This is really good advice. Also never sell land.
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Bay area housing market
- Thread starter 2legs2wheels
- Start date
This is really good advice. Also never sell land.
JesasaurusRex
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I don't think such a sweeping statement has any chance of accuracy. Rebuilding costs are around $100-125/ foot for shitty stuff on outskirts land. Consider that without land cost, a 2,500 foot home runs around $300-350K in build cost alone.
30% is a far overshoot, unless the economy completely collapses.
jt2
Eschew Obfuscation
No doubt that there are some signs of froth there. And it will correct at some point. But this isn't 2006 - people aren't leveraged as badly. The correction will come, but it won't be like the last one.
A sign, but NOT a leading indicator. If you want that, watch delinquency rates, existing home sales and inventory levels, etc.
Existing sales have slowed a bit, but inventory is still very low. A sign to watch, but not a concern... yet.
Agent Orange
The b0y ninja
HappyHighwayman
It's all in the reflexes
People said it was a bubble how many years ago?
That's my point as well...people always say "bubble bubble bubble".//10-15 years go by and the bubble finally hit and they're all "look how right I was" yet somehow they still don't own a home.
Horse
CONCITATOR
I'm moving back to bay area, every house I see for sale says "Great deal for an investor." Yeah right! lol
Foreign and domestic investors have swooped in after the 2007 crash and run up prices higher than the previous bubble. Same exact thing happened to the stock market. Stock market hit new highs in record time after the last 2007 crash. When things are going up, investors pile in.
While credit is extremely cheap right now, with crazy fed 0% interest rate. Guess what will happen when rates start to go up? A crash like you haven't seen before in your lifetime. Guess what happens when prices start to fall. Investors get out...
Right now its a perfect storm for the bay area. NASDAQ near record highs. Tech and Biotech flush with investor capital, trying to make any crazy idea work. Lot of tech and biotech unicorn companies out there with little hope of ever turning a real profit.
The markets are on the verge of crashing. When interest rates go up, this house of cards will come crashing down, if not before then.
What we are seeing is a bubble like we haven't seen in a hundred years. Interest rates have been steadily declining since 1981. Do you think that it is a coincidence that housing prices have been on the rise since the 80's?
Here are signs that this huge bubble is close to bursting. Nothing has changed since 2007, the consumer still has too much debt. Companies are struggling, and are starting to announce mass lay offs again. The stock market is struggling and on the verge of another bubble crash, even bigger than the 2007 crash. As fundamentals haven't changed since 2007, yet the market is higher than it was last time.
This time the government cant step in and pour in TRILLONS to save us from the coming crash. Neither can the fed lower interest rates to spur the economy, as it is already at zero.
Gas and oil inventories are at all time highs, showing people aren't driving as much, even with these low gas prices... Showing the economy is slowing.
Unicorn bay area tech/biotech companies are paying crazy incomes to their employees, and crazy mortgages/rents for their campuses/buildings. Yet these companies have no or little profits. How long can that last?
People are getting pissed at high drug prices, as biotech companies have been raising them enormous percentages to generate more income for their stock holders. Expect some legislation as raising drug prices in the name of research getting out of hand.
People are starting to realize they are wasting too much life on tech nonsense, and are growing tired of things such as facebook. A movement is growing to disconnect from internet, expect a coming tech backlash.
Computing is becoming more mobile. PC hardware and software companies struggling. Even bay area companies such as Apple that have gone mobile early are facing stronger competition, as competitors products have caught up and are cheaper. Which is why Apple is going to try and branch out making electric cars. As just making phones it can become the next Nokia.
Google has separated all the companies it bought from itself, putting them under the umbrella of Alphabet. Guess what is going to happen to all these no profit making companies formally owned by Google? They and their employees will get the axe. Yet Google stock will do fine thanks to advertisement revenue.
So we have the two major bay area industries about to take a huge hit. Tech and biotech. Expect mass layoffs in coming years. Rents will plummet/normalize as tech/biotech people lose their jobs and are forced to move away. Real estate investors will try and cash out early, so they can buy back at bottom. Crashes always come hard and fast when "investors" are involved.
Did you know these days you can own real estate without owning real estate? Investment money in REIT's (real estate investment trusts) are at all time highs. REIT's buy up properties to hold and rent for its investors. The amount of foreign and domestic money in REIT's is staggering.
Something to think about. Your 401k's are probably loaded with REIT's. Jacking up real estate prices, maybe keeping you from affording a house. Ironic.
Just like all investments, when they start to go down, people cash out. You will see a mass exodus from real estate when it crashes. With no one to step in and bail out the losers this time. Lucky for the USA, foreign investors especially the Chinese are now holding a lot of these properties, instead of Fannie Mae and Freddy Mac.
The Chinese made a great fortune in their stock markets, but that stock market is crashing down now. Don't expect them to hold onto USA properties as they plummet. Its going to fall hard and fast at first, then decline further as interest rates go up, and credit gets harder to come by. Who knows where the bottom will be, but I predict much lower than the last time.
Then throw in a natural disaster such as a big earthquake or persistent drought and things could get worse quicker.
But all that being said, no place else I would rather be. Housing here will always be more expensive than the rest of the country, and its worth it.
Foreign and domestic investors have swooped in after the 2007 crash and run up prices higher than the previous bubble. Same exact thing happened to the stock market. Stock market hit new highs in record time after the last 2007 crash. When things are going up, investors pile in.
While credit is extremely cheap right now, with crazy fed 0% interest rate. Guess what will happen when rates start to go up? A crash like you haven't seen before in your lifetime. Guess what happens when prices start to fall. Investors get out...
Right now its a perfect storm for the bay area. NASDAQ near record highs. Tech and Biotech flush with investor capital, trying to make any crazy idea work. Lot of tech and biotech unicorn companies out there with little hope of ever turning a real profit.
The markets are on the verge of crashing. When interest rates go up, this house of cards will come crashing down, if not before then.
What we are seeing is a bubble like we haven't seen in a hundred years. Interest rates have been steadily declining since 1981. Do you think that it is a coincidence that housing prices have been on the rise since the 80's?
Here are signs that this huge bubble is close to bursting. Nothing has changed since 2007, the consumer still has too much debt. Companies are struggling, and are starting to announce mass lay offs again. The stock market is struggling and on the verge of another bubble crash, even bigger than the 2007 crash. As fundamentals haven't changed since 2007, yet the market is higher than it was last time.
This time the government cant step in and pour in TRILLONS to save us from the coming crash. Neither can the fed lower interest rates to spur the economy, as it is already at zero.
Gas and oil inventories are at all time highs, showing people aren't driving as much, even with these low gas prices... Showing the economy is slowing.
Unicorn bay area tech/biotech companies are paying crazy incomes to their employees, and crazy mortgages/rents for their campuses/buildings. Yet these companies have no or little profits. How long can that last?
People are getting pissed at high drug prices, as biotech companies have been raising them enormous percentages to generate more income for their stock holders. Expect some legislation as raising drug prices in the name of research getting out of hand.
People are starting to realize they are wasting too much life on tech nonsense, and are growing tired of things such as facebook. A movement is growing to disconnect from internet, expect a coming tech backlash.
Computing is becoming more mobile. PC hardware and software companies struggling. Even bay area companies such as Apple that have gone mobile early are facing stronger competition, as competitors products have caught up and are cheaper. Which is why Apple is going to try and branch out making electric cars. As just making phones it can become the next Nokia.
Google has separated all the companies it bought from itself, putting them under the umbrella of Alphabet. Guess what is going to happen to all these no profit making companies formally owned by Google? They and their employees will get the axe. Yet Google stock will do fine thanks to advertisement revenue.
So we have the two major bay area industries about to take a huge hit. Tech and biotech. Expect mass layoffs in coming years. Rents will plummet/normalize as tech/biotech people lose their jobs and are forced to move away. Real estate investors will try and cash out early, so they can buy back at bottom. Crashes always come hard and fast when "investors" are involved.
Did you know these days you can own real estate without owning real estate? Investment money in REIT's (real estate investment trusts) are at all time highs. REIT's buy up properties to hold and rent for its investors. The amount of foreign and domestic money in REIT's is staggering.
Something to think about. Your 401k's are probably loaded with REIT's. Jacking up real estate prices, maybe keeping you from affording a house. Ironic.
Just like all investments, when they start to go down, people cash out. You will see a mass exodus from real estate when it crashes. With no one to step in and bail out the losers this time. Lucky for the USA, foreign investors especially the Chinese are now holding a lot of these properties, instead of Fannie Mae and Freddy Mac.
The Chinese made a great fortune in their stock markets, but that stock market is crashing down now. Don't expect them to hold onto USA properties as they plummet. Its going to fall hard and fast at first, then decline further as interest rates go up, and credit gets harder to come by. Who knows where the bottom will be, but I predict much lower than the last time.
Then throw in a natural disaster such as a big earthquake or persistent drought and things could get worse quicker.
But all that being said, no place else I would rather be. Housing here will always be more expensive than the rest of the country, and its worth it.
JesasaurusRex
On a break
unirr
Eating popcorn
I'm moving back to bay area, every house I see for sale says "Great deal for an investor." Yeah right! lol
Foreign and domestic investors have swooped in after the 2007 crash and run up prices higher than the previous bubble. Same exact thing happened to the stock market. Stock market hit new highs in record time after the last 2007 crash. When things are going up, investors pile in.
While credit is extremely cheap right now, with crazy fed 0% interest rate. Guess what will happen when rates start to go up? A crash like you haven't seen before in your lifetime. Guess what happens when prices start to fall. Investors get out...
Right now its a perfect storm for the bay area. NASDAQ near record highs. Tech and Biotech flush with investor capital, trying to make any crazy idea work. Lot of tech and biotech unicorn companies out there with little hope of ever turning a real profit.
The markets are on the verge of crashing. When interest rates go up, this house of cards will come crashing down, if not before then.
What we are seeing is a bubble like we haven't seen in a hundred years. Interest rates have been steadily declining since 1981. Do you think that it is a coincidence that housing prices have been on the rise since the 80's?
Here are signs that this huge bubble is close to bursting. Nothing has changed since 2007, the consumer still has too much debt. Companies are struggling, and are starting to announce mass lay offs again. The stock market is struggling and on the verge of another bubble crash, even bigger than the 2007 crash. As fundamentals haven't changed since 2007, yet the market is higher than it was last time.
This time the government cant step in and pour in TRILLONS to save us from the coming crash. Neither can the fed lower interest rates to spur the economy, as it is already at zero.
Gas and oil inventories are at all time highs, showing people aren't driving as much, even with these low gas prices... Showing the economy is slowing.
Unicorn bay area tech/biotech companies are paying crazy incomes to their employees, and crazy mortgages/rents for their campuses/buildings. Yet these companies have no or little profits. How long can that last?
People are getting pissed at high drug prices, as biotech companies have been raising them enormous percentages to generate more income for their stock holders. Expect some legislation as raising drug prices in the name of research getting out of hand.
People are starting to realize they are wasting too much life on tech nonsense, and are growing tired of things such as facebook. A movement is growing to disconnect from internet, expect a coming tech backlash.
Computing is becoming more mobile. PC hardware and software companies struggling. Even bay area companies such as Apple that have gone mobile early are facing stronger competition, as competitors products have caught up and are cheaper. Which is why Apple is going to try and branch out making electric cars. As just making phones it can become the next Nokia.
Google has separated all the companies it bought from itself, putting them under the umbrella of Alphabet. Guess what is going to happen to all these no profit making companies formally owned by Google? They and their employees will get the axe. Yet Google stock will do fine thanks to advertisement revenue.
So we have the two major bay area industries about to take a huge hit. Tech and biotech. Expect mass layoffs in coming years. Rents will plummet/normalize as tech/biotech people lose their jobs and are forced to move away. Real estate investors will try and cash out early, so they can buy back at bottom. Crashes always come hard and fast when "investors" are involved.
Did you know these days you can own real estate without owning real estate? Investment money in REIT's (real estate investment trusts) are at all time highs. REIT's buy up properties to hold and rent for its investors. The amount of foreign and domestic money in REIT's is staggering.
Something to think about. Your 401k's are probably loaded with REIT's. Jacking up real estate prices, maybe keeping you from affording a house. Ironic.
Just like all investments, when they start to go down, people cash out. You will see a mass exodus from real estate when it crashes. With no one to step in and bail out the losers this time. Lucky for the USA, foreign investors especially the Chinese are now holding a lot of these properties, instead of Fannie Mae and Freddy Mac.
The Chinese made a great fortune in their stock markets, but that stock market is crashing down now. Don't expect them to hold onto USA properties as they plummet. Its going to fall hard and fast at first, then decline further as interest rates go up, and credit gets harder to come by. Who knows where the bottom will be, but I predict much lower than the last time.
Then throw in a natural disaster such as a big earthquake or persistent drought and things could get worse quicker.
But all that being said, no place else I would rather be. Housing here will always be more expensive than the rest of the country, and its worth it.
10/10 post. Touched upon a large brush stroke of the economy. I must meet this Horse. I share similar solid views 
Reli
Well-known member
I swear, half of BARF members have a dupe acct. Gutless.......no integrity at all.
HappyHighwayman
It's all in the reflexes
Why do you say this, and why don't you just email an admin?
HappyHighwayman
It's all in the reflexes
No, I'm Spartacus.
Dubbington
Slamdunk Champion
[youtube]-cDAqrywsHE[/youtube]
unirr
Eating popcorn
wth.... It cracks me up that you even think that ...I wonder whats going through your mind that causes you to ponder on such things ... dat life.. dat mindset