[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Home prices top out? Cost of new houses levels off in area after meteoric rise By Andrew LePage -- Bee Staff Writer Published 2:15 am PDT Friday, October 7, 2005 Story appeared on Page A1 of The Bee Price appreciation for new homes in the Sacramento area has slowed to a crawl, with more builders tempering or skipping price increases and offering greater incentives to attract buyers. The median price of a new home sold in the capital region was $459,990 in the third quarter, unchanged from the previous quarter and up 3.4 percent from one year ago, according to the Gregory Group, a Folsom-based market research firm. For the same July-September period last year, the new home median shot up 23 percent for Sacramento, Placer, El Dorado, Yolo, Yuba and Sutter counties. In general the market is responding like it should, based on what's happened with price increases the last couple of years, said analyst Greg Paquin, who heads the Gregory Group. If we kept going at the same (appreciation) rate we would have been in trouble. We couldn't have sustained it, and we would have fallen off the proverbial cliff. Sales incentives and a surge in lower-priced condos and homes on small lots helped push overall third-quarter sales up 4.5 percent, but sales so far this year are down 7.5 percent. The lost steam in the new home market is the latest in a string of signs that the region's seven-year housing boom is winding down to a more normal pace of sales and appreciation. For example, sales of existing homes fell 7 percent in August and the number of resale homes on the market roughly doubled compared with a year ago. Paquin's forecast calls for the median sale price of a new home in the capital region to rise 1 percent to 5 percent annually for the next two to three years as job and income growth catch up to home prices. That forecast could include a dip in prices at some projects, especially those with homes priced over $600,000. Some economists and housing analysts view Sacramento homes as overpriced and vulnerable to significant price declines in the event of an economic shock, such as an interest rate spike. But most predict a soft landing for the market, meaning mild price declines, if any, as long as the national economy stays out of recession and local job growth continues. The outlook for the (Sacramento) region over the next five to 10 years is very bright, in my opinion; so consequently the outlook for the number of homes sold and the prices for those homes is very good, said economist Matt Newman, who tracks the Sacramento market for the Stanford Institute for Economic Policy Research. But because interest rates are rising and prices are already so high, I don't think you'll see a lot of price appreciation over the next few years. Today's new home market bears little resemblance to the frantic one of the last few years when buyers waited in lines overnight, entered lotteries and put their names on long waiting lists for a shot at buying a home. Now most builders are offering incentives worth $1,000 to $50,000 as they work to sell a growing number of houses that are under construction without a buyer lined up. In the last year the number of homes available for sale - including bare lots and homes under construction but not yet completed - has jumped 89 percent, to 2,303 in the third quarter, the Gregory Group reports. Often a buyer has backed out or the builder has forced someone out of a deal. Such cancellations have roughly doubled in the past year, to about 28 percent of all sales in the third quarter. Builders say they are ferreting out more investors. At the same time, more buyers are getting cold feet or simply failing to obtain financing. I wouldn't say it's totally a buyers' market, said Jack Hood, president of Centex Homes' local division. But it's getting to be more of an equilibrium between buyer and seller. If they can find a house that's nearing completion they can probably negotiate a better deal. Many shoppers realize the market is turning in their favor. It looks like it's a buyers' market right now, said Joe Gilmette as he toured a model home one recent afternoon at the burgeoning Anatolia community off Sunrise Boulevard in Rancho Cordova. There are a ton of homes on the market and maybe there will be some room to negotiate. I can make a good decision and not feel pressured. Gilmette, who works in law enforcement, noted that six months ago all of the builders had waiting lists and all of the lots were gone. The number of new homes sold in the six-county region fell 12 percent in the third quarter compared with the second quarter - a seasonal dip also seen in previous years. Hood, the Centex president, said builders have caused much of the market's slowdown by preventing investors from buying. Investors hoping to flip homes for a quick profit compete with builders for sales. And investors buying homes to rent out perturb neighbors who resent For Rent signs in their new
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Prices in London fell by 0.1 per cent in September, according to the latest report from Hometrack... London The average house price in London now stands at £261,000, down from £274,200 in July 2004, an annual decline of -4.6 per cent. Out of all 33 London boroughs, only six saw house price rises, 18 remained static and nine recorded falls. The best results were seen in Hounslow (0.5 per cent), Tower Hamlets (0.5 per cent) and City of London (0.3 per cent). The worst performers in September were Enfield (-1.4 per cent), Southwark (-0.6 per cent), Redbridge (-0.5 per cent) and harrow (-0.5 per cent). Sales, Supply and Demand Activity levels (the number of sales agreed) were up over the month, however, rising by 5.9 per cent (4.3 per cent in August) but with the number of properties listed falling by 2.5 per cent and the number of buyers decreasing by 2.5 per cent, supply continues to outweigh demand meaning that further house price falls are likely, says Hometrack. There was a slight dip in sales price as a percentage of asking price to 93.4 per cent compared to 93.6 per cent in August's report, an indication that it remains a buyers' market with vendors being forced to accept lower offers to secure a sale. The length of time taken to sell a property dropped slightly from 6.4 weeks in August to 6.3 weeks, and the number of viewings per sale was down from 14.4 in August to 14 in September, both indicating that properties are not sticking on the market for as long, according to Hometrack. Gradual Downward Trend Commenting on the report, John Wriglesworth, Hometrack's housing economist, says: House prices have continued along their gradual downward trend this month, falling by a further 0.1 per cent. London has been hit hard by house price deflation although there are no signs of an imminent crash. If activity continues to increase, and buyers come back to the market in force then prices should eventually continue their upward trend. However, while supply continues to exceed demand house prices will fall. House prices in the capital are still well above the national average, making it difficult for first time buyers to get on the first step of the property ladder. Although incomes are rising and mortgage lenders are relaxing their lending criteria, confidence is still low. A further rate cut is needed to help boost confidence across the capital. Our London house price forecast for 2005 remains at -five per cent. === Home prices top out? Cost of new houses levels off in area after meteoric rise By Andrew LePage -- Bee Staff Writer Published 2:15 am PDT Friday, October 7, 2005 Story appeared on Page A1 of The Bee Price appreciation for new homes in the Sacramento area has slowed to a crawl, with more builders tempering or skipping price increases and offering greater incentives to attract buyers. The median price of a new home sold in the capital region was $459,990 in the third quarter, unchanged from the previous quarter and up 3.4 percent from one year ago, according to the Gregory Group, a Folsom-based market research firm. = --- October 08, 2005 Asking prices drop by nearly 15% in 16 suburban Boston towns Price_reducedHomeowners in Greater Boston and elsewhere continue to expect big real estate gains despite a stunning revelation this week: asking prices in 16 MetroWest towns have dropped by nearly 15 percent since August, according to MLS statistics. Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Manhattan home prices drop A report shows luxury apartments took hit in third quarter amid lower sales activity October 4, 2005: 8:11 AM EDT Latest home prices for 149 markets Refinance Rates Hit Record Lows NEW YORK (CNN/Money) - Homes in Gotham got a little more affordable in the third quarter...or rather, prices dropped, but they still remained in nosebleed territory for most people. The price declines followed two consecutive record quarters in which real-estate prices saw gains of at least 10 percent. In its third-quarter Manhattan Market Overview report released Tuesday, Prudential Douglas Elliman attributed the price declines to a number of factors, including a modest uptick in mortgage rates, concern over the economic impact of Hurricanes Katrina and Rita, and a spike in gas prices. Luxury-home prices (condos and co-ops combined) were hit hardest, according to the report. The average sales price of a luxury home sank 26 percent, to $3.8 million, from $5.2 million in the second quarter. It also was 7 percent below the average price of $4.1 million from a year earlier. The median price of luxury homes meaning the price above which half of all luxury home sold -- also dropped, falling to $3.1 million from $3.8 million in the second quarter. A year ago, the median price was $3.2 million. Meanwhile, the average sales price for all types of Manhattan homes combined fell nearly 13 percent to $1.1 million from a record $1.3 million in the second quarter. Still, that was 10 percent higher than a year ago. The median sales price also fell, by 3.2 percent to $750,000. But it was still 25 percent higher than the median price of $600,000 a year ago. There were, however, price increases for smaller apartments. The average price for studios rose nearly 13 percent, to $428,831, while the average price for one-bedrooms rose nearly 10 percent to $687,744. Drilling down, prices for condos and co-ops both fell. Most notable: the average price of a co-op fell below the $1 million threshold, which it crossed for the first time in the second quarter. Sales activity overall declined. The number of units sold fell 8.4 percent, to 1,997, from 2,181 in the second quarter. And the average size of apartments sold fell 14 percent to 1,169 square feet. That's due in large part to the fact that there was an increase in sales activity for studios and 1-bedroom apartments, while demand declined for larger apartments. Not everything was down in the third quarter, however. The average price per square foot rose 1.4 percent, to $984, compared with the second quarter and it was up 22.5 percent from the year-ago price. Also higher was the amount of time it took to sell a property: 133 days versus 102 in the second quarter. = Prices in London fell by 0.1 per cent in September, according to the latest report from Hometrack... London The average house price in London now stands at £261,000, down from £274,200 in July 2004, an annual decline of -4.6 per cent. Out of all 33 London boroughs, only six saw house price rises, 18 remained static and nine recorded falls. The best results were seen in Hounslow (0.5 per cent), Tower Hamlets (0.5 per cent) and City of London (0.3 per cent). === Home prices top out? Cost of new houses levels off in area after meteoric rise By Andrew LePage -- Bee Staff Writer Published 2:15 am PDT Friday, October 7, 2005 Story appeared on Page A1 of The Bee Price appreciation for new homes in the Sacramento area has slowed to a crawl, with more builders tempering or skipping price increases and offering greater incentives to attract buyers. The median price of a new home sold in the capital region was $459,990 in the third quarter, unchanged from the previous quarter and up 3.4 percent from one year ago, according to the Gregory Group, a Folsom-based market research firm. = --- October 08, 2005 Asking prices drop by nearly 15% in 16 suburban Boston towns Price_reducedHomeowners in Greater Boston and elsewhere continue to expect big real estate gains despite a stunning revelation this week: asking prices in 16 MetroWest towns have dropped by nearly 15 percent since August, according to MLS statistics. Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to:
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
San Diego Housing Bubble Pops Tuesday, October 04, 2005 Option Arm mortgages now account for over 75% of all mortgage originations for the month of September. I have never seen anything like this before. I attended two mortgage conventions this month and every broker I talked to said they were experiencing the same thing. Add fuel to the fire because the San Diego housing bubble has finally popped and I am sure much of the rest of the country will soon follow. The damage will be the worst disaster in recent U.S. history. The fixed rate refinance boom has transformed into the Option ARM refinance boom. This is the negative amortization loan that your monthly payment is based on a 1% loan for 40 years for the first 3 to 5 years and then it recasts at normal adjustable rates. This allows someone to purchase a $700,000 home with $35,000 down using a $560,000 first mortgage with a starting payment of $1,415.99 plus an interest only second of $105,000 with a payment of $613.00. Put this together and you can buy a $700,000 home with $35,000 down and a monthly payment of $2,028.99. The same house would rent for around $2,500 a month, so the person buying justifies the purchase. The problem is when this loan recasts in 3 to 5 years, depending on how quickly interest rates rise, the new payment will be around $4,711.26 a month. That's right, the payment jumps from $2,028.99 to $4,711.26 in less than 5 years, and if interest rates rise the payment could be higher! This is justified by I am planning on moving in less than 5 years anyway. This is only the beginning of the problem Then because the house just sold for $700,000, an appraiser uses this house as a comparable on the next door neighbors refinance and this person only owes $250,000 because they bought several years ago when prices were lower. This person decides to tap into this inflated value and due a loan for $350,000 using an Option ARM so he can take out $100,000 to fuel the consumer spending bubble. His payment on his old mortgage was $1,500 per month, but because of this new super duper Option ARM loan he can get his $100,000 cash out and his new payment is only $885 per month. Now he can really blow up consumer spending and even use this extra money to invest in real estate. How about a nice condo in Florida? And the 3 to 5 year recast? (Which will be around $2,200 per month if rates don't rise) He figures he has another $350,000 in equity in his home so he can just keep refinancing every few years and knock his payment back down and don't forget real estate always goes up, so in ten years or so his house will be worth millions and he will probably just cash in and move into his Florida condo anyway. I disagree with all the experts I don't see a soft landing. With all this funny money being pumped into the American consumers pockets, all you can expect to see if a drastic end to consumer spending. If you really think about it, this extra money is fueling a bubble now not just in housing, but everything of value. If people stop buying cars, TVs, appliances, etc. then all those stocks will drop in value and everyone of those companies will cut back on spending and labor which will spiral undemployment out of control, which will cause more deflation. Credit Card accounts will begin defaulting because people won't be able to refinance out of credit card debt and now with the new bankruptcy rules (Effective Oct 15) there is no way out. Additionally, the banks and all these mortgage pools will go bust holding all these underwater loans and a massive government bail out will put everyone including the government into massive debt. Then the government will start the presses and print more money in order to combat deflation, which will cause more deflation because the money will enter the broken banking system instead of the consumers pockets and then we will have a prolonged depression like Japan. Maybe I am crazy, that is just how I see it playing out. Anyway, back to the housing bubble This thing is over in San Diego, September last year we had 67 loans coming from real estate agents, this month we have had 8. I am being told that the buyers have vanished and all that is left is people trying to sell. Some of these sellers are dropping prices by as much as 30% and they are still sitting. Luckily, these Option ARM loans are very profitable and the refinance business continues to boom. I hope all of my fellow mortgage brokers have managed to stash some cash under the mattress. I just sold my last piece of real estate and I am going to watch the storm roll in from the side lines. --- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: Manhattan home prices drop A report shows luxury apartments took hit in third quarter amid lower sales activity October 4, 2005: 8:11 AM EDT Latest home prices for 149 markets Refinance Rates Hit Record Lows NEW YORK (CNN/Money) - Homes in
Re: [FairfieldLife] Re: The Housing Bubble Beginning to Burst?
This is Enron type financial thinking. It always blows-up in the end. --- akasha_108 [EMAIL PROTECTED] wrote: San Diego Housing Bubble Pops Tuesday, October 04, 2005 Option Arm mortgages now account for over 75% of all mortgage originations for the month of September. I have never seen anything like this before. I attended two mortgage conventions this month and every broker I talked to said they were experiencing the same thing. Add fuel to the fire because the San Diego housing bubble has finally popped and I am sure much of the rest of the country will soon follow. The damage will be the worst disaster in recent U.S. history. The fixed rate refinance boom has transformed into the Option ARM refinance boom. This is the negative amortization loan that your monthly payment is based on a 1% loan for 40 years for the first 3 to 5 years and then it recasts at normal adjustable rates. This allows someone to purchase a $700,000 home with $35,000 down using a $560,000 first mortgage with a starting payment of $1,415.99 plus an interest only second of $105,000 with a payment of $613.00. Put this together and you can buy a $700,000 home with $35,000 down and a monthly payment of $2,028.99. The same house would rent for around $2,500 a month, so the person buying justifies the purchase. The problem is when this loan recasts in 3 to 5 years, depending on how quickly interest rates rise, the new payment will be around $4,711.26 a month. That's right, the payment jumps from $2,028.99 to $4,711.26 in less than 5 years, and if interest rates rise the payment could be higher! This is justified by I am planning on moving in less than 5 years anyway. This is only the beginning of the problem Then because the house just sold for $700,000, an appraiser uses this house as a comparable on the next door neighbors refinance and this person only owes $250,000 because they bought several years ago when prices were lower. This person decides to tap into this inflated value and due a loan for $350,000 using an Option ARM so he can take out $100,000 to fuel the consumer spending bubble. His payment on his old mortgage was $1,500 per month, but because of this new super duper Option ARM loan he can get his $100,000 cash out and his new payment is only $885 per month. Now he can really blow up consumer spending and even use this extra money to invest in real estate. How about a nice condo in Florida? And the 3 to 5 year recast? (Which will be around $2,200 per month if rates don't rise) He figures he has another $350,000 in equity in his home so he can just keep refinancing every few years and knock his payment back down and don't forget real estate always goes up, so in ten years or so his house will be worth millions and he will probably just cash in and move into his Florida condo anyway. I disagree with all the experts I don't see a soft landing. With all this funny money being pumped into the American consumers pockets, all you can expect to see if a drastic end to consumer spending. If you really think about it, this extra money is fueling a bubble now not just in housing, but everything of value. If people stop buying cars, TVs, appliances, etc. then all those stocks will drop in value and everyone of those companies will cut back on spending and labor which will spiral undemployment out of control, which will cause more deflation. Credit Card accounts will begin defaulting because people won't be able to refinance out of credit card debt and now with the new bankruptcy rules (Effective Oct 15) there is no way out. Additionally, the banks and all these mortgage pools will go bust holding all these underwater loans and a massive government bail out will put everyone including the government into massive debt. Then the government will start the presses and print more money in order to combat deflation, which will cause more deflation because the money will enter the broken banking system instead of the consumers pockets and then we will have a prolonged depression like Japan. Maybe I am crazy, that is just how I see it playing out. Anyway, back to the housing bubble This thing is over in San Diego, September last year we had 67 loans coming from real estate agents, this month we have had 8. I am being told that the buyers have vanished and all that is left is people trying to sell. Some of these sellers are dropping prices by as much as 30% and they are still sitting. Luckily, these Option ARM loans are very profitable and the refinance business continues to boom. I hope all of my fellow mortgage brokers have managed to stash some cash under the mattress. I just sold my last piece of real estate and I am going to watch the storm roll in from the side lines. --- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote:
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
--- In FairfieldLife@yahoogroups.com, Peter [EMAIL PROTECTED] wrote: This is Enron type financial thinking. It always blows-up in the end. These Option ARMS are just aggressive leveraging and laxing of credit standards. Enabled by lenders. All quite legal and transparent. Though quite imprudent IMO, as housing price appreciation expectations begin to diminish and turn negative. But no one is conning anyone. What CFO Fastau did, with CEO Skilling nodding, at Enron was a series of complex misleading, corrupt, illegal con transactions. These and Option ARMS are not really at all in the same ballpark. An intersting book that goes into the complexity and manipulative nature of the transacions is: http://www.amazon.com/exec/obidos/tg/detail/-/0767911784/103-0654142-0704622?v=glance Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Nonsense. Mortgages are subject (by law) to a limit in interest rate increases, so the most you could see after the 5 year term is up is about 2%. It is not in the interest of the business of the mortgage company to always put the highest legal rate up every year, because you will just sell your mortgage to a more reasonable company. Sure your interest can go up, but it is not unmanagable, plus you can re- mortgage. http://mortgages.interest.com/content/firsttime/ed-ab09.asp HOW CAN I REDUCE MY RISK? Besides an overall rate ceiling, most ARMs also have caps that protect borrowers from extreme increases in monthly payments. Others allow borrowers to convert an ARM to a fixed-rate mortgage. While these may offer real benefits, they may also cost more, or add special features, such as negative amortization. Interest-Rate Caps An interest-rate cap places a limit on the amount your interest rate can increase. Interest caps come in two versions: Periodic caps, which limit the interest rate increase from one adjustment period to the next; and Overall caps, which limit the interest-rate increase over the life of the loan. By law, virtually all ARMs must have an overall cap. Many have a periodic interest rate cap. Let's suppose you have an ARM with a periodic interest rate cap of 2%. At the first adjustment, the index rate goes up 3%. The example shows what happens. ARM Interest Rate Monthly Payment -- --- First year @ 10%$570.42 2nd year @ 12% (without cap)$717.12 2nd year @ 12% (with cap) $667.30 Difference in 2nd year between payment with cap and payment without = $49.82 Secondly: You can always sell your house to a rich Arab or a rich Canadian or a rich German (Germany is much stronger than people are saying in the media) --- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: San Diego Housing Bubble Pops Tuesday, October 04, 2005 Option Arm mortgages now account for over 75% of all mortgage originations for the month of September. I have never seen anything like this before. I attended two mortgage conventions this month and every broker I talked to said they were experiencing the same thing. Add fuel to the fire because the San Diego housing bubble has finally popped and I am sure much of the rest of the country will soon follow. The damage will be the worst disaster in recent U.S. history. The fixed rate refinance boom has transformed into the Option ARM refinance boom. This is the negative amortization loan that your monthly payment is based on a 1% loan for 40 years for the first 3 to 5 years and then it recasts at normal adjustable rates. This allows someone to purchase a $700,000 home with $35,000 down using a $560,000 first mortgage with a starting payment of $1,415.99 plus an interest only second of $105,000 with a payment of $613.00. Put this together and you can buy a $700,000 home with $35,000 down and a monthly payment of $2,028.99. The same house would rent for around $2,500 a month, so the person buying justifies the purchase. The problem is when this loan recasts in 3 to 5 years, depending on how quickly interest rates rise, the new payment will be around $4,711.26 a month. That's right, the payment jumps from $2,028.99 to $4,711.26 in less than 5 years, and if interest rates rise the payment could be higher! This is justified by I am planning on moving in less than 5 years anyway. This is only the beginning of the problem Then because the house just sold for $700,000, an appraiser uses this house as a comparable on the next door neighbors refinance and this person only owes $250,000 because they bought several years ago when prices were lower. This person decides to tap into this inflated value and due a loan for $350,000 using an Option ARM so he can take out $100,000 to fuel the consumer spending bubble. His payment on his old mortgage was $1,500 per month, but because of this new super duper Option ARM loan he can get his $100,000 cash out and his new payment is only $885 per month. Now he can really blow up consumer spending and even use this extra money to invest in real estate. How about a nice condo in Florida? And the 3 to 5 year recast? (Which will be around $2,200 per month if rates don't rise) He figures he has another $350,000 in equity in his home so he can just keep refinancing every few years and knock his payment back down and don't forget real estate always goes up, so in ten years or so his house will be worth millions and he will probably just cash in and move into his Florida condo anyway. I disagree with all the experts I don't see a soft landing. With all this funny money being pumped into the American consumers pockets, all you can expect to see if a drastic end to consumer spending. If you really think about it, this extra money is
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
--- In FairfieldLife@yahoogroups.com, off_world_beings [EMAIL PROTECTED] wrote: Nonsense. And you base your apprisal on a review of loan agreements for Opriosn ARMS? Option ARMS are quite a different animal than traditional ARMS. To cite evidence about conventional ARMS as an argument about Option ARMS is non-sensical. Secondly: You can always sell your house to a rich Arab or a rich Canadian or a rich German (Germany is much stronger than people are saying in the media) Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
--- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, off_world_beings Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Why not, we do it all the time in other countries that are poorer than us. Someone from a rich country doesn't really care if the house costs $10,000 and is only worth $7,000 to sell it again. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
off_world_beings [EMAIL PROTECTED] wrote: Nonsense. And you base your apprisal on a review of loan agreements for Option ARMS? Option ARMS are quite a different animal than traditional ARMS. To cite evidence about conventional ARMS as an argument about Option ARMS is non-sensical. Secondly: You can always sell your house to a rich Arab or a rich Canadian or a rich German (Germany is much stronger than people are saying in the media) Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
--- In FairfieldLife@yahoogroups.com, off_world_beings [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, off_world_beings Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Why not, we do it all the time in other countries that are poorer than us. Someone from a rich country doesn't really care if the house costs $10,000 and is only worth $7,000 to sell it again. Really! Quite shrewd investors these arab, canadian and russan friends of yours. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. With prices dropping globally. They are -- from London to Austrailia to Spain to China. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. -- Actually foreign investors already have been aggresive buyers in hot markets. And some are getting / may get caught in the bubble. But, you being an astute investor, I will sell you a potfolio of overpriced homes right now and you can make a killing on it selling it to the market you you envision. I am sure you will put your money where your mouth is. Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
--- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, off_world_beings [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, akasha_108 [EMAIL PROTECTED] wrote: --- In FairfieldLife@yahoogroups.com, off_world_beings Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Why not, we do it all the time in other countries that are poorer than us. Someone from a rich country doesn't really care if the house costs $10,000 and is only worth $7,000 to sell it again. Really! Quite shrewd investors these arab, canadian and russan friends of yours. Lol, your just not getting are you? They will be able to afford to make a loss on a US home because, ubder your bubble bust theory they will be rich compared to US, and they are not worried about 100,000 here or there. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. With prices dropping globally. They are -- from London to Austrailia to Spain to China. Jya...right. House prices have been dropping in China for a long time.jya right. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. -- Actually foreign investors already have been aggresive buyers in hot markets. And some are getting / may get caught in the bubble. No, becuase, like any wise investor, they know it is just a bubble and that eventually prices will start to rise again, along with wages. But, you being an astute investor, I will sell you a potfolio of overpriced homes right now and you can make a killing on it selling it to the market you you envision. I am sure you will put your money where your mouth is. I am not talking about inverstors. Try reading more carefully. I am talking about 2 things: 1. People who have bought their house to live in it and own it (rather than throwing 10,000 to 20,000 a year down the drain in rent money) 2. People spending some expendable cash on a second home in the US. There are plenty. Canada is a thriving economy not as tied to the US as people think. The whole point being that your bubble will not last under such supply and demand conditions. Maybe in some places there will be a fall but it will not be across the board, except for the fact that Bush's Quagmire will suck up money and resources for economic development, and another big disaste in US could rock things. As long as there is an increasing population in an area there will be increasing house prices. Not that it is a big advantage to anyone , unless it is their business to buy and sell. Yahoo! Groups Sponsor ~-- Get fast access to your favorite Yahoo! Groups. Make Yahoo! your home page http://us.click.yahoo.com/dpRU5A/wUILAA/yQLSAA/JjtolB/TM ~- To subscribe, send a message to: [EMAIL PROTECTED] Or go to: http://groups.yahoo.com/group/FairfieldLife/ and click 'Join This Group!' Yahoo! Groups Links * To visit your group on the web, go to: http://groups.yahoo.com/group/FairfieldLife/ * To unsubscribe from this group, send an email to: [EMAIL PROTECTED] * Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Are you implying such nationalities are stupid and will buy homes 30% above prevailing market rates (if a bubble burst occurs). I thought only certain eccentric Brits were that bonkers. :) Why not, we do it all the time in other countries that are poorer than us. Someone from a rich country doesn't really care if the house costs $10,000 and is only worth $7,000 to sell it again. Really! Quite shrewd investors these arab, canadian and russan friends of yours. Lol, your just not getting are you? They will be able to afford to make a loss on a US home because, ubder your bubble bust theory they will be rich compared to US, and they are not worried about 100,000 here or there. I suggest you are not getting it, or simply poorly informed about the housing markets in the US. First, how will foreign invesors, as a class, be richer if a global bubble occurs -- which is what what I am suggesting. Even without such, most foreign investors are just that: investors -- looking for a return. In most major markets, the fundamentals are so out of whack, the rent/mortgage rates (30-50%), and the affordability rates (15% or so) that the probability of a positive return from either rentals or selling appreciated property is fast becoming minimal. Losses, large losses, are gaining a much higher probability. If the foreign investors want to wait it out, 10 - 20 years while the markets readjust, then fine, housing may be a good long-term investment for such. But the current housing investor market is generally much shorter term. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. With prices dropping globally. They are -- from London to Austrailia to Spain to China. Jya...right. House prices have been dropping in China for a long time.jya right. Actually thats a direct quote from the PBS Lehr News hour tonight. There has been substantial state-financed overbuilding of upscale condos in Peiking, Shanghai and other areas, and prices -- the report said, have dropped 30% in the last couple of years. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. I am still waiting for you to buy the portfolio of overpriced properties that I can structure for you. If you are not willing to buy, your points are just empty and uninformed idle banter. -- Actually foreign investors already have been aggresive buyers in hot markets. And some are getting / may get caught in the bubble. No, becuase, like any wise investor, they know it is just a bubble and that eventually prices will start to rise again, along with wages. Yes, wages have to go up 4 fold in order for 50% of the population to be able to afford the median priced home in major markets. That will take a while. Or prices will have to drop 30-40% And wise investors of course will try to buy at the bottom of a market, not at its peak. But, you being an astute investor, I will sell you a potfolio of overpriced homes right now and you can make a killing on it selling it to the market you you envision. I am sure you will put your money where your mouth is. I am not talking about inverstors. Try reading more carefully. I am talking about 2 things: 1. People who have bought their house to live in it and own it (rather than throwing 10,000 to 20,000 a year down the drain in rent money) I thought you were talking about people who are going to buy housing at a 30% premium after the market drops such. These by definition are NOT people who have bought their house to live in it and own it . How many of your rich canadian, arabs and russians are planning to live and settle in their new US homes? The current market bubble has been driven by investors -- over 25%of buyers. 2. People spending some expendable cash on a second home in the US. There are plenty. Canada is a thriving economy not as tied to the US as people think. And you are sugggesting that such a foreign second home in US market is large and motivated enough to buy up all of the listed homes for sale so that they do not lingering on the market with eventual price drops. So where are they? That is already happening. Days on market is already stretching out substantially, and prices are beginning to drop. The whole point being that your bubble will not last under such supply and demand conditions. First you suggest that sellers will be able to sell at curret prices because of all of your envisioned foreign investors wanting second homes in the US. If prices are stable there is no bubble (bursting). Now you are suggest that there may be a bubble burst,
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
I suggest you are not getting it, or simply poorly informed about the housing markets in the US. First, how will foreign invesors, as a class, be richer if a global bubble occurs -- which is what what I am suggesting. The most ridiculous suggestion. There might be little green men on mars too. Gobal bubble burst. HOW? Even without such, most foreign investors are just that: investors -- looking for a return. In most major markets, the fundamentals are so out of whack, the rent/mortgage rates (30-50%), and the affordability rates (15% or so) that the probability of a positive return from either rentals or selling appreciated property is fast becoming minimal. Losses, large losses, are gaining a much higher probability. So you are saying less people will be able to buy a house so more people will be renting so rental acoomodation will become more scarce so rent prices will rise so people with mortgages can rent their place out and pay the mortgage. In addition renters will get fed up with rising rent which the market will bear unless there is mass unemployment on a scale not seen since the great depression. So renters will (as always) get fed up renting and will start buying so house prices will continuw to rise so there is no real bubble burstjust a normal market wiggle. If the foreign investors want to wait it out, 10 - 20 years while the markets readjust, then fine, . 10 years+, as ALL intelligent investors look at it. Yes you have hit the nail on the head. There are million of intelligent investors in the world who look at gains over 10 to 15 yearsnot year by year. They year by year types are the ones that CAUSED the tech bubble in the late '90s. housing may be a good long-term investment for such. But the current housing investor market is generally much shorter term. Then tough luck to them. Most people are not in it to make a killing. Most people are in it to live in their own place and if they make monety great, but if not they at least don't throw 10 to 20,000 a year down the drain in rent money. (100,000 to 200,000 lost in only 10 years). It is these people that are fueling the market. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. With prices dropping globally. They are -- from London to Austrailia to Spain to China. Jya...right. House prices have been dropping in China for a long time.jya right. Actually thats a direct quote from the PBS Lehr News hour tonight. There has been substantial state-financed overbuilding of upscale condos in Peiking, Shanghai and other areas, and prices -- the report said, have dropped 30% in the last couple of years. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. I am still waiting for you to buy the portfolio of overpriced properties that I can structure for you. If you are not willing to buy, your points are just empty and uninformed idle banter Yes Mr. Rich man. Sorry ain't got that kinda money to buy a bunch of houses, and I'm glad I don't. Most intelligent people don't want that much wealth, they just a house of their own and a car and a decent job they like with prospects and a decent pension. This is what most people actually want. Being rich is boring. Yes, wages have to go up 4 fold in order for 50% of the population to be able to afford the median priced home in major markets. That will take a while. Or prices will have to drop 30-40% True to some extent but mostly in California dude, but not elsewhere. If a house is 250,000 then the monthly mortgage payment will be around $2,300 including property taxes. Most working couples (on say 35,000 and 40,000 a year = 70,000 total) can just about afford that. And that is what mortgage companies look at. It is $24,000 a year, as opposed to about 15,000 a year they would have to pay in rent for something decent. With a bit of inginuity most working people can do it...though it has never been easy. Once they get older and are on 45,000 plus 55,000, then it is getting easier and easier, plus the equity goes up over 10 years. If analysts such as the ones you are quoting are going by average saleries of a single person then they are not very good analysts. Working couples buy houses probably the mostand they fuel house price growth over time. MAIN POINT: Most ordinary people understand the above 10 -15 year inverstment period, and they are fueling the house buying econmoy in the 150,000 to 450,000 range. Their logic will continue to fuel it . (barring the black hole of Iraq and other disasters) Without the
[FairfieldLife] Re: The Housing Bubble Beginning to Burst?
Well, you certainly have an intresting POV. I hope it serves you well and profitably. --- In FairfieldLife@yahoogroups.com, off_world_beings [EMAIL PROTECTED] wrote: I suggest you are not getting it, or simply poorly informed about the housing markets in the US. First, how will foreign invesors, as a class, be richer if a global bubble occurs -- which is what what I am suggesting. The most ridiculous suggestion. There might be little green men on mars too. Gobal bubble burst. HOW? Even without such, most foreign investors are just that: investors -- looking for a return. In most major markets, the fundamentals are so out of whack, the rent/mortgage rates (30-50%), and the affordability rates (15% or so) that the probability of a positive return from either rentals or selling appreciated property is fast becoming minimal. Losses, large losses, are gaining a much higher probability. So you are saying less people will be able to buy a house so more people will be renting so rental acoomodation will become more scarce so rent prices will rise so people with mortgages can rent their place out and pay the mortgage. In addition renters will get fed up with rising rent which the market will bear unless there is mass unemployment on a scale not seen since the great depression. So renters will (as always) get fed up renting and will start buying so house prices will continuw to rise so there is no real bubble burstjust a normal market wiggle. If the foreign investors want to wait it out, 10 - 20 years while the markets readjust, then fine, . 10 years+, as ALL intelligent investors look at it. Yes you have hit the nail on the head. There are million of intelligent investors in the world who look at gains over 10 to 15 yearsnot year by year. They year by year types are the ones that CAUSED the tech bubble in the late '90s. housing may be a good long-term investment for such. But the current housing investor market is generally much shorter term. Then tough luck to them. Most people are not in it to make a killing. Most people are in it to live in their own place and if they make monety great, but if not they at least don't throw 10 to 20,000 a year down the drain in rent money. (100,000 to 200,000 lost in only 10 years). It is these people that are fueling the market. If your theorized crash occurs then that makes the US poorer than some other countries who will be perfectly happy to buy property at the meagre prices they are seeing, wether there is a prevailing lower market rate or not. With prices dropping globally. They are -- from London to Austrailia to Spain to China. Jya...right. House prices have been dropping in China for a long time.jya right. Actually thats a direct quote from the PBS Lehr News hour tonight. There has been substantial state-financed overbuilding of upscale condos in Peiking, Shanghai and other areas, and prices -- the report said, have dropped 30% in the last couple of years. In fact, this very effect will be enough to keep house prices rising. We live in a global economy. The nouveau rich in Russia or Canada will come and buy your cheap little $300,000 dollar house in Boston. I am still waiting for you to buy the portfolio of overpriced properties that I can structure for you. If you are not willing to buy, your points are just empty and uninformed idle banter Yes Mr. Rich man. Sorry ain't got that kinda money to buy a bunch of houses, and I'm glad I don't. Most intelligent people don't want that much wealth, they just a house of their own and a car and a decent job they like with prospects and a decent pension. This is what most people actually want. Being rich is boring. Yes, wages have to go up 4 fold in order for 50% of the population to be able to afford the median priced home in major markets. That will take a while. Or prices will have to drop 30-40% True to some extent but mostly in California dude, but not elsewhere. If a house is 250,000 then the monthly mortgage payment will be around $2,300 including property taxes. Most working couples (on say 35,000 and 40,000 a year = 70,000 total) can just about afford that. And that is what mortgage companies look at. It is $24,000 a year, as opposed to about 15,000 a year they would have to pay in rent for something decent. With a bit of inginuity most working people can do it...though it has never been easy. Once they get older and are on 45,000 plus 55,000, then it is getting easier and easier, plus the equity goes up over 10 years. If analysts such as the ones you are quoting are going by average saleries of a single person then they are not very good analysts. Working couples buy houses probably the mostand they fuel house price growth over
