Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
In November 06 I expressed a concern I thought could not possibly happen. If it did, I thought to myself, there would be significant pain over a prolonged period of time.
Quote:
Originally Posted by Shores9
Posted 11-14-06
if real estate dropped 20%+ across the board we’d all be in deep - you know what - not just here in the US but globally. Risk and investment in US real estate (either directly or via secondary securities) is spread across the world. A resetting of this nature in real estate prices would have to follow a reset in almost all other values including salaries, raw material prices, food and energy, stock market, corporate share value etc. Basically a depression but on a global level.
Real Estate and the economy has long been the subject of debate on many forums. Here the debate goes back at least a couple of years. I had long been a cheerleader of real estate not just because I am a realtor but because of my economic background and the fact that real estate is a core underlying value in free market economies.
Looking back on Muggy's post he may have described me correctly (using my own words) when he said
Quote:
Originally Posted by Muggy
Posted 11-11-06
It’s even easier to get twisted over the unrealistic idiotic nonsense that is known as Florida real estate, perpetrated by those persistent, ill informed and disillusioned housing cheerleaders.
I certainly knew then that an adjustment was needed in real estate as there was a unrealistic and unsupported rise in values but I had not expected and hoped not to see as much a drop in values as many on this board (and elsewhere) were hoping for. Instead I was expecting to see a recession and correction (especially in real estate) to more realistic levels as part of our normal economic cycle occurring around the turn of the decade as has been the case for about the last 40 years.
I finally capitulated on the hosing price debate in early 07 but held out hope that a pending disaster could be averted
Quote:
Originally Posted by Shores9
Posted 4-20-07
The reality is that Florida real estate is overpriced and overtaxed making it unaffordable for the most of its residents.
Bottom line is people are looking at affordability in either a place to live or a place to do business or both. Florida is not that place anymore.
Prices will have to go back to 2001-2002 levels or taxes will have to be cut 20-50 percent or a combination of the two to keep people and businesses coming. Florida is NOT NY or CA. Take away the industries that came in the last 5-8 years and you are left with agriculture (which is only getting smaller) and tourism.
Now it seems likely that there will be a global reset of prices in almost all asset classes and there will be a corresponding reset in incomes. As you consider the fate of Detroit auto workers when the companies they work for ultimately file for Chapter 11 one of the first things to go is the UAW contracts. The workers remaining will be employed at a much lower wage. The same holds true of any industry when consumers hoard their dollars and employers let employees go. Higher amounts of unemployed help feed the cycle by holding on to dollars thus creating further cutbacks in goods and services being produced thus adding more people to the ranks of unemployed. More unemployed chasing fewer jobs = lower wages
Unfortunately, the significant pain that has come as a result of the housing collapse has affected many if not most other asset classes such as stocks commodities etc.
I agree with
Quote:
Originally Posted by jbravo
20+ years of living with imaginary wealth.
It's over.
And with
Quote:
Originally Posted by 58robbo
obviously, the biggest economic shake-up in history will have its consequences, but the idea of being chained to my office desk so that i can service the debt on my new suv, mcmansion and 5 star vacations and keep stocked up on battery operated pepper shakers and other useless articles is far more worrying.
Ultimately this could be a good thing. It has the potential to reshape values and habits. It’s sad that it comes at a lofty cost for so many people who can least afford it.
Lastly – Be careful for what you wish… you may just get it
Personally, I’m not sweating this – for me it’s just a point in the cycle. Fortunately, I don’t believe in the stock market as it is something I have little control over so I’m not invested in it and therefore haven’t lost anything. I have yet to loose on real estate, but the big word here is YET. Anything is possible! I agree… digits on paper – who cares!! However I really care for those who are less fortunate or don’t have time to recover from this kind of event – there’s a lot of people caught between the proverbial rock and hard place here.
I do have my family and we do have good health for which I am eternally grateful. I really like the Roast some marshmallows, grill a rabbit, relax and enjoy the ride... stuff and am doing my shores9 version of it.
Hope all is well with you and family – wish you all a Happy Thanksgiving
Things are rough in Florida, and over much of the country right now. This economy affects us all, even if many of us still have our jobs and homes. Every time I turn around another small business or restaurant has closed for lack of business or lack of capital. Too many people out of work and can't pay their bills let alone buy stuff in the stores or eat out.
And Shores, Charlie Crist and Florida is on the bandwagon for solar and alternative power, as well as green building. We are finally making strides.
State: FPL unveils plans for a solar plant (http://www.sptimes.com/2007/09/27/State/FPL_unveils_plans_for.shtml - broken link)
It is a bit of a downward spiral that is picking up steam. I'm working on a business strategy that is picking up a lot of interest. In a very short time, I've picked up a substantial project that I think we are going to turn around. As I noted earlier, so many people are effected by the greed, and short sightedness of others, yet they are suffering. So many people have worked their whole lives, saved their money, and now watch their accounts disappear day by day, and they are not withdrawing any of the savings they put in there. I've seen people that six months ago were as happy as can be, everything going in a positive manner, and now it is not only effecting their emotional status, it is effecting their health. - Sad.
Alternative energy is something we need to look hard at right now. Green buildings - everyone is talking Green Buildings, but the cost to incorporate "green features" vs. value is difficult for many to understand. Architects prepare great designs, using creative ideas, but usually don't understand the real costs. Generally, they think it is going to cost 5 -10% more than conventional construction solutions, but in reality it is much more. The problem is, that 5% will make or break the project proforma. And, if projects do not move forward because reasonable choices are not made then as a result, potential jobs will continue to be unrealized. That said, the movement toward Green is a worthy goal.
It's relative isn't it?
Here in FL, you will see an increase in crime.
You will see even more aggressive behavior in the streets.
Many will not come to terms with "once we all come to terms with the fact that there are better things to do than go to the mall, we'll be just fine."
I do not see an easy transition, specially here in FL were a lot of jobs were in construction.
But all in all, I agree with you 90%.
-
i'm not too sure about this crime epidemic that everyone is predicting. there is much evidence that poverty leads directly to crime, conversely however, there are many impoverished nations where crime isn't a major issue. i also believe that personal debt is a major contributing factor in the frustration that causes aggression. i also think that it's kinda a double edged sword. either you go into huge amounts of debt and present an image of success or you don't and you provide an image of failure. i know, i have first hand experience of the latter. very frustrating. i know that this is a preposterous suggestion but this forum is a platforn to discuss thoughts and ideas and these are some of mine.
Doomsayers are still doomsayers. If you stop reading the newspapers and watching the news about all the doom and gloom, would you be aware of anything different? No, you wouldn't. If you have concerns about you or your family, then keep them focused on you and your family and get counseling. Don't bring it to the Internet and spread the doom and gloom here. It doesn't help to "guess" what may or may not happen if this or that occurs.
Folks, get your feet out of the self-made grave and resume your position in the land of the living and switch your focus to the weather, the pretty skies. I am not saying to bury your head in the sand and ignore everything,m just stop spreading doom and gloom, That is how little problems turn into mountains. Look for the positive and prepare for the future and all the while, teach your children to pay games that don't require batteries or electricity - like cards and board games.
Spend your energy preparing yourself and your family for hard times. When you need one can of corn, buy three. When you need one bottle of shampoo, buy two - but shop again when you have used only one. Learn how to make convenience foods at home. Learn how to make colas at home. Learn how to make bread at home. This is all part of being part of the solution rather than perpetuating the problem.
I sure see it! We don't watch the news because I don't want my small kids hearing about nothing but violence and stuff.
My dad died and mom doesn't get his disability that was majority of their income. My mom was working for a mortgage company. Before dads unexpected death, they were doing great - thought about buying a house at the beach and had plenty of money to do things. Unfortunately, 2 weeks after dad died, the mortgage company mom worked for filed bankruptcy. No more income - at all. She's been applying at places and sending resumes everywhere SINCE MAY!!!! Still no jobs. There are jobs that pay $10 an hr but she can't live on $10 an hr. She has tons of experience (20 yrs!!) in her field.
Not only that but she has lost their house. Without income, she couldn't pay the mortgage - which was an ARM and adjusted up from $1400 per month to $2800 per month!!
It's so easy to say that you don't notice anything wrong if you don't watch the news - until tragedy strikes your home! When you lose all you have worked for in your life at 53 years old, you notice!
what happens when houses become cheaper to buy then they are to build?
its almost reached that point hasn't it? I read somewhere 2 story condo building often cost around 40k a condo to build, and in some areas the prices are reaching that
i'm not too sure about this crime epidemic that everyone is predicting. there is much evidence that poverty leads directly to crime, conversely however, there are many impoverished nations where crime isn't a major issue. i also believe that personal debt is a major contributing factor in the frustration that causes aggression. i also think that it's kinda a double edged sword. either you go into huge amounts of debt and present an image of success or you don't and you provide an image of failure. i know, i have first hand experience of the latter. very frustrating. i know that this is a preposterous suggestion but this forum is a platforn to discuss thoughts and ideas and these are some of mine.
Those impoverished nations have been that way for years and years. There are a few "haves" and a lot of the "have nots". For a "have not" the most likely way up is to become a soccer star. If you can't, then you just quietly go about you destiny. If you don't like it and attempt political action, the consequences will be quite utter. If you chose to improve your situation via crime and target the "haves", it's a one strike - out kind of a deal that makes the treatment of minorities by US judicial system look very humane. And, of course, there's always an option of finding your way, be it legal or otherwise, into a "developed and civilized" country such as US, Canada, EU, Japan, Australia. Anyhow, considering where you grew up you know this stuff just as well as Jbravo or I do.
Now imagine that the use of certain magical "creative financing tools" is instituted in those impoverished nations. Suddenly those hungry hoardes of "have nots" are getting very cozy with concepts like "pride of ownership", "St. Augustine grass", "granite countertops", "sunrooms", "heated pools" and such. And a good number of them can no longer imagine their life without all sorts of those proverbial "electric pepper shakers". Better yet, a fair number of folks become experts on using the "tools" to the extent that allows them to afford a mentality that the contents of their septic tank smell better than the finest purfume in Paris.
A decade goes by. Certain somebody had accomplished a certain goal by now. The clock strikes midnight all of a sudden the rug is instantly pulled from under the "proud owners".... Knowing who and what they were before the magic "tools", what sort of behavior do you expect from them now?
Last edited by outsider1; 11-23-2008 at 10:29 AM..
what happens when houses become cheaper to buy then they are to build?
its almost reached that point hasn't it? I read somewhere 2 story condo building often cost around 40k a condo to build, and in some areas the prices are reaching that
people stop building. the population continues to grow, housing numbers naturally decline by fire, decay, hurricanes etc. then a housing shortage gradually develops and people start building again. obviously not having the same ridiculous financing schemes available, people will have to be more humble in what they build ie smaller homes, fewer extras (granite, crown mouldings, fancy faucets, garages, stainless appliances etc). the focus also moves toward longer lasting and lower running costs. some old building techniques which have been put aside by the emergence of cheap energy will start to find there way back into the mainstream
Those impoverished nations have been that way for years and years. There are a few "haves" and a lot of the "have nots". For a "have not" the most likely way up is to become a soccer star. If you can't, then you just quietly go about you destiny. If you don't like it and attempt political action, the consequences will be quite utter. If you chose to improve your situation via crime and target the "haves", it's a one strike - out kind of a deal that makes the treatment of minorities by US judicial system look very humane. And, of course, there's always an option of finding your way, be it legal or otherwise, into a "developed and civilized" country such as US, Canada, EU, Japan, Australia. Anyhow, considering where you grew up you know this stuff just as well as Jbravo or I do.
Now imagine that the use of certain magical "creative financing tools" is instituted in those impoverished nations. Suddenly those hungry hoardes of "have nots" are getting very cozy with concepts like "pride of ownership", "St. Augustine grass", "granite countertops", "sunrooms", "heated pools" and such. And a good number of them can no longer imagine their life without all sorts of those proverbial "electric pepper shakers". Better yet, a fair number of folks become experts on using the "tools" which allows them to afford a mentality that the contents of their septic tank smell better than any parfume in Paris.
A decade goes by. Certain somebody had accomplished a certain goal by now. The clock strikes midnight all of a sudden the rug is instantly pulled from under the "proud owners".... Knowing who and what they were before the magic "tools", what sort of behavior do you expect from them now?
like i said, it could go either way. i'm not necessarily discounting this possibilty
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.