patrick.net

Most lovingly I love the bubble because it will absolutely remove the carpet baggers from the natives. Fuck you, California is the only state that could secede and pull it off. Fuck the rest of the USA. I only care about the California Republic. Mrs. X, normally not affiliated with the HARM-X mafia, had this to say, "I’ll rent for the rest of my life before moving". Fuck you fucking fucks, move back to the fly over states and enjoy you 590 FICO. Me? I'll be enjoying a Ca Bungalow and surfing while you're wondering how you could have gotten it so wrong. Yes, there is beauty to a perfect margarita.

Surfer-X,

HARM has expressed some interest in moving out of CA so native Californians aren't immune from the siren calls of cheaper housing and decent public schools.

I don't wish gloom and doom on CA. After all, I like it here and plan to stick around until Australia or Canada wants me. However, I did want to present a counter argument to BA invincibility.

However, I did want to present a counter argument to BA invincibility.

Bay Area is a very special place... to its residents. There is no need to present counter arguments. Many people in Asia do not like the Bay Area because of earthquakes and its proximity to San Francisco demographics.

I even heard of international students declining admission to Stanford after they found out it is so close to San Francisco.

Yes, there is beauty to a perfect margarita.

Especially with the perfect mac-n-cheese.

HARM has expressed some interest in moving out of CA so native Californians aren’t immune from the siren calls of cheaper housing and decent public schools.

Ah yes, as so have i, but talking and putting your shit in a truck are two different things. Besides, it's albacore season.

Did you see the new high tech weapon we will use in Iraq? Moats.

and where there's moats, there's drawbridges... pouring boiling oil on the enemy is pretty effective too...

the norman french took castle building to a whole new level when they took on the british isles -- particularly in wales -- they upgraded quite a few existing castles as strongholds...

Do the moats come with hungary crocodiles?

Will the enemies counter with dead diseased sheep and siege engines?

What kind of snake are we using for the snake pits?

The snark possibilities here are just about endless.

heh, lobbing diseased sheep over the wall with a catapult to give everyone plague inside...

Or the heads of your enemies, like the Celts did...

I have argued that Bay Area incomes are strong, which not everyone here agrees with. But I think the data shows some solid, quarter over quarter income growth in the BA.

Less than 10%, to be generous.

Meanwhile, homes have increased over 100%.

I highly doubt that even in "your company of 2,600" you've enjoyed 100%-150% salary and bonus increases in the past 3 years. If you have, then please share your company's jobs URL with the rest of us.

As cool as gastrophetes, trebuchets and ballistas are...

Nothing beats having a friendly local population which believes in your cause.

Where are you getting that homes have increased by 100% in the past 3 years?

Lots of places. For anecdotal evidence, just look at the sales records on Zillow or Redfin. My wife and I were just looking at a home in Mill Valley yesterday. Owner is asking $1.98M, bought it in 2004 for 895K and maybe (I stress maybe) put $250K into it to be very generous. There was another in Corte Madera. $1.6M, owner bought for $785K in 2002.

My income since 2003 has definitely more than doubled. 2002-2003 was horrendous, and i thought i was going to get fired.

According to the US BLS, you are not typical for this area then. My guess, you're either young, lucky, or brilliant. It's not atypical for young folks to double the income a couple times in their early career years.

But young, lucky and brilliant people aren't enough to prop up an entire region of hyper-inflated properties.

I believe this so much I'm banking 10 years worth of equity gains on it by sitting out before reentering. If you're right, I lose 5-6%. If I'm right, I get a multi-million home debt-free.

whaddup Says:

My income ref wasn’t used to justify homes going up. It was a response to Randy’s question. Many people have had their income rise by more than 40-50% since 2002-2003, and homes are only up up 40-50% since then.

You are comparing anectode ("many people have had their income rise by more than 40-50% since 2002-2003") to actual data ('homes are only up up 40-50% since then.")

Sorry, that doesn't fly. Median income has not increased in the BA by anywhere near 40-50%. Good for you and your examples of BA residents, but that doesn't make for statistical significance.

But muggy,

Even according to the (crappy) NYT, which you referenced, part of the reason for rent increases is reluctance to buy and the glut of condo conversions.

You can always blame the media for the bubble crashing, too, if you're a realtor:

http://www.nytimes.com/2006/09/17/weekinreview/17bijaj.html?ref=business

More NYT housing related stuff from today:

http://www.nytimes.com/2006/09/17/business/yourmoney/17view.html?ref=business

SP,

I did a wikipedia search on pininfarina after you mentioned them yesterday. I didn't realize they were the major designer of ferraris though wikipedia did list Enzo. Now that you mentioned it, I do see the similarities. I really like the S2000 shape, it's very clean and shapely. Most roadsters in that price range are either too bulked up (Audi TT and 350Z) or too round (Miata, Toyota's Spyder, z4, etc).

whaddup,

If you're making 40-50% more than you did in 2003, then good for you. As for using your personal experience as basis of argument, that's just bad scientific method. Many of my friends (now 25 to 30) went from being students to getting fairly good paying jobs in the same time period, should I use that dataset to justify whatever price hikes came in?

I must also comment on the sheer stupidity of you buying in 2002/2003. You admitted that your job was shaky and the overall job market was bad, that's not exactly the right time to launch into a major purchase on credit. So you lucked out so congrats, but even bad gamblers win sometimes.

cajun100,

The gay and lesbian couples market has been around for a while, so I don't think there would be a particular rush to buy that changed the recent market. What I've seen more in my personal experience are young people getting more parental help to buy earlier and buying housing with their boyfriend/girlfriend, family or even friends.

#1) end all welfare / hand-out programs accessed by illegals. Including birthing, medical, legal services, schooling, WIC, ADC, section 8, headstart, state disablity, social security.
#2) $50,000 fine, with the payment going directly to the Minute Men support fund, per alien to any employer with illegals employed.
#3) Send Mexico a bill for all of the costs they are responsible for. Dont give up the The Dog until payment is made.

We should just end most welfare for all.

I think employers should be fined AND sent to jail. 50K sounds fair.

Mexico will not pay for the bill, so #3 is out. We should not be anti-Mexico anyway. We should only go after people who broke laws.

I must also comment on the sheer stupidity of you buying in 2002/2003. You admitted that your job was shaky and the overall job market was bad, that’s not exactly the right time to launch into a major purchase on credit. So you lucked out so congrats, but even bad gamblers win sometimes.

Sometimes I feel more stupid for being too cautious though.

That’s all true, but you have to keep in mind that for most buyers, every dollar increase in price (at current levels) is a full dollar increase in the mortgage principal.

Worse, if price is higher and the saved downpayment is now less than 20%, interest rate is higher.

I don't think the government should be funding vigilantes. Can we just use the money to pay down the humongous federal deficit instead?

I don’t think the government should be funding vigilantes.

They are not vigilantes. They are just assistance to law enforcement. Like a neighborhood watch program.

Can we just use the money to pay down the humongous federal deficit instead?

For that there is a printer.

Governments don't fund neighborhood watch programs either. Government funding of private sector pet projects just inject a lot of inefficiency and mal-incentives. If the minutemen want to do their thing (and I'm not completely convinced that vigilante groups are ever a good idea, since they're beyond the control of the government and hence the general citizenry), then let them do it with private funding and donated time.

"Can we just use the money to pay down the humongous federal deficit instead?

For that there is a printer. "

At the cost of high inflation and permanent loss of USD's reserve currency status. Belt tightening and living within our means is a better long run strategy.

There is nothing to argue about income and buying power. It is all about what one wants to believe. It all comes down to pessimism and optimism.

Governments don’t fund neighborhood watch programs either.

Fine. Just hire more border agents then.

Belt tightening and living within our means is a better long run strategy.

You think that will happen? :)

I still think its much better to cut off the demand. Patrolling several thousand miles of desert and ocean is a dubious and highly costly endeaver. Just heavily criminalize hiring of illegals, don't have amnesties and change the constitution to give citizenship only to children born here to 2 legal permanent residents and/or US citizens.

We don't want the illegal situation to turn into another war on drugs, working at the supply side doesn't do anything other than heighten the criminality and violence aspects, to the detriment of everybody.

"Belt tightening and living within our means is a better long run strategy.

You think that will happen? "

Why do you think I want to move to Australia or Canada?

whaddup,

When did you buy, and when did you sell for your 10 year’s worth of equity gains? Not bad! I hope to hold for even longer, but i’m not there yet.

First off (I have said this before, but not for a while):

Having gained equity by owning a house for the past 10 years involved no real skills or merit. In order to have my home equity increase I didn't need to be a genius; just not an idiot.

Secondly,

What you're not considering in the whole big picture is "the next guy". Think of it like this: your income went up quite a bit. Good for you! You can afford that massively overpriced condo now, even though it's appreciated by 60-100% over 3-4 years. Congratulations.

But you're not going to stay there forever. Plug in all the numbers, and forecast what someone your age now in about 5 years will need to make in order to afford your condo given your expected 6% appreciation. Do you really, deep in your heart, think that there will be a lot of folks out there making that much money and willingly blowing over half of their monthly income on your condo?

In other words. Look forward past just you. Every buyer will someday become a seller, and in order to sell you'll need another buyer.

Every buyer will someday become a seller, and in order to sell you’ll need another buyer.

Or you can liberate your equity before it is too late. Re-fi to voodoo. :)

Not financial advice.

Or you can liberate your equity before it is too late. Re-fi to voodoo.

Or you can just liberate it into a safe Vanguard fund of tax-exempt bonds & commercial paper.

Oh wait. Too late.

I’m sure if you asked “Skibum” how his income growth is, and how’s he’s doing in general, he’ll say he’s doing well as well.

Maybe my income sucks, maybe it's great. Maybe I'm a pimple-faced 14-year old bored at home surfin' the net. No need to make assumptions, whaddup. Again, my point is, and you continue to do this with all of your posts, is don't conflate anecdotal evidence with statistically significant data.

Ha Ha,

Neither do the Republicans. They're much more interested in building boogiemen like gay marriage and sex crazed lesbian abortionists to trot out every 2 years. Republicans are much more beholden to big agriculture and business owners, people who have every interest in seeing the continued flow of cheap illegal workers. Democrats, dispite their effort to woo Latino voters, have strongly embedded interests to discourage illegal immigration. Their traditional base of union workers and blacks are both quite hostile to any kind of immigration, especially illegal immigration that would compete with them for jobs and resources.

I think the Democrats are much more likely to effect real change in immigration policy than Republicans. The change will not be as drastic as is to my liking, but at least it won't be something as costly and pointless as building a big fence across the US-Mexico border.

It is unfortunte to see that legal path to GREEN CARD (and then citizenship) is LONGER than Illegal/Amnesty…..

How about a site for ordinary citizens to report/expose illegal aliens. Is this legal?

Can someone explain how the market can bear a soft landing?

Soft landing is what cats do.

Republicans are much more beholden to big agriculture and business owners, people who have every interest in seeing the continued flow of cheap illegal workers.

But the only way to get business support for a crackdown is a sensible guest worker program.

The change will not be as drastic as is to my liking, but at least it won’t be something as costly and pointless as building a big fence across the US-Mexico border.

I think a moat full of stingrays may stop them.

whaddup,

and i decided to sell my car and buy a condo with 20% down.

So tell me, why is that so bad?

Click my name, go download my Bubblizer Excel spreadsheet. Punch in your data. Take a look at what you are implicitly expecting "the next guy" will need to make/pay in order for your purchase to simply break-even, net of inflation.

You can go on and on and on and on about qualitative factors and the fuzzier side of financial numbers. But, if your asset purchase price was TOO HIGH, then your decision will turn out bad (unless you love that condo enough to sit on it for a decade or longer).

You know, real-estate doesn't "always go up". (There's a nice HSBC study on my site that will give you hard RE data going back to the 50s. You can see lots of periods in the past when your purchase would have gotten you into deep water then too).

New thread: Le meilleur des mondes possibles

whaddup Says:

Haven’t you ever wondered how someone could afford that new 2007 porsche 911 who looks 28 years old, or that $1.2 million condo as a single 30 year old etc? We are surprised b/c we think that b/c we can’t afford it, and we generally like to think of ourselves as good well off people, then we find it incredulous if someone younger can afford it.

You are truly the master of unsubstantiated anecdotes. You continue to justify today's prices with stories of this or that person with a certain car, house etc. That 28 year-old Porsche driver? I don't wonder how he/she can afford the car. I wonder how small his, er, ego must be.