Bubble Bloggers, Naysayer and Animal Rights Nuts
Posted on March 19, 2008
Filed Under bubbles, Relationships, Portland, blogging, Real Estate |
A comment on this post, from the perfectly named Naysayer:
I love how you real estate people and the homedebtors try to blackmail the rest of us with your ominous threats about how the return to sane housing prices will be bad for all of us. Bullpucky.
Let it crash. Let it crash HARD. The dotcom bubble burst didn’t hurt everyone and this one won’t either. Well, no one except stupid people who bought overpriced dwellings and the real estate industry that reaped the benefits. A return to sane pricing is the very least of our problems. More pressing is the damage done by the lending practices of the financial industry. Propping up prices won’t alleviate that one bit.
You people have only yourselves to blame. Save the warnings. We’re past that.
Charming.
But, again, Naysayer, thanks for accepting the invitation. I have a point I want to make and want to make only once, but I didn’t want to make it on Ron’s site; he’s much, much nicer than I am. This fits. Perfectly.
I’ve been through this before. In the early nineties I was involved in - and even moderated for about thirty six hours - an animal rights newsgroup. I had a friend who was in medical research, and my wife was involved with the AKC and the breeding of dogs; both were targets of these nuts, and the Animal Liberation Front - originality is not the strong point of sociopaths - was busy burning mink farms and research labs in order to prove a point.
Profiles emerged almost immediately:
- The AR devotees - note this is the rat is a pig is a dog is a boy club - were for nothing; they defined themselves by what they were against. They didn’t love animals, they hated humanity. Still do, for all I know.
- As you might expect, intellect wasn’t a dominant trait, but even those who should have known better - one even had a law degree and a PHD in philosophy - lacked any measure of discernment; logical flow simply wasn’t part of their arsenal. That was, well, logical: When you begin with a conclusion, as they had, and try to work backward for proof, logic gets in the way. They were forced to resort to non sequiturs, begged questions and, most popular, ad hominem to make a point, and almost all thought they were infinitely more clever than they actually were.
- Most, of course, cowered behind anonymity. It was there that it first came to my attention that those not willing to put their name to an idea likely didn’t have an idea worth hearing.
- Perhaps most importantly: in their zeal for a world of utopian parity, they confused lifting themselves up with bringing others down. As long as they could damage their perceived nemeses, it didn’t matter if it scorched the animals they were pretending to champion or, ultimately, even themselves. Destroy, destroy, destroy, destroy.
Are you getting the point, Naysayer? Even your handle fits the profile. The biggest difference between you and me is I want people to succeed; I value excellence and the rewards that come attached to it. You are invested in failure: you want more foreclosures, you want the economy to tank, you want more people to suffer, so you can accommodate your poorly sourced narcissism.
I want the very best for my clients, and work to get them the very best information possible so they can make informed decisions. That’s why I tell them to stay away from the crap that NAR puts out, but even more emphatically tell them to stay away from the crap put out by bubble blogs. Both have agendas, but you have the added disadvantage of not knowing what you’re talking about. You know nothing about the business of real estate, nothing about the decision dynamics that go into buying and selling, nothing about market forces. [‘Propping up prices’? What the hell does that mean?] You don’t want people to have good information, you want people to only have your information; your whole paradigm is wrapped up in the decidedly fatuous “If people buy now, they’re stupid”.
I’ve spent the better part of the last two months trying to find ways for a couple not to put their home on the market, including working with their lender and getting them into HUD counseling. I have nothing but contempt for anyone who’s delighted by their angst. [Let it crash. Let it crash HARD.]
We’re in a tough market, a fact I’ve never tried to hide. While it’s not going to crash nearly as hard as you hope, we’re going to be in it for at least another six months, possibly much longer.
But it is what it is. I’m going to do everything I can to help those who need my services to see their way through it.
What, exactly, are you going to do?
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60 Responses to “Bubble Bloggers, Naysayer and Animal Rights Nuts”
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Thank you very much for this. I’ve seen Naysayer running around a bunch of local sites and it’s getting rather old. Hopefully I’m right in reading between the lines of what you wrote and we agree that housing isn’t a national or state-level or even city-level trend, but a per house issue. I commend you for helping your customers to not sell, since I assume the market isn’t right for THEIR house. But I’m sure you’re not telling everyone you meet to pull their listings, because it IS right for THEIR house.
Thanks and keep up the good work.
Jeff - Here, here! You have summed it up perfectly. Many of the people like Naysayer seem to be more concerned with bringing other people down than putting all of the facts into perspective. All I really see from them is a twisted, negative view where people suck, the world sucks, and everybody that disagrees with them sucks.
There are people (and I think you are one of them)in the industry that actually care about their clients’ needs and want to help them made good decisions. I appreciate your candor and willingness to speak out.
It’s too bad you had a bad experience with animal activists.
But caring about living beings is the antithesis of a sociopath.
———–
Thank YOU, Nick. Yes, you’re correct: real estate is local down to each individual house and each individual circumstance. It’s the job of good agents to help people sort through options to come up with the right solutions…
Is this where the freaked out real estate shills and nervous homedebtors hang out to commisserate over their shrinking equity and stalled sales?
Don’t worry. Portland is different. Soon we’ll be back to bidding wars, multiple offers and 20% yearly appreciation!
PS. The whole social envy thing is getting old. Why would we bubblesitters envy people who overpaid for an asset that is losing value every month? Meanwhile, you and those like you have not stopped looking down on anyone who wasn’t willing to participate in this insanity. Which, as it is turning out, seems like a pretty rational thing.
Thanks, Jody!
I found from my AR experience that most either ignored the doctrine because it’s just too dumb, or were too polite to call them out as the nuts they were. That led to some tacit public sympathy. Once the vacuous nature of the movement was exposed, they’ve gone largely away.
Too many people take bubble bloggers seriously, undeservedly. I hope more speak out.
Naysayer, your entire comment is apropos of absolutely nothing I said. Just not-very-clever vitriol.
Which proves my point.
Jeff,
Thx for the comments…it sounds like you really bend over backwards for your clients. What are you and your affiliates doing to help first time home buyers (making a median income for this area) obtain a 30-year mortgage in Portland? Median income in this area is estimated to be 43k (by Sperlings) to 63k (PDC estimate). What advice do you have?
Hi, Nick, Jody, & Jeff,
The only thing certain about the future is uncertainty but I will ask you this question regardless.
Looking forward to March 2009 do you think prices will be higher or lower than the current median?
Thanks in advance.
[Deleted by Admin]
James: Since you didn’t leave an email address I’ll explain: Irrelevant, even if true, and I don’t want even secondary links posted here.
Given the income of the ‘average’ Portland metro resident, how can any one afford Portland prices? Do you guys really think this is sustainable? If 10% down is now required, how many people did that knock out of the market? And given record inventory (not even counting the 2,000 condos w/out rmls numbers), who the heck is going to buy all these homes over the next 2 years?
Why leave common sense out of all this?
Someone making between 43 and 63K won’t qualify to buy a shack here anymore. The only way they were able to in the last 5 years was with dangerous, “creative” financing that is threatening to sink our whole economy.
Hi, Chris …
MY role is relatively simple: I have three loan originators that I’ve worked with, trust and recommend to anyone who asks. They in turn will recommend products to fit the requirements; if there isn’t enough in the qualifications to do it right, they’ll counsel on how to get there.
With FHA going to a new limit of $418k - and 3% down w/no reliance on FICO scores - we’re beginning to see a lot of first time buyers going that way.
Once that’s done, a price range can be established given the amount of down payment. 3% down @ $50k/yr means about $200k - $210k, depending on other debt, at today’s interest rate.
Importantly: Depending on where you’re looking, I wouldn’t recommend buying anything right now if you’re not absolutely sure you’re going to stay at least two years, preferably five or more.
Clint, nice to see you here.
First let me reiterate what I’ve said elsewhere: median price, in and of itself, is a poor predicate of a market’s health. Much better to have declining median and increasing sales than the opposite.
That said, I don’t think there’s any more chance we’ll be flat or up than we’ll be down 20%. If you want something for the record, I’ll say down about 10%.
>Do you guys really think this is sustainable?
Greenie - Suzan? - you’ve done a lot of disingenuous ‘gotcha’ reading of my last blog, but apparently not enough to be able to answer that question yourself.
Please do.
I’m at a loss as to how you got from Naysayer’s post that you quote, to comparing hime to the ALF.
Some real(tor) desperation here it would seem.
“But it is what it is. I’m going to do everything I can to help those who need my services to see their way through it.
What, exactly, are you going to do?”
I think a lot of folks like Naysayer are trying to prevent people from making the mistake of buying near the peak (which is now past) of a falling market. That could save people many thousands (tens of thousands) of dollars. You assume that all of the “Naysayers” are only trying to be “negative” when really their motivation may be to get the word out. At least folks like Naysayer and other bubble watchers have no finanical conflict of interest connected to the advice they’re giving. The “There’s never been a better time to buy!” crowd definitely has a financial conflict of interest when they dispense their advice and predictions.
Re: “Propping up prices”
Hi Jeff, may I suggest you read up on Moral Hazard and take a look at our government’s current monetary policy?
>I’m at a loss as to how you got from Naysayer’s post that you quote, to comparing hime to the ALF.
From Eric Hofer’s 1959 definitive The True Believer:
“Passionate hatred can give meaning and purpose to an empty life. People haunted by the purposeless of their lives try to find new content not only by dedicating themselves to a holy cause, but also by nursing a fanatical grievance. A mass movement offers them unlimited opportunity for both.”
Hope that helps.
>Hi Jeff, may I suggest you read up on Moral Hazard and take a look at our government’s current monetary policy?
Thanks, Ralph. Yes, you may certainly suggest it. I just won’t know what to do with it until you give me an author or a link.
Here’s what set me off. When the blog owner said this:
It does, however, dovetail nicely with a post I’ve considered writing to those numbered and universally nameless souls who’ve been predicting a Portland downturn for awhile now, and are gleeful that they’re finally right: Beware of that for which you wish; this affects everyone.
There it is. That threat that if we don’t rescue people and thus the real estate industry we’ll all suffer for it.
So Jeff. If Barney Frank gets his way and we change the terms of the loans and only make people pay back 90% of what their homes are worth at foreclosure time, are you going to give back part of your commission? After all, the price was changed after the sale. Why should the bank absorb all the loss? What about you and the Wall Street slime that sold the mortgage over and over for ever escalating prices?
And how about those speculators and flippers. When they pulled their money out of the houses they kept bidding up higher, did they surrender their gains to the greater good, as in “this affects everyone”? Did the people who sold at the top have to pay any of their gains to rescue the lesser homedebtors (the ones who missed their opportunity to sell at the top) for their losses? No, we don’t even charge cap gains tax on home sales anymore!
I used to work for a non-profit that serves lower income communities. There’s real suffering out there, people living in the streets due to mental illness or a bad run of luck. And as a society we don’t really do that much for them. For decades we’ve been slowly reducing the little help we do provide them and we bitch for having to do it.
But you expect us to gladly chip in to keep people from losing houses they bluffed their way into? And you accuse us of sour grapes if we don’t think that’s a priority?
I think you and the other realtors who frequent this place are the ones who need to look inside yourselves and discover what your true motivation is. It’s not your clients. It’s not society.
It’s your income.
Thanks, Ralph. Yes, you may certainly suggest it. I just won’t know what to do with it until you give me an author or a link.
I’m sorry, I didn’t realize I had to direct you on how to use resources on the Internet. If you click the link below, with your left mouse button (don’t look for a left button if you are using a Macintosh computer, just use the Big One), it will direct you to a resource called WikiPedia.
Moral Hazard
As for what our federal reserve is up to, please use the following link as well:
Yahoo! News
Thanks again, and good luck.
Thanks, Ralph. Yes, you may certainly suggest it. I just won’t know what to do with it until you give me an author or a link.
I’m sorry, I didn’t realize I had to direct you on how to use resources on the Internet. If you copy and paste the following link into your web browser (you will need to consult you operating system’s manual on how to copy and paste), it will direct you to a resource called WikiPedia.
en.wikipedia.org/wiki/Moral_Hazard
As for what our federal reserve is up to, please use the following link as well:
news.yahoo.com/
Thanks again, and good luck.
Clint - I see prices being less in March 2009 for the Portland market, and I think that’s a good thing. Really. We needed an adjustment. However, I don’t see PDX crashing like California/Florida/etc. Portland is a popular place to live and people continue to move here (I’m not sure that’s such a good thing for Portland, but it’s a good thing for the housing market) and we are just not as over-developed as many parts of the country.
Naysayer - Your comment There it is. That threat that if we don’t rescue people and thus the real estate industry we’ll all suffer for it. doesn’t make sense to me. Where in Jeff’s statement does it say that he is for the governement bailing out homeowners? I think he’s trying to say that those people who have been predicting a market crash here in Portland are all to happy to jump on the “I told you so” bandwagon every time we have a downward turn in numbers, even if they are small. Sometimes I get the feeling that you WANT the Portland market to crash. Do you think it will teach all of those real estate agents/flippers/stupid over-their-head-homeowners a lesson for being too greedy? Well, I think you’re missing the point. A huge housing crash in Portland will affect all of us - the good and the so-called greedy. You included.
It’s too bad you lump so many people together in one bucket and view them through a telescope turned the wrong direction.
Jody, if you can’t see a threat in Kempe’s post or yours just now, you’re blind.
I don’t believe we’ll all suffer WHEN (not if) Portland housing prices come crashing down to reality. We will all suffer for the credit crisis but the housing prices dropping will not add a bit to my misery or anyone else’s in my position. In other words, the damage is going to be done whether prices drop or not so yes, I prefer them to crash. It serves society, future generations and everyone (except the groups you mentioned) better than manipulating the economic system (bailouts, after-the-fact price adjustments-total insanity!). All that will do is destroy the credit markets further.
Sorry that you’re freaked about your equity or your career but that’s the way it goes.
“From Eric Hofer’s 1959 definitive The True Believer:
…
Hope that helps.”
But Jeff, you seem to be a true believer as well. Apparently you believe in the NAR cause thus you defend it here very strenuously. How are you not a “True Believer”?
Oh, and as for that “everyone is moving here thing”? There’s a story in one of the papers today about how migration to the Sun Belt has slowed due to uncertainty in the economy. Funny how projections can be so off. The same will happen here. There’s no “million new people” coming here for certain. It could be 2 million or 100,000. Metro has no way of knowing (that’s the source of the number) and uses its projection to promote an agenda.
And Portland is overbuilt. That explains the huge increase in inventory.
It’s sad how Portlanders rely so heavily on myths and legends.
Naysayer - Once again, your interpretations are interesting. Thanks for the chuckle.
Hi Jody,
Can you explain more about what this means:
A huge housing crash in Portland will affect all of us - the good and the so-called greedy. You included.
How will a huge housing crash effect me and how could it be prevented from effecting me?
I’ll bet you won’t be chuckling in a few months and definitely not in a year from now. One of the only reasons we aren’t already in a deep recession is the fact that we’re in an election year.
[…] Bubble Bloggers, Naysayer and Animal Rights Nuts, by Jeff Kempe. […]
Naysayer, you remind me of my Dad. We were watching football before a holiday dinner and my Dad gets up walking toward the kitchen.
“Where are you going?”
“Time to agitate.”
Within 30 seconds the ladies were squawking and he was smiling as he walked back in to the room.
I have seen you make your comments which seem to be off point and to agitate. I don’t actually think you believe what you write. I think you are the guy with too much time that wants to stir things up. Good job, it is mildly entertaining.
And to skeptictank who wrote, “Apparently you believe in the NAR cause thus you defend it here very strenuously.” I guess you missed in this post where Jeff wrote,”That’s why I tell them to stay away from the crap that NAR puts out.” Strenously? Please
Get some intellectual honesty.
Ralph - I’m no economist, but here are a couple of web posts that talk about the effects of a housing crash/slump/bubble burst:
The first is the Wall Street Journal Econoblog - http://online.wsj.com/public/article/SB116100680840693865-y_rNLgprqhco8ALVTGWvXi6h0tw_20071017.html
And another is from International Viewpoint, an online magazine - http://www.internationalviewpoint.org/spip.php?article1332
The articles point out how a housing crash can affect not only housing-related industry (building trades, mortage industry, decorating, remodeling, landscapers, etc.) but also consumer spending, thus negatively affecting our economy. If the economy dives then businesses close, people loose their jobs, and everyone is worse off.
Take off the blinders, ayesayer. The economy is swirling round the bowl due to the housing bubble madness, the Fed is almost out of ammunition to stave off disaster and we’re hurtling towards the abyss. Now THAT’S agitating.
Try reading something besides NAR Times or the happy talk from the RMLS reports and you’ll be agitated too. Come out from under that Portland-is-special blanket.
Sorry you had a bad relationship with your Dad. He sounds like a fun guy.
I think this housing crash will cause way more pain in the general economy than the .com crash did - it may even pose systemic risk of a collapse of the banking system.
Specifically because during the .com people were at most leveraged to 150% of their assets - When the markets crashed sure they lost everything they had - but this time around people are leveraged 100%+ with 0 down loans in effect they are 500k on margin with 0 suppoting assets.
The banks are going to have to eat this unless they can foist it off on the taxpayer via fannie and freddy.
To put this in perspective consider everyone’s fave bank of the moment - JP Morgan Chase has 7.7 TRILLION in credit based derivatives on it’s books.
If they have to revalue those down 15% because of a housing crash that represents a loss of 1.2 Trillion dollars.
There is $900Bn of US currency currently in circulation according to the Fed’s H41 report.
How can we even start to bail out those kind of losses when there isn’t even that much currency in circulation ?
In addition Feb ‘07 AAA tranch of the mortgage backed securities are trading at 55 cents on the dollar - if they had to “mark to market” it’s a 45% loss…..
AAA is the highest most secure tranch - the subprime stuff is rated MUCH lower….
Hi Jody,
Thanks for the links. To be honest, I am quite aware of the risks to the economy as a whole. Recessions and depressions happen for reasons. Americans have financed themselves to the nines.
Household Debt as percent of GDP
As you can see from the above chart, the American consumer has dug a huge debt hole for themselves. Housing being a large force behind that debt:
Consumer Debt Mortgage vs Consumer Credit
Considering America doesn’t produce any goods that the rest of the world wants, we are over our head in debt, and housing has peaked; there isn’t much to throw at the problem. Though of federal reserve is going to try desperately while causing tremendous inflation while debasing our currency.
(An interesting game plan that Chinese will wake up to soon enough)
So I ask you the following questions:
Wouldn’t it be better to take our lumps and get back to an economy where the fundamentals make sense? Wouldn’t it be better if our economy was based on wealth creation by producing things and not consuming things?
This seems to be where people like Naysayer and I part ways with people like you and Jeff. We would much rather have stable growth, real wealth, and a society where the middle class is disappearing.
middle class is disappearing.
doh! NOT disappearing.
Sorry.
“The articles point out how a housing crash can affect not only housing-related industry (building trades, mortage industry, decorating, remodeling, landscapers, etc.) but also consumer spending, thus negatively affecting our economy. If the economy dives then businesses close, people loose their jobs, and everyone is worse off.”
I think it is undoubtedly true that a housing bust will affect other parts of the economy. That’s why I think it is short-sighted to be gleeful about it.
However, I also think that it is short-sighted to believe that the housing bust can be prevented, or that it would be good to prevent it. The bust was inevitable when the bubble started. You can’t have one without the other; it’s simple cause and effect. All those jobs and all that spending were supported by reckless financing; it is not by accident that they are now beginning to disappear.
“I’m going to do everything I can to help those who need my services to see their way through it.”
Believe it or not, many bubble-sitters are doing exactly the same thing. For every piece of NAR propaganda that is issued, they provide a counterargument so that people won’t be led to their own slaughter. (Note that I’m not accusing any one particular person here of pushing NAR propaganda, but every industry manufactures propaganda, and NAR is certainly no exception.) The longer a bubble lasts, the more harm it causes, so the sooner it pops, the better for all of us. In the end, no one benefits from mass delusion.
Even Bush seems to get it:
“Some in Washington say the government should take action to artificially prop up home prices. It’s important to understand that this would hurt millions of Americans. For example, many young couples trying to buy their first home have been priced out of the market because of inflated prices. The market now is in the process of correcting itself, and delaying that correction would only prolong the problem.”
That’s from his radio address last Saturday. First intelligent thing he’s said in years.
http://www.foxnews.com/story/0,2933,338128,00.html
Ralph, Leo et. al.
Another of the common traits exhibited by the AR crowd is they consistently ignored what was going on around them and instead attacked fantasy stereotypes. Not so much as straw man arguments, really, as tilting at windmills.
You’re tilting at windmills.
I think one of the worst financial precedents from the last thirty years was the bailout of Chrysler. I’m an emphatic free market conservative, and government intervention nearly always prolongs and exacerbates problems. It’s going to be painful, but given the freedom of market forces to act the market will sort itself out.
That said, Ralph, you assign too much authority to Moral Hazard - interesting but nothing revelatory; Adam Smith said as much a few hundred years ago. It has almost nothing to do with propping up prices, which I believe was your original premise.
>Believe it or not, many bubble-sitters are doing exactly the same thing. For every piece of NAR propaganda that is issued, they provide a counterargument
No, Leo, I don’t believe it. Bubble sitters by and large are invested in being right and, much like the NAR, look for ways to prop up their case even with bad information. And a lot of it is very, very bad.
To all: comments with two or more links get snagged in spam moderation. Please be patient if you don’t see it immediately.
That said, Ralph, you assign too much authority to Moral Hazard - interesting but nothing revelatory; Adam Smith said as much a few hundred years ago. It has almost nothing to do with propping up prices, which I believe was your original premise.
Really?
You say you are a free market kinda guy, eh?
So, HOPE, bumping GSE conforming limits, reducing GSE capital reserves, dropping the Fed Funds Rate, Bear Stearns.
All these things, they are conservative free market approaches to you?
I should start up and investment bank, the government will save me. I should buy a home I can’t afford, the government will work to keep me in the home. I should stop paying my mortgage payments, the banks won’t kick me out it costs too much.
Moral Hazard.
Ralph? You’re still tilting at windmills.
Ralph? You’re still tilting at windmills.
I think you have proven the type of person you are Jeff. There is a word for it, Sophism.
Good luck to you.
1. Oh my God. I actually agree with something Bush said. This taints my whole way of looking at life.
2. In a free market, interest rates would seek their own level. By setting the most important price- the price of money- through manipulations in the rate, we long ago ceased being a free market economy. Whatever that is.
Take off the blinders, ayesayer. The economy is swirling round the bowl due to the housing bubble madness, the Fed is almost out of ammunition to stave off disaster and we’re hurtling towards the abyss. Now THAT’S agitating.
Try reading something besides NAR Times or the happy talk from the RMLS reports and you’ll be agitated too. Come out from under that Portland-is-special blanket.
Sorry you had a bad relationship with your Dad. He sounds like a fun guy.
The real problem is debt. We are a country built on debt. Regardless of whether it is housing or credit cards.
Why can’t we say Portland is different? It is until the numbers say different.
Detroit was different. “Over the past five years, Metro Detroit has recorded a 26 percent increase in home prices, according to PMI. By comparison, home appreciation across the nation increased 50 percent in the same period. Among individual markets, San Diego prices skyrocketed 120 percent.”
I love my Dad and laughed when he did that. It was entertaining just like you are entertaining me now.
Jeff,
I’m reminded of the saying “Those who throw dirt, lose ground”. Naysayer’s island only gets smaller with each clump of soil thrown. So be it!
The mudslinging on both sides is completely missing the point - the economic future is coming down the pipe no matter what we wish for.
Best course of action is to analyze the data and position ourselves to take advantage of it.
You may wish for a crash, or for 20% a year continued appreciation forever - I’m in the business of looking at the facts and positioning myself for the future.
To me the facts say hard landing coming - and I’ve yet to have anyone change my outlook through analysis of my data / reasoning.
The most analysis I’ve got out of he real estate professionals thus far is -
* “Can’t happen here because of UGB”
* “It’s different here (Thus far)”
Neither of which make any logical sense at all.
*Shrug*
No, the problem is uncertainty. No one one knows the extent of, depth of or damage from the credit crisis. The Fed and the admin are playing with liquidity which isn’t the problem.
Nevermind that, I’m going to go buy a condo with no money down so my island gets bigger, all that dirt throwing and all! Can one of you nice realtors find me a bank that will loan me 400K on an average salary? Thanks in advance!
“No, Leo, I don’t believe it. Bubble sitters by and large are invested in being right and, much like the NAR, look for ways to prop up their case even with bad information. And a lot of it is very, very bad”
Like I said, believe it or not, it doesn’t really matter. Note that I didn’t claim that all of the bubble-sitter information was correct, just that they provide counterarguments to the NAR propaganda and other housing perma-bulls. And in that “mission” bubble-sitters believe they’re providing a service, just like you believe you are providing one. Bubble-sitters may be wrong about that, just as you may be.
If you’re just pointing out that there’s bad information on the web on both sides of the issue, that almost goes without saying. But I think that housing bulls are often not far from “tilting at windmills” themselves; the bubble sitter they ridicule is just another fantasy stereotype.
>I’m in the business of looking at the facts and positioning myself for the future.
Actually, UG, I was wrong initially. You’re not looking for facts at all; like the rest, you’re looking for attention and validation. Otherwise this:
>The most analysis I’ve got out of he real estate professionals thus far is -
* “Can’t happen here because of UGB”
would seem as silly to you as it does to most others. I’ve never said that, in fact the opposite; to my knowledge no one else has, either.
What I HAVE said is your original postulate - that the Portland Metro MSA and the 37 MSAs in California are directly correlated one year apart - is nonsense. You’ve yet to establish any correlation because none exists, Leo’s assertion that it’s up to me to disprove it notwithstanding.
And Leo:
>And in that “mission” bubble-sitters believe they’re providing a service, just like you believe you are providing one.
Outside the postmodern world of phantom truth, only one of us is correct. Bubblers lump the market into a hypothetical package, wrapping “Don’t buy! Don’t buy!” around everyone, regardless of circumstance.
I - and all good agents I know - treat every client separately, giving advice only based on individual need.
There will be 5 million resales in 2008, 1 million new homes sold, most to the advantage of both buyers and sellers. Like the AR nuts furious that a child’s cancer cure came at the expense of several dozen labratory mice, I suspect that drives bubblers up a wall.
The market adjustment is going to be painful, for pretty much everyone.
But it will adjust.
Jeff :
Actually you stated across on Ron’s blog that the UGB protected Portland from the price runups other parts of the country have seen and also helps prevent declines -
“But Portland’s UGB restrictions on growth - which held back the 40% spikes but, coupled with a high percentage of incoming population, tempers declines”
I just didn’t see how that was possible as it functions as a supply constrictor - and it certainly wouldn’t prevent both runups (not enough supply to go around for a given demand) and downturns (too much supply vs not enough demand).
The correlation is a result of downward pressure being applied to the market with people’s “creatively financed” mortgages adjusting and bringing the reality of that kind of debt load on them - PDX boomed about a year after SD and thus the suicide mortgages have a later adjustment date. That’s why I think there are certain trends that shaped the SD market we will see repeated here in our own market - just with a lag time.
If I’m correct expect to see a lot of people start to put their houses on the market in an attempt to get out from under the debt load once they discover they can’t refinance out of it given the recent changes in the lending environment.
I’m honestly interested as to what economic factors would prevent Portland from returning to historical income/price levels just like the rest of the country is in the process of doing - I’m just not seeing any.
Most people I’ve spoken to (not just realtors) seems to think we are sheltered yet none have given a well argued theory as to why.
Is it just “Can’t happen here” mentality or am I missing something ?
To get the whole story you should always listen to both sides of the discussion - I’ve hung out on bubble blogs to collect data there - and realtor blogs are the obvious flip side of the coin.
Actually you stated across on Ron’s blog
Oops.
Good grief. Techniques haven’t changed in fifteen years.
UG, Dowding a quote to eliminate meaning and context is the last refuge of a losing argument. In full, getting from this
We’re in a tough market, certainly from a sales standpoint. But Portland’s UGB restrictions on growth - which held back the 40% spikes but, coupled with a high percentage of incoming population, tempers declines - argues seriously against trying to predict future based on what’s happening in, um, ‘California’.
to this
* “Can’t happen here because of UGB”
is impossible unless you’re a True Believer with an extra set of blinders.
I’m going to put together a housing primer that will answer your questions, not for you - you see only what you want to see - but for anyone reading who still thinks you may know what you’re talking about.
Not now, however. It’s Good Friday.
OK - so you were saying is that constricting supply via UGB prevented price increases so we didn’t rise as high and that coupled with population growth means we are insulated from the crash?
I’m really not trying to be an ass - just the internet lacks as a communication medium sometimes - is the above more or less what you meant ?
What do you think about the point I made regarding reset timelines for mortgages ?
Any value there or do you think that people in PSX were more conservative with their financing ?
From Fleckenstein’s column today:
“Even the government seems to think that advocating the abrogation of certain real-estate contracts is sound policy.
Where will all this stop? Can those who behaved prudently afford to bail out those who behaved imprudently? Why should they have to? And is that what we really want? After all, this country’s median income of roughly $49,000 can hardly be expected to service the debt of the median home price of $234,000, up from approximately $160,000 in 2000.
Let’s do a little math. Forty-nine thousand dollars in yearly income leaves approximately $35,000 in after-tax dollars. Call it $3,000 a month. A 30-year, fixed-rate mortgage would cost approximately $1,500 per month. That leaves only $1,500 a month for a family to pay for everything else! (Of course, in many communities the math is even less tenable.) This is the crux of the problem, and the government cannot fix it.”
http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/CateringToTheBailoutNation.aspx?page=2
You people are talking blasphemy. Real estate NEVER DROPS no matter how fast it has risen. It’s a guarantee of life that one’s dwelling will only increase in value. Believing anything else is to be a heretic.
You’re just jealous of those with the good fortune to have bought at the peak and whose homes will provide them riches beyond their dreams in their golden years.
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FYI latest case schiller numbers are out -
Portland 178.81 -2.0% -0.6% -0.5%
Down we go.
Complete results -
Las Vegas, down 19.3% in the past year; Miami, down 19.3%; Phoenix, down 18.2%; San Diego, down 16.7%; Los Angeles, down 16.5%; Detroit, down 15.1%; Tampa, down 15%; San Francisco, down 13.2%; Washington, down 10.9%; Minneapolis, down 10%; Cleveland, down 8.5%; Chicago, down 6.6%; New York, down 5.8%; Denver, down 5.1%; Atlanta, down 4.8%; Boston, down 3.4%; Dallas, down 3.3%; Seattle, down 1.3%; Portland, down 0.5%; Charlotte, up 1.8%.
Charlotte managed to stay above water but is now the only MSA they track that’s still afloat.
Just for comparison - here are last years numbers stacked up against this years -
MSA Jan 2007 Jan 2008
————————————-
Atlanta 2.3% -4.8%
Boston -5.6% -3.4%
Charlotte 7.9% 1.8%
Chicago 2.2% -6.6%
Cleaveland -2.7% -8.5%
Dallas 0.5% -3.3%
Denver -1.1% -5.1%
Detroit -6.9% -15.1%
Las Vegas 0.0% -19.3%
Los Angeles 1.0% -16.5%
Miami 4.2% -19.3%
Minneapolis -0.9% -10.0%
New York -0.9% -5.8%
Phoenix -0.7% -18.2%
Portland 8.7% -0.5%
San Diego -4.2% -16.7%
San Francisco -1.4% -13.2%
Seattle 11.1% -1.3%
Tampa -0.1% -15.0%
Washington -3.9% -10.9%
You naysayers and bubble bloggers are just bitter renters with sour grapes that you didn’t buy at the peak in 2005! How dare you decry the rapid, phony escalation in housing prices that have caused considerable hardship to the majority of the population and the economy?
A decline in housing prices is un-American! We must empty the Treasury if that’s what it takes to keep prices in Portland rising at 20% a year!