so many home "owners" extracted equity during this bubble, its going to be a very different downturn.

    Tomorrow is the anniversary of Black Friday. It has some spooked. Does it mean anything? We'll find out.

    The downturn is happening now. San Diego sales are down 66% (Oct 1st-14th) versus 2005. Very few zip codes provide weekly sales data. DC is one of those areas that unfortunately obscures the obscures the data; that implies a weak market. But how weak? I know of buyers getting bored waiting and thus won't even look at homes for two or three years. (There is no way buy/rent ratios will get in balance any quicker anyway, so not a bad strategy.)

    Why is it that everyone I know whom has cash has absolutely no interest in buying real estate? Hmmm? There is a reason the bears are becoming more vocal; we're no longer waiting, "the event" is here. Sadly, it will last for a long time. Cest la vie.

    Got popcorn?
    Neil

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  18. uhm ... it was kh that said I "won the lottery" ... I don't necessarily disagree with kh in that I am now safe and snug in a home that today would cost me much more to purchase than it did then, but I don't view myself as having won the lottery in the sense that BHs seem to be interpreting it.

    I have no short term plans for selling the property and taking the equity out of it. I also don't agree with the implication that by "winning the lottery" that it somehow fell into my lap. It didn't. I did lots of research prior to deciding to buy and prior to buying the place I bought where where I bought it. Nothing was left to "luck" ... Unlike the BHs, I came to the conclusion that one could indeed be left behind from buying in the desirable area I wanted to live in and make my home. Now, were I looking to establish my home in one of the exurb areas or one of the "edge" transitioning areas, I might have come to a very different conclusion. What the BHs seem to have great difficulty understanding is that it isn't an "all or nothing" question. Many of us who bought in 2005 have done just fine thank you in many ways. And since many of you just seem to understand dollar bottom lines (and not "quality of life" issues), you should understand that I have done well in that respect too. Do a little research, if you can, and you'll see that the value of properties in my area have risen dramatically in the past couple years. Hint: research 1531 S Street ... look at the DC.gov site and pull it up under the Tutt Taylor Rankin site where it is for sale.
    I understand that this site has become a place for BHs to pat each other on the back and hear that they've made the right choice by "waiting" ... and I understand that my experience doesn't validate that. Sorry ... but my experience doesn't say you did the wrong thing, just that for at least some of us, waiting to buy back in 2005 wasn't a bad choice. And I am emphasizing "some" of us. Waiting for a price collapse is a "one size fits all solution" ... In most cases, these types of solutions don't work.

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  19. I forgot the "not" in "not waiting to buy" ...


    but my experience doesn't say you did the wrong thing, just that for at least some of us, NOT waiting to buy back in 2005 wasn't a bad choice. And I am emphasizing "some" of us. Waiting for a price collapse is a "one size fits all solution" ... In most cases, these types of solutions don't work.

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  20. "but my experience doesn't say you did the wrong thing, just that for at least some of us, NOT waiting to buy back in 2005 wasn't a bad choice. "

    Wow, lance took a big step today everyone.

    He appears to have given up on his sadly misinformed beliefs that it is always a good time to buy and that anyone who hasn't done so isn't a "real citizen" and is instead now defending his personal purchase as "[not] a bad choice."

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  21. It has taken a long time, but I gree, Lance has come around. Maybe he has sworn off real estate and got a real job and a calculator to do his math. Or maybe his renters found out what he says about them online. I suspect the comments will soon be screened by David again before posting is allowed so...

    Fuck you Lance you ignorant twit, I hope your children have to pay off debts.

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  22. Builder confidence at record low:
    http://biz.yahoo.com/ap/071016/new_housing_outlook.html

    You'll want to see the chart. We are literally in uncharted territory:
    http://calculatedrisk.blogspot.com/2007/10/nahb-builder-confidence-falls-to-record.html

    In 2006 the REIC was 16.3% of GNP. Everyone I'm talking to has said that demand is the lowest they've ever seen: Jewelers, truck drivers...

    And look at the port traffic. Always an economic leading indicator.

    It amuses me how much the bulls dislike renters. Fine, we won't rent from you. ;) There are plenty of other opportunities to rent.

    As to waiting, there are so many homes out there cheap to rent. With homes sales dropping fast, especially those requiring a jumbo loan, its obvious prices are about to drop.

    In the OC (California) it looks like prices dropped 2.2% in ONE WEEK. Think it cannot happen in DC? Think again. OC is hurting because its the mortgage capital of the US. Tightening credit always drops the demand for and thus the price of the item being financed. Anyone with cash is smart to wait. The "value" of a home is an opinion. The debt on it is a cold hard fact.

    Lance, you've been so arrogant about being a home buyer. I'll be curious about your opinion when you have neighbors move in for $250k less with lower payments.

    We were a year late in the timing. Sadly, its happening faster and with greater magnitude than what we predicted. Cest la vie.

    Got popcorn?
    Neil

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  23. Lance,

    BTW, I'm tired of defending you. You encourage insults against the bears and are the most consistent offender. Since you've been so good at ignoring insults and even threats against David, Bob, and myself while enjoying insulting everyone. Reap what you sow.

    You've accused me of "making up facts" and yet items I posted are indeed being confirmed. Stop being a hypocrite. Go out and talk to owners of small businesses. Some are doing well... Quite a few already feel the downturn.

    Again, their are a lot of lurkers on this site. The impression the bulls are giving the lurkers isn't one of calm mastery of the market. If you want to spread our message in your way. Go ahead. But there is no question about a 6% to 20% drop in DC prices in the six month timeframe. None. To think, this isn't even the time of the most rapid drop. The bottom? 2011 or 2012.

    Got popcorn?
    Neil

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  24. Neil -- 2011? 2012?

    Seriously. Get on with your life.

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  25. "Neil -- 2011? 2012?

    Seriously. Get on with your life."

    His estimate isn't that far out of line from what the big guys are saying...


    So much for cautioning us all not to "risk" trying to "time the bottom" huh lance? The bottom is going to be very broad.



    “U.S. housing prices will continue to decline at least through the end of next year and may not begin creeping upward again until 2010, executives from the biggest mortgage financiers said Monday.”

    “Officials with government-sponsored mortgage companies Fannie Mae and Freddie Mac and CEOs from two major mortgage banks told the Mortgage Bankers Association’s annual convention that the continuing spike in foreclosures and a glut of unsold homes will prevent any quick price rebound.”

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  26. Neil, you're better than him. None of us is fooled by the cursing and shouting from the bulls.

    ReplyDelete
  27. Neil said:
    "I'll be curious about your opinion when you have neighbors move in for $250k less with lower payments."

    Ever the pessimist! ... or is it "the optimist" since you're hoping to can profit off of others' misfortunes. From what I can see (e.g., 1531 S St NW), my new neighbors will be paying at least $250k more AND have higher payments since jumbo loan rates have soared far beyond the low interest 30 yr fixed rate I obtained in 2005 ... The last I noticed, they were at something like 7 1/2% ...

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  28. Lance, as usual that house is quite a bit nicer than yours, in a better location... and like your other neighbor's house it has already cut its asking price.

    BTW, hasn't exactly gone from $1 million to $2 million in the last 12 months has it? We are all still waiting for you to post the addresses of those average rowhouses you visited earlier this year...

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  29. "average rowhouses"

    I never said average ... On the contrary, I specifically said I was refering to higher-end homes in the neighborhood that I had observed going "from something like $1.2M to just under $2M" and that what was happening with these higher-end home prices in DC was indicative of we should expect to happen with home prices in general for properties in desirable DC areas ... One of the BHs actually cut and paste my words on this very subject a week or two ago ...

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  30. Oh, so that explains your inability to provide an example of such a house even though you claimed to have visited multiple examples.

    Oh wait... no it doesn't...

    ReplyDelete
  31. http://www.treas.gov/press/releases/hp612.htm

    http://www.treas.gov
    /press/releases
    /hp612.htm

    October 16, 2007
    HP-612

    Remarks by Secretary Henry M. Paulson, Jr.
    on Current Housing and Mortgage Market Developments
    Georgetown University Law Center

    key points of the speech

    While adjustable-rate mortgages (ARMs) are not new, recent years saw an increase in hybrid-ARMs with low teaser rates, interest-only features, low- or no-down payments, and even negative amortization. In fact, about one-quarter of mortgage originations were non-traditional ARMs in 2005 and 2006, exposing mortgage holders to much greater risk than the traditional 30-year fixed rate mortgage with a 20 percent down payment.

    This decline in lending standards was not limited to, but was most pronounced, in the case of subprime lending, which grew from only about 2 percent of mortgages in 1998 to nearly 14 percent in mid-2007. A significant percentage of the non-traditional ARMs were marketed and sold to subprime borrowers. Predictably, the result has been progressively higher rates of default on subprime mortgages.

    The inevitable correction began in early 2006.
    Today, average nationwide home prices are barely up in the year through June, sales of existing single-family homes are down by nearly 25 percent from the peak in 2005, and the inventory of unsold homes has increased to levels last seen in the early 1990s.

    As I mentioned earlier, mortgage defaults and foreclosures are rising. While the delinquency rate today is near the 2001 rate, there are over seven times more subprime mortgages today than there were in 2001. At the end of the second quarter of this year, more than 900,000 subprime loans were at least 30 days delinquent. Foreclosures are also up significantly – increasing about 50 percent from 2000 to 2006. Foreclosures on subprime loans are up over 200 percent in that same period. Current trends suggest there will be just over 1 million foreclosure starts this year - of which 620,000 are subprime.

    Of the approximately 50 million outstanding mortgages in the U.S. today, approximately 10 million are subprime loans. Many have cited the statistic that 2 million of those subprime mortgages will reset to higher rates in the next 18 months. That statistic is true, relevant, and troubling, but it is not the complete picture of the risk going forward. Many of those borrowers will be able to afford their new mortgage payment or they will be able to refinance into another more affordable mortgage. Yet, the problem today is not limited to subprime mortgages as the number of homeowners having trouble making payments on prime mortgages is also increasing. And finally, the wide geographic variation in home price trends adds to the complexity of sizing this problem with any certainty.....



    .....Originators often sell mortgages to securitizers who package them into mortgage-backed securities, which are then divided and sold again to a global network of investors.

    In today's decentralized system, a homeowner having trouble making payments often does not know where to turn for assistance....


    In addition to affecting individual homeowners, the housing correction is also having a real impact on our economy. Annual housing starts peaked at an annual rate of almost 2.3 million units in early 2006 before falling off more than 40 percent through August of this year. Employment in residential building, including specialty trade contractors, has dropped by almost 200,000 since early 2006, offsetting about one-quarter of the jobs gained in the housing boom. It looked like housing construction had reached a bottom in the first half of this year, but starts have declined again since June and data on permit applications and inventories of unsold homes suggest further declines lie ahead....

    ....The breadth of disaggregation in the mortgage market today is unprecedented, presenting a fundamental, practical problem that does not lend itself to an easy solution.....


    Secretary Paulson continues with his speech but ends his with an upbeat hopeful outlook.
    Whether the outlook and outcome will be upbeat or not remains to bee seen.
    Isn't it interesting that Secretary Paulson said in his speech-

    "The inevitable correction began in early 2006"
    when so many housing experts ridiculed, laughed or dismissed the idea of the "inevitable correction" happening in 2006 or any year in the future...

    From Anti Lance
    (for some reason, the comment would not take when I tried to submit it with an identity)

    ReplyDelete
  32. "I specifically said I was refering to higher-end homes in the neighborhood"

    Hey Lance, any idea WTF is going on?

    Over on the NoVA bubbleblog, I've been tracking 2819 Russell Road which jumped 38% this year. The Jan 2007 assessment was $1.008M and it just sold for $1.38M

    The BH's don't want to discuss actual price increases.

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  33. kh asked:
    "Hey Lance, any idea WTF is going on?

    Yeah, but the BHs don't want to hear it ... it doesn't line up with what they've been banking on. The put all their chips on the table in the hope that they can buy the property they want at distress prices. The problem is, the only properties going for distress prices are the places they didn't really want in the first place. Meanwhile they find themselves increasinly priced out of the places they really want. It's like they're holding on to a stock that's gone from $100 a share to $20 ... They keep holding on 'cause they just know that it's gonna turn around someday. "Someday that place I want to buy will drop to what I could've/should've bought it for back in 1999 ...someday. I mean nothing has changed since 1999, why should I be paying more for it now?"

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  34. Neil is going to wait until 2011 or 2012 for the bottom? So, that would mean 8 to 10 extra years of renting(since the BH's first appeared). Hmmmm....makes sense to me. If you are so financially retarded that you can't stomach a 10-20% cyclical downturn in your home value - you should rent. Buying is not for everyone. Nothing is guaranteed but death and taxes. Meanwhile, owners will just be that much further down the am schedule and can settle in and raise their kids. Day traders should not buy RE.

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  35. "Neil is going to wait until 2011 or 2012 for the bottom? So, that would mean 8 to 10 extra years of renting(since the BH's first appeared). Hmmmm....makes sense to me."

    2012 - 2007 = 5

    5 years to save up for a good sized down payment.
    5 years to save up for an emergency repair fund (houses need repairs, the roof needs replacing, the hot water heater goes, cement work needs to be done, etc.)

    5 years of watching the banks and Wall Street deal with the credit market mess, the CDOs, the SIVs, the years of excess housing inventory coming onto market.

    Taking 5 years before buying a house, all the while he is saving money, dining out, not worrying about losing paper profits from a house, etc.

    THAT makes sense to me.

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  36. Anon 7:46

    FIVE YEARS!????? LOL! Neil didn't decide not to buy in 2007. He's been here over two years - so that makes a minimum of 7 . If he is so prescient, where was he in 2000? And, precisely how much has his desired neighborhood dropped?

    Gosh, he'd be almost halfway though a 15yr mortgage (not in paydown, but you know what I mean).

    VA_Investor!

    ReplyDelete
  37. "Someday that place I want to buy will drop to what I could've/should've bought it for back in 1999 ...someday."

    That someday might never come. That's what they don't get.

    The financial and investment news is filled with reports of inflation, energy going up.

    Maybe houses will fall but costs of material, energy, labor will skyrocket.

    ReplyDelete
  38. "Taking 5 years before buying a house, all the while he is saving money, dining out, not worrying about losing paper profits from a house, etc."

    That's fine if it works out that way. Cash has a way of burning a hole in some people's pockets. That BMW or big Mercedes, that trip to Australia.

    More power to Neil if he can bank the cash and invest it for a good return.

    It's also not a given (in spite of BH's wishes) that real estate will fall. I'm tracking study groups in Alexandria and prices are up this year.

    Another few years like 2007 and prices will be out of reach of most folks.

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  39. "Another few years like 2007 and prices will be out of reach of most folks."

    Same old story, buy now or be priced out forever! Did you even have a straight face when you typed that? Prices will be and will always be hovering around 3-4 times average family income. When they skew, like now, they come back. Nothing will ever be priced out forever. So dumb.

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  40. anon 6:22,

    I hope for your sake that you are right. Contrary to your statement that prices "will always be hovering around 3-4 times average family income"; it used to be 2.5 to 3 times income. But interest rates were 12 to 14% at that time. I hear alot of BH's still saying 2.5 to 3. You say 3-4. Why is it not 5-6, since rates are half of what they were?

    Do "ratio's", the all-time lending standard, no longer matter? If so, why? And how do you then justify abandoning the tried and true 2.5-3X income standard of the 80's?

    ReplyDelete
  41. "Nothing will ever be priced out forever. "

    Except in most of the world, most people are priced out forever. Unfortunately.

    While I agree that it's not right and that property absolutely must be priced such that a buyer can afford it, whatever the percentages and ratios work out to be.

    The fallacy in BH thinking is believing that they are the buyers. (Or representative of the generic buyer.)

    The buyers are not just you and me, not just those who are willing to take subprime loans. There are people who have a million dollars in CDs. You know the Scott Trade Ad, "Since when is One Hundred Thousand Dollars prefixed by Only", there are people who can say, "Only five million dollars."

    We bid against them too. They are not generally interested in tatty quick-ups in Manassas or driving 2 hours each way anywhere, except in their Ferrari's.

    (I'm not saying that they're interested in my small house on 5,000 sqft.)

    ReplyDelete
  42. KH said:
    "(I'm not saying that they're interested in my small house on 5,000 sqft.)"

    give it time. you'd be surprised what 5,000 sq feet of real estate lot can bring in the District - anywhere in the District ... Five, ten, fifteen, twenty years, that 5,000 sq ft lot of yours out in Alexandria (but within the Beltway) could very well have the same relative value that a 5,000 sq ft lot out in somewhere like Palisades or Chevy Chase DC now has. You've made a smart move ... a very smart move.

    ReplyDelete
  43. Lance wrote: "... anywhere in the District..."

    Funny story, one of my neighbors has been fixing up their small place. Bathroom, kitchen, stainless, granite, designer (not Home Depot) fixtures, you know how it goes.

    That house is on 10,000 sqft. I once told them, "Why are you doing it? When you sell, they'll knock your place down, no matter how much you put into it."

    The city assesses that land at 330K. $33/sqft. My smaller place a short distance away is $275K land and 5,000, $55/sqft.

    319 Mansion Drive is $801,500, 31,421, $25/sqft.

    How is that fair? (at least it's consistant.)

    ReplyDelete
  44. "Five, ten, fifteen, twenty years, that 5,000 sq ft lot of yours out in Alexandria (but within the Beltway) could very well have the same relative value that a 5,000 sq ft lot out in somewhere like Palisades or Chevy Chase DC now has."

    This is utter and complete bullshit. You know nothing about real estate except that you bought at the top of a bubble and paid too much and it is bothering the hell out of you. What you do here is blog-therapy trying to alleviate the pain.

    ReplyDelete
  45. kh,

    The apparent disparity is probably a reflection of the number of dwelling units that can built on each parcel. Most of the value is contained in the fact that the lot is buildable. Is the 10,000 sf lot subdividable? Even if it is in the same zone as your 5000sf lot, there are numerous reasons it may not be simply split in two buildable lots such as frontage requirements, yard requirements, easements, or floodplain.

    ReplyDelete
  46. "Most of the value is contained in the fact that the lot is buildable. Is the 10,000 sf lot subdividable? "

    Yes, that's certainly a big factor.

    My lot (50x100, narrow and deep, 5,000 sqft) will never support a grand house. It's a squeeze now and I have a small place.

    My neighbor's lot, 100x100 (something like that) 10,000 sqft will site a fancy big house, driveway, pool, whatever they want.

    If you buy my place and knock it down, you could only build another small house.

    10,000 sqft lets you build big and fancy. I think their place should be worth much more than mine, per sqft.

    As I said, my neighbor, who is well-to-do, has made many upgrades. As long as they enjoy it, that's fine. I think that the next owner will buy the lot for the land value and not the 60-70 year old house.

    ReplyDelete
  47. kh,

    The lack of potential in your lot is reflected in your tax rate, if you consider the rate to be assessed per dwelling unit and not per sqft. Your neighbor's land is taxed at $330K/dwelling unit while yours is only $275K/dwelling unit. Value is directly correlated to use, but use is not diretly correlated to size, when dealing with single family use. If these were commercial properties and we were dealing FAR's it would much more straightforward.

    ReplyDelete
  48. That's me above.

    ReplyDelete
  49. "Value is directly correlated to use, but use is not diretly correlated to size, when dealing with single family use."

    I think my place should be worth "less" than it assesses at. I guess I shouldn't complain, the small patch of ground beneath nearby townhouses are over $100/sqft.

    Still seems like owners on Mansion Drive are getting away with something. They're assessed at $25/sqft.

    Of course, on the plus side, between my weeds, deck, house, and driveway, there isn't much grass to mow or leaves to rake compared to my neighbor.

    ReplyDelete
  50. KH said:
    "My lot (50x100, narrow and deep, 5,000 sqft) will never support a grand house."

    Sorry KH, I must disagree with you. True that under current zoning it may not be able to support a grand house in Alexandria. But just look at DC where an 18X90 lot will support grand houses worth in the millions. Just give it time, your lot is an invaluable asset. In the meantime, enjoy it for the home it is.

    ReplyDelete
  51. Lance... some of my neighbors agree with you.

    Three have built incredible additions to their homes. They converted 60 YO modest homes into stunning, towering, showcases.

    This scope of expansion, if done poorly, is derided as McMansioning.

    I've considered a project like that but I don't need the space and the BH-inside advises caution. Anyway, the city says the dirt under my house is worth about as much as the house.

    Other neighbors have done kitchens and baths. One shock - after a $100K kitchen upgrade, the rest of the house suddenly looks worn.

    I will take your advice, thanks!. Fall flowers go in this weekend, a party at a neighbors, wax the red convertible, got a pumpkin to carve.

    Watch the neighbors with the big yards rake leaves.

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