Berkeley CSUA MOTD:Entry 40929
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2025/05/25 [General] UID:1000 Activity:popular
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2005/12/9-11 [Reference/RealEstate] UID:40929 Activity:high
12/8    Housing bubble? Yes yes yes!
        http://money.cnn.com/2005/12/08/news/economy/housing_bubble_jobs
        \_ You know, I really do honestly feel bad for the younger people
           here who weren't able to buy a house years ago and now just can't
           but posting articles that say housing is going to fall back to
           more normal levels of price growth and screaming "bubble! bubble!"
           is not going to make housing prices drop.  The article you posted
           but didn't read did make me wonder how many of the 800,000
           construction jobs are legally held, though, and what increase,
           if any, we'll see in unemployment claims as housing goes slowly
           from "way too hot" to "normal expected growth rates".
           \_ I don't have generous Asian parents so I've been trying to
              save enough money for a decent down payment. BTW I graduated
              almost a decade ago. But no matter what, it seems like the
              price of homes in the past 5 years keep outpacing the
              rate at which I can save up. I'm at an age where I really
              want a home *now* but it's impossible. Almost everyone older
              than me say that I should buy a home. But it's so easy for
              them to say that when they bought their homes several years
              ago when the prices aligned with income and savings. Now it's
              all out of wack. Had I been older and saved up, of course
              I'd buy a home. Life is arbitrary and random, and this whole
              home buying deal is even more arbitrary and makes life seem
              so meaningless. Do I feel bitter? Of course I do. And I'm not
              the only person who feel this way.
              \_ My theory is that this is the result of all the tax cuts.
                 With wealth so much easier to generate, the people with
                 money can easily generate and keep more after taxes.  Couple
                 that with $250k tax free profit (if you're single), meant
                 lots of people could speculate on less desireable locations,
                 like Modesto or Gilroy.
                 \_ The tax cuts were trivial as a percentage of income for
                    people in upper brackets.  Going from 70 to 50 was a big
                    cut.  Going from 50 to 39 was a big cut.  No recent tax
                    cuts were of any note.
              \_ Yes, life is unfair.  I have no easy answer for you.  Have
                 you looked in other parts of the country?
                 \_ That is, in fact, the easy answer. Some people in the Bay
                    area don't seem to have any conception of how out of whack
                    prices are there, even compared to other "expensive" regions
                    back east and in the Northwest.  I live about 70 miles from
                    nyc, and I know people who are paying mortgages on
                    decent homes with a grad student stipend.  That would be
                    harder now than it was three years ago, but still doable.
                    I'd say housing where I live, where everyone is complaining
                    about prices is roughly a factor of ten cheaper than the
                    Bay area.  Is the Bay a factor of 10 more desirable?  Not
                    to me.
              \_ Your problem is that you are not financially savvy. Saving up
                 for a downpayment is silly. I used to think like you. I
                 was trying to save $50K to put down on a (then) $200K
                 house. However, interest rates got so low and lenders got
                 so lax that I didn't have to save that much in the end. I
                 bought my house for $10K out of pocket. Sure, I didn't
                 have much equity then, but I sure do now. I think you are
                 too tentative. You could've had a house by now and now
                 it's too late (for this real estate cycle). I bought my
                 house when I made $40K/year less than I do now and so did
                 many of my friends. It was difficult to make the payment.
                 If you are expecting to magically "save up" to buy a
                 house stress-free and also buy (say) all of the gadgets
                 you do right now then you will never make it. If you
                 graduated 10 years ago then you missed your chance. I
                 feel badly for the kids who graduated 2 years ago, but
                 that's not you.
                 \_ I graduated two days ago.  Can I feel bitter? -!pp
                    \_ Sure, but your situation isn't so bad. When you are
                       ready to buy in 3-7 years housing will probably be
                       more affordable. I'd like to add that if I was
                       saving that $50K I'd probably have it about now,
                       5 years later, and it wouldn't do me any good. Even
                       making $40K more I probably couldn't buy my own
                       house and my mortgage payment (after interest
                       deductions) is less than many 'housing bubble whiners'
                       are paying for rent. Your first house is always a
                       stretch to buy, but to me it's been totally worth it.
                       Even if it hadn't more than doubled in value, but
                       merely stayed flat it would've been a great buy.
                       Heck, I think I'd be happy even if the value had
                       fallen somewhat. Home ownership is that important
                       to me. Maybe it is less important to others. If it
                       is important to you and you can afford it then do
                       it, whatever will happen to the market.
              \_ I graduated in 1993 and my Asian parents are not generous to
                 me at all.  Yet I managed to buy a house in 2000 while putting
                 my sister thru Cal (paying out of state tuition) and then
                 supporting my parents with $1k/mo (non-tax-deductible).  And
                 no I didn't make big bucks from dot-com stock options.  I
                 think it's just a matter of what fancy car you drive, how
                 often you eat out, and how many vacation trips you go in a
                 year.
              \_ Don't feel too bad. In the Bay Area these days it takes
                 two incomes to make a housing payment. You will probably
                 be able to afford a starter home when you have a spouse.
              \_ Just rent for now, and be flexible with your home buying
                 plan.  Don't listen to the stupid advice asking you to
                 put money saved for a housing downpayment in a CD.
                 There are lots of ways to invest and make money.  Take
                 the stock market for instance.  I've been getting 30%
                 annual return the last 3 years.  That will double your
                 money fast, and unlike a house, it's liquid.  And the
                 S&P500 aggregate PE ratio is lower now than when it was
                 in 2002, unlike the ridiculous price/rent ratios of
                 homes in the Bay Area.
                 money fast, and unlike a house, it's liquid, so unlike
                 money fast.  Also, it's liquid, so unlike
                 a house, you are not stuck in a single type of investment.
                 And the S&P500 aggregate PE ratio is lower now than when
                 it was in 2002, unlike the ridiculous price/rent ratios of
                 homes in the Bay Area.  Now some will claim that stocks
                 are risky, but the housing market is just as risky,
                 especially now.  And check out Japan, Hong Kong,
                 Singapore, etc. over the last 15 years and you will see
                 how badly home prices can fall.
                 how badly home prices can fall.   - homeowner
                 \_ A first home is not an investment. Don't treat it like
                    one or think of it like one.
2025/05/25 [General] UID:1000 Activity:popular
5/25    

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2013/8/1-10/28 [Reference/RealEstate] UID:54722 Activity:nil
8/1     Suppose your house is already paid off and you retire at 65.
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        Area? Property tax will be about $10K/year for a modest $850K
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        \_ I think at age 65, health insurance is the next biggest expense.
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	...
2013/7/31-9/16 [Reference/RealEstate, Finance/Investment] UID:54720 Activity:nil
7[31    Suppose you have a few hundred thousand dollars in the bank earning
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2013/3/11-4/16 [Reference/RealEstate] UID:54622 Activity:nil
3/10    I'm trying to help my parents, in their mortgage there's an
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2013/2/19-3/26 [Reference/RealEstate] UID:54610 Activity:nil
2/19    I just realized that my real estate broker has a PhD in plant
        molecular cell biology from an Ivy League school in the mid 70s.
        Now she has to deal with a bunch of young dot-comers, and they're
        pain in the ass.                        -Only a BS in EEC$
        \_ My agent used to be a hardware engineer.  He switched to real estate
           when he got laid off during the 80's.  Now he's doing very well.
	...
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money.cnn.com/2005/12/08/news/economy/housing_bubble_jobs -> money.cnn.com/2005/12/08/news/economy/housing_bubble_jobs/
RSS There go 800,000 jobs out the door UCLA: Housing slump to hit building and finance employment, slow the econ omy, but no recession seen. com senior writer A coming slowdown in building could cost 800,000 jobs in construction and finance according to a recent forecast. A coming slowdown in building could cost 800,000 jobs in construction and finance according to a recent forecast. com) - The expected downturn in the housing market cou ld end up costing 800,000 construction and finance jobs, putting a big d ent in economic growth over the next two years, a report from UCLA said. But even with economic growth slowing as much as 1 or 2 percentage points , the nation should be able to avoid a recession, according to the widel y watched report from UCLA Anderson Forecast. The authors of the report admitted that they had forecast earlier this ye ar that the slowdown in the housing market was going to start in mid-200 5, which now looks like it was a little premature. But they noted that r ecent reports from home builders, real estate agents and the government indicate the slowdown may have now begun. The report, released Wednesday, forecast a loss of 500,000 construction j obs and 300,000 jobs in the financial services sector from the housing s lowdown, but noted that job losses would not spread across many industri es, other than some limited pullbacks in manufacturing. "There will be weakness in retail, for su re, and in manufacturing. Still, there are risks to the economy due to the housing slowdown, accord ing to the school's report. Its research shows that nine of the previous 12 drops in spending on resi dential housing were followed by recessions, and the latest report forec asts a decline in spending ahead. But Leamer said the lack of the job loss in other sectors it the key to k eep the economy out of recession, and keep the housing slump from being more severe. The Anderson Forecast does not make a firm prediction on whether there wi ll be broad or deep decline in home prices nationwide in the coming hous ing slowdown. But it warns, "these may all be indications of an incipient decline in th e housing market." It said its next forecast due early next year should have a better indication on home price direction. Still, Leamer said that even if housing prices fall nationally, he doesn' t expect a steep drop. "Housing is driven by two things, one is jobs, one is interest rates," he said. "Unless you get severe job loss in a particular market that force s people to sell, the market recalibrates slowly to the overpriced statu s" The forecast points to a number of factors for the coming slowdown in hou sing, including rising mortgage interest rates, slowing population growt h, overbuilding and prices that had reached bubble-like heights in some hot real estate markets. "On all these grounds, we believe housing is due for a sustained decline, " wrote Michael Bazdarich, a senior economist with the Anderson Forecast . "The remaining questions are how hard the fall will be and when it wil l begin. Again, the recent anecdotal evidence suggests the decline may b e beginning. The report is just the latest in a series of readings suggesting a slowin g real estate market ahead. warned that 2006 would be affected by a sl owing real estate market, as it cut its earnings guidance for the coming year. "It appears that the housing market is not as robust today as it was thro ughout 2004 and through the summer of 2005, although there is wide varia tion in local markets," said the company in its earnings report. "Many believe the deceleration in price growth was inevitable, as the inc reases of 2004 and most of 2005 were not sustainable and were fueled, in part, by speculation," the company's report continued. "Our sales results indicate that housing demand is returning to the more normalized levels of the decade from 1994 to mid-2003, before home price s really took off in quite a few markets."