All time high reached in January for Median home prices. Likely to continue climbing (Los Angeles: rentals, loans)

[Carpenter858]

Originally Posted by C2BP

Some of us who understand how economic cycles work KNOW that both cycles need to be honored.......Inflation and Deflation. Our economy was supposed to deflate from 2001-PRESENT. Deflation means a deflation of debt. Instead the FED chose to protect DEBT and try to avoid or at least delay the very real pain of deflation. Now the FED has hit the DEBT WALL -Inflation is telling us that repressing interest rates to protect debt has a real cost.
Now the deflation begins. 300% total debt to GDP must be cut to about 130%. In 1929-1947 it took a global depression and a World War to accomplish this. It is a time of destruction and darkness by definition so yes we may have a Civil War or WW3 and maybe you should own a gun.

Good Luck!

But the Debt/GDP is at 133% right now, not sure where you get 300%? The moderate Dems stopped the spending madness hopefully, so not sure the US will reach 300%.

I agree once interest rates rise more than 100 bp's, there could be some slowing down and possible depreciation. If we enter a recession in the next 6-12 months, then sure we'll see some price declines or stagnation. I think we're more likely to experience another 40% stock market decline than a 50% housing decline. We're already at a 7% S&P decline for the year.

Even from 2006-2012 our house in Encinitas only declined by 18%, so something far worse would have to occur. Could it? Maybe, time will tell. I'll be waiting like the others here with cash ready to buy, even at a 20% decline, then if it goes to 50% I'll buy another one. Housing is not like the stock market, whereas it takes 5-6 years to get to the bottom. Will history repeat itself and keep this pattern over the last 40 years? My bet is it will.

[1AngryTaxPayer]

Originally Posted by NORTY FLATZ

You should have received this memo 15 years ago. Dunno about butter, but ammo, now that's a commodity that's hard to come by now-a-days.

I collect firearms. Some I bought for less than 200 bucks just a few years ago are going for 2000.

Butter is harder to store

[NYSD1995]

Note that capitalizing words doesn’t make what you’re saying more important.

I guess what I don’t understand is, why when civilization ends, everyone no longer needs a place to live?

[NORTY FLATZ]

According to the local fishwrapper, (SD Union) median home prices recovered to their previous peak (NOV2021.) $750k.

Condo's are $583k.

SFR's are $845k

For comparison...(median)

Orange County....$950k
San Berdoo........$475k
Ventura.............$750k
LA....................$791k
Riverside..........$550k

From Core Logic

[C2BP]

Originally Posted by NYSD1995

Note that capitalizing words doesn’t make what you’re saying more importan
I guess what I don’t understand is, why when civilization ends, everyone no longer needs a place to live?

Who said anything about ending of civilization? The only way out of this mess that we have created for ourself's is thru higher interest rates, debt destruction, deflation and depression. We need to let our old economy that we are keeping on life support since 2001 die, and then we can start all over again building better economy, real economy. Now this will be very painfull, but this is the only way. There is no painless solution for our economic problems.

The FED needs to understand finally the Volcker Spirit is the only thing that can save us. The FED NEEDS to keep raising interest rates. Make it PAINFUL to have to service unproductive debt. Things will change.

[C2BP]

Originally Posted by NORTY FLATZ

According to the local fishwrapper, (SD Union) median home prices recovered to their previous peak (NOV2021.) $750k.

Condo's are $583k.

SFR's are $845k

For comparison...(median)

Orange County....$950k
San Berdoo........$475k
Ventura.............$750k
LA....................$791k
Riverside..........$550k

From Core Logic

Housing prices RECOVERED back in 2008-2011 when the housing bubble deflated. The FED lowered interest rates to ZERO and lured more people into debt, created massive speculation in housing and today we have the biggest housing bubble ever.

The FED is solely responsible for creating FRANKENSTEIN out of the housing market.

[1AngryTaxPayer]

Originally Posted by C2BP

Housing prices RECOVERED back in 2008-2011 when the housing bubble deflated. The FED lowered interest rates to ZERO and lured more people into debt, created massive speculation in housing and today we have the biggest housing bubble ever.

The FED is solely responsible for creating FRANKENSTEIN out of the housing market.

They didn't recover much at the beach which is what those that live here are interested in. Vegas and Phoenix, ya. Prices plummeted. Our house's value dropped less than 100 grand.

[Finper]

Originally Posted by Carpenter858

But the Debt/GDP is at 133% right now, not sure where you get 300%? The moderate Dems stopped the spending madness hopefully, so not sure the US will reach 300%.

I agree once interest rates rise more than 100 bp's, there could be some slowing down and possible depreciation. If we enter a recession in the next 6-12 months, then sure we'll see some price declines or stagnation. I think we're more likely to experience another 40% stock market decline than a 50% housing decline. We're already at a 7% S&P decline for the year.

Even from 2006-2012 our house in Encinitas only declined by 18%, so something far worse would have to occur. Could it? Maybe, time will tell. I'll be waiting like the others here with cash ready to buy, even at a 20% decline, then if it goes to 50% I'll buy another one. Housing is not like the stock market, whereas it takes 5-6 years to get to the bottom. Will history repeat itself and keep this pattern over the last 40 years? My bet is it will.

If it goes down 20 to 50% I sure wouldn’t sell my house. Why do you think all these houses will be for sale?

[Carpenter858]

Originally Posted by Finper

If it goes down 20 to 50% I sure wouldn’t sell my house. Why do you think all these houses will be for sale?

Where did I say all the houses will be for sale? I didn't. I said if it declines 50% like the OP seems to think, just like some areas did last time, I will buy. I said it would take something drastic to force people to sell and get that large of a decline. If they lost their job and bought a $1.8M house at the top of the market with only 20% down, the rent is not going to cover the $8,200 PITI monthly payment. That's all I'm saying.

[C2BP]

Originally Posted by Finper

If it goes down 20 to 50% I sure wouldn’t sell my house. Why do you think all these houses will be for sale?

Because you will not see those overinflated prices of today again, not in your life time. ZIRP and QE were experiment to try to cheat and avoid DEFLATION. But if the FED is finally ready to capitulate and admit that ZIRP and QE don’t work this experiment will never be repeated again. FED activity after 2001 attempted to CANCEL the DEFLATION CYCLE by encouraging people to borrow more by repressing interest rates. Now, however, the FED is no longer repressing interest rates.

Repressing interest rates to keep the present generation "in the money" and then handing the DEFLATION STAGE off to the younger generation is not something the FED or anyone else should be proud off. With ZIRP and QE the FED only managed to buy some more time and postpone deflation. Now finally we have to begin the DEFLATION (de-levereaging) process we have been postponing for so long.

Housing speculation happened because of cheap money. Without the cheap money there is no speculation in housing. Higher interest rates make our US dollar stronger and stronger and all prices lower and lower. Sellers would beg buyers to buy their house and give them strong US dollars. It will be a buyers market where sellers would beg buyers to buy their house. How quickly things will change. There will be a time when no one would care about buying a house and that would be the housing bottom, not the FAKE one back in 2010-2011.

Good Luck!