The Koolaid is Still Strong

F

FairEconomist_IHB

New member
I was walking into a coffeeshop near my house in Orange and saw one of the baristas loading up his car. This guy remembers my name and even my food preferences even though he sees me maybe twice a month so I said hi and asked what he was up to. He happily announced that he and his committed girlfriend had just bought a house together, also in Orange. He said they had had to choose between getting married and buying a house and since there was "never going to be another time like this to buy a house" they had gone for the house since it was their only chance. I was speechless initially since although there may very well never be another time like this to buy a house, it's not in the sense he meant it (actually, there may never again be such a good time to *lose* money on a house). But it was obviously too late for advice so what could I say? So I said I hoped he was very happy there.



Sadly, I don't <b>expect</b> him to be very happy there. I figured such stories were a thing of the past but obviously not. :down:
 
Sad. I know some smart people that are still dumb in this respect. They'll say stuff like "I'm an owner not a renter", "my family always owns", "why throw money away renting?". For a while I felt that way - and part of me still does - but sometimes you have to listen to the facts on the other side right?



Live and learn I guess. It still amazes me how quickly this bubble happened after the stock bubble and how it took years for the mainstream to recognize it even as a possibility.
 
He might not be that far off.



There are a couple of reasonable small homes that are near rental parity. I'm not interested in any of them...........but it's getting closer.
 
True enough, NoVas; Orange has really been clobbered and I'm not sure why. But even if it's near rental parity he shouldn't be stretching. Stretching your financing a long way to *rent*, effectively, isn't good policy. And of course neighborhoods near rental parity now are likely to overshoot.
 
Those guys make bank, doesn't surprise me. I've also seen others who wouldn't normally be able to afford a home get into a low income housing deal financed by the city and then have the b/f, or g/f move in without notice so their income isn't on the deed. That kills the rest of us with a solo income.
 
The NAR propaganda is strong with that one.



I also have seen some properties approaching or even below rental parity - though these are small condos in not desirable neighborhoods.
 
I'd say it just depends upon the circumstances. But generally, most people don't quite understand or have the depth/breath to make a completely informed decision. If they can afford it, then i say good. That they are affording a "asset" that is going to be depreciating is their own choice. You have to remember the pathology of "buy now or be priced out forever" has been INGRAINED in alot of the younger folks. They don't the the memory of the 90's crash.



good luck

-bix
 
rents are falling and vacancy is rising.



As more homes fall in price those issues are going to worsen for would be landlords.



And we still have to address the problem of all the empty houses.
 
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