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entropy

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My home is so over valued what difference will it make if the bubble burst, and it falls 20%, it will not matter to us, we are not going anywhere at this time. Although come to think of it that 20% is what we paid for it to begin with, crazy
There is no housing bubble in SoCal. They have been saying the bubble is gonna burst since 2013 lol.

there is more people with money, more competition, no new constructions, a shit ton of international real state investors. Your house isn't over valued. It is in a highly desirable location and whoever pays whatever it costs to own has the money to turn it into a little a palace. Heck where I live you see all these little cottages and bungalows displaying mini landscapes that you'll see in Dallas mansions. Tiny but mighty.

Look at San Francisco. When did the bubble burst? it didn't cause there wasn't one. Another example? Manhattan. studio apartments that used to rent for dimes are now condos selling for over 2 million dollars.

Now, there is a ridiculous inflation thing going on with the economy right now and possibly a recession coming. We might see a small dip on housing in socal, but it'll go back up. There might be pockets of housing that will crash in not the most desirable areas. But anywhere near the coast, or neighborhoods that have always been desirable such as beverly hills, pasadena suburbs, culver city, etc... wont get hit.

This place has become way too desirable for the rich. People leaving are mostly hard working middle class. It sucks and it is unfair but that's how big cities are.

People are just gonna start living more in apartments and condos like they do in most big expensive cities. I am more worried about the inflation of consumer products, services and first need products.
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entropy

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We have been in the market to upsize our home but every month it just gets worse and worse with house prices going up a ridiculous level and that not even being enough as then they are bid well over asking price. Now prices are high and rates are way up so double whammy.

Yes, our current home has appreciated, but so has every other one to an even greater extent so it makes it difficult. Being a first time home buyer must be demoralizing unless you come from money.

At some point something has to give. With rates now approaching 5% demand has to cool down at some point, but what will happen to supply? will people sell? why would they? tons refinanced into lower rates (we did into a 20yr loan @ 2.6%) so why sell to go buy at high prices, higher rates with few options? If the market starts whispering words of a bubble, will that trigger FOMO and make people sell to cash in before a market decline?

With prices so damn high i wonder if banks were giving out loans at a high debt to income ratio where now those people are in a financial bind due to inflation, which could increase supply but not in the near term.

What a mess.
I refinanced too and not going anywhere lol. I got like 2.4% or something like that. Interests have gone up around here and people are still buying high prices. I bought Decemeber 2019. Prices were pretty high already. Getting my loan was not easy, the banks were pretty strict.

My dad is in the process of buying a condo right now. He has enough money in retirement accounts to afford the place cash and still more than enough left to live from. And he has a retirement job that gives him enough money to live without touching his retirement money. lenders are being difficult giving him a loan under 50% down payment because of his retirement job.

In 2008 they gave loans to anyone. Whatever you wanted. I don't see 2008 happening again.
 

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Uncommon Sense

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They made Home Economics an elective instead of a required course. I remember they taught us about stuff like Jury Duty, and making a budget and all of these life skills that Mr Parallelogram is crying about not getting taught.
Yeah, I took home ec in 8th grade I think back in mid 80s. I just think we should be teaching high schoolers about banking, budgeting, investing, managing credit and debt, insurance, retirement, taxes, etc.... this stuff is critical to a successful life and is not really taught comprehensively. Some of us are lucky enough to figure it out on our own or to have parents that teach it, but far too many people are kept ignorant.
 

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😅

You should check out a little diddy called "nonprime loans".
I've been originating mortgages for almost 20 years. Current mortgage underwriting is far higher standards than 2007/2008 era. The big issue during that time was fraud because underwriting guidelines go so loose it was easy for speculators / fraudsters to take advantage. You had all the stated and no doc loan products so ANYONE could qualify for a mortgage even if there was no income.

Mortgage underwriting now is very tough. Yes, there are low down payment options, but you still need income / credit to qualify. At the margins, there are certainly some people who probably shouldn't be buying a home regardless (some FHA borrowers), but loan quality overall is far higher than the big short era.

The market crash then was because credit market seized up and mortgage guidelines changed as well. This put pressure on prices and a lot of investors were left holding the bag on multiple properties and no income to support the mortgage debt. They eventually go into foreclosure which put even more pressure on prices. Next thing you know, Joe Six pack is now underwater on his house through no fault of his own and he has to walk away.

What we have now is that so many people have bought at inflated prices with low rates (and over paid for housing). As rates rise, borrower's budgets tighten and thus prices eventually start going down. What really drives foreclosures more than anything is loss of income. If job market craters then you'll start seeing problems in housing market.
 

Sean L

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Yeah, I took home ec in 8th grade I think back in mid 80s. I just think we should be teaching high schoolers about banking, budgeting, investing, managing credit and debt, insurance, retirement, taxes, etc.... this stuff is critical to a successful life and is not really taught comprehensively. Some of us are lucky enough to figure it out on our own or to have parents that teach it, but far too many people are kept ignorant.
For sure. But I think instead of "kept ignorant" they remain ignorant on their own choice.

At least in my school where "Life Skills/Home Ec" class was an elective that was shunned by the Uber Straight kids...
 

Uncommon Sense

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For sure. But I think instead of "kept ignorant" they remain ignorant on their own choice.

At least in my school where "Life Skills/Home Ec" class was an elective that was shunned by the Uber Straight kids...
No doubt. You cannot save everyone. However, some people also don't know what they don't know. Sometimes you don't learn until you get burned. I just think we can prevent a lot of people from being burned unnecessarily.

I'm almost 50 and done pretty well for myself by most standards. However, there are still a lot of things I wish I had known back when I was 22 that seem so obvious now to my old self and I wonder why it was never taught in school.

There are a lot of things about life that I feel like don't get taught. It creates a nation of educated idiots. There is a difference between being wise and educated.

An educated man knows a tomato is a fruit... a wise man knows you don't put a tomato in a fruit salad.
 

CT_LFC

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In 2008 they gave loans to anyone. Whatever you wanted. I don't see 2008 happening again.
Me neither as the quality of loans is higher, but prices at some point have to go down as affordability has to be very low at this time. Just saw that rates hit 5% so at some point it has to impact demand which will make houses stay active longer and start seeing some price reductions, or at the very least, not bid so far over asking.

Would need a recession and significant job loss for any type of crash, however, and can't see that happening even with so many people have bid so much over asking price and foregone inspections/appraisals.
 

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BigFeet

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I hate to be "That Millennial" but cursive has had ZERO real life application in my entire life.

just-saying-colin-jost.gif

This is part of the overall problem we are witnessing today. Not that you don't write in cursive, but the fact no one does anymore.

When was the last time you wrote a personal thank you note, letter, etcetera to someone? Writing in cursive by pen (blue personal / black professional) is a time consuming and personal endeavor. It shows gratitude/appreciation towards someone else's deeds, and/or thoughts. It tells the recipient that they are meaningful, and deserve the time and effort.

For those that do not find showing appreciation, gratitude, and patience towards others as still being applicable today... very sad.

We now live in a world where I get mine, and you're on your own - an instant gratification society that takes no accountability makes it easy to sell out on pretty much anything at all. Hence, a lot of the problems you face today.

A hand written note that takes ten minutes to put together lends much more weight in thoughtfulness than a ten second text message. I wonder which of these societies would tend to care for the "whole" more?

By the way, prices do suck!
 
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Heimkehr

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When was the last time you wrote a personal thank you note, letter, etcetera to someone?
At least twice annually: Christmas, and my birthday.

There's also the grocery lists, signatures on personal checks, note-taking in the garage during various projects (which I did just this morning, coincidentally), a quick memo to a work colleague, etc.

I grant that handwriting is in decline, but it's not ready to be called Extinct. :)
 

BigFeet

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At least twice annually: Christmas, and my birthday.

There's also the grocery lists, signatures on personal checks, note-taking in the garage during various projects (which I did just this morning, coincidentally), a quick memo to a work colleague, etc.

I grant that handwriting is in decline, but it's not ready to be called Extinct. :)
When I was trying to purchase the house I live in now, I was outbid by two other cash offers over asking price.

I wrote a personal letter to the seller, and gave it to my agent to deliver to their agent. My offer was 10K under asking and they take care of closing. I'm sitting in that home right now, and was informed that my letter was the determining factor in the seller making a decision.

I wrote about how this house would help my daughter and I, yadda, yadda type stuff. Turns out the seller was a college professor. Actually, wrote me back, and made mention of my penmanship.

Not applicable... my ass!
 
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