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Old 07-05-2018, 08:00 PM
 
Location: Vienna, VA
204 posts, read 105,220 times
Reputation: 221

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Quote:
Originally Posted by GeoffD View Post

The bubble is caused by people buying houses with stock option and stock market run-up money. When the stock market corrects which it always does, that demand vanishes and the high COL region bubble pops. The 1,200 square foot ranch in Sunnyvale won't be worth $1.25 million. Unlike the last one, a stock market correction and high COL region bubble collapse won't crush places like Phoenix, Vegas, and Florida.



Your average family buying up $1,000,000 homes doesn't have $300k just sitting around in a trading account. They save up for a down payment by working at high paying jobs and saving. Most people are clueless when it comes to the markets, never-mind a population full of successful stock traders saving up for a down payment by timing the stock market.



When 2008 came around and the stock market fell by 50%, the high COL areas did best. My area fell by about 10% at the peak, the lower priced areas fell by over 30%.







Has continued upwards 2015 - present



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Old 07-05-2018, 08:15 PM
 
Location: Ohio
18,018 posts, read 13,247,591 times
Reputation: 13827
Quote:
Originally Posted by GeoffD View Post
Capitalism is inherently unstable.
There's nothing inherently unstable about Capitalist Property Theory or Free Market Economics.

On the other hand, Socialist Property Theory and Command Economics were responsible for a famine in Ukraine that resulted in 6 Million to 10 Million deaths.

Quote:
Originally Posted by GeoffD View Post
The bubble is caused by people buying houses with stock option and stock market run-up money.
No one buys housing with stock options.

Quote:
Originally Posted by JONOV View Post
I'd be curious to see how many of the homes foreclosed on were never owner occupied.
Depends on the State.

A study on mortgages originating in 2006 showed that less than 8% of defaults were on non-owner occupied housing in California, Virginia and the northern Plains States.

Florida had the highest default rate at just over 19%, and interestingly, States east of the Rocky Mountains -- Idaho, Utah, Nevada, Arizona and Nebraska -- and the southeast -- Georgia, North & South Carolina -- along with oddly enough Indiana and Ohio had default rates between 14% and 19%. All other States fell between 8% and 14%.

The data also showed that non-owner occupied home owners had higher incomes, higher FICO scores, a lower loan-to-value ratio, and lower debt-to-income ratios than homeowners of owner-occupied homes, so this is not an issue of sub-prime lending.
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Old 07-06-2018, 09:08 AM
 
4,543 posts, read 11,549,619 times
Reputation: 3063
Quote:
Originally Posted by Sharpydove View Post
What a flat-out lie, but expected, none the less. It is happening.
So you are convinced that the Subprime market is rocking "full force" like 2002-2009?

May want to consider changing your moniker.
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Old 07-06-2018, 11:50 AM
 
244 posts, read 126,080 times
Reputation: 212
Quote:
Originally Posted by C2BP View Post
American housing market has been turned into a Casino Game. Real Estate is number one scam in desert cities like Las Vegas, Phoenix, majority parts of Florida, Sacramento and etc. Housing prices are detached from reality everywhere in America and Americans have stopped buying homes long time ago. Americans are renting now because buying is unaffordable and out of reach for many American families.

In order to sell overinflated and overpriced real estate in America our government lowered the bar for its taxpayer-backed mortgage programs every year since 2014. It lowered the down payment requirement, broadened the definition of what constitutes a down payment (as an example, seller concessions can be counted as part of a down payment), thereby reducing even further the amount of cash required from a buyer's bank account at closing, it cut mortgage insurance fees and it lowered income and credit score restrictions. After all this, the government and NAR CRIMINALS are running out of people into whom they can stuff 0-3% down payment and 50% DTI mortgages in order to keep the housing market propped up.

Very high prices, rising mortgage rates and stagnant wages are like poison darts being thrown at the housing bubble 2.0 that is bigger now than housing bubble 1.0. Stay far away from toxic real estate in America!!!

Can Seller Concessions be used for the down payment? I thought it was only able to put towards closing costs and capped based on the LTV amount. At 90% LTV I think it is capped at 3% and cannot exceed the closing costs amount.


MIP got jacked up after the crash and went from dropping off after the borrower reached 20% to being charged for the life of the loan (or 11 years if they put enough down). They have been ripping off borrowers on the MIP since the crash and even with these reduction borrowers still continue to get ripped off IMO.
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Old 07-06-2018, 12:12 PM
 
Location: Vienna, VA
204 posts, read 105,220 times
Reputation: 221
Quote:
Originally Posted by C2BP View Post
In order to sell overinflated and overpriced real estate in America our government lowered the bar for its taxpayer-backed mortgage programs every year since 2014. It lowered the down payment requirement, broadened the definition of what constitutes a down payment (as an example, seller concessions can be counted as part of a down payment), thereby reducing even further the amount of cash required from a buyer's bank account at closing, it cut mortgage insurance fees and it lowered income and credit score restrictions. After all this, the government and NAR CRIMINALS are running out of people into whom they can stuff 0-3% down payment and 50% DTI mortgages in order to keep the housing market propped up.

!
Good luck asking for any concessions in a hot market, your offer will get tossed. That may work in the midwest or some slow market. The RE market isn't likely to do anything drastic, so you best start making more money.


"U.S. Census Bureau reveals that conventional loans accounted for 73.8% of new home sales in the first quarter of 2018, the highest share in a decade."



Conventional Loan Share Reaches Decade High | Eye On Housing






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Old 07-06-2018, 12:28 PM
 
2,392 posts, read 2,119,776 times
Reputation: 2549
Quote:
Originally Posted by luv4horses View Post
We had a big problem pre 2009, then it was eliminated and cured by the new administration with regulations put in place to prevent it happening again. Then in 2017 an even newer government thought it wise to get rid of those annoying regulations. So history tries to repeat itself since there are beaucoup bucks to be made by the unscrupulous.
Don't forget to mention it was the Clinton administration that provided the main catalyst for the subprime crisis.

I'm sure you just left that out on accident.
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Old 07-06-2018, 02:24 PM
 
1,481 posts, read 593,586 times
Reputation: 3764
Good time to buy a house. Interest rates are below 5% and you can just put 5% down.
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Old 07-06-2018, 02:40 PM
 
Location: Mt. Lebanon
1,793 posts, read 1,826,056 times
Reputation: 1745
Quote:
Originally Posted by k374 View Post
https://www.bloomberg.com/news/featu...es-to-the-poor

And now the government is backstopping all these loans while these fraudsters get rich.. where is our government in all of this? I get it, just like last time they are asleep at the wheel and will wake up only when the financial system collapses again and then it will be time to bail out using taxpayer money QE6..7..8..9 etc. at the expense of future generations.
this is what we get from the government we have. i'm not surprised. want to do something? get in touch with your peers and come November, fight this. every way you can.
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Old 07-06-2018, 03:04 PM
 
Location: Silicon Valley
2,760 posts, read 1,214,346 times
Reputation: 5082
The Chicken Littles may have a point in certain markets. South Bay is arguably not the gem of Silicon Valley, but they've build 10's of thousands of new high density condos/townhomes that are selling north of $1M around here. We're at nearly 2x of the last peak. Up the peninsula is higher in appreciation. Pretty sure you can't buy anything within 10 miles of Google for less than $2M.

To buy at the low end of range, assuming you have the deposit, you're putting away $5K a month to mortgage, over $1K for property taxes and a bit on insurance. That's a six figure job post taxes doing nothing more than paying a mortgage. I have to assume these are couples buying these things and both partners are working.

The last two recessions the unemployment rate spiked by 10% over a 6 month period. People caught in these mortgages with one person laid off suddenly aren't going to be able to pay their bills. It's not that they'll need to replace a lost job, but they'll need to replace it with a six figure job or they lose everything. With so many people newly arrived to the area, there's a higher chance for them to hang it up and move somewhere else.

The loans don't have to be bad this time. People are making good money. The market is near full employment. It's just what happens when everyone is competing for the same things. Prices go crazy. You visit someone's home that is really nice and are surprised to see it's almost empty for furnishings. A lot of people banking on future raises. A lot of start-ups banking on future funding.

Real estate is local. I wouldn't say its a macro-event, but some markets certainly have been hot for a long time.
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Old 07-06-2018, 03:17 PM
 
1,066 posts, read 707,616 times
Reputation: 1199
My mortgage broker said back in 2006-2007 the people doing appraisals would literally just drive up to the house, take a photo, and never actually look inside and just write whatever number seemed appropriate on the paperwork. That kinda thing doesn't happen anymore.. Just another example of some of the differences between then and now.
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