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Old 09-08-2007, 10:22 AM   #41
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What that says to me is that it's actually easier to time a housing bubble than a stock bubble. Once you see the volume peak, wait a year or two and sell your real estate (if you can find a buyer).
So EASY!? Didn't you sell in 2003 & 2004? Maybe it was different that time.
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Old 09-08-2007, 10:54 AM   #42
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Originally Posted by laurencewill View Post

Meanwhile, we poor simpletons are seeing our neighbors sell their houses for 10%+ less than what they were selling for a year ago, both in San Diego and in San Fran (friends there). Those stats from the real estate industry about home prices increases are a bit disingenuous considering the median is being buoyed by the fact that a larger % of homes being put on the market are more high end luxury homes, skewing the results.

But hey, you are still making big bucks with your rapier business wit, good on ya mate. Just please don't tell me the overall RE market isn't down, the official reports on wall street and the signs in my neighborhood can't both be wrong.
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Don't know about SD but would like more details on anybody in SF that is selling for 10% less than last year! I posted some actual resales recently that show continuing appreciation. Are the facts confusing you? I've pointed out the problem of posting median prices before but you don't seem to mention it when W*b or Tw*ddle post his graphs supporting the bursting of the bubble. Seems a little selective. Listen, the overall RE market IS not down!! Wait.. what the hell is the overall RE market. I think I said there is no bubble in SF and Hono in 2004, 2005, 2006, & 2007!! I'll stand by that. Did the official reports on wall street get you out of the market in 2000?

I'm not denying your bubble. Cry and moan about it if it makes you feel better. Just don't tell me something that is wrong and make fun of me when I prove you wrong.
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Old 09-08-2007, 11:09 AM   #43
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The shiller data does say SF and San Diego are down 4% and 7%, respectively, year over year. Laurence, you aren't imagining things.
Justin That data is for the SF metropolitan area that probably includes 9 counties in the Bay Area. Some of these sales would be more that 2 hours from SF. It would also include alot of new home sales. I'm on record that subsequent sales in new developments are often lower than the first sales. I reccomend not buying in new developments.
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Old 09-08-2007, 11:20 AM   #44
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Honobob, in every region that has already popped, we first saw declining sales and increasing inventory as a leading indicator before prices declined.

Can you tell us what the inventory and sales volume are doing in the regions you say are immune from the bubble?
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Old 09-08-2007, 11:27 AM   #45
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Honobob, in every region that has already popped, we first saw declining sales and increasing inventory as a leading indicator before prices declined.

Can you tell us what the inventory and sales volume are doing in the regions you say are immune from the bubble?
Yes.
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Old 09-08-2007, 11:36 AM   #46
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Yup, we both know. You got the bubble virus is those markets.

Look, this isn't rocket science. We had a long period of double-digit appreciation. Even you know that's unsustainable and appreciation rates have to adjust. They've been adjusting downward, and even negative in many markets. There's no reason to suspect the current downward trend will reverse until the fundamentals cry CHEAP! and override the expectations of further reduced prices.
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Old 09-08-2007, 11:57 AM   #47
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LW
Don't know about SD but would like more details on anybody in SF that is selling for 10% less than last year! I posted some actual resales recently that show continuing appreciation. Are the facts confusing you? I've pointed out the problem of posting median prices before but you don't seem to mention it when W*b or Tw*ddle post his graphs supporting the bursting of the bubble. Seems a little selective. Listen, the overall RE market IS not down!! Wait.. what the hell is the overall RE market. I think I said there is no bubble in SF and Hono in 2004, 2005, 2006, & 2007!! I'll stand by that. Did the official reports on wall street get you out of the market in 2000?

I'm not denying your bubble. Cry and moan about it if it makes you feel better. Just don't tell me something that is wrong and make fun of me when I prove you wrong.
Actually, I bought my house in 2001 and I'm still living in it. In my hood my house peaked at $580,000 and is not lucky to get $510,000 (that's based on sale prices of comparables).

As far as proving me wrong. Well, every time someone throws up a stat you just say, "that's not the way I want to see it, I'm going to slice the data this way." - Look, I hope you continue to have success in your business, but the aggregate data says the overall trend is down, possibly down hard.
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Old 09-08-2007, 12:14 PM   #48
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Yup, we both know. You got the bubble virus is those markets.

Look, this isn't rocket science. We had a long period of double-digit appreciation. Even you know that's unsustainable and appreciation rates have to adjust.
Well Doc, Not everybody that carries the virus gets sick. Not rocket science but medicine. Maybe not immune but symptoms will be mild like in the past. I've had 21 years of double digit appreciation. The only adjustment has been from 30-50% to 10-11%.

You've got three years invested in this prediction but all you've been spending is Wabinnero's. How about picking a couple of properties in SF give me the bubble burst price % off and the date and I'll buy them from you at a 10% preminum. You'll even save the REALTOR fee. That would be about a 50% return on your money. You'd be stupid not to take that offer unless you're worried that there is no bubble. Didn't I make you a good offer last year?

Bubble virus? Doc Twaddle....waddle?.....Duck........QUACK!
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Old 09-08-2007, 12:19 PM   #49
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I've had 21 years of double digit appreciation. The only adjustment has been from 30-50% to 10-11%.
Think about that for a nanosecond, honobob. $600K median, and your expectation is for 10%/year going forward?

That would make the median $4M in 20 more years. Who's buying at that price? In fact, very few can afford to buy at today's prices. All-time low affordability has got to tell you something, d00d.

As Shiller mentioned, even a 2% annual premium over other markets would lead to a 100X price difference compared to the average home in the long-term. Trees don't grow to the sky.
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Old 09-08-2007, 12:25 PM   #50
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As far as proving me wrong. Well, every time someone throws up a stat you just say, "that's not the way I want to see it, I'm going to slice the data this way." - Look, I hope you continue to have success in your business, but the aggregate data says the overall trend is down, possibly down hard.
Well if you don't have any actual proof of resales at 10% less in SF why didn't you just say so? I didn't know we were using cocktail talk stats. Sorry! And sorry you lost $70,000 in equity plus the inflation loss and your carrying charges. You should sell and rent and buy in a few years when beach front property is 50% off. Cheers.
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Old 09-08-2007, 12:37 PM   #51
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Think about that for a nanosecond, honobob. $600K median, and your expectation is for 10%/year going forward?
Well, it has been 11% for 21 years so I thought a 10%ish reduction in appreciation might be appropriate. I am conservative. See you are dampening the market expectations! I already answered who will be buying.
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Old 09-08-2007, 12:41 PM   #52
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I already answered who will be buying.
You'll be buying! Riiiight. Lesse, assuming 3% inflation, that $4M median translates to $2.3M in today's dollars.

I will happily sell you median-priced homes in SF or hono for $2.3M/each. How many would you like?
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Old 09-08-2007, 01:15 PM   #53
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Justin That data is for the SF metropolitan area that probably includes 9 counties in the Bay Area. Some of these sales would be more that 2 hours from SF. It would also include alot of new home sales. I'm on record that subsequent sales in new developments are often lower than the first sales. I reccomend not buying in new developments.
The Case-Shiller data uses information from 5 counties: Alameda, Contra Costa, Marin, San Francisco, and San Mateo.

Only Contra Costa and Marin counties have anything resembling regions outlying the major SF metropolitan center. Note that the data does not include Santa Clara County (which includes San Jose down to Gilroy).

Same-home prices have not necessarily decreased in all areas of the bay; maybe these small pockets are where you own.

In most areas they have decreased. This, oddly enough, is identified by a decrease in the Case-Shiller index for the SF bay.

Rents still cover <60% of carrying costs on most housing purchases in this 5 county region. This situation is simply not sustainable. So you'll eventually see more of an equalization by increased rents or decreased house prices. And rents generally trend quite closely with salary increases...
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Old 09-08-2007, 02:41 PM   #54
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Same-home prices have not necessarily decreased in all areas of the bay; maybe these small pockets are where you own.

In most areas they have decreased. This, oddly enough, is identified by a decrease in the Case-Shiller index for the SF bay.
My small pocket would include about a 30 mile radius from SF. Most resales have NOT decreased (excluding outlying new construction) I posted several resales awhile back showing substantial increases. I have no proof of a decrease. Would you be so kind to supply addresses of properties?
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Old 09-08-2007, 03:07 PM   #55
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My small pocket would include about a 30 mile radius from SF. Most resales have NOT decreased (excluding outlying new construction) I posted several resales awhile back showing substantial increases. I have no proof of a decrease. Would you be so kind to supply addresses of properties?
Here is a brief description of the Case-Shiller index taken from Standard and Poor's.

"The S&P/Case-Shiller® Home Price Indices measures the residential housing market, tracking changes in the value of the residential real estate market in 20 metropolitan region across the United States. These indices use the repeat sales pricing technique to measure housing markets. First developed by Karl Case and Robert Shiller, this methodology collects data on single-family home re-sales, capturing re-sold sale prices to form sale pairs. This index family consists of 20 regional indices and two composite indices as aggregates of the regions."

This is the most comprehensive statistical data available for the San Francisco region (and as I noted before, this is the core metropolitan area, not "outlying regions" such as Modesto or Los Banos). Any anecdotal evidence (such as specific street addresses) are a subset of this information and therefore do not give as complete of a picture of price trends.

Again, perhaps your properties are located in still-appreciating pockets of the SF bay area. But they are, in the layman's (although perhaps not mathematical) sense, statistical outliers.

I challenge you to provide any statistical or widespread information (anecdotal information is NOT valid) that suggests housing prices in the overall bay area have increased year-over-year.
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Old 09-08-2007, 03:08 PM   #56
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My local market (north of Boston) has corrected just about to where it was as of the start of this thread - 8/2004. Spoke to a realtor today (will be listing a SF next month) who seemed pleased/excited about the having pulled some of the excess out of the market.

The zero down buyers (aka speculators) are gone; lots of shady mortgage companies are gone. Buyers have decent credit and are actually putting DEPOSITS into the deal. And low ball offers are acually considered.

The healing has begun.


So would a typical SF property in your market flow cash to an investor, assuming a 30 fixed mortgage and 20 to 25% down? Still a ways to go by me, despite very healthy rents.
Not even close ... wages would have increase - or prices decrease - about 40 % more to make purchasing a rental cash flow. That's why I am still a seller in this market.

FWIW, I've had 11 years of double digit appreciation. BUT the prior 12 years came with ZERO % appreciation (as posted on prior threads).
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Old 09-08-2007, 03:20 PM   #57
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Here is some fun anecdotal evidence that might indicate decreasing prices. (Or, of course, all the reduced prices could still be above what the house would have sold for 1 year ago. Is it likely and would anyone in their right mind really believe that? I find that hard to fathom. Is it possible based only on craigslist listings evidence? Yes.)

Two years ago, many properties on craigslist.org could be found with "open for bids" or "bid now" in the title.
s.f. bayarea craigslist > real estate for sale: search for "bid"
Not too many anymore, eh?

At the same time, it was impossible to find property that had been reduced in price. Everything was selling within days - and had multiple bids above offering price. A search for SF bay area properties including the word reduced gives the following:
s.f. bayarea craigslist > > real estate for sale: search for "reduced"

It seems the trends have changed just a bit in the last several years.
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Old 09-08-2007, 03:35 PM   #58
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anecdotal evidence that might indicate decreasing prices. could still be above in their right mind believe I find that hard Is it possible



It seems

Can't argue with this. ??
I know a place to get a good deal. They're having a going out of business sale. It seems their prices should be lower than last year when they had their last going out of business sale.
"if WalMart is always lowering prices how come nothings free yet?"
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Old 09-08-2007, 03:46 PM   #59
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Can't argue with this. ??
I know a place to get a good deal. They're having a going out of business sale. It seems their prices should be lower than last year when they had their last going out of business sale.
"if WalMart is always lowering prices how come nothings free yet?"
Note that my post regarding the Case-Shiller index derided the use of anecdotal evidence as an effective data point for prices.

Note also that, when providing anecdotal evidence, I added in the appropriate qualitative disclaimers. Your post is merely highlighting the fact that my arguments are self-consistent.

I'm still waiting for you to provide any statistical or broad-based evidence that year-over-year prices on residential real estate have increased. Good luck.
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Old 09-08-2007, 03:46 PM   #60
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Here is a brief description of the Case-Shiller index taken from Standard and Poor's.

"The S&P/Case-Shiller® Home Price Indices measures the residential housing market, tracking changes in the value of the residential real estate market in 20 metropolitan region across the United States. These indices use the repeat sales pricing technique to measure housing markets. First developed by Karl Case and Robert Shiller, this methodology collects data on single-family home re-sales, capturing re-sold sale prices to form sale pairs. This index family consists of 20 regional indices and two composite indices as aggregates of the regions."

This is the most comprehensive statistical data available for the San Francisco region (and as I noted before, this is the core metropolitan area, not "outlying regions" such as Modesto or Los Banos). Any anecdotal evidence (such as specific street addresses) are a subset of this information and therefore do not give as complete of a picture of price trends.

Again, perhaps your properties are located in still-appreciating pockets of the SF bay area. But they are, in the layman's (although perhaps not mathematical) sense, statistical outliers.

I challenge you to provide any statistical or widespread information (anecdotal information is NOT valid) that suggests housing prices in the overall bay area have increased year-over-year.
366 Lovell Ave (Mill Valley): closed on 8/09/07 for $4,500,000 (2.4% over asking)
220 Danvers: closed escrow on 8/08/07 for $2,050,000 (3.5% over asking)
7 Cameo Way: closed escrow on 8/22/07 for $1,550,000 (3.7% over asking)
801 Teresita Boulevard: closed escrow on 8/29/07 for $950,000 (6.1% over asking)
741 Noe: closed escrow on 8/20/07 for $1,057,000 (6.9% over asking)
610 Rhode Island: closed escrow on 8/30/07 for $2,551,000 (10.9% over asking)
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