House of Ill Gotten Gains: Real Estate, and other forms of human predation...

[Tilikum Turbo]

We sure didn't learn much after the implosion of 2008 after the last round of
Ponzi-Scheming from the Real Estate, Escrow Companies and Banks

I see a lot of smiling faces of Real Estate Agents on signs all over Southern California, and wish I could pump a 12-gauge round into every one of those signs.

We now equate unaffordable housing as sign of a GOOD and HEALTHY economy: home prices that keep increasing(out of reach for the average American) keeps those commissions coming and the financial institutions rolling in cash.

And the states which collect on the grossly over-inflated property taxes on the 'value' need to keep that cash cow rolling. California for instance throws more money per child than any other state, yet the kids coming out of school here are as dumb as a box of rocks...DEAD LAST.

Our State Lottery: 80% of it's customers are the poorest of the poor: helping keep poor people poor by grabbing whatever little disposable income they have
and thru clever marketing letting them 'invest' in a negative-return business.

HSBC Bank...convicted of money laundering by the DOJ...not millions...not billions...trillions of dollars washed for drugs cartels in Mexico, and look at that! Still doing business in America.

If I wanted to give my home to my kids, they couldn't even afford the GD tax payments.

Of yes, I forgot...unemployment is less than 6% now, and 'happy days are here again'.

I believe we in America via out business schools produce the best predators in the world: when you don't have anything to hunt, you pray on other humans.

[emcon5]

Easy solution, get the hell out of California.

[Bill Douglas]

You could have bought cheaply a few years ago and planned for the future.

[legion]

Go back and read my real-estate thread from before the 2008 crash.

If everyone is priced out of the market, there is no one to buy the houses, they won't sell, and the market will crash.

The real problem is the government manipulation and distortion that allows these peaks and crashes, and the prime issue is forcing banks to lend to people who can't really afford to own a home (the so-called subprime market).

[nostatic]

Originally Posted by Bill Douglas

You could have bought cheaply a few years ago and planned for the future.

My wife did that in '06 - ended up being near the peak of the market and she was quickly under water.

"Cheaply" for SoCal means around 2001 or earlier.

Timing is everything, and sometimes life events get in the way of things. At some point you run out of either time and/or money to get into the game. I remember my ex asking why I wasn't buying a condo or house a few years after we divorced. That was in '07 and my reply was that I didn't have enough cash for 20% down (would have been about $200K - my partial settlement for the equity in our house wasn't near that), I thought the market was going to crash, and I wanted flexibility to be able to move if need be for schools. Turns out I was right on the last two points - the market went south and in '09 I moved to Santa Monica for decent public middle/high school.

Fast forward to now. Son is a senior, wife and I make decent money but a downpayment on anything would drain our "we can live for a year with no job" emergency fund, and once the boy goes off to college we're not sure where we'll want to end up. I think the market is about to crash here again, so no way I'd get into anything unless I knew I had a stable income for 5 years and wouldn't want to move. I can't say either of those with a straight face so buying would be silly and end up probably costing us a fortune.

Easy to have 20/20 hindsight and say shoulda done that...but the drive to "own a home" also pushed a lot of people into making bad choices as well.

[Bill Douglas]

Well, a few years ago in SoCal the banks were looking for anyone to buy houses off them. They didn't want to be in the house ownership industry and were certainly looking to make a deal. Things were looking bad. That's when it's time to buy. When everyone thinks it's great and buying buying buying, that's an indication that it's time to get out.

[tabs]

We sure didn't learn much after the implosion of 2008 after the last round of
Ponzi-Scheming from the Real Estate, Escrow Companies and Banks

The Ponzi scheme just got bigger in that it is now the SOVEREIGN DEBT OF THE GOOD OLE USA THAT IS NOW A PONZI SCHEME.

That is the truth of the matter, however the devil that you know is better than the devil you do not know when you chance a roll of the dice. So what alternative did the FED and US govt have? Mr Lockhart will chime in with Mr Stockmans take on the matter. However I heard Mr Sotckmans exposition when he came out with it...to whit go read Radio Tabs for the rebuttal.

[nostatic]

Originally Posted by Bill Douglas

Well, a few years ago in SoCal the banks were looking for anyone to buy houses off them. They didn't want to be in the house ownership industry and were certainly looking to make a deal. Things were looking bad. That's when it's time to buy. When everyone thinks it's great and buying buying buying, that's an indication that it's time to get out.

When are you thinking? If I look at valuations in my area, the time to buy was around 2003 at the latest. After that is was a roller coaster ride.

This house is down the street from us. I suppose with a crystal ball we could have bought in 2010, but I'm betting it will soon drop back down to $1M or less within the next year (check the 10 year pricing). No way in hell I'd buy anything right now:

1127 Ozone Ave, Santa Monica, CA 90405 - Zillow

[tabs]

Originally Posted by Bill Douglas

Well, a few years ago in SoCal the banks were looking for anyone to buy houses off them. They didn't want to be in the house ownership industry and were certainly looking to make a deal. Things were looking bad. That's when it's time to buy. When everyone thinks it's great and buying buying buying, that's an indication that it's time to get out.

Up until the 1970's residential RE was not considered to be an investment that you could retire on. It was considered to be an overhead expense as it was primarily a place to live. Prices were stable and only increased moderately up until that time...As stated homes were a place to live, where over time you built equity. Eventually paying the place off so that in retirement you had a place to live relatively cheaply.

This all changed in the 70's when Nixon took the US off the Gold Standard, and that eras inflation took place. The 1970's is when the USA hit the skids, and everything since has been an ever greater ponzi scheme...one after another

In the 1980's American bizness got lean and mean in order to compete globally, which has left the American people high and left out to dry...that is until 2008 when ole GW came on the Tube and said, "We is in MELTDOWN CRISIS....now the American people have this underlying little knot of anxiety in the pit of their stomachs which in other words is called fear.....

and what they don't get is that you can not put the Genie back in the bottle as much as all the FED's men and Fed's horses have tried to do....So they will keep on keeping on until it all blows up again in their faces..only this time it will be the US govt debt or USD that blows...sky high..

[Hugh R]

Todd, that is about $1,000/sq.ft. Yikes.

[porsche4life]

You guys realize that while agents benefit from the rising prices, most of us have no desire to drive the market to a crash again. If homes aren't selling its bad for our busines... Talk to the lenders who gave money to people who couldnt afford it....

[tabs]

Originally Posted by nostatic

When are you thinking? If I look at valuations in my area, the time to buy was around 2003 at the latest. After that is was a roller coaster ride.

This house is down the street from us. I suppose with a crystal ball we could have bought in 2010, but I'm betting it will soon drop back down to $1M or less within the next year (check the 10 year pricing). No way in hell I'd buy anything right now:

1127 Ozone Ave, Santa Monica, CA 90405 - Zillow

For such a smart guy you really are myopic...you don't see it, you don't smell it...??? Maybe you just don't pay attention...??? I just don't get it Nostatus...

[nostatic]

Not sure what I or you don't get. I get your doom and gloom narrative, and share some of the concerns. But in the end, I have to have a place for my family to live. My crystal ball says renting is the best course of action at this point.

[nostatic]

Originally Posted by Hugh R

Todd, that is about $1,000/sq.ft. Yikes.

Yup. And we're not in a particularly great part of Santa Monica either.

For those that grew up suburban in the post-war boom, and have been part of the "American dream," it requires a change in deeply rooted thinking. My wife is far more comfortable with the uncertainty and going with the flow. But growing up in Hong Kong under less that ideal conditions prepare you for that type of approach. So it is interesting to see when my deep-seated Leave-it-to-Beaver anxiety burbles to the surface. In the end you can spend your life living in fear, or just live it because stuff is going to happen one way or another anyway...

[dlockhart]

Originally Posted by tabs

[ Mr Lockhart will chime in with Mr Stockmans take on the matter..

Originally Posted by tabs

This all changed in the 70's when Nixon took the US off the Gold Standard, and that eras inflation took place. The 1970's is when the USA hit the skids, and everything since has been an ever greater ponzi scheme...one after another

Credit growth was the path to prosperity

[tabs]

Originally Posted by nostatic

Not sure what I or you don't get. I get your doom and gloom narrative, and share some of the concerns. But in the end, I have to have a place for my family to live. My crystal ball says renting is the best course of action at this point.

In reality Mr Notstaus you have to play the game as if it will never end...you have no choice, and there is literally nothing you can do to ameliorate your situation if it all does go kablewie....Not even Mr Buffet..

It amounts to a mathematical equation Mr Nostatus...it is when the random numbers plugged into the equation turn up SNAKE EYES... that imponderable, subjective snake eyes...

[tabs]

Originally Posted by nostatic

Yup. And we're not in a particularly great part of Santa Monica either.

For those that grew up suburban in the post-war boom, and have been part of the "American dream," it requires a change in deeply rooted thinking. My wife is far more comfortable with the uncertainty and going with the flow. But growing up in Hong Kong under less that ideal conditions prepare you for that type of approach. So it is interesting to see when my deep-seated Leave-it-to-Beaver anxiety burbles to the surface. In the end you can spend your life living in fear, or just live it because stuff is going to happen one way or another anyway...

MR Nostatus we, as in just about eveybody alive only knows the Post War Boom...and as such hard times remains an abstracton as we have not bitten into the bitter reality of it. This is what I want you to consider as a model, look at American society in the pre WW1 era as the 30's was skewed by the Depression. That is the likely scenario if things do not go kablewie...

[Por_sha911]

Originally Posted by emcon5

Easy solution, get the hell out of California.

This.

Your frustration sounds similar to those that camped out on Wall St a while back. Most banks and Realtors are not evil predators. They are businesses that helped you get what you wanted. No one tricked you into a payment. No one hid the number of months. I can't get mad at anyone except the jackazz that signed the papers agreeing to pay the payments. Oh, wait, that's me. Maybe I should have done the math before I agreed to the loan. I am accountable for my financial actions to buy what and where I can afford instead of what/where I want.

[look 171]

I look at lot of houses in a certain area of los angeles. My agent and I have notice many of the buyers are not American. They are foreign, from various parts of the world. I listen to them, and notice their very thick accents from their native lands when they speak to the listing agents at some of these open houses. I would say that make up about 10% or more of the people that look at these things. about 3 weeks ago, we looked at a home that was under construction where the build ran out of funds. We were there for about 30 minutes, and I noticed the three other folks that actually came into the property was a couple of Indian men, the others were middle easterners. My agent, a blonde hair blue eye girl said," they are going to drive this one through the roof". We were at an auction couple of weeks ago at the LA court house. I say more then 1/2 were speaking a different language other then English. Many of that foreign money is also driving the market upward. In those heavily Chinese populated cities around Socal, that crazy money is driving real estate through the roof leaving nothing for us common working folks. Kida with college degrees who are earning 70-80K today will not be able to own a home in a good neighborhood near LA. Sit in traffic, drive to work is what many of them expect to do.

[nostatic]

Originally Posted by tabs

In reality Mr Notstaus you have to play the game as if it will never end...you have no choice, and there is literally nothing you can do to ameliorate your situation if it all does go kablewie....Not even Mr Buffet..

It amounts to a mathematical equation Mr Nostatus...it is when the random numbers plugged into the equation turn up SNAKE EYES... that imponderable, subjective snake eyes...

Right. And endlessly proclaiming gloom and doom does nothing productive, so at some point you just put your head down and do the work you need to do.