Saturday, August 1, 2009

A bottom for prices??

There's been a few articles in the median lately about the bottom being here. The leveling off of prices and even a few increases are seen as an indication the bottom is in. It's nice marketing but I'm not sure anyone really believes it. Over at Piggingtons they put up a nice chart of the last real estate bust we suffered here in Cali. The chart shows the price declines from the early 90's bust. You can clearly see that there was a "spring bounce" pretty much every year. Even in 1993 which was the worst year of that bust there was a tiny increase in the spring. Those bumps did not stop the fall or indicate a bottom or a turnaround. All the articles spouting off about a bottom or a turn around are optimistic at best. Could it be the bottom? Sure it could, just as easily as it could be the half way point. We won't know when the bottom hits until years after it happens, and it's not going to hit every market at the same time.

The indicated points are the spring/summer increases in median for San Diego.


dgelz said...

Hey Golfer X, it's been a while. The wife and I went to look at a couple of open houses yesterday in South Corona. 92882 and 92881. Nothing impressive by any means. We were basically looking to get a better feel for those particular areas. Not wanting to buy anything for another year or two.
I need some advice. What do I say to agents when they insist that "Now is the best time to buy. Housing in South Corona won't go any lower. In fact, we'll probably be looking at 5% yearly gains again like we were before the boom."

When realtors start talking nonsense, it totally takes my friendly vibe and flushes it down the toilet. I get apprehensive and the pleasant conversation quickly turns to "get me the hell out of here."
How do I handle their BS? When they talk about the market not going any lower in Corona, do I not believe them because I know better or because I don't really want it to get better because we're looking to buy in a couple years?

Sigma said...

dgelz: I feel you. I despise realtors and mortgage brokers like the scum of society they are. Bottom feeding crapholes that need to be rid of existence.

However, they aren't completely talking non-sense when they say it's a good time to buy. It *IS* a good time to buy, just not the *BEST* time to buy. I think if you do buy something right now, it's more than reasonable.

golfer_X said...

dgelz, just tell them " that's the same line of crap you tried to feed me last year, and we know how the market's gone since then".

You are absolutely right though. As soon as a realtor spouts out a line like that you just want to puke. It does ruin the mood. The last time one said that to me, I told them if they are so confident then maybe they should buy it! I usually try to be nice because my wife really doesn't like me to ridicule the realtards. But every now and then I just have to mock them. Some of the lines I've used as comebacks to the "there's never been a better time" are:

And monkeys are about to fly out my butt"

1998 was a much better time to buy.

I'll bet you pink slips next year will be better.

You were wrong last year!

I've said a few other choice lines too!

Sigma is right. Now is not a bad time to buy. In some areas like Lake Elsinore, Murietta, Temecula, MoVal, Perris etc, it's probably as good as it's getting or very close to it. If you are looking to stay 10 or more years in the home, It's not a bad time to buy.

I don't think there is much chance it will be better in two years. It could happen but then again, monkeys could fly out my butt....

Sigma said...

I've been driving around looking for homes, and take back what I said about it being a good time to buy. After seeing the number homies driving around town in luxury cars, seeing people who cannot afford their next meal buying iphones at the AT&T store, and other such indicating factors, I am convinced that we are nowhere near the bottom and have a HUGE correction in front of us.

I'm going to wait it out at least another 6 months. Call it as ridiculous as you'd like but this is how I'm going to gauge when the economy/house prices have or have not hit bottom.

Martin Burtin said...

So if the CaseShiller index is not your cup of tea, Sigma has invented the HomieLexus index... lmao Makes as much sense as anything else these days!

ButterMonkey said...

*Snort* "HomieLexus Idex" Bwahahahahahahaha!

Sigma said...

Doesn't roll off the tongue. I like "Homie-Meter". Or a more generic term for everyone: the "Full-o-shit-o-meter".

Sigma said...
This comment has been removed by the author.
Sigma said...

NYMag prefers the "Waitress Hotness Index" to gauge the economy.

Anonymous said...

I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.