How scared should we be??? (Empire: real estate, to rent, mortgage)

[dreamfollower]

Just when it seemed like the housing fiasco was showing some sign of slowing down {I mean how far down can it go?!}, we now have a second wave of panic thanks to Mr. Schwarzenegger, along with other "things" which have surely helped to deplete this state.

Anyone out there scared of making the decision to purchase property and make CA their home when such an economic unknown seems to exist? Or is this just another extreme scare tactic in order to make the feds take notice and hand over the money?

Would you move here now or not?

[EscapeCalifornia]

Why buy now when there's no signs of economy recovery and everything points toward falling home prices?

[bhcompy]

unfortunately rates have jumped nearly a point in one damned week!

[dreamfollower]

It is because I need to settle somewhere and I do not want to rent. It may be that other states are headed in the same direction {AZ/NV} and if there is any state more capable of rebounding, habitual thought seems to still favor CA simply because of its size and diversity.

New York recovered from the brink, so why not California?

[Greenchili]

No were not scared.
Yes we bought a house last year.

Greenchili

[EscapeCalifornia]

Originally Posted by dreamfollower

It is because I need to settle somewhere and I do not want to rent. It may be that other states are headed in the same direction {AZ/NV} and if there is any state more capable of rebounding, habitual thought seems to still favor CA simply because of its size and diversity.

New York recovered from the brink, so why not California?

Have you ever heard the expression "Don't try to catch a falling knife"?

Why is it better to lose tens or hundreds of thousands of dollars on a house than rent for a while to let the market stop it's free fall?

[kettlepot]

If the mortgage rates drop back down below 5% lock in your mortgage and buy a house. We are very near or at the bottom in areas near the coast, particularly for starter homes. Inland Empire and Central Valley locations are bit more problematic.

You will save far more money on the low mortgage rate than you will ever temporarily lose if the value of the house you buy drops by 10k more. Starter houses have dropped enough now in price that there isn't $100ks of room for them to drop. Plus, given the massive expansion in the money supply over the past year, we are in far, FAR more danger of a few years of general price inflation than we are in danger of price deflation adding further pressure onto housing prices. An under 5% mortgage coupled with a real asset like real estate will actually do rather well in the next few years in a moderately higher inflation environment. Maybe not in the next 12 months, but after that, modest but steady appreciation is the most likely scenario.

When the media rings the bell and announces that the housing price declines have ended, they will be making that announcement 6 months too late.

[JohnG72]

Originally Posted by kettlepot

If the mortgage rates drop back down below 5% lock in your mortgage and buy a house. We are very near or at the bottom in areas near the coast, particularly for starter homes. Inland Empire and Central Valley locations are bit more problematic.

You will save far more money on the low mortgage rate than you will ever temporarily lose if the value of the house you buy drops by 10k more. Starter houses have dropped enough now in price that there isn't $100ks of room for them to drop. Plus, given the massive expansion in the money supply over the past year, we are in far, FAR more danger of a few years of general price inflation than we are in danger of price deflation adding further pressure onto housing prices. An under 5% mortgage coupled with a real asset like real estate will actually do rather well in the next few years in a moderately higher inflation environment. Maybe not in the next 12 months, but after that, modest but steady appreciation is the most likely scenario.

When the media rings the bell and announces that the housing price declines have ended, they will be making that announcement 6 months too late.

Do you just enjoy magically making things up in your mind an blurting them out?