Falling Prices: Costly

[SmilingDog]

Home prices always grow faster and higher than they will fall. That's why a home purchase 20 years ago for $100k is now worth $500-$750k depending on where it's located.

As Frederick R. Ruffell pointed out for the San Diego area is true just about everywhere in Calif. (except Northen Calif which was over inflated with Silicon Valley and Dot COm industry).

Supply and Demand. We have huge demand here and little supply. Not much more land to build. L.A. and Orange county are pretty much built out, with exception of some larger open areas.

I could be wrong... call me OPTIMISTIC, but the boom here should last another 3-5 years.

 

[Austin]

I think some of you guys in those high growth areas are misinterpreting what is going on. When 55,000 people move into an area prices are naturally going up due to high demand. The question is: Where are those 55,000 people coming from and why? If demand is skyrocketing in one area then demand must be tanking somewhere else or the places these birds are flying in from. That explains the two diametrically opposite stories we are hearing: 1. Our area has huge demand with value increases. 2. Our area has tanking prices. It is a zero sum game based on a shifting economy. All of the wealth is being concentrated in certain diverse areas at the expense of the less diverse areas.
My market is suffering because it is based on three depressed industries: Textiles, tobacco, and aircraft tires. The population of the city has dropped to below 50,000 and is headed down. Don’t be fooled by these high growth areas. They are not what they appear to be. It all shows in the GDP and when that shows slow or no growth you know the real story. Did anybody read the news out of Europe this morning? Negative growth in GDP and Greenspan is scrambling to counter what is going on fearing deflationary forces.

 

[Frederick R. Ruffell]

Austin,
"They" are coming here san diego and orange county for the promise of jobs in the Bio tech industry, which is in it's infancy right now. Also Austin your nationalistic view of population growth doesn't wash. What was the reported number of legal imigrants to this country last year?

 

[Joshua Fookes]

We are seeing a lot of urban refugees up in the way northern CA, People coming out of bay area up to Redding, lot of growth in services, etc. It's like this town just got rediscovered and people are flocking to it. Huge shortage of homes but lots of developers busting to crank homes out. There was a carpet layer that is pushed so hard he stays up till 2 am laying in a new development, rolls out his sleeping bag on the new floor, then gets up and works all day on a new home in the development No thanks. But how long is that going to last? Buyers only have so much buying power, and they will not buy if things are overpriced for too long. Eventually they/we wise up.

Prices here are going up, but for how long? :question: It's cyclical. Are people paying to much because of the realestate hype? Maybe, but there is some justification for the hype IN MY AREA. But if the thing turns out to be a bubble that pops, I'm just getting excited to hear some people talk about how they are going to have piles of work when things slow down because of all the REO.

Josh

 

[walt kirk]

I have noticed a large number of buyers from New York City and surrounding areas entering the market in Burlington County N.J. ( about 60 miles south of NYC.) Resales of some year old houses are $100,000 more than builders list. Buyers from New York consider the housing cheap, locals laugh.

I recently did an appraisal of a Levitt colonial in Willingboro (Levittown) N.J. for a family who paid 25% more than the house was worth last year. This family was moving from public housing in Brooklyn.