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ATG wrote:

Unless you;

don't live with mum and daddy
have a job and support a family
own a home that has not lost it's equity


You are talking out your ass and your opinion means nothing.


Punk ass teenagers have so little life experience they have nothing of merit to offer on the economy.

So please wise one, explain to us children how borrowing money and then not paying it back is something other than theft.

Can I steal your car? I need a car and don't have one.

Can I rob you at gunpoint? I need your money more than you do.

Can I rape your daughter or wife? I need the sex.

Well, it perhaps would have been better if he took a Morgan Stanely building out with his bulldozer, after all, weren't they involved in peddling worthless investments to overseas investors?


My experience is thus;
I run a business and I own my own home that is now worth half of what I paid, even though I never drew one cent in equity. I have been self sufficient for 25 years, have voted in most every election. I see people of every walk of life going down and losing everything.


So, take your personal attacks and insults and stuff them up your ass. They will keep your brain company.

melt down

bennisboy wrote:

ATG wrote:

Well, it perhaps would have been better if he took a Morgan Stanely building out with his bulldozer, after all, weren't they involved in peddling worthless investments to overseas investors?


My experience is thus;
I run a business and I own my own home that is now worth half of what I paid, even though I never drew one cent in equity. I have been self sufficient for 25 years, have voted in most every election. I see people of every walk of life going down and losing everything.


So, take your personal attacks and insults and stuff them up your ass. They will keep your brain company.

haha my personal attacks? Jeez, you're the one that started with the insults cos I disagreed with you.

A housing market is just that, a market. Prices go up and down, you know that whn you buy it, just like anything else that is bought and sold. And unless you've taken out more loans than you can afford, you can just wait for house prices to recover, which they already are over here.

Buy low, sell high is the investment creed. ATG, you simply made the mistake of buying high and now you're stuck. There's no one to blame but yourself. Just take your lumps, learn a lesson and move on... like an adult.

There's honestly nothing wrong with doing a strategic default if you're willing to pay the price which is a major hit to your credit rating. And yes, you should take a major hit because you're reneging on a deal and breaking your word. Your credit rating is nothing more than a marker telling lenders how much they should trust you if they give you a loan.

Anyway, how do jobs get created in the first place? It doesn't come from the government. It comes from the private sector feeling that there is a demand for their services and so they hire more people to help meet that demand. It's far from an overnight quick fix because all good businesses are cautious, especially when loading up on long term commitments like training and paying employees.

Couple this with the fact that many consumers are leery of spending in general now and especially of using credit, so there is less demand for goods and therefore less reasons for businesses to expand. And add in that many people are anchored to a single location because they bought a home that they can not now sell and it makes it even more difficult for people to find work.

Btw, as I said in the other thread, home ownership isn't the right choice for 90% of the population in this country anyway so it's their own fault for getting locked in.

ATG wrote:

JohnG@lt wrote:

home ownership isn't the right choice for 90% of the population in this country anyway

Please expand.

I explained it in the other thread but I'll do so again.

First off, if you're taking out a 30 year mortgage on a home you are paying for the home twice, once for the house and once for the interest (No, this doesn't make the bank evil, it's providing a service that you are using and aren't required to use). So on a $250k home (yes, I know, cheap), you're paying $500k for it over the course of 30 years. Along with this you're paying for upkeep and renovations along the way. Appliances need updating, wiring, new roof etc, home owners insurance etc. It all adds up. You're also paying property taxes yearly (yes, I know you get a federal tax writeoff). So in reality, over the course of that 30 year mortgage you're in all likelihood putting $700k into that $250k home.

Now, if you rented at $694 a month ($250k/360) for thirty years and invested the monthly difference ($1944-$694=$1250 a month) at a reasonable return of 7% annual you'd end up with: $1,516,095.62 instead of a house worth $780,000 (assuming 4% annual growth on the home price which is still well above normal inflation of 2%). $694 is a bit low for rent on a home that cost the owner $250k but you get the point.


Ok, so the investment bit is out of the way... If you're a worker bee, i.e. you don't own your own company, you severely limit your job prospects by owning a home in one specific area. If you buy land in a one horse town in the Midwest what happens when that one factory leaves? You're fucked. If you had been renting you could find a job elsewhere in the country, pack up your things and move relatively easily (possibly a broken lease). This is the correct path for anyone who does not own their own business. Owning property is glorified in our society but it's not very realistic for most people. If I got offered a job in California today paying me double what I earn now I could take it because I rent month to month. If I owned a home I would have to put the house on the market before I could go. See the difference?

Edit - I firmly believe that most people buy a home because it gives them a psychological boost and makes them feel like they belong to the 'middle class' instead of the 'working class'. Most of the time it's just an illusion and not reality and that's why they get in trouble financially.

Last edited by JohnG@lt (2010-02-21 13:26:52)

JohnG@lt wrote:

home ownership isn't the right choice for 90% of the population in this country anyway so it's their own fault for getting locked in.

god once this country understands this it will be much better.  everyone thinks it is some sort of right or something.  or they have bought into the whole scam that is being fed to them about home ownership.

11 Bravo wrote:

and btw (inb4kmarionyellsatme) but what is the point of all the real estate people getting rich off this scam?  they have made buying a house such a stupid process that you really do need someone....it has been designed that way.  i dont need a "car agent" when i buy a new car.

Yeah, a relative of mines is an estate agent. Some of the shit he tells me. I mean, the guy is minting it. But still, even he knows it, it's somewhat of a joke and a farce.

ATG wrote:

Well, I agree. It's somewhat of a joke and a farce.


And as for Cali, it's a lost cause.


I give it about one month or so and I am out of here.


It is all but determined that I must walk away and move.

I held out for over two years of free falling property values. Now it is being decided for me as the climate is so miserable I can no longer justify being here.

If you walk away you lose all the value that you've put into the home. You can either cut your losses and move on like you're planning or hold onto it for the long term and watch the prices go back up. It depends on what you do for a living I guess. Personally, I'd hold on because owning a home isn't supposed to be a short term 'investment' anyway. But, if you're mortgage payments are over 1/4 of your income it's probably best to walk away and rent somewhere else.

The thing about California real estate is that you have so many stupid 'green space' laws that it severely limits the amount of land that can be developed and thus creates a supply shortage. Those green space laws are 90% of the reason that home prices are so high out there. If the economy picks back up out there you'll see another housing boom because of the lack of supply.

It's surely a tough decision. Do whatever is best for you and your family.

ATG wrote:

As it is now I lose three years of paying essentially too much for rent and about 18k up front.
I would face a up hill climb of around 200k to reach zero equity if I stayed.

Say that takes five or ten years of paying extra every month to break even; they have demonstrated that those years of gained value can be erased with a few toxic assets.


By the time you are talking to a bank about modifying your mortgage your credit is jacked. They won't talk to you until you are in default.
It seems to me prudent to start that 7-10 year clock ticking as every month they list me as behind on my home.


Of course, there could be some magic bullet that turns things around but I don't see it.

California will soon make national headlines as the first bankrupt state.

Eh, it didn't have anything to do with the banks... you simply live in an area where they built more homes than there was demand for. Supply and demand kicked you in the nuts, not the banks. Blame Prop 9 if you want too because it's a big reason so many businesses are fleeing your state. Oh, and the environmentalist whack jobs too. They're going to realize their dream of a communist utopia state where they can all prance about naked in the forests without a smokestack for hundreds of miles around

ATG wrote:

JohnG@lt wrote:

The thing about California real estate is that you have so many stupid 'green space' laws that it severely limits the amount of land that can be developed and thus creates a supply shortage. Those green space laws are 90% of the reason that home prices are so high out there. If the economy picks back up out there you'll see another housing boom because of the lack of supply.

JohnG@lt wrote:

Eh, it didn't have anything to do with the banks... you simply live in an area where they built more homes than there was demand for. Supply and demand kicked you in the nuts, not the banks.

eh, which is it? Or is arguing with me reason enough to post?

And, fuck the banks, they are 98% responsible.

It's both actually. Those green spaces drive up home prices which drive out low income families which drives up wages for those employed in industry making those industries non-competitive. Then they tack on carbon taxes and the companies decide it's better for them to move to Texas.

Everything is interconnected and your situation really is effected by the banks to a minimal degree. If you need a scapegoat, fine, but Cali has been heading towards the toilet since the dot com bubble burst a decade ago. Why? Because during the dot com boom municipalities handed out platinum clad deals to the public service unions. Now you're paying wages to people that reflect earnings during a boom, not a bust. Enjoy.