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Old 05-15-2013, 02:10 AM
 
244 posts, read 286,303 times
Reputation: 204

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Quote:
Originally Posted by ScoopLV View Post
Doesn't matter. It's all about buying power. Hawaii may have all the pineapples, but they don't consume much. Even if every one of them is eating a pineapple every week, that doesn't compare to the US mainland. That's why a pineapple costs $10 in Maui and $3 in Las Vegas. Buying power.

You wouldn't believe how little we pay at restaurants for the same stuff people buy in grocery stores. Same reason. Buying power. We buy in bulk and pay a lot less. That's just how it is.

China will not be able to take advantage of that until they start buying their cheap junk in the same quantities as Americans. And that's why America needs a strong middle class. We're losing the middle class, fast. And we're paying the price.
That reasoning is ludicrous and totally wrong. The entire subject is entirely off topic for this thread anyways.

Here is something that DOES tie in with the topic of the thread, it describes the BUBBLE that you deny is currently developing:

Las Vegas Real Estate Forecast – Shadow Inventory and Bubbles | Las Vegas Home Rental & Real Estate Blog

"Current market conditions show another bubble is forming. Housing prices are rising dramatically, up 30% from a year ago, without incomes rising a similar amount….again. Last time this happened in 2006-2008 we had another giant bubble that blew up and for the last 5 years Las Vegas has been recovering from that disaster. It’s happening all over again and it’s not caused by normal market conditions….again."

 
Old 05-15-2013, 02:39 AM
 
Location: Silicon Valley
3,673 posts, read 7,993,588 times
Reputation: 2933
Quote:
Originally Posted by ScoopLV View Post
Same reason pineapples are more expensive in Hawaii than they are here on the mainland.
Almost all fresh pineapple available on the mainland is a product of Costa Rica or the Phillipines. There is a small amount of locally grown pineapple for sale in Hawaii, but if you go into a supermarket in Hawaii and pick up a pineapple, it's probably going to be a Dole pineapple from Costa Rica.
 
Old 05-15-2013, 03:15 AM
 
Location: Sunrise
10,869 posts, read 13,666,212 times
Reputation: 8987
And you're proving my point -- even though pineapples are grown locally in Hawaii, they still pay way more for a pineapple than we do in Las Vegas. Why? We buy more pineapples. We also pay less for ahi tuna, mahi mahi, and macadamia nuts. The economy of scale works for all things -- be it Las Vegas real estate, pineapples or macadamia nuts. That's why Las Vegas is called the "Ninth Island."

I certainly don't think it's fair. But that's how it is.
 
Old 05-15-2013, 07:50 AM
 
133 posts, read 147,184 times
Reputation: 50
Quote:
Originally Posted by VegasVicsezhowdy View Post
That reasoning is ludicrous and totally wrong. The entire subject is entirely off topic for this thread anyways.

Here is something that DOES tie in with the topic of the thread, it describes the BUBBLE that you deny is currently developing:

Las Vegas Real Estate Forecast – Shadow Inventory and Bubbles | Las Vegas Home Rental & Real Estate Blog

"Current market conditions show another bubble is forming. Housing prices are rising dramatically, up 30% from a year ago, without incomes rising a similar amount….again. Last time this happened in 2006-2008 we had another giant bubble that blew up and for the last 5 years Las Vegas has been recovering from that disaster. It’s happening all over again and it’s not caused by normal market conditions….again."
Rapid price movement and a bubble are two entirely different things. It blows my mind that the real estate bears simply cannot grasp this fact.
 
Old 05-15-2013, 11:56 AM
 
1 posts, read 924 times
Reputation: 15
Who is crazy enough to pay over 100 per sq in Vegas these days?
Many of you don't realize that majority of people couldn't afford to buy 10 months ago when prices where 30% less, how do you expect them then to buy
now?
What about PMI that is going to be for the entire
life of the loan starting next month?
On $200,000 Loan PMI is just under $300.

Look at this;
"The housing recovery reinforced the belief that it is heavily dependent on low interest rates induced by the Federal Reserve, as mortgage applications declined for the first time in over a month.
According to the Mortgage Bankers Association’s latest report for the week ending May 10, loan application volume fell 7.3 percent on a seasonally adjusted basis from one week earlier.

The average interest rate for a 30-year fixed-rate mortgage came in at 3.67 percent, up from 3.59 percent in the prior week. This is the highest rate since the beginning of April."
 
Old 05-15-2013, 12:54 PM
 
Location: Sunrise
10,869 posts, read 13,666,212 times
Reputation: 8987
Quote:
Originally Posted by Zapppos View Post
Who is crazy enough to pay over 100 per sq in Vegas these days?
Many of you don't realize that majority of people couldn't afford to buy 10 months ago when prices where 30% less, how do you expect them then to buy
now?
It wasn't a question of them being able to afford to buy. They could but they didn't. People in the valley are basically lemmings. They followed the herd and ran up the housing bubble in 2005. Then they all strategically defaulted in 2009. Now they're all buying homes again because that's what everyone else seems to be doing -- and because banks are easing up on credit. Doesn't matter how low the rates are when people don't qualify.
 
Old 05-15-2013, 01:16 PM
 
2,132 posts, read 2,196,643 times
Reputation: 1301
Quote:
Originally Posted by ScoopLV View Post
It wasn't a question of them being able to afford to buy. They could but they didn't. People in the valley are basically lemmings. They followed the herd and ran up the housing bubble in 2005. Then they all strategically defaulted in 2009. Now they're all buying homes again because that's what everyone else seems to be doing -- and because banks are easing up on credit. Doesn't matter how low the rates are when people don't qualify.
People didn't want to risk their own money to stabilize the market. Now they have to pay a premium to enjoy the stable market.
 
Old 05-15-2013, 02:09 PM
 
244 posts, read 286,303 times
Reputation: 204
Quote:
Originally Posted by ScoopLV View Post
It wasn't a question of them being able to afford to buy. They could but they didn't. People in the valley are basically lemmings. They followed the herd and ran up the housing bubble in 2005. Then they all strategically defaulted in 2009. Now they're all buying homes again because that's what everyone else seems to be doing -- and because banks are easing up on credit. Doesn't matter how low the rates are when people don't qualify.
Right... and wrong.

The herd mentality of ignorant investors contributed to the run-up and subsequent collapse.

There is a compelling argument that the re-inflating housing bubble is real and that the "everything is different this time" philosophy won't be any more true than it was in the past.

We all know what's driving prices and we also know about the future instability that will be the result. I heartily agree that housing is an inflation-protected store of long-term value but don't try and claim that this is not yet another asset bubble which will, at some point, implode. To do so is to be disingenuous.

P.S. Thanks for getting back "ON TOPIC", your fellow City Dat'sters appreciate it!

 
Old 05-15-2013, 02:14 PM
 
133 posts, read 147,184 times
Reputation: 50
Quote:
Originally Posted by VegasVicsezhowdy View Post
Right... and wrong.

The herd mentality of ignorant investors contributed to the run-up and subsequent collapse.

There is a compelling argument that the re-inflating housing bubble is real and that the "everything is different this time" philosophy won't be any more true than it was in the past.

We all know what's driving prices and we also know about the future instability that will be the result. I heartily agree that housing is an inflation-protected store of long-term value but don't try and claim that this is not yet another asset bubble which will, at some point, implode. To do so is to be disingenuous.

P.S. Thanks for getting back "ON TOPIC", your fellow City Dat'sters appreciate it!

Population is much higher, rates are much lower, and prices are half of what they were. Stop ignoring prices. Stop ignoring rates. Stop ignoring population. Stop ignoring the move in other competing asset classes. We are not close to a bubble yet.
 
Old 05-15-2013, 02:37 PM
 
244 posts, read 286,303 times
Reputation: 204
Quote:
Originally Posted by gaash2 View Post
Population is much higher, rates are much lower, and prices are half of what they were. Stop ignoring prices. Stop ignoring rates. Stop ignoring population. Stop ignoring the move in other competing asset classes. We are not close to a bubble yet.
It's a double-edged sword and 24-48 months IS close for someone buying now and in for the long term. All artificially lowered rates do is induce participation in risk taking and as far as I can tell that has not ended well (in the past).

Coupled with the fact that the rising tide has not lifted all boats, the middle income population has experienced declines in wealth since the crisis began, the majority are NOT in a position to buy now unless the ban on easy-lending is lifted, which, as we are already aware would spell doom.

If the American people truly understood how the Federal Reserve system worked and what it has done to us, they would be screaming for it to be abolished. It is a system that was designed by international bankers for the benefit of international bankers, and it has systematically impoverished the American people.

Article I, Section 8 of the U.S. Constitution, the U.S. Congress is the one that is supposed to have the authority to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”. So why is the Federal Reserve doing it???

Here's something else that is a very real danger and an important topic which has received almost no media attention:

During the 2008 crisis there was the equivalent to an electronic run on the banks in the form of panic selling out of money market mutual funds which are not FDIC insured. If left unchecked this run would have wiped out the majority of wealth held by the American public. So, on September 19, 2008, the U.S. Treasury established a temporary guarantee program to protect shareholders of money market mutual funds (Average citizens have exposure to these funds without even knowing it. Think 401k, but its actually much deeper than that). This temporary guarantee was akin to FDIC insurance and stopped the run. However, the temporary guarantee program expired on September 18, 2009. The treasury then lost the "authority" to intervene or backstop money market mutual funds with the passage of The Dodd-Frank Wall Street Reform Act in 2010 (Legislation to protect the public from the Too Big to Fails). Even after this so called "recovery" these funds still pose a systemic risk and are prone to runs.

Difficult to ignore... ?

Last edited by VegasVicsezhowdy; 05-15-2013 at 02:51 PM..
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