PropertyForeclosure.com

for a whole $10 down this genius will show you how to flip
a house in less than 6 hours and resell it at profit to a hungry
investor that is willing to do the repairs….

And he has been teaching his methods to the public for
8 years… and why wait… buy his book, CD or online course
and you too can be rich without lifting a finger or ever using more
than $10 of your own money.

The sharks are still out there…

I don’t know when it exactly started. All I know is that around 2005
you couldn’t escape the advertisements on T.V. and Flip this House,
Trading Spaces and all the other “reality” real estate shows started
to replace the down to earth shows that taught you how to build
a bird house or fix your dripping faucet. All the sudden “hype, action
and how to make a fast buck” was hip on public television.
Of course these shows were just the peak of the ice berg and the
whole “buy cheap and sell for profit” thing had to have started alot
earlier. The nonsense did probably originate here in California.
Most likely southern California priced the middle class out of
the market. These people moved to the Bay Area. The Bay Area
went nuts during the tech hype of the 90’s. (this is why everybody
thinks that every Californian makes $200K a year) The Bay Area
aka the “Pit” can’t expand anymore and next think you know they
are knocking on the door of sleepy old northern California and buying
everything in sight at “bargain” prices. The next wave follows and the
first wave sells to the second wave, etc. etc. Inbetween was a slump
aka the 9/11 recession and then the lending standards dropped.
Just as we were in the middle of the second wave of Bay Area exodus
to the north it started getting interesting and what would have been
just a wave or two from the Bay turned into a different game.

Add to this an earthquake or two, the fact that wild fires don’t
care about the price of your mansion in Malibu, that the north gripes
about having to give up the water to the south and you can see why
Californians like to move alot.

Reena.

P.S. I do love it here - and remember people are people.
There are a lot of down to earth people here that work hard and
try to make a living just like everywhere else in this country.

It’s great to see posts on this blog from people like Reena. We follow the same finanical mantra she does (with the exception that my wife and I have one credit card for emergencies only). It’s called “LIVING WITHIN YOUR MEANS AND NOT BEING STUPID WITH YOUR MONEY, FOLKS.”

2 years is a safe bet for a BIG Nor Cal (were we also live) correction. However, if the defaults continue to rise at an even faster pace (Sacramento Area in particular), the correction may come a bit earlier. I have said many times that once homes are back to the 3 x income, then we can talk about a recovery in the market. Which means, PONZI SCHEME GAME OVER. Hopefully the nation never sees another stupid episode like this in the future.

And for you Doc, keep the good posts coming. These posts always have humor in them. You should talk to Jay Leno and see if he would entertain the thought of you doing a stand up gig on one of his shows.

Needless to say that most of them are no longer homeowners. But not
a single one really understood the loan papers they signed.
Which is the real problem… I don’t think that everybody was in for this
because they saw $$$$ in front of their eyes and meant to buy property
to flip and resell at a huge profit. No, they were just everyday people
that were told that yes, they could realize the american dream and
buy a house.

They thought that their mortgage was a fixed 30 year when in reality
they had one of those bogus mortgages that reset within a year or two
with the downpayment attached as a second.

Me? I rent. - I am a realist and $400K for a house isn’t worth it.
Everybody thought I was nuts to stay out of it - but I prefer to be able
to sleep at night knowing that I have at least 6 months worth of cash
in my savings and a comfortable checking account balance that doesn’t
need to be checked every time I make a purchase.

I haven’t owned a credit card in ten years. My ATM/check card does just
fine. I bought both of my cars with cash. Used, of course but very reliable.
I don’t need the newest gimmick and absolutely hate Cell phones.

Large purchases (TV, Laptop, etc.) are “planned” meaning that I will
pay cash. I may not be fond of what my 401K or my IRA are doing right
now, but at least I have them. I find it amusing that the gold I own has
gone up in value but I wouldn’t think of selling it. Gold panning is a hobby
of mine although this year you can’t squeeze yourself into an open spot
at the rivers and creeks. Everybody is trying their luck at it - have fun
but don’t think you will get rich quick.

As far as I can see it will take at least 2 more years for the Real Estate
prices in CA to come down to where they need to be. Incidently by then
all the people who defaulted will have their Credit restored to them and
the game can begin again. Hopefully this time it will not end up in another
frenzy and people will realize that we buy houses to live in and raise a family
with the expectation to be in the house for a long time.
Of course we will need to attract alot of people. You should see how many
new housing projects have been built around here in the last couple of years.
It is absolutely amazing. These are huge, beautiful mansions with hardly
anybody living in the neighborhoods. From the looks of it everybody must
think that Californians make $200,000 a year. I am sure they are out
there but around me is just plain old middle class and the average Joe.

Greetings from Northern California and thank you for your comments and
stories. For a while there I was afraid that there was no common sense
left out there.

Reena