Re: Patrick.net is in SF Bay Area

Post #282,085

4/17/07 12:43:44 AM

That market is too far removed from reality. I agree with his prognosis there. It will implode. It needs to.

It is NOT a typical market.

Too much of today's music is fashionable crap dressed as artistry._{Adrian Belew}

Post #282,132

by tonytib

4/17/07 11:02:59 AM

CA might be the center, but the problems will spread

Just to give two examples, Orange County is subprime central, but as the subprimes go out of business, it not only hurts OC (e.g. loss of jobs), but the rest of the country, because it removes a significant pool of buyers. Less buyers = less demand = lower prices for a given supply

Second, non-traditional mortgages are widespread outside of CA; for example, [link|http://money.cnn.com/2007/03/01/magazines/fortune/nar.fortune/|here David Lereah] claims that Atlanta had 40% I/O loans in 2005. Unless those Atlanta homeowners can handle a significant increase in mortgage payments, Atlanta will be hurting too.

--Tony

Post #282,162

by imric

4/17/07 1:42:14 PM

Cool. Maybe I can buy a forclosure.

I'll cough up $1000 bucks. I have no credit.

I think I'll still have a wait longer than my lifespan though.

Imric's Tips for Living

Paranoia Is a Survival Trait
Pessimists are never disappointed - but sometimes, if they are very lucky, they can be pleasantly surprised...
Even though everyone is out to get you, it doesn't matter unless you let them win.

Nothing is as simple as it seems in the beginning,
As hopeless as it seems in the middle,
Or as finished as it seems in the end.

Post #282,316

by rcareaga

4/18/07 11:43:46 PM

SF Bay Area: not a typical market

That market is too far removed from reality...It will implode. It needs to.

It's certainly far removed from the gritty reality of the rest of the country, but there's a reason (actually several reasons, starting with weather, culture, cuisine, politics) that people would rather live here than in Muncie, Peoria or Hackensack. Obviously prices can't continue to rise at the rate they've been the last fifteen years—my 99 year-old crumbling manse, even with its foundation issues, would probably not have any takers in today's market at 4x its 1999 purchase price, but would be snapped up in a minute (with the Whole Foods Market shortly to open a hundred yards away) at 3x. I'm not particularly worried about an implosion.

cordially,

Die Welt ist alles, was der Fall ist.

Post #282,354

by boxley

4/19/07 9:33:56 AM

you sir are defaming Hackensack, a fine city

Any opinions expressed by me are mine alone, posted from my home computer, on my own time as a free american and do not reflect the opinions of any person or company that I have had professional relations with in the past 51 years. meep

reach me at [link|mailto:bill.oxley@cox.net|mailto:bill.oxley@cox.net]

Post #282,363

by tonytib

4/19/07 11:38:42 AM

As you point out, those reasons have been there

so the increase in prices hasn't been related to "everyone wants to live here because....". And given the number of people leaving the Bay Area (and CA, too), it's certainly not true eveyone wants to live here at any price.

Prices haven't increased because of job or population growth, because the Bay Area has yet to recover from 2001, and population growth is basically negative or flat.

Oakland will get some major decreases, but not as bad as Brentwood, Antioch, Mountain House, etc. Some initial evidence for this - Notices of Defaults are way higher for Alameda county vs last year, but are up even higher for Contra Costa county.

But, yes, if you can pay your mortage, plan on staying put for a long time, and don't rely on your home's value going up (e.g. for cash-out refi, like many people have been doing), sure, a housing crash makes no difference.

--Tony

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