Posted on 05/30/2011 9:29:40 PM PDT by 2ndDivisionVet
The U.S. housing market is going through an adjustment of historic proportions. Before 2006, when the housing slump commenced, American home builders regularly built as many as 2 million new houses annually, rarely less than a million. This amount was needed to keep up with new household formation, immigration, homeowners moving up, and replacement due to obsolescence. Since then the number of new houses built has dropped drastically—the seasonally adjusted annual figure announced by the federal government in February 2011 was about 400,000! What's going on?
The recession, obviously. High unemployment and unease about the economy have made potential first-time homebuyers leery of entering the market, and many have decided to wait on the side lines. Although house prices have fallen, few are convinced that they have bottomed, and no one wants to buy a house and see its price decline. The large number of foreclosed (or about to be foreclosed) houses on the market, which account for no less than four out of 10 sales of existing homes, likewise dampens demand for new houses. And those willing to take the plunge discover that, despite low interest rates, lenders who were burned by the subprime mess now require large down payments. The other chief cause for weak demand is a slowdown in household formation—the U.S. Census reports that the rate of household formation is currently lower than at any time since 1947, as people put off getting married and starting a family. According to my colleague, real estate economist Peter Linneman, the marginal household size, which has historically hovered around two or three, shot up to more than six in 2009 and 2010, the result of doubling-up and moving in with relatives.
Common wisdom is that eventually the housing market will stabilize.....
(Excerpt) Read more at slate.com ...
On the subject of Social Security, I’d like to point out - strictly for the purposes of accurate language - that “I paid into it, so I deserve the benefit” is the very definition of “entitlement.”
If GGetc. means that his SS payment is not a handout that he gets simply for breathing, that is true.
Assume Texas is perfectly flat and featureless...
Texas (square miles) 261,797
Square mile in square feet 27,878,400
Texas (square feet) 7,298,481,484,800
Approximate population, H. sapiens (Planet Earth only) 7,000,000,000
Square feet of Texas per individual H. sapiens, divided equally 1,043
Exact measurement of each side of square territory 32.2899397973159
Here’s a video posted here a few weeks ago. Regardless if this is an example of your answer or not, it’s worth the watch.
http://www.youtube.com/watch?v=pbDeS_mXMnM
Had the Government stayed out of the lending market, chances are we would have already been seeing a recovery. Instead, with the implementation of Dodd/Frank and the start up of Elizabeth Warren's Consumer Financial Protection Bureau, they have institutionalized a housing depression.
“they have institutionalized a housing depression”
Intentionally.
NO one who created this monster has been even reprimanded.
The bankers who were forced to make bad loans are the perceived bad guys.
Yep this was well planned out and executed by frank and dodd. And they remain in power.
What is keeping buyers out of the market is uncertainty about their jobs.
Good for you. As long as you can make the payments, buy whatever you like.
I sure don't want to see your lender coming to me for a bailout, that's all.
Great post. By the time I retire I want to be pretty much self-sufficient. We lived in the city for two years and I could not wait to leave. I have lovely neighbors, but I can’t see their houses. I have a garden growing and room to grow the garden. I have an excellent well for water. I can make bread - buy the flour from a mill down the road. I buy my meat locally from the folks who raise it. I rarely go to movies and like Smokin’ Joe I don’t miss the dry cleaners :-)
I found the arragonce of city folk amazing. Not a one of them had an idea that they would starve if the country types didn’t raise their crops and sell them to the food vendors. They actually believe in the food fairy. They complain about the “inconvenience” of living in the country, but spend hours every day fighting traffic to access all those “conveniences”.
Not the life style for me.
So only those willing to live an agrarian life style should live in the country and modern agriculture only requires about 2% of the population. You also expect all city workers to be city dwellers. Are you planning on using the power of government to force people to behave as you see fit?
Your feverish ramblings leave out a significant portion of the population, many of whom you've pointed out are unfit to live in the country and unwanted in the city. Are you advocating genocide?
I’m going to call BS on an apples to oranges comparison if those are based on city boundaries and not MSAs or some such.
Cincy only includes the central city, as the suburbs are other municipalities. LA is a large city that includes many of its own “suburbs” within the city limits.
Not that I think Cincy is all that great, mind you. If not for the events of 9/11, the Cincy black riots of April 2001 should have sparked a big backlash against the race hustlers.
Hard wood floors cost more than wall-to-wall carpet, thus your tax assessment is increased.
That would literally cost $4 million in the SF Bay Area (where I live)—can’t afford that!—but it sounds beautiful! Sounds like your girlfriend should spend more time at your place!
I love fruit trees! We have 9 different ones. . .
With respect, this is not quite correct.
If you are self employed, the Social Security tax paid was seven percent in the '70s, eight percent in the early '80s, and about twelve percent since then.
If you worked for a salary, the maximum rate was (approximately) five percent in the '70s and slightly over six percent since then. You really can't count the employer contributions, as absent the SS program there is no way to know whether those funds would have been added to your take home pay or not.
Without knowing your income history over the last couple of decades, it would be impossible to know whether those SS taxes would have grown into a multi-million sum or not. But most people do tend to overestimate the total amount paid by them into SS and Medicare (even considering investing those funds at a conservative rate) by comparison with the amount they have received., or actuarially are scheduled to receive.
Are you paying tax dollars for your own destruction?
“Oculus” is definitely wack, but I can’t deny that suburbanites spreading into what were once conservative rural areas have brought taxes and liberalism with them in a big way. I’ve personally seen it happen more than once.
Thirty years ago, tiny Galveston opted out of the entire Social Security system for its county employees and introduced private accounts.
It was the brainchild of a county judge, Ray Holbrook, and a few other officials, who took a good look at the parlous state of Social Security in the late 1970s and came up with an "Alternate Plan" of privately managed personal accounts they believed would outperform the public model. An opt-out clause in the original 1935 law (since shut) let them try something different.
How did they do? Three decades later, Galveston County employees take home pensions with nearly a 7% average annual return compounded over 30 years.
By contrast, Social Security recipients get a 1% to 2% return and newer workers will get even less. So Galveston's retirement checks are about four times the size of Social Security and come with life insurance, too.
I have been wondering about the McMansions all along. In some of the towns here (NE PA), some of the big old sprawling Victorian homes were repurposed as multifamily housing with two or three appartments in them. I suspect that McMansions will have a similar future.
Since your least precise figure, population, has approx. one digit of accuracy, then your result should be expressed as “30 feet by 30 feet”.
Actually, I pulled the numbers off the historical Social Security document that I referenced earlier and created a spreadsheet. I started from 1966 and went through 2005 (forty years) and used the assumption that for every year worked you maxed out the contribution amount, and I used the actual S&P market returns for those years. The results will probably surprise you:
Forty years of the employee-only contribution totals: $900,339.14
Forty years of the self-employed contribution totals: $1,460,193.64
Let's pretend that you were able to find a guaranteed return that held constant for each of those forty years. What would the "modest interest" rate need to be in order for you to have "several millions?" (I used $2,000,000 as the target):
Forty years of employee-only contributions: 15.67%
Forty years of the self-employed contribution: 13.49%
Getting that kind of return year-in and year-out is pretty unlikely. And keep in mind that I assumed you maxed out your contributions each and every year for those forty years.
Summary: Sure you got screwed by the Social Security scam, but not as bad as you think. Pity the 25 year-old who's return can't possibly be in the positive territory.
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