Thanks for the great site. I’ve been renting and waiting for a correction for the past 4 years. As far back as 2003, I was working at a bank in Chicago where everybody knew flippers were driving up real estate prices and creating a bubble. It was obvious to EVERYBODY even back then. So I’m more than a little shocked that Greenspan has so far pretty much gotten away with pretending they didn’t know they were helping to create a bubble. I thought it was obvious at the time that prices would eventually come down. We’ve been saving our money, driving a used car, not eatting out often, and have managed to save up a significant about as our salaries increased. Still, I see only shacks on the market in our desired price range, and I’m now hearing that Paulson, Bernake and Bush have come up with a master plan that basically rewards all the idiots (and well, maybe they’re not idiots anymore), by magically somehow declaring that all ARM’s will not reset for maybe another 7 years. Apparently, people who are conservative with their money will not be rewarded, and one way or another, we will have to give it up.

Is it time to throw in the towel and buy a $500M shack?

Every time you pick up a newspaper or read a web article, the same ‘expert’ who once said ‘…there is no housing bubble…’, then said ‘…the worst is over and the bottom is in site…’ is now saying ‘…it will never happen in the high-priced coastal areas like Newport Beach and La Jolla…’, will eventually be saying in June of 2008 ‘…I have always said that real estate is cyclical and I am not surprised that this has happened - it always does - but, 2009 will be a HUGE buying opportunity…’!!!

As the old saying goes - ‘History always repeats itself’ and, it is those 2004/2005/2006 real estate ‘virgins’ (much like the stock ‘day traders’ of the late 1990’s) who drink the Kool-Aide, thought prices ALWAYS went up, and then blame everyone else for their bad decisions…and ask for the government (taxpayers like you and I), to bail them out!!!

It is since they get their data via lenders filing defaults. A mortgage isn’t going to discriminate between a home and a condo.

But if you want to see the extent of the housing shenangians take a look at this article:

“Floyd is in no position to drain the pool or improve his property. He’s in eastern Kentucky serving a 78-month federal prison term for conspiracy to sell hundreds of pounds of marijuana. He was indicted two days before he borrowed $825,000 for the 4,300-square-foot home in the Woodlands subdivision. Through contact with the prison’s administration, Floyd declined to be interviewed for this story”

http://www.detnews.com/apps/pbcs.dll/article?AID=/20071128/BIZ01/711280404

Selling weed and flipping houses. And you thought you had an exciting career?

I have a friend at Washington Mutual (LA County area) who tells the bank has issued an edict that they will not issue loans for more than $417k (obviously conforming limits).. Have you heard about this and if so have you hear that other banks are taking the same stance?
Certainly there are obvious outcomes if this is true.