Berkeley CSUA MOTD:Entry 44150
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2021/12/08 [General] UID:1000 Activity:popular
12/8    

2006/8/25-28 [Reference/RealEstate] UID:44150 Activity:nil
8/25    http://money.cnn.com/2006/08/24/real_estate/pluggedin_tully.fortune
        Yeah it's about time!!!  -bitter young grad, born and graduated
                in the "wrong" era and missed out on dot-com and
                housing boom.
        \_ I think a correction to cool things down is a healthy thing.
           --- '93 grad who didn't profit from the dot-com or housing boom,
           didn't have rich parents, and own one home and one rental
        \_ I think it's a good thing.  --- old grad who didn't profit from the
           dot-com era, didn't have rich parents, and own one home and one
           rental
        \_ Bad news is that rents are on the way up.
           \_ Awesome.  Now we renters can be smug on the motd.  RENTS WILL
              NEVER GO DOWN!!!!11!!! --smug renter
2021/12/08 [General] UID:1000 Activity:popular
12/8    

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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.
        How much expense does one expect to spend a year, in the Bay
        Area? Property tax will be about $10K/year for a modest $850K
        home. What about other stuff?
        \_ I think at age 65, health insurance is the next biggest expense.
        \_ I am thinking that we can have a nice middle class
	...
2013/7/31-9/16 [Reference/RealEstate, Finance/Investment] UID:54720 Activity:nil
7[31    Suppose you have a few hundred thousand dollars in the bank earning
        minimum interest rate and you're not sure whether you're going to
        buy a house in 1-5 years. Should one put that money in a more
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        horizon is only 1-5 years?
        \_ I have a very similar problem, in that I have a bunch of cash
	...
2013/3/21-5/18 [Reference/RealEstate] UID:54634 Activity:nil
3/21    Holy crap is Bay Area real estate on fire right now. I keep
        getting outbid by hundreds of thousands of dollars on places.
        \_ does more home-owners mean fewer people will be renting,
           driving the demand for rental down?          -poor renter
           \_ I am kind of doubting that, but it might work.
        \_ what is the zip code that you're bidding on?
	...
2013/3/11-4/16 [Reference/RealEstate] UID:54622 Activity:nil
3/10    I'm trying to help my parents, in their mortgage there's an
        "escrow" amount. What exactly is this? From reading Google,
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        insurance, but they've been paying home insurance themselves.
        I'm really confused on what this fee is.
        \_ Without an escrow account, you write checks to your insurance
	...
2013/2/19-3/26 [Reference/RealEstate] UID:54610 Activity:nil
2/19    I just realized that my real estate broker has a PhD in plant
        molecular cell biology from an Ivy League school in the mid 70s.
        Now she has to deal with a bunch of young dot-comers, and they're
        pain in the ass.                        -Only a BS in EEC$
        \_ 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/2006/08/24/real_estate/pluggedin_tully.fortune -> money.cnn.com/2006/08/24/real_estate/pluggedin_tully.fortune/
Shawn Tully, Fortune editor-at-large August 25 2006: 5:42 AM EDT NEW YORK (Fortune) -- For the past five years, the housing bulls have been trotting out one rational-sounding argument after another to explain why the boom made perfect economic sense. Expect a "soft landing" where your three-bedroom colonial in Larchmont or Larkspur not only holds onto its huge price gains, but keeps appreciating at a "normal," "sustainable" rate of 6 percent or so into the sunset. Prices actually fell where housing is most vulnerable, in the bubble markets in the West and Northeast. In the Northeast, they dropped 21 percent from July of 2005, at the same time prices nationwide rose around 3 percent, meaning that houses lost over 5 percent of their value adjusted for inflation. It's time to examine the clichs that the "experts" - chiefly analysts and economists from realtors and mortgage associations - used to convince Americans that what they're seeing now could never happen. Here are the four great housing myths - and why they never made much sense in the first place. Myth #1: As long as job growth is strong, prices can't go down You can almost forgive the bulls for stumbling over this one. In past housing recessions, prices fell sharply in markets with severe job losses, like Texas in the mid-80s and Boston in the early 90s. But the argument that prices can't fall in a good job market doesn't make economic sense: To be sure, a strong employment picture helps demand. But if far more houses are pouring onto the market than can be absorbed by households lured by the new jobs, and if the sellers are pressured to sell, prices will fall. That's precisely what's happening now in good job markets such as San Diego and Northern Virginia. In this boom, prices soared to such extraordinary levels that builders kept churning out new homes, and owners of existing houses threw a record number of units on the market to cash out. The supply grew so fast that demand, even in strong job markets, simply couldn't keep up. As usual, for the believers, it's always easier to fall back on a clich than read the warning signs. Myth #2: The builders learned their lesson in the last downturn. They won't swamp the market with new houses when the market turns You might call this the OPEC theory of homebuilders. The idea was that the builders wouldn't take a chance by building lots of unsold, "spec" units that could clog the market in a downturn. They had supposedly absorbed hard-won discipline from their excessive building in past downturns. Builders are still pouring out near-record numbers of new homes as sales decline, assuring a further fall in prices. "Buyers" are walking away from deposits on houses that were supposedly pre-sold, forcing developers to throw them back on the market at a discount. The problem is that even now, margins on new homes are still pretty good, though well below the levels of a year ago. As a result, builders will just keep building until those big margins evaporate. Myth #3: Low interest rates will keep values rising, or at the very least, put a floor under prices What really matters for all assets, whether it's houses, stocks or bonds, is real interest rates - in other words, nominal rates after subtracting inflation. That caused a legitimate, one-time increase in housing prices. The rub is that prices rose far more than could ever be justified by declining mortgage rates. Today's relatively low rates are not, and never were, a reason why prices would keep rising. Once real rates drop and stabilize, the impetus goes away - again, the gain is a one-time, not a recurring, phenomenon. When the one-time gain of 2001-2004 reverses, housing prices could take a further hit. By the way, a decline in rates due to a fall in inflation isn't the boom to real estate it's advertised to be. Sure, rates go down, but workers also receive lower raises. As for what matters - real rates - what goes down later goes up, and housing prices go in the other direction, namely south. Myth #4: restriction on development in the suburbs ensure low supply, and guarantee rising prices This argument ignores that the tough zoning laws and anti-development fervor have been a feature of America's tony towns since the early 1970s. Sure, it's still difficult to get new building permits in suburbs of New Jersey, New York, Washington, Seattle and San Francisco. People move farther from job centers, and commute longer hours, to get bargains where housing is plentiful. People in their 50s and 60s cash out early in San Diego and buy a bigger house for half the money in Texas or South Carolina. And the cities are just as enthusiastic about developing blighted areas with new, tax-paying high-rises as the suburbs are slamming the door. In the New York area, Brooklyn, Jersey City and Hoboken - and even Manhattan - are sprouting more new housing than in decades, despite a job market that's hardly robust. A year ago, the reigning clich was that real estate had entered a new world of "no supply." Now, a record 385 million homes are up for sale, and buyers are getting scarce.