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Old 04-02-2009, 12:21 AM
 
373 posts, read 738,543 times
Reputation: 193
Quote:
Originally Posted by teach1234 View Post
I don't believe any one person, but try to read and listen to everything I can. I am not into gloom and doom, nor unreasonable cheeriness. I don't think we're at the bottom yet. Job losses continue to accelerate, 742,000 projected lost in March, that's almost 100k over what was predicted. I am not optimistic on the stimulus package--our government has already spent hundreds of billions, to little effect that I can see. Here is the fundamental problem: Housing prices shot up 2, 3, 400% or more. How much did people's incomes increase? Maybe 10%? In my amateurish investor way, I say take the real estate prices of the late 90s, add 10-15% and that's where housing prices should be and will probably fall to. I'm sure I'll take some heat for this crude estimate, and deservedly so, but my estimates can be no worse than the professionals who do this for a living and whose attempts at rescuing our economy have been anything but confidence inspiring. More like a 5th grade science fair project.
Actually, incomes have dropped 10% between 1990 and 2000 when adjusting for inflation.

"The median income of Los Angeles County households diminished by a 'startling' 10% in inflation-adjusted dollars between 1990 and 2000, according to a report issued Thursday by United Way.

The figure went from $45,266 at the beginning of the decade to $42,189 at the end of it, a decrease of about 7% without adjusting for inflation."
10% Drop in Median Income in County Reported - Los Angeles Times
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Old 04-02-2009, 01:12 AM
 
147 posts, read 253,122 times
Reputation: 57
Are these single or household incomes, I would wager they are household incomes.

Notice how individual incomes are always left out of the equation. Such a disingenuous society we have become accustomed to living in.

Measure of America: American Human Development Project

http://mylifesucks.org
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Old 04-02-2009, 02:10 AM
 
Location: Living on the Coast in Oxnard CA
9,798 posts, read 12,386,429 times
Reputation: 11221
Quote:
Originally Posted by Radical Raul View Post
Are these single or household incomes, I would wager they are household incomes.

Notice how individual incomes are always left out of the equation. Such a disingenuous society we have become accustomed to living in.

Measure of America: American Human Development Project

http://mylifesucks.org
Between my wife and me our individual income is greater than $45,000. Not sure how someone can afford to live here for less. I would think that unless you bought your home 30 years ago chances are you need a minumum of $75,000 to get into a small place. Take rents. If you were to rent a place for $1,250 and to maintain a basic lifestyle you would need $3,750 in Gross pay. That is a gross pay of $45,000 a year. That is why I find the minumum wage thought process so interesting. We are not supposed to live on minumum wage. Who makes a decision to live on minumum wage? Why even pay a minumum wage? People should be paid what they are worth not what a regulation says that they are worth. What if the guy making $8. an hour isn't worth that much to the employer? What if an employee is worth more than the minumum wage? A good judge of what an employee is worth is how much revenue they are generating or saving an employer. On the minumum an employee should be able to return the amount paid in labor.

Last edited by SOON2BNSURPRISE; 04-02-2009 at 02:23 AM..
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Old 04-02-2009, 08:57 AM
 
Location: DFW
219 posts, read 366,724 times
Reputation: 157
Quote:
Originally Posted by 00molavi View Post
One unknown factor to me is future inflation. I am sure we are in for a big one, not sure how soon. When it happens, if incomes go up too, then you will have higher housing prices. If incomes fall behind (which is usually what happens), people's buying power would be less, mostly because of increased cost of basic necessities.
Future inflation may prove to be less of an issue than people fear. As jzt noted, real wage growth has been negative to flat (at best) over the past decade despite good economic growth. It seems like loans (mortgages, auto loans, home equity loans, credit cards, etc.) made up for the declines in wages, which is why Americans now have so much debt. But that credit faucet has been turned off. So without either wage growth or debt growth, there's no way for inflation to go beyond 1-3% like it has been for the past 10+ years, even if you pump lots and lots of cash into the system.
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Old 04-02-2009, 09:46 AM
 
147 posts, read 253,122 times
Reputation: 57
There has been rampant exploitation of cheap labor provided by unskilled undocumented workers; eventually the low payed, exploited workers begin to acquire more skills over time which in turn drives down the pay for the higher skilled workers. Then add into the mix housing costs targeted towards the upper tier income earners, and you end up with Southern California as we know it now. Did I mention the outsourcing of our customer service and tech support jobs?

Take off your blinders and take a look around and you will notice all the multi-family occupied homes these day's even in the so called middle class suburbs, especially among the Asian and the Latin American immigrants.

In early 2004 as a member of the Cable Access committee I attended city council meetings in El Monte, and witnessed first hand all the complaints regarding the unsustainable rate of home appreciation; for example, a teacher who could no longer afford to buy a home in El Monte; all those who were complaining about the housing costs were basically shrugged off as whining malcontents; then the term "it's better to own than to rent" was coined. I knew right then and there we were in for some deep problems down the road.

Look at us now.

Last edited by Radical Raul; 04-02-2009 at 10:27 AM..
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Old 04-02-2009, 09:59 AM
 
Location: Las Flores, Orange County, CA
26,365 posts, read 51,661,319 times
Reputation: 16192
Quote:
Originally Posted by Radical Raul View Post
There has been rampant exploitation of cheap labor provided by unskilled undocumented workers; eventually the low payed, exploited workers begin to acquire more skills over time which in turn drives down the pay for the higher skilled workers.
Did this (pay being driven down) happen in the 1910s and 1920s (or after) as a result of the Italian, Jewish, Polish, Irish, and German immigrants?
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Old 04-02-2009, 10:16 AM
 
147 posts, read 253,122 times
Reputation: 57
Quote:
Originally Posted by Charles View Post
Did this (pay being driven down) happen in the 1910s and 1920s (or after) as a result of the Italian, Jewish, Polish, Irish, and German immigrants?

May I ask where you are coming from?

Up until the early 1900's big companies like Ma Bell were exploiting child labor, and it would be reasonable to assume they were from all ethnicity's, expect for Blacks, Mexicans, and Asians. Back then us Mexican Americans were presumed by society to be only capable of working the fields.

Look at us now.

For a history refresher course, during the great depression there was a thing called the labor movement and Unions.

Sounds to me you need some history lessons.

Last edited by Radical Raul; 04-02-2009 at 10:24 AM..
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Old 04-02-2009, 10:48 AM
 
147 posts, read 253,122 times
Reputation: 57
Regarding the housing market, speculators and investors are snatching up cheap homes in the Inland Empire, Victorville and Hesperia, with the goal to have them occupied by renters who want to 'rent to own'.
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Old 04-02-2009, 05:09 PM
 
946 posts, read 1,215,379 times
Reputation: 439
Yes, I find myself dangerously tempted by those adds.
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Old 04-02-2009, 05:31 PM
 
68 posts, read 76,759 times
Reputation: 28
My only experience with CA real estate was in the early 1990s (also a down market). I moved to the LA area in 1993 from Chicago and due to my inexperience with the area I took a full 2 years to find the right location and eventually the right home. At that time, California was also experiencing a very depressed real estate market. Although I do not recall the exact dates that real estate market crash occured, my recollection is that crash started sometime in the very late 1980s. The market back then was depressed for several years and there were many bargains (relatively speaking) to be had for a long time. If history is any indicator there will be plenty of time to buy at good prices.
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