Housing bubble The Sequel (Liquidity trap edition)

[zinfamous]

Southern California, Here in the LA area I've been seeing homes in "asian" areas going for 50k-100k over asking. It's nuts.

yeah, just saw a local report on this the other day. especially in Palo Alto, Mountain View...SV area. Lots of newly-minted millionaire Chinese have been flooding in this year, offering prices 40-50% or more above asking. All deals done online of through broker.

Locals can't even buy houses any more, as you have overseas money willing to pay anything. Disgusting, really. It's like the birth of SV all over again--horribly overpriced housing leading to perpetually unrealistic value for decades.

 

[zinfamous]

It was destined to explode when you leave it up to dumbasses to decide for themselves that a retard bachelor degree won't get them a job.

What? You mean to say there is no jobs for my bachelors in video game playing? WTF IS THIS! I BLAME THE GOVERNMENT! Sorry, but if you're going to take loans that us tax payers will pay for - the very least is that we should be able to decide if what you are doing with it is stupid or not.

actually, no.

 

[Engineer]

Well if you live in a state where lenders cannot come after you for value beyond what the house is worth I would think the optimal solution would be to have your fiance stop paying the mortgage and then live their rent free for the next 2 years.

Then you use the saved money as a down payment on a new house using only your credit. And after purchasing the new house get married.

Personal responsibility my ass. 🙄

People who quit paying and are later determined they did it for no other reason other than they didn't like being upside down on the home that they AGREED to buy at a price should have their credit frozen for 10 years, minimum. Pay your fucking bills deadbeats.

 

[jagec]

Personal responsibility my ass. 🙄

People who quit paying and are later determined they did it for no other reason other than they didn't like being upside down on the home that they AGREED to buy at a price should have their credit frozen for 10 years, minimum. Pay your fucking bills deadbeats.

As long as the banks get the same treatment.

 

[Engineer]

As long as the banks get the same treatment.

OK...I'll listen. Explain.

 

[Hugo Drax]

Personal responsibility my ass. 🙄

People who quit paying and are later determined they did it for no other reason other than they didn't like being upside down on the home that they AGREED to buy at a price should have their credit frozen for 10 years, minimum. Pay your fucking bills deadbeats.

Trump does it all the time when he is in a deal he does not like he walks away and declares bankruptcy.

http://www.forbes.com/sites/clareoc...ow-donald-trump-made-bankruptcy-work-for-him/

 

[Engineer]

Trump does it all the time when he is in a deal he does not like he walks away and declares bankruptcy.

http://www.forbes.com/sites/clareoc...ow-donald-trump-made-bankruptcy-work-for-him/

Again, there should be frozen credit for 10 or more years IF you can afford something that you agreed on contract to buy and decide you now don't want to do it because it decreased in value. As for the banks, I'm waiting for a explanation so I can weigh that.

I don't care if it's Trump or not. He should be no different.

With that said, I feel no sympathy for the banks that refuse to work with those that CANNOT afford to keep their home yet the banks refuse to refinance or lower the mortgage because the house is upside down (I have seen this several times lately with people around me). The banks suddenly find religion when the people finally give up because they are literally broke and walk way. The banks are then willing to work with them but it's too late. The banks usually take a bath on these when they could have simply worked with the customer and avoided all of it. Tough shit to the banks on that one.

 

[jagec]

OK...I'll listen. Explain.

Your golden parachute and huge bonus should be 100% contingent on your company performing well and not screwing investors. If you run your bank into the ground by making risky loans, you don't get to spin off your bad investments onto the taxpayers and come out smelling like roses with a new Ferrari and an even-bigger market capitalization.

That also works for companies that declare bankruptcy...the extreme salaries of executives is hazard pay as far as I'm concerned, and one of those hazards is that if you screw up, you get canned. If the company doesn't have any money, no one gets paid. The company shouldn't have to buy you out first and leave all other concerned parties with nothing.

I agree with you on individual bankruptcy. It should certainly be an option to discharge debts that people couldn't possibly pay, but clearly the barriers to entry are somewhat too low right now. Futhermore, it seems that bankruptcy should get worse each time to discourage people like Donald Trump from continuing to take on excessive risk after it blows up in their faces the first time.

 

[lothar]

From what I understand a lot of lenders are also simply holding on to foreclosed properties instead of auctioning them off because there's too much supply driving prices of foreclosed properties down.

Home builders in my area seem to have no problem putting new home after new home up right now, even if they aren't under contract at time of construction OR completion. There's a shitton of inventory on the market are ridiculous prices. It's a buyer's market right now, but yeah, for sellers it's pretty damn tough.

It's a seller's market.
I've been looking to buy a home for $400k, home hasn't been found.
Everything I'm seeing that's new and worth buying is 55+ villa homes.

Inventory is very low here.

 

[Engineer]

Your golden parachute and huge bonus should be 100% contingent on your company performing well and not screwing investors. If you run your bank into the ground by making risky loans, you don't get to spin off your bad investments onto the taxpayers and come out smelling like roses with a new Ferrari and an even-bigger market capitalization.

That also works for companies that declare bankruptcy...the extreme salaries of executives is hazard pay as far as I'm concerned, and one of those hazards is that if you screw up, you get canned. If the company doesn't have any money, no one gets paid. The company shouldn't have to buy you out first and leave all other concerned parties with nothing.

I agree with you on individual bankruptcy. It should certainly be an option to discharge debts that people couldn't possibly pay, but clearly the barriers to entry are somewhat too low right now. Futhermore, it seems that bankruptcy should get worse each time to discourage people like Donald Trump from continuing to take on excessive risk after it blows up in their faces the first time.

I can agree on that, 100%!

 

[wirednuts]

Or just walk away and take the small credit hit from the foreclosure which will bounce back in about 2 years assuming you dont let all your other credit default, etc.

Its the most financially smart move and lots of people are doing it including myself. We bought our house for $185k about 3 years ago. VA loan so the cost were rolled into the loan which was for like $189k total. We currently owe $182k and our house when went to try and sell was worth about $160k. So about 22k upside down plus if used a realtor you got their 6% etc you have to come up with in cash. Cant take a loan to cover that amount is what i found out.

So we just stopped paying last August. Still living there currently and saving the money for when we are forced to move out. But we still pay all our other debts. Cars, bills etc. So our credit score in the end wont be hit too bad, not that i care about that anyways. Could be 0 Credit score and i wouldnt care. But thats me lol.

america, fuck yeah 🙁 im not sayin im just sayin... im going through foreclosure and bankruptcy myself. i tried to hold on for over 4 years though... i just cant do it anymore.

 

[Gigantopithecus]

In the United States, the National Association of Realtors said that more than $7 billion of properties had been bought by Chinese in the US last year.

http://www.telegraph.co.uk/news/wor...t-party-cadres-launch-property-fire-sale.html

 

[1sikbITCH]

Yet:

US home sales rose to 5-year high in 2012

I guess that would be the Arab oil companies that are scooping up all the US real estate.

That's just my loosely based paranoid delusion based on #4.

 

[soulcougher73]

america, fuck yeah 🙁 im not sayin im just sayin... im going through foreclosure and bankruptcy myself. i tried to hold on for over 4 years though... i just cant do it anymore.

I dont feel bad about doing it either. The industries are the one that caused their own mess by being greedy. Normally i would feel bad, but given they got tax payer bailout after they caused it. Fuck em lol