Tuesday, November 20, 2012

Must Read Articles

Even though I have not been actively posting, I'm still listing the most current meltdowns across the Westside on a weekly basis. Condos in Brentwood, Westwood, Marina del Rey, Culver City and West Hollywood are getting hit the hardest right now. But, every area on the Westside has some significant declines. For the next month, I am going to post "Must Read Articles" for anyone considering about real estate.

The first one is  Greatest Real Estate Bubble in Modern Day History Has Yet To Really Burst. By Forbes Magazine.

Next is Dont Believe the Near-Term Housing Data by Anthony Randazzo

 In Housing Debt We Trust by Dr. Housing Bubble

5 year outlook for Real Estate, "Fuzzy" 1.5% Annual appreciation at best by Robert Shiller


Latesummer2009s@gmail.com said...

Just posted 37 Meltdowns all across the Westside:

Brentwood (12)
West Hollywood (2)
Mar Vista (3)
Rancho Park/Cheviot Hills (3)
Beverly Hills (1)
West LA (4)
Westwood (5)
Bel Air (4)
Beverlywood (3)

Check the Westside Area of your choice on the posts dated April 2nd below.

Anonymous said...

Pretty amazing to see the prices in Beverlywood.

Latesummer2009s@gmail.com said...

Yes, the price declines in the Beverlywood Area are inpressive. Especially the house on David. At $443,000 off the last sales price in 2006, that's a 42% decline.

Anonymous said...

"Don't believe the near term data" is a given. Nobody does. I think what we are seeing is positioning for the next boom bust style bubble/recession which can't be too far down the line. Locking in low thirty year rate with with no equity is a hedge, not a belief in a recovery. The term recovery just means we're buying time until we've figured this out properly.

Anonymous said...

weak hands are selling... As long as interest rates are kept this low for another decade... Home prices aren't dropping any further in rental parity areas.

Sure, wealthy enclaves have some weak hand price drops.. but people have always taken a bath in a divorce or job losses.

Latesummer2009s@gmail.com said...

Because of limited inventory and very attractive interest rates, the high end is extremely strong right now. People with money are buying in areas they love with plans of staying 10 years or more.

On the other hand, those who are stretched and buying in the lower to mid range areas better love the house and neighborhood the're in. Massive housing appreciation will not happen for another 10-20 years unless we get into a hyperinflationary period, where everyone loses. People who can afford it, are actually buying houses to live as opposed to making instan profits. If the banks are allowed to extend and pretend for another 5-10 years, the Fed keeps interest rates low and we get QE4,5,6,7,8 etc., prices will stagnate or increase gradually.

The big questions are how long does the government let the banks off the hook? What about the moral hazard issue(TBTF)? And what happens when people wise up and just stop paying mortgages as the banks or Fannie Mae rarely foreclose?

Anonymous said...

People are far more likely to stop paying their mortgage if home prices continue to fall... or drop dramatically from current levels. This could be caused by another recession/depression or higher interest rates without wage inflation. 2007-2009 price drops were viewed as a one-time event.. another massive drop people will throw in the towel on a massive scale.

Since the government seems to have control over interest rates... I don't see why they would let home prices fall anymore. Since depending on how bad the drop is.. Our current squatter and moral hazard problems would look like a drop in the bucket.

While home prices remain flat or slowly grow.. people will pay their mortgages. So the government and fed are going to do everything to keep them inflated. There really isn't a non-chaotic alternative option.

Can you name one?

Anonymous said...

LS2009 said...If the banks are allowed to extend and pretend for another 5-10 years, the Fed keeps interest rates low and we get QE4,5,6,7,8 etc., prices will stagnate or increase gradually."

No offense, but I told you essentially the same thing way back in 2009. Yet, whenever I did, I was hit with an endless parade of horrors for why this was "not possible".

Well better late than never I guess. Welcome back to reality LS2009, we missed you...

Anonymous said...

Everything we've put in on has seen multiple offers and has gone for above asking. The latest was an 800SF 2BR/1BA house near the Venice Costco. Developer bought it off market in August for $450K cash. Three months and a renovation later, list is $600K. One week on the market and there have been so many offers that they are only considering offers above $700K now. Haven't seen the meltdown this blog claims is happening.

Latesummer2009s@gmail.com said...

I have just added 50 more meltdowns(short sales) on the Westside from 11/20/12 - 12/12/12. Prices as low as 2001. The areas and numbers of meltdowns are:

Beverly Hills (2)
Culver City (5)
Brentwood (8)
West LA (3)
Mar Vista (5)
Bel Air (3)
Beverlywood (2)
Westwood (1)
West Hollywood (8)
Cheviot Hills (1)
Malibu (2)
Marina del Rey (5)
Pacific Palisades (2)
Santa Monica (2)
Venice (1)

It will be interesting to see if the federal legislature renews tax forgiveness on short sales that expires at the end of the year. If not, those who are underwater will have a nice tax bill, if and when they sell short.

Latesummer2009s@gmail.com said...

This is what the market has been reduced to with restricted inventory, bankers not having to foreclose, FHA 3.5% down payments and artificially low rates, high rents and prinitng presses going overtime to jack up inflation.

Developer flip in a marginal area at best. I sure hope whoever buys it, loves it and the neighborhood, as they will be living there for at least 10 years, possibly more. These types of transactions are sucker buys, and the developer is laughing all the way to the bank.

Anonymous said...

These types of transactions are sucker buys, and the developer is laughing all the way to the bank.

Is that buyer any more of a sucker than the guy who refused to buy it at 450K because he was sure - absolutely positive that "we are NOWHERE near the bottom" - such that he is still on the sidelines today, and possibly the rest of his life if doesnt wake up and realize it isnt gonna happen?