Let's talk housing bubble!

[BlueStateBlue]

How crazy is it in your area?

:crazy:

[nadinbrzezinski]

1. Craaaazzzyyy

we cannot buy until it bursts and it is only a matter of time now

[BlueStateBlue]

2. Bingo!

I feel the same way. What state are you in?

[nadinbrzezinski]

4. San Diego, California

[vivalarev]

7. Just read about SD....

I just read recently that San Diego has one of the worst bubbles in the country and that something like 55% of all new houses are being bought with ARM loans. Youre right. Youre market is about to burst.

[slackmaster]

29. San Diego is great if you bought 10 years or more ago

My house has more than tripled in value since I bought it late in 1994. At this point I could handle a 50% reduction in housing prices and still be under 50% loan-to-value.

I feel sorry for anyone trying to get into their first home now. OTOH back in the '80s I couldn't see any hope of ever owning my own place. You just have to wait until things fall into place with your income, family situation, and the market.

[LiberallyInclined]

45. they'll be saying the same thing in another 10 years.

San Diego is the only place in the country with perpetually perfect weather, and they aren't making any more land, so OF COURSE San Diego is gonna be pricey.

[BlueStateBlue]

17. I'm in NJ, suburbs of NYC

Rumor has it that a major percentage of properties that have been sold in the past 18 months to moderate income working people are back on the market already because the people can't afford their mortgages after all. This is going to be ugly. I remember when the homeless families in the NYC are were fighting over cardboard boxes during the "Reaganomics" fiasco...

[David Zephyr]

42. Rumor again. Not statistics.

Tsk.

[tamtam]

23. San Diego is NUTS

We cannot afford to buy in San Diego. I keep hearing about the bubble bursting but I'm not so sure. Check this out, a one bed one bath condo will go for 200,000 here. I just talked to a agent and she said the housing is "slowing down"

[BlueStateBlue]

28. Once the investors start to jettison their investment properties

the tide should turn. They're all going to flood the market at once. As soon as a few start taking less than asking, it will probably snowball. Less attractive properties are sitting for a long time in my area (north Jersey), where prices have about tripled in the last 4 years.

[Bluerthanblue]

13. same here-

just hoping it bursts in time for my son's education to be in a town where he'll get a chance to succeed-

Even a simple trailer that would have cost 20,000 a year2 ago is up in the high 70's- not to mention park rent- i don't want to move- and can't afford much, but need to get into a different district within the next 3 years-

(New Hampshire)

[BlueStateBlue]

25. Scary, isn't it?

The place I'm renting was just sold. Apparently the guy who's buying it (who lives on the adjacent property) wants to keep it standing for a year, then knock it down and build a mansion. Good country this America, eh?

[Bluerthanblue]

35. yeah-...

i watched this happen here during the Raygun years, and people lost thier shirts right and left- empty houses everywhere- talked to a real estate agent recently, and he said the 80's were due to banking tricks- that this is different- but i can't see how it can last, with people taking out interest only morgages- and jobs dissapearing while taxes, food, gas and EVERYTHING keeps rising....

Hope for all our sakes it eases.- in time. Unfortunately NH has no sales or income tax- and as such is seen as a haven for some- but for those of us just plain folks, it's getting pretty difficult.

[vivalarev]

3. Where are you guys at?

Im just outside of Philly, and we now have townhouses going for $525k. I feel sorry for the moron that thinks thats a good investment.

[BlueStateBlue]

30. North Jersey

Same thing here. Crummy little capes are going for 400K - 600K. Townhouses 550K, Condos 350K. NUTS!

[Merrick]

5. I live in So Cal. Does that answer your question?

My rent is quite good though considering where I live, though. Quite content not dealing with the whole hassle anyway.

[The_Casual_Observer]

6. OC Calif, crappy 150k houses sell for 800k

Forget the good ones, the sales are to people who sold theirs and then buy the next one with the proceeds and take out an interest only loan for the balance.

They whole thing is a pyramid, when they get to the last sucker, the thing will collapse as they all do.

[BlueStateBlue]

31. Yep, it's a Ponzi scheme n/t

[Gormy Cuss]

8. Just peachy. East Bay SF

The neighbor's modest 1960s ranch (1700 SF) was listed for 850K, sold quickly for just under 1 mil. Five years ago it would have commanded about 500K.

BlueStateBlue: OT, I read your profile so I have to ask. Do you go to Mario's?

[BlueStateBlue]

12. Gormy Cuss, Who doesn't go to Mario's??

I'm about a half mile away. Gotta love the mussels!

[Gormy Cuss]

18. Darn straight!

I married into a family of Mario's addicts and it's mussels every time we visit. Can't be beat.

[BlueStateBlue]

26. It's the little things in life... n/t

[wryter2000]

9. Oy

I live on the border of a bad area of Oakland, CA. Old two bedroom, one bath fixer-upper worth $340,000 two years ago. It must be over $400,000 by now. I bought it for $295,000 a year before that.

I don't care about a bubble because I'm not planning to sell.

[Horse with no Name]

10. I'm planning on moving to the Phoenix area

and my Mom told me that real estate was unbelievable there.
She said her house (and the houses in her area) has gone up in value $80k since she bought it LAST year.
I am going to wait another year to make my move--I am hoping that it is better by then.

[Demobrat]

11. I live in San Francisco. Next question?

I don't even think about buying here. I live in a gorgeous rent controlled 2 bedroom flat, and hope to never leave. Meanwhile I bought a place in Phoenix, which I rent out. Real craziness hasn't hit there yet, but I don't care if it does. The place is close to paid off and I have no intention of selling.

[Nikia]

14. We don't have that craziness

Many older homes are still under $100,000. Many of the new, nice reasonable sized homes, are $150,000-$200,000. The new mansion type houses are around $400,000, but those are huge houses built near other huge new houses. Probably around $50,000 of these houses value is derived from living around other rich people.

[sam sarrha]

15. Tax cuts to the Rich invested in Realestate..causing the housing bubble

and they use it to screw us .. yea that helped out the economy real good

[Demobrat]

22. Artificially low interest rates had more to do with it.

Not to mention interest only loans. Boy are those people screwed, if they are thinking they will just go ahead and refinance when the intro period is over. Good plan, for as long as rates stay artifically low. But if three years from now the only loans available are at higher rates than the loans they have.....hello, major league bargains. That's when the rich will make out like bandits, picking up foreclosed properties dirt cheap.

[bj2110]

16. I'm in Tampa Bay. I'm relatively new here, but just bought a condo...

I hear the real estate market here just started blowing up in the last 2 or 3 years. I figure we're 2 or 3 years behind the markets like San Diego & Phoenix. The condo is our primary residence, I'm not interested in real estate as an investment. Not now anyway. I'm still hoping to make some $ on my home when I sell in 3 years or so. If I don't, no big deal, but it'd be nice. I'll be content to sell at the top and rent during the inevitable real estate crash...

We bought a 2 year old converted apartment, 3 bedroom. 1500 s.f. for $230K. In a nice complex, beautiful pool, right next to a golf resort, in Pinellas county, which is generally completely built out.

[LeftyMom]

19. My friend's house went up 60K over the last year

and it's a fixer on a busy street in a bad neighborhood with no AC and she didn't do anything to improve it.

[lastliberalintexas]

20. Locally very little bubble

Our bubble only exists with respect to new construction. Otherwise, you can find any number of houses, 1700-2000 sq ft in various parts of town, for *under* $120K. They might need a little updating, but they're solidly built, usually on 1/3 to 1/2 acre lots, curbed streets and good neighborhoods.

Jealous yet? Then let me also tell you that you'd have to live in Beaumont, Texas, where the median income is $35K and unemployment is about 9%. It is also an area known as Cancer Alley because of all the petrochemical, refinery and paper mill plants in the area- not exactly an environmentalist's paradise! By and large though the people are ok, and this is at least a blue area of Texas that could always use even more liberals moving in! :)


Now the all to mostly white repub outlying areas? Oy. But still not bad at all compared to the really hot markets.

[Lilyhoney]

21. Santa Barbara, California

My husband and I have a sweet deal and pay about $16,000 a year in rent. You can't buy a trailor home for under $350,000. A MILLION $$$ for a 2 bedroom 1 bath termite infested complete rehab. We wish we would have stolen money to buy anything when we moved here 5&1/2 yers ago. We would have made hundreds of thousands of dollars. Too bad we missed out.

[eissa]

24. Insane

California, of course, but not even a nice area (Modesto -- a KILLER place to live -- HA!)

Luckily we bought our home in '92 (thank you, Clinton!) We were considering moving to a larger home, using all this great equity we have, but even with that our mortgage would have been outrageous with homes averaging around $600,000.

[Lilyhoney]

27. Let me add...

I have looked into moving somewhere cheaper. But being from chicago, we don't want to go back to the cold weather. We don't like the dessert. We do'nt like the south. I have lived in Louisville, KY, Charleston, SC and Sarasota, FL.

There is just simply noplace like southern california. I guess that is why it is so expensive.

[candy]

32. Newton,Mass,it is nuts,totally nuts.

[chaska]

33. NEED YOUR HELP.

I have a friend who just sold his house in Pasadena CA. He is a pretty unusual guy. His mother was an extremely messed up alcoholic and his father deserted pretty early. Long story short, my friend had to drop out of school at age nine. He is only just now (at 50) learning how to do his 3 Rs. And believe me, it's hard at that age.

Anyway, his plan is to buy another house immediately. I'm wondering if that's a good idea. I know nothing whatsoever about buying a house, and my friend has a history of getting screwed at every turn. You would not believe the life this guy has had. Just horrible. He deserves a break.

I'm wondering if now is a good time to buy. What with the bubble and peak oil and God knows what else.

Can anyone advise me on what he should do? I think he should get some advice before he buys again. But from whom?

[BlueStateBlue]

37. I'm not jumping into this game, for what it's worth. n/t

[bj2110]

39. For god's sake, don't let him buy. Follow this link:

http://www.investorshub.com/boards/board.asp?board_id=3979

[converted_democrat]

41. My husband and I sold everything except for our primary residence.

It's nearly paid for so we are keeping it. Alot of it depends on you location. Prices can't go up forever. Personally, we are waiting to see what the end of summer brings.

[Silverhair]

34. Not seeing much bubble here.

Obout 20 miles south of Dallas TX, homes under 100K, 1/4 acre lots, about 2,000 sq. ft., nice neighbors (although most are Reps), clean air, crime is almost non existent, no traffic jams. Local gov't is very laid back and actually helpful to the citizenry.

[madmark]

36. In AZ in some areas its 6% a month appreciation or more

The prices are driving mortgage servicing amounts beyond the ability of middle class incomes to pay even with the low interest rates. California money has been flowing here for a while but now we are seeing national and even foreign investors acquiring individual residential homes, site unseen, apparently in lieu of other investment vehicles such as equity or debt securities. The conventional wisdom seems to be evolving from an approaching burst to rather a mere lessening of the appreciation rates. We need this final bit of psychological adjustment, the denial of the possibility that values could ever dip, to fuel the mania into its final overdrive. What many of these investors are disregarding is that these homes are not liquid assets like securities. Those investors who do not have a large warchest to service the margins they are using to acquire these homes for a extended period time when the market ceases to constantly appreciate will be slaughtered. I

[BlueStateBlue]

38. They just keep inventing new mortgage products

to drive the prices up further. It's unsustainable. I have never seen so many "for rent" signs in my area (northern NJ). One house in my neighborhood has been vacant with a for rent sign since February. That can't be a happy cash flow situation for the new investor (it was just sold in February).

[bunny planet]

44. Let's talk Northern NJ bubbles BlueStateBlue. I'm in Montclair.

Thank goodness I bought a dozen years ago. It is insane what has happened to real estate prices in this town.

[BlueStateBlue]

46. I'm right next door in Clifton

At least Montclair has a bit of culture and nice big old houses - what's the excuse for Clifton? Nutley?? Insane!

[amazona]

40. not at all crazy

There is no bubble in southeast Louisiana -- greater New Orleans area.

[OneBlueSky]

43. New York suburbs are insane . . .

little 1950s two-bedroom, one-bath tract homes on 1/4-acre lots are going for well over $300,000 . . . in some cases they're approaching $400,000 . . . and people are buying them . . . absolutely nuts . . .