Will a burst housing bubble lead to social problems?
We could be seeing a rerun of this movie soon. Here's a quote from the September 26, 1990 Wall Street Journal, as quoted in the book Prechter's Perspective. The Wall Street Journal quotation describes Los Angeles area homeowners. Prechter suggests from the last paragraph that denials of financial danger can lead to serious and dangerous social problems.
"It's gotten to the point where we can't even sleep at night," said Darryl Jackson, who has been trying to sell his house for nearly six months.
Jackson and his wife, Debbie, are suffering from what some realtors have dubbed the "home sellers' blues" - a sad litany of frustration, anxiety, desperation, and even anger.
It's a tune that's being sung by hapless would-be sellers in many parts of Southern California, with backup vocals provided by millions of home-owners in depressed housing markets across the nation.
Sleeplessness. Headaches. Upset stomachs and - as one would-be seller puts it - "a general state of disorientation. I think about it when I'm at work. I think about it when I'm cooking dinner. I think about it when I go to sleep at night.
"It's all just sort of hovering there. I feel like I'm in a twilight zone."
"Frustrated sellers are angry at the world, and they want to place blame on somebody for their problems," said Irene Goldenberg, a family psychologist and professor at UCLA.
posted by bearmaster at 9:37 AM
6 Comments:
Hi cereal,
I'm sorry to hear of your experience but glad you were able to quickly get out.
I was far stupider in the mid 90's. I sank tons of money into a place in Gardena where I was upside down and lost it all as I was no longer willing to cohabit next to less than friendly neighbors in a condo complex.
If all the bubble blogs help a few people escape that fate, I'll be glad. Unfortunately, somebody's still gonna get hurt as there always has to be a bagholder.
Glad to see you focusing on my neck of the woods. Checkout patrick.net as well...
I am stil amazed that LA seems to be the last area to see any deteriroation - visible that is. I have seen a lot more open houses, and http://www.benengebreth.org/housingtracker/ will show you that offering prices are dropping across the board around the region.
There still hasn't been a real tangible effect here and I still find myself debating with people vs showing tangible problems. Since I've been on this thing for 2 years now with the same fervor - I'm written off as the nutjob of the community...I just can't figure out how the region has kept away from the obvious issues that have started hitting Phoenix, Boston, DC and Miami. Heck even Sarcamento!
Guess we'll need to see these I/O's start resetting ($1Tril in 07) with no refinancing capability before the shit hits the fan.
Cereal,
I work up at UCLA and occasionally go home down Lincoln Blvd, and I know exactly what you mean about Playa Vista. It's as if we (collectively, as a society) are not happy until we have destroyed every bit of open space. Ugh!
Yes, Los Angeles county is holding up amazingly well considering other housing markets, even California housing markets, are starting to unravel.
Even "The O.C" is starting to show some unraveling, but Manhattan Beach, where they film "The O.C", still appears to be holding up.
I have lived in my North Redondo neighborhood twice - once from 1989-1990, and continuously since 1995. Personally, we felt homes here were not good values even in the mid to late 90's, and that's one reason why we never bought anything.
It's very hard to tell from listings at places like Zip Realty just how the market is doing, because unsold listings may expire and "delist". The property with the asking price of over $1.3 mil has recently delisted from Zip Realty, but the For Sale is still hanging.
Glad to have you guys around. Any other South Bayers out there?
checkout the link to housing prices I threw on there...that's why the guy created a site that tracks LISTED prices weekly. Seems those agents can hide those price drops by just letting them expire - then starting them at a lower price later. That info would be captured and evident in his tracking listed prices.
The Playa Vista thing is just depressing. I gather it had to happen but it ain't pretty.
Ah yes, Ben Engebreth is a terribly busy guy tracking all that data but I'm glad somebody's doing it. From his data, looks like not all is quite rosy in La La land as averages and medians have been drifting down a bit.
His link is on my Housing Bubble Education page on beartopia.
I stop and pick up For Sale brochures in my neighorhood all the time. Still not seeing much in the way of "reduced price!" or "seller motivated!" yet. 5%-10% markdowns from asking prices have been customarily going on for years.
My last post of Beach City Home Prices shows a lot of variation month-to-month over 2005, but by the end of the year the trend was still clearly up.
I remember late 1989 and early 1990, living in a south bay community called Lomita, and the forest of For Sale signs I would see while jogging down a street. Expect that spring will more definitely show us just how glutted we are here in La La Land.
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