Mortgage Rates


#142

He keeps appx 30% (around 120 b) cash. Since his private businesses like Seescandies, Benjamin Moore etc gives good cash flow, he has 30% cash


#143

WB is cash holder, but I have mortgages. Keeping cash at hand and paying mortgage interest is waste!


#144

Where are all the housing bears that said when interest rates increase the housing prices will decrease?


#145

Roaming in Patrick.net


#146

In the U.K. it is very common for people to have a mortgage that gets offset by their bank account on a daily basis. So if they have 50k in their bank account one day, they do not pay mortgage interest on that 50K that day. I’m not sure why that doesn’t get offered as a product here. Most of my friends there have that type of mortgage so I assume it doesn’t have negatives that balance out the savings.


#147

Never heard of this site. Does it have a reputation of anti-housing or something?


#148

Patrick is a perma bear that drove his grumpy band of bears into permanent poverty.

Here is classic Patrick…he is truly an uniformed asshole…A techie with absolutely no knowledge of construction or real estate…Three years after the bottom of the market still saying rent don’t buy…There were several of his disciples on Redfin…None came to this forum…They were all scary permabears…Many were survivalists, preparing for the zombie apocalypse…
He has turned his fake news website into a cash machine…

https://patrick.net/post/1282720


#149

Ah I see. He has some valid points but they all have to be taken in context. If he was spouting this same stuff at the bottom, then I can see his disciples losing out big.

edit: The comments on the post are golden though!:rofl:


#150

His site is a cesspool of crazies…Several attacked me on Redfin…One called himself Crazyman…They all believe that the world is doomed…He charges $5.46/m. All you get is a positive feedback of negative news…Zerohedge for real estate…They should provide a suicide hotline for the truly inoculated…
An unapologetic bear since the 2008 crisis…


#151

Why not man? Did you guys chased my bears away? :panda_face:


#152

I volunteered to go find them, but Terri didn’t want me too…I am actually the biggest bear on here. I am selling more than buying these days…More due to my age than the economy…I sold in the BA in 2015…even though prices didn’t drop in 2017 like I predicted


#153

Elt scared them away.


#154

That crazy bull looks more like @wuqijun:thinking:


#155

Bulls are no match to a single Lion!


#156

They had 3 major bear arguments:

  1. Price to rent ratio made renting much cheaper than buying
  2. Interest rates would increase from record lows causing prices to drop to keep payments the same
  3. They couldn’t afford the home they thought they deserved, so the market must be a bubble

Most of them expected another 2008 style crash, and they were going to buy when it happened. That’s despite the fact they didn’t buy a couple of years earlier when it happened. They were too ignorant to admit that if they were too scared to buy in 2008, then they’d be too scared to buy the next time.

They failed to consider that rents could increase, and they increased big time from the lows of the great recession.

I thought the interest rate argument was solid. It makes sense, but I looked at the data going back to the 1920’s. Median home prices never declined in a year with an interest rate increase. That’s because rate increases are a lagging indicator or inflation. Inflation means wages and home prices have already increased. That’s when I decided to buy and lock in a low rate on a low price.

They failed to acknowledge there are people in the bay area more financially successful than they are, and they aren’t that special.


#157

Hey! I might be a bull but I’m not crazy!


#158

So who’s the lion?


#159

Outside of the content, his site is so annoying to navigate and read as well. I much prefer @manch site here.


#160

Well I think you were partially right in that rents peaked in summer 2015. And in 2016 the real estate market was flat for several months in SF. I was looking that spring and summer and houses were selling but far fewer offers, especially for places that were a bit flawed (e.g., weird floorplan or bad/no staging.) It felt like beginning of a correction or at least a plateau. People who had been outbid for a while landing places. Sparse open houses. My agent told me how many offers there were each time I bid, and it was usually 3 or 4. Funnily enough interest rates were great. I think the dip was bc of the aftermath of when stocks tanked in Feb 2016. I remember when LinkedIn dropped like 40 percent in a day, it felt like the end was nigh. My friend bought a house in Berkeley end of 2015 and regretted it, felt he’d made a mistake as he saw comparable things sell for slightly less. My tech companies stock was down 25% relative to 2015. It’s now up way more than that. A place i looked at in Bernal had fallen out of contract because the buyers Twitter stock dropped in value (at least that’s what the agent said.) I guess things are really dynamic, so many factors. Just based on that interest rate doesn’t seem to be as important as it appears.


#161

Same for South Bay.