Market Conditions: The End of the McMansion?
Over the weekend, the Chicago Tribune tackled the subject of how suddenly people are looking to downsize their homes instead of move into something bigger- mainly because of the economy.
Could this spell the end of the McMansion craze? Will 3,000 square feet become the “new” 5,000?
“It’s a value play, it’s a cash-flow play,” said Jim Kinney, president of Rubloff Residential Properties in Chicago.
Kinney says his brokerage’s phone is ringing with consumers of a certain age who want to sell their homes—and soon—and replace them with something smaller.
“Trading down is the whole new thing,” said the head of the Gold Coast-based brokerage. “We just had a whole bunch of listings and there are a whole bunch coming on the market soon. Every single one said, we’re tightening in, we want to trade down. People are worried about cash flow.”
Kinney said that although a downsizing trend had been predicted for years, the housing boom derailed it.
“There was an expectation that Baby Boomers and empty nesters would go into a smaller space, but it went contrary,” he said. Flush with profits from selling their existing homes and fueled with cheap mortgages, they moved up to larger spaces instead.
But suddenly, the bottom line is speaking to them with a whole new voice.
“Now, people are suddenly more sensitive to how much the tax is and how much [homeowners’ association] assessments are,” he said. “Before, they didn’t really care—they figured that when they sold, the capital gains would cover those past carrying costs.”
No more, he said. These sellers are definitely feeling leaner times, and cheap—or cheaper—is the word. Some of them are talking about renting instead of re-buying, in order to keep cash at hand, he said.
Downsizing trend already in full swing, realty pro says [Chicago Tribune, Jan 11, 2009]
thanks for the heads up on the article, Sabrina. good stuff.
too bad there isnt going to be anyone around who can afford to buy these anymore
I wonder if the next money making wave is goign to be turning these into multi-units
“I wonder if the next money making wave is goign to be turning these into multi-units”
I don’t think you can do that unless it gets re-zoned? Although handing an alderman $1k in cash would probably do the trick.
No surprise that with easy lending money gone, not as many people can afford to buy brand new McMansions!
That story is hilarious. Too funny. My favorite is this:
“And whole new neighborhoods have opened up to the downsizing city dwellers—thanks to the transit fiat of Gov. Rod Blagojevich (seniors ride free program), Kinney said.
“The older crowd, now that they’re able to ride the bus for free, they’re willing to look farther afield for a place to live,” he said.”
How much did it cost seniors to ride the bus before the rate increase on Jan 1, $1.00 or something? Kinney just totally made up that assertion.
“”I’ve talked literally to dozens of sellers who are in this position,” he said. “They don’t want to be perceived that they’ve lost money. They preface it with, ‘We feel it’s time that we cut out the waste [in our housing], and we don’t need this, we don’t need that.’ They want to make it sound like it’s just a transition.”
Translation: They’re spending $1,000 a month on taxes, $400 on heating gas in the winter, $300 on electricity during the summer, $175 on the full HD digital cable package, $75 a month for lawn maintenance, and literally tens of thousands each year on interest on the mortgage.
Builders have been building infill project homes in established, ecnomically viable suburbs and neighborhoods for yeras. It’s just that most of the SFH’s that’s been built has been….McMansions.
i.e. http://cribchatter.com/?p=5750
3757 N. Keeler
“”The way Stephani figures it, in the coming year, Baby Boomers will be ready to downsize and ditch their heavy property-tax bills. But they’ll want their new homes to be environmentally smart, and they’ll want easy transit in order to be able to get around. Bye-bye, big subdivisions in isolated areas, he said; hello, infill projects in established, economically viable suburbs and neighborhoods. “
“hello, infill projects in established, economically viable suburbs and neighborhoods”
So more crummy townhomes. You should love it, HD.
*I don’t think you can do that unless it gets re-zoned? Although handing an alderman $1k in cash would probably do the trick.*
LOL. Yes, you are so right. I love how you treat it as a cost of doing business.
The funny part is that if you buy a house now, you have to pay $7.50 in taxes for every 1,000 spent so that granny can ride the bus for free. Thanks to Todd Stroger… (*#$@!#%@#$@!!!!)
So if they buy a 100k house, they have to pay $750 in taxes, which is the equivalent to paying for a unlimited ride pass for 10 months! Or about 375 cash fare rides!
LOL! I don’t think its about what baby boomers, by and large, want anymore. After the massive 401k hit in 2008 I think for the first time in their lives its about what baby boomers can afford. If they just lost 40% of their net worth I doubt its what baby boomers ‘want’ anymore.
And anybody trying to sell their McMansion now is way behind the curve. So far behind so as to be in a tough situation riding out this downturn, which will be long.
“Baby Boomers will be ready to downsize and ditch their heavy property-tax bills. But they’ll want their new homes to be environmentally smart, and they’ll want easy transit in order to be able to get around. Bye-bye, big subdivisions in isolated areas, he said; hello, infill projects in established, economically viable suburbs and neighborhoods. “
The population of the U.S. is reverting to normalcy not only in the matter of house prices and debt:income rations, but in size of houses.
Where was it ever written that paralegals should own $300K condos and that ordinary workers should live in 3,000 sq ft houses? Or that everybody should move into a $1 Million McMansion the first year they make a 6-digit income.
My grandparents were affluent people, yet raised their kids in a suburban Cape Cod with about 1600 sq ft and ONE BATHROOM if you can imagine- even though my grand-dad was upper management. My mother’s neighbor was a Executive VP of TUMS (you know, the stomach aid), and raised his family in a 2-story 1700 sq ft 4 bed 2 bath colonial in the suburbs of St. Louis that he just sold for $187K last year. Every car he ever bought was used, at least 3 years old and I had several older brokerage clients who were in senior management at Fortune 500 companies who never bought a new car or lived in a house over 2000 sq ft.
We are going back to caution and frugality. The days of deluding yourself about who you are and where you really sit in life, by means of Trickbag loans and a wallet full of credit cards, are over.
My bet is that many of the mansions of Lincoln Park, especially the really large and extravagent ones, will either become multifamily housing or commercial buildings, or perhaps schools or other institutions, as all teh bad credit that was the fake “wealth” of the past decade unwinds.
Many McMansions and in-fill 3-Flat/6-Flat condo projects are so poorly built that their “useful life expectancy” is about twenty years. Those concrete block and/or vinyl-sided structures are cheaply constructed, poorly insulated, and prone to water-penetration, causing high utility bills (for SF), water seepage, and mold. These recently constructed “one-off” homes, often constructed by “pick-up truck” contractors with little prior building construction experience, are poor investments targeted at naive homebuyers who do little due diligence home inspection effort prior to purchase. The average buyer gets excited by cabinets, granite, and stainless steel appliances, neglecting to consider the construction quality itself.
Close friends bought a new McMansion ten years ago. I carefully encouraged them to hire a qualified home inspector to do a thorough punchlist and inspection before closing on their big vinyl box with brick front facade, but I doubt it occurred. They’ve had many water seepage, window rot, and drywall pop problems since. This summer they had a daytime barbeque, so I could see the inside and outside in daylight and was shocked by the decay in building materials. They’re not happy with the house, and they don’t even see how much damage is readily visible to me.
Chicago Building Department is aware that many 3-flat/6-flat condo buildings constructed in last decade used wrong kind a concrete block for exterior wall construction, and failed to waterseal those blocks. Many of these buildings were constructed by amateur contractors with little construction knowledge or ethical concern. They sold their product to naive yuppies who only saw “new” and granite/stainless “eyewash” interior finishes. Water penetration is saturating those walls, causing mold and wood rot. There is concern that wood joists, supporting floors and roofs, will begin to sag and fail in next decade. These homes are definitely the slums of Chicago’s future. Chicago Tribune covered this story several years ago.
Laura: Not a bad bet, and I think history will prove you correct. Looking at Wicker Park (specifically Hoyne & Pierce streets) you’ll find many mansions that have been converted to multi-family homes. A few trended back to large single family but there are still plenty of multiple mailboxes on the fences. Gorgeous places.
ever read the millionaire next door? wealthy people tend to live well below their means. aka – not living in a mc mansion or driving a new BMW, even though you can afford it. and those are the people who can stop working at 55 and enjoy life.
The same idiot boomers who helped create the housing bubble after 9/11 and their whole “home is where the heart is” mentality now are going to pay a steep price for their overconsumption.
There aren’t enough people with enough money to come along and relieve the boomers of the giant bag they are holding in their overpriced residences. A lot of people who were counting on realizing RE gains to help meet their retirement goals are going to be in deep doo doo.
When I read the article again all I see are follow the herd lemmings. Too bad for them its TOO LATE to get out if they upgraded their home during the boom, they are STUCK. I didn’t hear them complaining back in 2006…
It’s not just the “boomers” of my own generation, Bob, and I’ll bet we’re the least of it.
Generation X folks, who are now 35-45 years old, appear to have been the people who assumed the most extravagant loans and did the most HELOCS- and it looks like irresponsible 2nds and HELOC loans were a big factor in the credit bubble of loans that don’t have a chance of being paid back.
So you can’t hold any one generation responsible, except to say that the idea that you could create wealth by means of piling on debt started in my parent’s time, just after WW2. That was when we bacame a Consumer Economy, and after 1970, when our manufacturing base began to erode rapidly, it became government policy to drive the economy by means of debt creation and consumer spending. It’s interesting that until the late 70s, housing prices tracked median incomes and rentals. But, when we started losing manufacturing and the mass layoffs and plant closings of the 70s and 80s started, we got our first big “housing bubble” in the late 70s. That was when the first ARMs were introduced, because interest rates were very high and fluctuating wildly because of the inflation due to the oil price shocks of the 70s. Then, ANOTHER housing bubble in the late 80s followed by a housing bust in the early 90s.
And now, the grandaddy of credit bubbles, that will most likely be followed by the longest and nastiest bust we have ever experienced, excarbated by resource shortages. Old timers in the 80s and 90s, who say that things were much more difficult in the 30s than they are now should take note: we are probably only now just entering the longest and most severe period of hardship we have ever experienced. May these people who suffered through the Great Depression not have to live through the next.
The caution and frugality won’t be a choice- it will be inflicted on us. Get ready, it isn’t going to be fun.
Wow Laura, that’s some doom and gloom. It almost makes me want to stock up on canned goods, solar panels and gunpowder.
And gold. Cannot forget to stock up on gold.
“…Caution and Frugality..”…. I’m gonna put that on a tshirt….paid for in cash of course
homedelete, I believe we are looking at not an “emergency” so much as a period of prolonged and severe austerity to which we will just have to adjust. Everybody from the rich clear down to the struggling is going to take losses, I believe, including me. I’ve reconciled myself to the fact that my retirment will most likely not be comfortable.
I also believe that we will make a much better adjustment than we think. So, yes, by all means stock food, because that’s an inflation hedge, and lay in lots of sweaters, blankets, long underwear and other warm things to be comfortable in underheated dwellings. And by all means, most important, PAY DOWN DEBTS and readjust spending.
But put it in perspective. What was considered a lavish lifestyle for the typical moderate-to-middle or even upper-middle (like my grandparents and my mother’s neighbor)income folks back in the 50s and 60s, is now considered baseline for anyone not poor thesedays.
And I see high-income, upper-middle-class people I know arrive at retirement close to bankruptcy because they spent themselves into insolvancy on super McMansions, 50-foot cabin cruisers with 3 decks, a new BMW every 4th year, jewelry and designer clothes they wear maybe twice.
I mean, is having to live in a 3 bed 1.5 bath 1600 sq ft house, with only one car for the whole family, so HORRIBLE? I mean, my grandparents did, and he was a dept store exec. Is it SO HORRIBLE to buy clothes with the idea you might have to wear them for more than two seasons.
Moderate income people of my acquaintance have so many goods that they spent tens of thousands of $$$ on, on credit, that they have to rent storage lockers for all this garbage they never even really wanted. What ordinary folks spend over any 10-year period on electronic garbage like cellphones and gameboxes and small appliances that are either completely unnecessary or/and that obsolesce in a year, could buy a house full of really beautiful, durable, classic furniture complete with sterling flatware and fine, handmade oriental rugs.
That money could also pay off a mortgage, if that mortgage was within the borrower’s means to begin with.
My bet is that,once people adjust to the idea that you have to live within your means ,that it will feel good to them to save, and spend money only for things that are either necessary or have real value. We will see a big shift in consumer preferences. People will start to eschew faddy trash in favor of stuff that has durable value and beauty, and way less of it.
And people will start to save money again, and keep their debts under control. We will have a better basis for a solid, honest, production-based economy.
Lets not get into value judgements Laura. I’d take my PS3 any day over your vintage rugs and fancy utensils. But yes they shouldn’t be spending it on these things but rather paying down debt.
I don’t think the transition is going to be as easy as you think, either. There will be a tsunami wave of defaults over the coming years as entire generations have grown up accustomed to living beyond their means. They aren’t all going to turn on Suzi Orman one morning and ‘get it’. How much they take the overall economy down with them remains to be seen but I think they will and it will be significant.
“entire generations have grown up accustomed to living beyond their means”
Which generations are these, Bob? Not mine–I grew up with the feeling that economic calamity was just around the corner.
anon(tfo),
I can tell you my generation (“Y”) grew up living beyond their means. Also my sister’s generation (“X”) grew up living beyond their means. Baby boomers, from studies I have read, are very much behind on their retirement goals and have likely lived beyond their means.
You’d have to go back to the ‘greatest generation’ to find one that lived within their means and took savings seriously. Looking at the long-term household savings rate and its a disturbing trend. Even these days now that ‘thrift is sexy’ the savings rate only approximate that of the mid-1990s.
Bob:
I guess you mean something different by “entire generation” and “grow[n] up” than I do.
I am part of X, as are most of my numerous prudent-if-not-necessarily-thrifty friends, thus it isn’t the “entire” generation and I didn’t feel remotely comfortable with debt (other than grad school debt) ever, and especially not “while growing up”–when I lived with constant dread of being genuinely (as opposed to functionally–I was a kid/student after all) broke.
“50-foot cabin cruisers with 3 decks” LOL. Do those come with other upper-middle class toys like gameboxes and storage lockers to stash the goodies? Or The Google?
I like it when people make broad sweeping exaggerations, but you take a tad to far.
While I agree that things are not looking so hot, I don’t think that we will have the implosion you describe. And as for returning to a “solid, honest, production-based economy” – yeah, that’ll not happen again. That boat has sailed. Forever.
Ok, you have all convinced me, I am selling my place and moving back in with my parents.
Jason,
This would’ve been prudent back in 2006. Its a little late now :O
Its okay, I bought my place 45% lower than the 2006 price…..
I know couple with a large six bedroom brick home in the city yet they have no children. Generation Y all the way. They have good paying jobs but I’d suspect they’re hurting financally given the industries they work in. I’ve calculated their monthly housing paying PITI and either they have a printing press in the basement or they’re living well beyond their means thanks to IO stated income jumbo mortgages.
Homedelete: If you are sitting around calculating your friends’ house payments, you have much more to worry about than the current state of the housing market in Chicago…
Chris:
If you’re sitting around criticizing how others (legally) spend their time, you also have much more to worry about.
Oh noes! The hypocrisy … it burns!
PS–HD, do those friends happen to have two porsches and a big boat, too?
I thought you guys would like this article:
http://online.wsj.com/article/SB123146363567166677.html
Ha! It’s not that hard to do…..it’ takes 2 minutes on ccrd.info and karl’s mortgage calculator …..
“Chris on January 12th, 2009 at 2:35 pm
Homedelete: If you are sitting around calculating your friends’ house payments, you have much more to worry about than the current state of the housing market in Chicago…”
anon, no porches or a boat. Just the big house. At least that I know of.
Oh, dear. I’m afraid you’ve missed the point.
Okay, then enlighten us.
HD, is Chris your neighbor?
“I mean, is having to live in a 3 bed 1.5 bath 1600 sq ft house, with only one car for the whole family, so HORRIBLE? I mean, my grandparents did, and he was a dept store exec. ”
If you don’t live in Chicago, or a handful of other ‘car optional’ cities, yeah, it will be horrible. Your grandparents probably did not live in remote subdivision with 20 minute drive to the nearest grocery store, doctor’s office, etc. This country is not going to be green, or frugal, for as long as the majority of people are so dependent on cars for their basic everyday life.
It’s this: Instead of wasting time being resentful of what everyone else has, it may be more productive to instead spend time thinking about how to improve your own lot in life. That’s all, nothing more.
(Cue the “The More You Know” music)
“Instead of wasting time being resentful of what everyone else has”
That damn Forbes magazine. Now I remember why it’s beneath me.
Why would he be resentful of his neighbor owning a house that is worth $300,000.00 after his neighbor paid $500,000 for it?
Resentful? Hahahahah that’s hilarious. More like a cautionary tale of overextension. Or how to be house rich cash poor. Or how to ask your north shore parents for money once a year to cure arrearages.
What I did was like checking out your neighbor’s home value on zillow except that I took it a small step further.
I’m a baby boomer who has always felt this way (that economic calamity was just around the corner). I guess not all of my generation got that message, though, since I understand that many boomers are not ready for retirement and are hoping that social security will be enough. I’m not counting on a penny from that ponzi scheme. My parents were born during the depression and managed to pass the frugal meme to me. Unfortunately, I don’t think I’ve passed it on to my kids, at least not to my teenaged princess. Although she understands how it kills me to pay full price for anything and she learned how to bargain for things tagging along with me to garage sales when she was a preschooler.
anon (tfo): “which generations are these, Bob? Not mine–I grew up with the feeling that economic calamity was just around the corner.”
My grandparents were one of the first waves of suburbanites, and, yes, they had to drive to most things, with this difference: my grandfather worked downtown, as almost all white-color people did then, and took a commuter train down from Kirkwood MO. Those trains were pulled out of service 45 years ago.
Now, since the 2nd wave of suburbanization in the 70s, which meant outer suburbs with office parks and retail and single-use zoning and subdivisions lined up along divided 40 mph limited-access collector roads you can’t let your kids walk along, everyone out there has to drive. And drive. And drive. If “urban” planners had deliberately set out to design a way of life diabolically tricked to burn as much fuel as possible, as much congestion as possible, and drive as many people as possible insane and broke with 50-mile-each-direction commutes, they couldn’t have have made a better job of it with the kind of suburbs we’ve built since 1970.
“as almost all white-color people did then”
How racially insensitive of you. 🙂
Laura: I agree with your 1:07 p.m. post.
I think that a re-shifting in values must and will evolve. But unfortunately, there will be lots of blood on the streets, due to our (over)consume(r) based economy. What are the thousands of the pretending-to-be-successful realtors going to do now that the market has dried up? Don’t even mention the mortgage brokers galore. What about diamond dealers? Fur stores? Vacation packages? Luxury car dealers?
There are many who will watch their businesses die on the vine, for even if things pick up later this year or next, the credit card based over consumption days are gone for now, and the substantial number of people who made their living this way will have to re-tool in terms of occupation and lifestyle. They aren’t going to be falling in place to suck up that huge inventory of housing units that has been building for the last 2 years.
http://chicago.craigslist.org/chc/apa/982254599.html
Only $20,000 a month!
Bob, I meant to say WHITE COLLAR, sorry for the mispelling, which I should have caught. What a diff a typo makes!
My grandparents moved from “blue collar” south St. Louis, to white-collar Kirkwood.
No racial insensitivity intended.
Homedelete:
Well at least we get to see what most of the outside, front, looks like for our 20k a month rental property. I’d take it, but no pets allowed so I’m out of luck. /sarcasm
There was a great little piece with interesting links about the death of the exurbs/McMansion in the NYT yesterday I think.
http://arieff.blogs.nytimes.com/2009/01/11/what-will-save-the-suburbs/
Funny how the NYT is predicting the death of the exurbs and McMansions. (They should write a story predicting the death of the print media). Do they have no sense of history? People like my grandparents moved to the suburbs because they watched the city become a poor and crime ridden hell hole in the 50’s, 60’s and 70’s. In cities like Detriot the exodus was complete; most of the city proper is blighted while the suburbs are actually quite nice and respectable. Families will eventually fill those homes; the ghetto will eventually take back some of the neighborhoods it gentrified; and there will continue to be good paying jobs in the suburbs. I personally perfer the city but quite frankly none of us travel outside a few square area in the city.
hd,
The media is quite funny and obviously extremely biased against the suburbs. The WSJ recently did an article investigating this in their review of the new movie with DiCaprio.
Apparently much of the media elite lives in urban areas. What is funny is that Hollywood itself is urban in name only. Its about as suburban as it gets. You don’t go anywhere in LA without a car.
“What is funny is that Hollywood itself is urban in name only”
The “industry” is definitely suburban, but I think that Hollywood–the neighborhood–is the most genuinely urban part of SoCal. Only EsEff and Oakland/Berkeley feel more “urban” than Hollywood.
***Bob, I meant to say WHITE COLLAR, sorry for the mispelling, which I should have caught. What a diff a typo makes!***
LOL. I think that was the worst type-o I have ever seen!!! 😉
Funny, my family was reverse white flight in the mid-seventies.
One factor not mentioned here is the cost of children’s education. An affluent family in the St. Louis suburbs might send their kids to parochial schools and pay cash for college tuition. That wouldn’t leave much for a big house. Now the problem is that irrespective of your housing budget, saving enough money for your children’s college education is not a reasonable goal. This is actually not a reflection of anyone’s morality or values, simply a fact that’s a consequence of the relative inflation of these costs. Solution: buy a McMansion, use home equity loans to pay the tuition bill, then go into foreclosure when the last kid graduates?
“So, yes, by all means stock food, because that’s an inflation hedge, and lay in lots of sweaters, blankets, long underwear and other warm things to be comfortable in underheated dwellings.”
Are you kidding me? Last time I checked the cost of heating a home is down about 70% in the past 6 months. Also, the idea that we are suddenly going to stop caring about spending money and have a “return to moral values” is laughably naive. Check out a new book called “Panic” by Michael Lewis. It’s a collection of news articles from before, during and right after each of the last 4 financial crises/recessions. There are articles after each crash talking about how we are all going to return to “traditional value” and stop caring about money. As soon as the market cycle comes back, which it will, all this BS about values will go right out the window again.
But, Turd, it’s different this time. Or here. Or something. The economy can’t rebound. Real estate is always nothing more than shelter. It’s a new paradigm.
Get out now or lose everything forever!
I don’t think you guys understand, you should all get underground bunkers and store food. Read here: http://online.wsj.com/article/SB123051100709638419.html
I don’t know about you but I recieve a gas bill from ComEd around the middle of each month and it ain’t no 70% cheaper. In fact it is more expensive than last year.
“Last time I checked the cost of heating a home is down about 70% in the past 6 months. “
Turd–It might be a little easier to take the Russian seriously if he eveidenced any understanding of how the USA might cleve. Some of his line drawing is preposterous–Idaho and Utah wouldn’t voluntarily associate with California and SC, Tenn and Kentucky wouldn’t stick with New England.
“I receive a gas bill from ComEd”
Dude, you’re being scammed.
Gas prices *are* down a lot from the summer, but the price of natural gas is always higher in the summer, at least thru Peoples Gas.
Hahaha. The world isn’t going Fallout 3 or anything where you wander the desolate landscape with a combat shotgun and all ‘towns’ are really just a collection of scrap metal held together with bondo. There will be retail stores not just caravans of heavily armed traders. There will be no systemic collapse of society.
But, that doesn’t mean you can take the situation at hand lightly. Financial collapse is occurring and a lot of people are feeling financial pain. Instead of stocking up on food and bottled water, I suggest taking financial precautions instead: reduce unnecessary expenses, keep some cash around, make yourself indispensible at work, sell the mcmansion, keep the car a few years longer, take shorter vacations, and of course, ALWAYS have a plan B and Plan C ready to go at a moment’s notice because that’s all your going to get when Plan A goes awry.
“Turd Ferguson on January 13th, 2009 at 4:59 pm
“So, yes, by all means stock food, because that’s an inflation hedge, and lay in lots of sweaters, blankets, long underwear and other warm things to be comfortable in underheated dwellings.”
Are you kidding me? Last time I checked the cost of heating a home is down about 70% in the past 6 months. Also, the idea that we are suddenly going to stop caring about spending money and have a “return to moral values” is laughably naive. Check out a new book called “Panic” by Michael Lewis. It’s a collection of news articles from before, during and right after each of the last 4 financial crises/recessions. There are articles after each crash talking about how we are all going to return to “traditional value” and stop caring about money. As soon as the market cycle comes back, which it will, all this BS about values will go right out the window again.”
How am I being scammed by ComEd? Do I have another choice? They send me a bill and I pay it. I didn’t know you could get differnet levels of residential gas service.
Or wait, Maybe I should chop my own wood for my wood burning stove.
I think TF was being facetious with his link to a Russian academic.
However I think his previous post has some truth in it. I really don’t think America is capable of changing the fabric of its spending, consumer driven paradigm easily. And if the government has its way they will be assisting in helping boost consumer confidence and layer on more debt.
However TF, I don’t think things can begin to return back to normal until housing has bottomed/stabilized. And we aren’t there yet. So lets have a couple years of frugality and the government wasting massive sums of money in feeble attempts to stabilize housing.
Its funny though the government never seemed to care about stabilizing the price of housing when it was going up 10+%/year..
“How am I being scammed by ComEd?”
When did ComEd get into the gas business?
“a Russian academic”
Like calling Michael Moore or Ann Coulter or Al Franken or Rush Limbaugh an “academic”. Attention-sseking cranks are a dime a dozen here in the future-Disjointed States of AmeriKa. He’s about as credible as the Dow 36,000 guys–who still get treated as credible, but at least had the sense to almost immediately start kicking the can down the road on their prediction.
anon(tfo),
hahahah! I meant People’s Energy……hahaha! I need to pay closer attention
I love the map. It’s certainly always a possibility that the US may/could fragment – it nearly happened before. I think it’ll take something larger than an economic crisis to do it though – it could begin, though, with people losing their homes succumbing to extremist groups and views (most likely right wing), however we aren’t quite there yet.
I think Utah would go to a Cali Republic, there are tons of LDS members there and they bankrolled the Prop 8 debacle among other connections, plus they are economically and socially more similar to the coast than other western states in some ways.
HEY! Chicago could be a national capital, think about it? All the Burnham plan fetishists could get a big legislative building built and stuff like that.
“The world isn’t going Fallout 3 or anything where you wander the desolate landscape with a combat shotgun and all ‘towns’ are really just a collection of scrap metal held together with bondo”
/sigh
My stupid PS3 blu ray drive died… i miss that game, so fun!
“I think TF was being facetious with his link to a Russian academic.”
Bob wins the award for “Only Person on This Board Who Understands Sarcasm.” Anyways, I agree that we will be forced to be more frugal for awhile, but I find it humorous how cyclical and predictable human nature is.
Posted by Bob
“You’d have to go back to the ‘greatest generation’ to find one that lived within their means and took savings seriously. Looking at the long-term household savings rate and its a disturbing trend. Even these days now that ‘thrift is sexy’ the savings rate only approximate that of the mid-1990s.”
Good thing they saved so hard for the last 30-40 years, pumping money into 401k’s, etc only to have in wiped out in the last few months. Whoops.
I agree that being thrifty and saving are great ideas, but there are two sides to every story…
Curious as to what you guys think about the River North market. I recently submitted an offer on a place there and I think its a pretty good deal. Is it a fair offer to offer 15% off the 2006 price?