Comments on: Is It Time to Buy?

By: A Giant Wave is Coming | Redfin Los Angeles Sweet Digs

A Giant Wave is Coming | Redfin Los Angeles Sweet Digs — Wed, 06 Aug 2008 15:26:45 +0000

[...] San Fernando, Santa Clarita « Is It Time to Buy? [...]

By: Arash

Arash — Tue, 05 Aug 2008 16:23:44 +0000

Needless to say it is the worse time to buy anyay, the prices are DROPPING like a rock in the water, slow and steady.

Housing market is not like the stock market, when a trend starts its a very slow changing trend, when its down turning it takes 4-5 years to change direction or even stop. The uptrend started in March 2003 (Coincidentally with the Iraq invasion) and stopped in Feb 2008 when all hell broke lose. Look for the new uptrend to start around 2013.

In my opinion the housing market has left such a bittyer taste in everyone’s mouth that most people will run away and stay away from it for a long time and invest in other commodities especially food (cooking oil, rice, corn, wheat).

By: Arash

Arash — Tue, 05 Aug 2008 16:20:11 +0000

Real estate purchase has never been a good investment. Those who bought 30 years ago, if they had rented (rent controlled) and invested their mortgage payments in a 5% CD would’ve been MUCH richer now. There is opportunity to buy anytime as long as you ignore the asking price and set your own offer INDEPENDENTLY. Take the value of the house from 10 years ago (I use Zillow for 10 years ago value) and add 5% per year and set your offer based on that. You cant use 5 years ago value, the numbers are too skewed.

Here is an example of my rule of thumb:
In 1998 was worth In 2008 (Probably worth)
$100k $265k
$200k $325k
$300k $488k
$400k $652k
$500k $814k
$600k $977k

And so on….

By: Pete

Pete — Tue, 05 Aug 2008 06:56:29 +0000

One Thing to keep in mind about the price ratio, it includes the ratio during the bubble. I’d be curious what to see the ratio was in 2001 to see where our bottom will be. Citing 16.8 % like that’s where the bottom will be, where rational prices are is not founded in recent bubble history.

Remember opportunity costs. The money you sink into realestate is the money you can’t invest in milk futures, rice paddies, or tanzanite mines.

By: Patrick

Patrick — Mon, 04 Aug 2008 18:25:49 +0000

I think the bashing is from jealous owners who have had to drop the rent on their properties or real estate folks who have seen their incomes drop 50% in a year.

By: Cindy Allen

Cindy Allen — Mon, 04 Aug 2008 16:23:19 +0000

LOL, Summer. Man, there is a lot of renter-bashing in the blogs. What do you make of that?

By: eternal summer

eternal summer — Mon, 04 Aug 2008 16:04:27 +0000

Hi Cindy,

Since there is so much renter bashing in the blogs and the Government (how ’bout helping out homeless people instead of idiotic home buyers), I thought of the perfect reason to rent in California: freedom to move if the big one hits!