Moo, cause you have not lived in SB. The weather. And all the good looking women. Woo. It's always been a woman's town. Go to a simple restraunt and see a young woman who looks like an actress. And way more single women than men. A man's heaven.
Well, I am very spread out over the country (nothing out of the US though). I still have good notions about North Carolina and might move more funds in that direction. Bill is dead on about Colorado but I have a small stake there so I can stand to hold it for a while. As far as my zip code, I just plain like it here and I can tell you from moving around and living all across the US as well as traveling to some of the places you mention - not much competes with Santa Barbara. My stake will be fine if we get a 30% decline, but 15 years down the line - I can easily see prices doubling again from their current value after 2-3 years of turbulence In case you didn't read in between the lines, I am going to get out of several of my CA holdings in the next two months. It will be a tax problem, but I can stomach that. Three ideas that I keep reminding myself: 1. Don't get greedy. 2. Better safe than sorry - avoid leverage. 3. Paranoia is healthly when it comes to investing. That's it. P.S. I am not obsessed with investing in CA, if you ever tried to manage a property that isn't within driving distance you'll find it is a pain in the a**. Regards, Mike
Just try, then we'll see. It's all very entertaining anyway. Ha! I can believe that. So it's the BIG EGO that wins over rationality, once again. The female vanity seems to be the biggest evil. Keep em under control, and never let em rule... Funny indeed!
You mean theire debt service ratio is running up to 70% (not LTV), right? That is scary high. If prices drop, they'll have trouble refinancing because of LTV, too.
Bill, I finally had to search for Santa Barbara in Mapquest. Seems that I was driving through there last year. Don't remember the girls, but the landscape was beautiful indeed. Anyway, there are plenty of good-looking women all over the world. Especially here in Finland. Mike, you're starting to sound more rational. It is wise to be paranoid when others are hopeful (and vice versa).
Moo, Isn't Finland coooold?? I cannot handle the cold - spoiled by year round good weather here in CA I guess Mike
Most of the year, yes. Right now the weather is terrible. But summer and winter can be beautiful, and the former also quite warm. See yourself: http://taivasalla.net/index_eng.html US, though, was terribly hot even in October!
Just thought I'd post another link. Alot of folks forecasting higher interest rates. Yet the 10 Year Note for instance has a distinct look of heading lower, not higher. You be the judge. http://www.ttrader.com/mycharts/display.php?p=29227&u=oldtrader&a=OldTrader's Charts&id=1300 OldTrader
So long, California Family ties, better schools and simpler, less costly lifestyles are luring families east. By Marnell Jameson Special to The Times December 12, 2004 While on vacation with their three young sons last January, Mark and Ellen Kiely made their decision. Like many people, they had talked about moving out of Southern California for some time. They wanted to be closer to their family on the East Coast and to nature, get more home for their money and be near better public schools. "On that trip, we were all together enjoying life and the outdoors, and it clicked," Mark Kiely said. "Ellen and I looked at each other and said, 'What are we waiting for?' " Nine months later, the Kielys had sold their Studio City home and were living on a saltwater inlet in Rhode Island, fishing and kayaking from their frontyard. "Though the effort was Herculean," said Kiely, an actor who grew up in Rhode Island, "the payoff is seeing my kids so happy in this environment. I'm now able to give them the boyhood I know how to give. I couldn't do that in Los Angeles." Although not everyone would trade the West Coast for the Northeast, the Kielys are part of a quiet trend fueled by home equity and technology, such as the ability to telecommute, that is making it possible for more families to move out of state. In a statewide survey of 2,500 California residents issued last month, one in four respondents said they were seriously considering leaving the state or moving to another part of the state to find cheaper housing. Of adults under 35, one-third were considering moving somewhere more affordable, according to the Special Survey on Californians and Their Housing, conducted by the Public Policy Institute of California. "Up until two years ago, California had always been a net inbound state," said Doug Hill, president of the California Moving & Storage Assn., meaning that more households moved into the state than moved out to other states. That shifted in 2002, when California became a net outbound state. This year about 55% of all domestic moves that crossed the state line were households moving out; 45% were moving in. States with large populations, such as Florida and Texas, are drawing the most Californians. "People in hot markets like Southern California look at their equity and think: 'Gee, if I sold, I could get a lot more house in another area, or a better quality of life, or I could retire,' " said Bert Sperling, author of "Cities Ranked & Rated: Your Guide to the Best Places to Live in the U.S. and Canada" (Wiley Publishing, 2004). And this line of reasoning makes sense for some residents of the Southland, where the median home value was $410,000 in October, according to DataQuick Information Systems, more than twice the national median price. Proximity to family was also a deciding factor for the Kiely family in their move to Rhode Island. Today, the Kiely boys, ages 4, 7 and 9, live near 16 first cousins and many aunts and uncles. The older boys walk down a dirt road to catch the school bus, and each attends a class with only 17 other children, two teachers, and music and art enrichment programs, which didn't exist in their old public school. "We decided our children, the environment, good schools and family were our priority," Mark Kiely said. "Life changes like this shouldn't be just financial." But that part is working out too. An established actor and professional photographer, Kiely said the move "added a level of difficulty to my career," but his agent and his manager supported his decision. "I always fly to locations for work anyway, so who cares if I'm not flying in from Los Angeles?" In fact, he just accepted a role in an upcoming film, "American Black Beauty," which begins shooting this month in Ventura. "That offer was nice, because it affirmed my decision." Ellen Kiely works part time doing financial consulting and helps in her husband's photo studio. The couple, both 40, sold their 1,500-square-foot Studio City home for $697,000. They had bought the property for $345,000 three years ago. All their profit was tax-free because gains of up to $250,000 for a single person or $500,000 for a married couple are not taxed â if the sellers meet the two-out-of-the-last-five-years residency requirement. Now the Kielys are doing what their real estate agent, Ray Ross, of ReMax on the Boulevard in Sherman Oaks, believes more people should do. They're renting in their new community until they know which neighborhood they really want to live in. "Typically, people new to an area hire an agent, tell him or her to show them everything within a price range, then pick the house they like best without taking into consideration all the subtleties of different neighborhoods," Ross said. "Later, they wished they'd taken more time to look and learn." The Kielys like the neighborhood they're living in now and are looking at two others. Once they narrow their search, they plan to buy a home in the $400,000-to-$500,000 range by June. Meanwhile, their temporary home is 2,000 square feet and has a 33,000-square-foot lot for a yard. The house would normally rent for $1,900 a month during the school year, but the Kielys are renting from a friend and paying only $750. The couple chose Rhode Island because they loved the small state and its simple outdoor lifestyle. Plus they knew the area. Familiarity with the area helped make their move a success. Experts agree that the most common mistake people relocating make is not spending enough time getting to know a community before they buy. Though you can compare cities online and in books, nothing reveals a city more than several visits, said Joe Hollingsworth, author of "The Southern Advantage" (Economic Research Press) and chief executive for the Hollingsworth Cos., in Clinton, Tenn., which develops business sites in areas he hopes are attractive to live and work in. "No one should relocate to a new community until they have visited at least three times," Hollingsworth said, adding that each visit should have an express purpose, and both partners should go on all trips. "People want to save money on airline tickets, so they try to do everything in one trip, or send only one spouse," he said. "That's a mistake. People shouldn't risk their happiness to save a few hundred dollars. Successful moves require a lot of time and due diligence." The diligence can begin by picking up the new city's local paper. Hollingsworth suggests checking for community events and timing a first visit when the town is having one to get a feel for the people. On that trip, check out shopping centers, restaurants and schools. Then use the Internet to investigate taxes, cost of living, unemployment rates and school scores. A second visit should include a neighborhood search, not a home search. If focusing on living near a new job, look at all possible neighborhoods. Drive around and talk to people besides a real estate agent about the areas, Hollingsworth said. "Visit the barbershop." By the third trip, start looking seriously at housing, and also try to visit a civic meeting. Depending on your interests, stop in at a meeting of the local PTA, the city council, the boating club, a charity group or the Rotary Club to get a sense of whether the community suits you. A desire for more land and a lifestyle change motivated Richard and Barbara Metzler to sell their Mission Viejo home of 23 years in July and move to Medina, Ohio. But it was telecommuting that made it possible. The Metzlers bought their 3,400-square-foot Mission Viejo home on less than a quarter-acre in 1981 for $324,000 and sold it for $800,000. Their new home on 26 acres cost $600,000 â it has 3,200 square feet plus a basement. The couple, who are both 60 and have no children, had been discussing moving back to Ohio for 10 years. Before settling in California, the Metzlers had lived in Texas and Colorado. "That was during a stage of my life when my career was booming, and we kept moving to the bigger house in the nicer area," Richard Metzler said. "It was a status thing." As a telecommuter, Richard Metzler will keep his position as chief technology officer for a semiconductor firm and continue designing semiconductors and working on two start-up companies from his home base. His wife left her administrative assistant job and, once they're settled, will look for new work in Ohio. "Something was wrong with our former way of life," Metzler said. "Life shouldn't be about status but about doing what you enjoy. For me that meant more land, less traffic and seeing the seasons change. Now when I've had a tough day, I go out and chop wood."
And yet, if you look at the weekly for a big picture perspective, you see higher highs and higher lows: http://tinyurl.com/58ud6 Not only that, but the upswings have a disconcerting bit of vertical feel to them. Appropriate for the situation we're in. Sometimes charts say a lot, sometimes they don't say much at all. Often the context really helps. For example, we did the lombada thing with rates already. You have to stop when the back of your head brushes the ground. We got to what, 40 year lows? 50? Not to mention that average US consumer saving, proportionate to income, is down to $1.50 per week. The keg's tapped out. We drank all the beer. We're drinking more to try and avoid the hangover. The maestro himself is talking down the dollar (or at least he was last month). Lowering rates now would be like pouring salt in our creditors' wounds. The only way we go back to falling yields is if the economy stumbles and falls again, which brings recession and potential stagflation to the party. Not the most bullish scenario. Macro just ain't in RE's corner in any way, shape or form. Let me stress again that I still think "muddle through" (as John Mauldin calls it) is a reasonable possibility, and not one to be counted out. But the truly ugly scenario is still 1 in 5, and maybe 1 in 3. p.s. actually there is another scenario that could bring about lower rates on the 10 year - an inverted yield curve. But once again, this would not be pretty... in fact it would probably be a nightmare...