tag:blogger.com,1999:blog-5140004705538204727.post99483011132318707..comments2023-12-16T04:08:06.419-08:00Comments on Real Estate in the LBC: Elephantine Greed and Vanity: UPDATEel beehttp://www.blogger.com/profile/14187665973956068496noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-5140004705538204727.post-5114368176617142752009-06-02T17:50:55.793-07:002009-06-02T17:50:55.793-07:00One thing that MAY happen is that there will be mo...One thing that MAY happen is that there will be more foreclosures if rates keep rising (they didn't today). Those who couldn't afford their house without a Option/Alt-A mortgage will be even less likely to refinance at these higher rates. <br /><br />The other thing is that there may be potential "buyers" who run the numbers at 4.5% vs. 6 or 7 per cent may be out of the market at current valuations. <br /><br />Both leading to lower prices, I hope.Carlhttps://www.blogger.com/profile/07595452272222717964noreply@blogger.comtag:blogger.com,1999:blog-5140004705538204727.post-219928206511871892009-06-02T09:20:15.523-07:002009-06-02T09:20:15.523-07:00More interest to write off?More interest to write off?el beehttps://www.blogger.com/profile/14187665973956068496noreply@blogger.comtag:blogger.com,1999:blog-5140004705538204727.post-31635886933469315952009-06-02T08:51:14.397-07:002009-06-02T08:51:14.397-07:00Wow, so the interest rate has raised that much?!? ...Wow, so the interest rate has raised that much?!? Just a couple months ago, it was at 4.8%. This is what I don't get though, how a rising interest rate helps overall. Because even though the mortgage prices will decline, the interest prices will rise. <br /><br />For example, I just ran the numbers for a $200,000 mortgage, on a 30 year loan. Now at a 5% rate, the monthly would be $1,073.64 and the total payment would be $386,512. <br /><br />Lets say the interest rate rises to 6.5%, and the price of the same home declines to $160,000. The monthly would be $1,011.31 and the total payment would be $364,071.<br /><br />Now I don't know how much a home value would drop, in relation to the interest rate, but it seems to me that it's not a very big "win" situation for us buyers.<br /><br />What am I missing??Mike in LBChttp://operator7lbcyahoo.comnoreply@blogger.comtag:blogger.com,1999:blog-5140004705538204727.post-28356531983520453102009-06-01T21:21:54.738-07:002009-06-01T21:21:54.738-07:00according to bankrate.com, the average rate on a 3...according to bankrate.com, the average rate on a 30 yr. fixed is 5.825 for a 0 point loan (5.869 APR) for 90808. <br /><br />I'd rather be interest rate fucked than valuation fucked, if I have to be fucked. <br /><br />(and the foreclosure picture was pretty!)Carlhttps://www.blogger.com/profile/07595452272222717964noreply@blogger.comtag:blogger.com,1999:blog-5140004705538204727.post-23987100394110795552009-06-01T13:07:22.804-07:002009-06-01T13:07:22.804-07:00Well, if the bubble started earlier in LB, then it...Well, if the bubble started earlier in LB, then it would stand to reason that it would bottom sooner here. Looking at most LB prices, I have yet to see any evidence that sellers have capitulated or that any bottom is in sight. As this property conveys, the perceptions of "specialness" have yet to dissipate.<br /><br />I absolutely believe we will overshoot in most areas of Long Beach. We have already seen 90s pricing (and 80s!) in less desirable 'hoods, and I think there simply are not enough $200,000 per year households to prevent the mid- to upper-tier from suffering a similar fate.<br /><br />I keep reading the next two weeks will be crucial for mortgages. If rates consistently creep up and people are able to finance less, I think 90s prices in nicer LB neighborhoods is all but assured. <br /><br />But never underestimate the gov.el beehttps://www.blogger.com/profile/14187665973956068496noreply@blogger.comtag:blogger.com,1999:blog-5140004705538204727.post-71508996418754864952009-06-01T12:49:21.034-07:002009-06-01T12:49:21.034-07:00El Bee,
Did you get a chance to check out the pr...El Bee, <br /><br />Did you get a chance to check out the presentation that SocalBubble posted in this post - http://www.socalbubble.com/2009/05/more-mortgage-meltdown.html (Slide 8)<br /><br />Looks like this bubble STARTED in 2000, and looking at property shark numbers, it could have started in portions of Long Beach a little earlier. For the condo price (in 90802), the ppf went from $83 in 1999 to $107 in 2000. THIRTY PERCENT from 1999 to 2000. <br /><br />Once the bloodbath in Long Beach begins, do you think we could see 90's pricing? Most bubbles overshoot on the downside. <br /><br />Wow. <br /><br />BTW, an REO in Tustin, near where my parents live is listing for $267 sq. ft. Foothill High School. North Tustin address. <br /><br />http://www.redfin.com/CA/Santa-Ana/1042-La-Loma-Dr-92705/home/4761632Carlhttps://www.blogger.com/profile/07595452272222717964noreply@blogger.com