A slowing market, another sales to rental switch-a-roo. Originally planned as a sales development, Villa Malibu has gone rental. Developed by the Carlyle Group, the gated luxury 68-unit community on Cavalleri Road opened for leasing earlier this month. The first luxury rental development in Malibu, rents range from $3,850 to $9,650 (for a few thousand dollars more, you can get a furnished pad), while the complex offers five-star amenities like include two tennis courts, pool, basketball court, concierge, private cabanas, and the obligatory Zen Garden. This summer, beach porter service will be available.

“And, no, you didn’t answer my main question despite thinking that you did.”

Let us try again to answer your question in direct format:

“Ask any of the doom & gloomers if they are hoping for a housing crash. Ask them if they want to see people get hurt financially. In fact, ask a housing bubble blog owner the purpose of their blog. I am quite sure they won’t answer.”

1. Do I want to see folks get financially hurt? NO!
2. Do I want a housing correction? YES!

Can it be any clearer? Of course both of these questions do not support each other although you have it linked up in your mind that housing crash = financially hurt. The fact is, many people are already getting hurt financially. Even though prices are at all time highs equity in homes is at all time lows. Consumption does not equal financial health or security. I think most people that read housing blogs are not doom and gloomers; they have worked hard in whatever line of work they are following and want to provide the basic necessities for their family without leveraging their entire net paycheck on one line-item, that of housing. The fact that housing blogs have readers and supporters shows that there is a market of folks that have issues with the current state of housing. It is simple supply and demand; the media doesn’t pour over the details with charts and analysis so people go out and conduct their own due diligence. That is the beauty of the internet. Although I would argue that the mainstream media is taking the baton and carrying the fire of many housing bloggers.

You mention that the Phoenix market is healthy; if this is the case why not go out there and load up your portfolio with housing in Arizona since you believe housing will perpetually go up? The fact that Southern California has one of the lowest affordability in the nation is troublesome; even two-income families are struggling to keep up with the basics necessities of life. And yes, California has always been expensive but $400,000 to $450,000 for a 2 bedroom 900 square foot home in Lynwood or South Gate? Take a look at the “real homes of genius” category on this blog and then say California housing isn’t in a bubble. Low affordability means that only 15% of the local inhabitants can adequately afford a home. The direct correlation between rising home values and increased use of interest-only and exotic mortgages is nearly perfect. If rates are at 40 year lows, why would people go with mortgages that are highly risky and are not fixed?