On My Own

As I mentioned before, I am living at home at the age of 28. That's expected in a traditional Chinese family. I didn't realize just how traditional my parents were until I brought up my goal of saving money to buy a house for myself which engendered no words of encouragement. Instead, they said, "You're stupid. Don't expect us to help you. Even if we had the money, we wouldn't because buying a house is reserved for when you find a husband and want to get married."

I was shocked to say the least. I never expected my parents to help me financially. They are of modest means with my youngest sister still in college at a UC. However, the least I expected was emotional support. What about feeling pride that their daughter is taking responsibility for her own future? That she's making an adult decision?

This illustrates one again the chasm that exists between traditional Chinese culture and the American way. When I moved out at the age of 25 into my own apartment, my parents were upset. My dad did not speak to me for 6 months. When I told my boss, who's Caucasian, he thought their reaction was quite odd. He flipped cartwheels when his children moved out.

In some ways, my parents are surprisingly modern. They know their way around BitComet and want personalized ringtones on their cell phones, unlike many of their peers. In other ways, they are still "stuck in the mud". Like paying for a $18, 353 new car, embarrassingly, all in cash. They are not the stereotypical Chinese parents, never pushing us kids to become doctors, lawyers or play piano, only to do well in school and become an upstanding member of the workforce. On the other hand, they adhere to the old ways, especially concerning gender roles.

When it comes down to it, they object to me buying a house by myself because I'm female. In their way of thinking, a man should provide for me and it's silly for me to provide for myself. This is incomprehensible to me and, frankly, unacceptable. This is just another piece of the yoke I'm slaving off on my personal journey of independence. Sigh, it's tough to be the eldest daughter of first generation immigrants. I'm paving the road for my younger sisters and breaking my parents in for them. Lucky dogs. If and when my sisters decide to buy on their own, I bet my parents will barely bat an eye.

In light of my parents' revelation, I'm cutting up my credit cards and resolve to be less generous with my spending. I can't count on anyone but myself to achieve the dream of a house all my own.

I love reading the Wall Street Journal. Their articles are well researched and present more in-depth analysis than any other paper. The Sacramento Bee lately has run almost daily articles on the real estate meltdown, but really is a rehash of the various news bits out there with a few sob stories thrown in. This WSJ story is something different. (I found a reprint on ajc.com to circumvent the subscription wall.)

On the front lines of the great American mortgage workout, tens of thousands of borrowers are in trouble and looking for relief. Washington has offered advice about what lenders should do, and influential groups that counsel low-income borrowers are ratcheting up pressure on Citigroup and others to offer struggling homeowners more favorable terms on their existing loans — even borrowers whose finances seem hopeless.

In many ways, the pressures Citigroup faces mirror those on other mortgage servicers, whose job it is to collect monthly payments and pass them on to mortgage investors. Servicers are responsible for protecting the financial interests of those investors. But they also have become targets for criticism that the mortgage industry isn't doing enough to clean up problems arising from years of careless lending to subprime borrowers with shaky credit.

Citigroup, however, may have a bigger mess on its hands than many. In September, as the U.S. housing crisis deepened, it bought servicing rights to a problematic $45 billion mortgage portfolio. It announced a commitment to "help distressed borrowers remain in their homes," working with Acorn Housing Corp., a nonprofit group that counsels low- and moderate-income home buyers. But with 46,000 borrowers already in default, Citigroup is struggling with the magnitude of the portfolio's problems, and its relations with Acorn are fraying.

Taking Stock

It's time to take stock as the housing market tanks. Here are some updates on houses I've been watching.

7191 Havenside Drive

MLS #: 70099271

Asking Price: $317,500

Previous Asking price: $335,000 (July 2007)

Price Cut: $17,500 (-5.22%)

This was a halfplex I visted with a friend during an open house and I ranted on this blog about the overwhelming scent candles the agent used to drive us out the door. Well, it seems like it worked. An article in the Sacramento Bee featured its owner who, based on Money Magazine's designating Holland, Michigan as one of thebest places to live, decided to sell her home and leave Sacatomato. Looks like she ain't leaving anytime soon.

7030 Havenhurst Drive
MLS #: 70043176 (Pending)
Asking Price: $269,000
Previous Asking price: $299,000 (June 2007)
Price Cut: $30,000 (-10%)

I looked at this halfplex the same day as the one above. By July, the price had dropped to $285K, which seemed like a pretty good deal per square foot compared to what was on the market at the time. But, the home was dark and dank with a tiny, tiny backyard.

7444 Spicewood Dr. (Update)
MLS #: 70100557
Asking Price: $289,000
Previous Asking Price: $309,000
Price Cut: Still not enough

I've always thought that this house was cute. Seemed well-kept and in a good location near the Bel-Air shopping center where I used to live when I rented in the Pocket. When this house went into pending a few months ago, I thought, "Who's the crazy person paying over $300K for 982 square feet?" Looks like nobody was that crazy. The seller really isn't trying to sell his/her house now, are they?

799 Crestwater Lane
MLS: Sold 9/27/2007
Asking Price: $239,000
Old Asking Price: $275,000
Price Cut: $36,000 (-13%)

This is a nice 2/2 1201 sq/ft condo. It had high ceilings, nice detail and spacious rooms. The only bad thing was the separate kitchen. It finally sold, after a $36,000 reduction, selling for less than $200 a sq/ft. I think it might have been listed at a higher asking price at one time too but I'm not sure. It's been so long since it first went on the market. I definitely remember the $275,000 price tag though and the chase down to the bottom. At one time, I thought, "If it goes down to $250K, I'll take a look." Then the market soured, my interest waned. Next thing I know, it's sold at at what is not a bad price for the area. I'll take it as good tidings.

Another interesting sign of the times is dearth of applications for a recent job opening at my work place. I was screening the candidates and over half of them were loan officers, mortgage brokers and real estate agents. Good luck to all of them. Posting an opening for a stable job is like throwing a bone to a den of hungry lions.

Bailout Talk

I'm disenchanted right now with the whole housing scenario, thus the silence. As housing bloggers know well, President Bush announced a program to help homeowners last Friday. Ostentatiously called a "lending hand," it really is a soft bailout. Here are some interesting viewpoints on the plan:

Is America really pro-bailout? Los Angeles Times - According to a recent Fox News poll conducted by Opinion Dynamics, there's 70% opposition to a taxpayer sub-prime bailout

Major bailout is unlikely on sub-prime mortgages. The Hill - There doesn’t appear to be sufficient appetite in Congress for rescuing borrowers with taxpayer funds. (Damn right there shouldn't be!)

Will Congress bail out lenders? MarketPlace radio segment with Steve Tripoli - What I'm concerned about is that Congress is going to engage in a wholesale bailout, with taxpayers' money, of lenders and borrowers who've made very bad decisions.

Every Penny Counts

It's six months into my saving scheme for a down payment. In taking stock, I realize I've done pretty well. Except this month with the purchase of a new car and attendant costs that have wrecked my budget. I expect to get back into shape in the coming months. I've relinquished both my credit and debit card to my mother for safekeeping. I admit that I'm suffering a bit of fatigue, depressed by the still-high price of real estate in California and the reality of delayed gratification that goes with long-term planning. There was a discussion over at the Sacramento Landing blog about the XY generation and our general lack of wherewithal to save. So, when I read this NY Times article about people my age who worked to save enough for a house payment, in New York no less with little help from parents, it was a dose of encouragement.

When Janey Lee and Pablo Agüero were struggling freelance Web designers, buying an apartment in Manhattan seemed like a dream, one clouded by credit-card debt, student loans that had to be repaid and the bills for their wedding. Their combined salaries of just over $100,000 qualified them for a mortgage, but it took a lot more for them to come up with the down payment. In a city synonymous with luxury and spending, Ms. Lee, 30, and Mr. Agüero, 35, decided to do without. They gave up smoking to cut costs, they stopped meeting friends after work for beers, they didn’t buy new clothes, and they stashed away tax refunds and as much of their earnings as possible. Whenever they wanted to buy drinks, gadgets or cookware, they asked each other: “Do I want an iPod or a house? Do I want a latte or a house?”

Plankton Theory Revisted

Remember some time ago, I referenced Plankton Theory which likened first-time home buyers to plankton, the essential life force of the real estate food chain. Price them out of the market, and a chain reaction suffocates the rest of the market. This Press Enterprise article quote shows that force in action.

“Inland Southern California’s home sales last month were the worst in a decade in Riverside County...We have seen rising foreclosure activity through the year and no sign it is done climbing, and we are now seeing some real steep declines in prices. It is very difficult to say where bottom is,’ said Andrew LePage, analyst for DataQuick."

The news that Forbes ranks Sacramento as the third riskiest housing market in the country - and the riskiest investment in California-quickens my heart. Sacramento's share of adjustable-rate mortgages exceeds 50 percent. Which means that the market has nowhere to go but down.

Window Shopping II

Checked out a few more new build communities last weekend. It's become a rather interesting hobby. The places we checked out included Astoria townhouses by Centex, The Discovery, Sunrise, American collections by Beazer, and the Carriages and Isla del Lago communities by K. Hovnanian. It was a lot of houses in one day. The Astoria townhouses had great curb appeal but no models. We toured a unit under construction though and didn't like the flow. A 1562 sq foot plan 2 bd/2.5 bath went for $309,990 at $198.46 a square foot. The deal breaker, however, is the $340 HOA fee. The Mello Roos of course was also steep but I forgot how much.

Of the Beazer collections, the only one that made an impression was the Discovery collection, new "pull apart" townhouses connected only by the garages. Their website still show them as single-family homes. It was cheaper at $181.75 per sq foot. My friend and I both loved the 1,568 3bd/2bath plan at $284,990. It had a great open floor 1st floor that wowed us at the door and nice sized rooms. The drawbacks were a tiny postage sized yard and an alley garage. With two dogs, I have to have a nice sized yard. Sure, my pookies are toy poodles but they still need to run. The HOA is $83 and the Mello Roos is $120.

The Carriages had horrible floor plans with the kitchen completely separate from the rest of the house and dinky rooms. Isla del Lago was another story. Though halfplexes, the models had huge backyards and represented a good value. The largest plan, the 3bd/3bath San Miguel, could be had for $345,365 for 2100 sq foot, working out to $164 a sq foot. Out of our price range even though the per sq foot price is lower and too large for a single homeowner. But..but..but...that didn't stop us from lusting for all that space. The HOA is $35 and Mello Roos is $138.

It will be interesting to compare these prices in six months. Every builder we questioned said their properties were selling briskly (Beazer's the Landing community is sold out for example) and implied that price was going to go up and inventory down. If I were in the market right now, I'd be tempted to look seriously at the Beazer Discovery townhouses and the Isla del Lago halfplexes. Good for me that I don't have the down payment now and can't be pushed to jump the gun.

Top Ten Signs of an Asian Household

Take these with a grain of salt and a sense of humor. I have to admit, though, that there is some truth to these observations. These apply to my family's house and the homes of most of my Asian friends. You just know walking into a house that it could be owned by an Asian if:

1. In the foyer, there’s an altar to the ancestors. It’s typically red-stained woods with red blinking lights.
2. Open the dishwasher and it’s full of mismatched Tupperware.
3. The backyard is mostly concrete.
4. There’s a gas range outside for cooking.
5. Large winter melons grow in the backyard.
6. The garage can double as a supermarket. Stockpiling is an art.
7. All the walls are white, white, white.
8. The bathroom seems remodeled, but in different styles and shades of tile.
9. Pairs of shoes line the entrance to the house.
10. The property has a gate, fence or some other impediment blocking direct access to the house.

Window Shopping

My best friend and I went window shopping for houses today, visiting several open houses and model homes. We learned a couple of things: new houses show a lot better and are more affordable than a year ago, pictures can't accurately represent a house online and we should definitely wait to make a purchase. The new homes we looked at included Sheldon Farms, Laguna Point Condos and Laguna Oaks condo conversions. Sheldon Farms was the most attractive with nicely laid out one-story plans in the $350,000 range. Still out of the price range of a single girl with a modest income, but still more affordable than a year ago when the same house would have fetched maybe 20K more.

The condos were a cheaper alternative. The two bedroom condo floor plan at Laguna Point had huge rooms and an added walk-in closet for each room, a nice touch. The front door, however, opened directly into a steep staircase up to the second floor. Instinctively, it didn't feel welcoming and was definitely a no-no in feng shui. I don't know many Asians who would buy a home with that layout. The other floor plans at Laguna Point had cramped bedrooms that felt claustrophobic. Laguna Oaks condos were nicely renovated from apartments into condos in the low 220K range. Definitely affordable, but with 216 units to be sold, we didn't feel the rush to purchase one. The salesperson said that the low price was only for the initial offering and may rise as time goes by. I doubt it and will check back in a year to see if it pans out that way.

The open houses we toured were in the Pocket area: three halfplexes and a house. The interesting point is that a halfplex that didn't look that inviting turned out to be our favorite while another halfplex that looked wonderful online was disappointing. It just honed in the fact that one needs to feel the physicality of a space to get a proper sense of whether it's a contender.

Oh, and one more thing we learned. If you want to have a successful open house, don't perfume your house with an overpowering scent. The last open house we visited had an strong odor, a scent candle or something, that practically drove us out at the door.

A Kiwi Perspective on Housing

I chatted over IM with my friend in New Zealand yesterday about housing and gained an international perspective on the housing boom (and bust at least in the U.S.) In Auckland, the price of houses jumped 16% in a year, indicative of a dramatic upward trend for the last five years. The pressure my friend feels to buy in now before the prices rise too much out of her economic reach is eerily reminiscent of the atmosphere in California before the subprime meltdown. The average price of a Kiwi house in June was $557,546 versus the median household income of approximately $51,094, numbers that look positively Los Angelean. This article points out the rapid rise in housing is hardly contained within the U.S and may be closely tied to what happens over here in our neck of the world.

The rise in prices is worrisome because the international housing boom is a byproduct of globalization. The economic links act as a self-reinforcing network that has fueled the global surge in house prices but would also be likely to magnify the pain on the way down. The ripples would extend well beyond the housing markets. A fall in American house prices, for example, would crimp consumer spending - and free-spending Americans have supported growth in many export-minded nations. If house prices drop and American consumers are forced to tighten their belts, buying fewer imports, China and other nations would have to slow their dollar investments, driving interest rates higher and higher. That could hurt housing markets from Paris to Shanghai to Auckland.

Interest Rates to Hold Steady

So, the lazy days of summer have arrived along with the perpensity for vegetation, the human kind. Even as my fevered tracking of the housing market has waned, I'm still keeping an eye on interest and mortgage rates. Merrill Lynch & Co. and Goldman, Sachs & Co. recently announced that they don't expect the Federal Reserve to cut interest rates meaning that the healthy yeilds for money market funds would hold steady at 5.25%. At the same time, however, mortgage rates will likely rise. The average rate on 30-year conventional mortgages nationwide was at a nine-month high of 6.42% last week, up from 6.37% the previous week, according to mortgage finance giant Freddie Mac. I never thought I'd be interested in these types of figures. However, this news has a direct impact on little ole' me. One, I've parked my house down payment savings in a high yield CDs earning more interest than those accounts historically have offered. Second, the higher mortgage rates affect the monthly budget that I can work. Good thing the housing units for the area I'm interested in has begun to fall. Just this week, a house in the Greenhaven area listed for $171.77 per sq foot, the lowest I've seen yet. There is hope, afterall.

The Human Face of Foreclosure

My glee in watching the housing market implode is tempered by stories like this that illustrate the personal costs of subprime lending. Not just investors or even new home buyers are caught in the foreclosure net, but people who have owned their homes for years are also at risk. They have my empathy though I will stop short of advocating government bailout. In the end, responsiblity for debt lies firmly in the person who made the choice to sign their name on the loan forms, regardless of circumstances.

For decades, the 5100 block of West Outer Drive in Detroit has been a model of middle-class home ownership, part of an urban enclave of well-kept Colonial residences and manicured lawns. But on a recent spring day, locals saw something disturbing: dandelions growing wild on several properties.
"When I see dandelions, I worry," says Sylvia Hollifield, an instructor at Michigan State University who has lived on the block for more than 20 years.

Ms. Hollifield's concern is well-founded. Her neighbors are losing interest in their lawns because they're losing their homes -- a result of the recent boom in "subprime" mortgage lending. Over the past several years, seven of the 26 households on the 5100 block have taken out subprime loans, typically aimed at folks with poor or patchy credit.

Buyers a Rare Breed

The Sacramento Bee profiles three buyers who are a rare breed in the softening housing market. Everyday that I see more houses in my price range become available is another day I will wait to buy.

Now that it's done, Joi Bess couldn't be happier about selling her Rancho Cordova house and buying a bigger one in Folsom.She closed escrow in April on the first anniversary of a new marriage and blended family of eight. "It worked, and we're reaping the benefits already in a fantastic house and fantastic area," she says.

In what's proving to be a second straight year of slowed sales and falling prices in many neighborhoods, that closing makes Bess a hero to the Sacramento region's real estate trade. She is a buyer.

All-Time High Prices

Prices are at an all-time high....not for housing, anyway but aluminum cans. Just read this interesting article in the LA Times about the rising value of recycled materials. On Jan. 1, the California redemption value for a 12-ounce bottle or can went up from 4 cents to 5 cents with the average price for a pound for aluminum at $1.55, an all-time high. Whether the amount paid for cans is a pittance or an income stream depends on your perspective.

When I was 10 or 11, it certainly was a great way to get pocket change for snacks. Money was tight and us kids didn’t get allowances. I remember scavenging the flea market garbage cans on the weekends while my parents worked their stall. My dad even made a special pole with the hook at the end so I could really dig in. It’s not exactly a fond memory. The days were really hot, the garbage smelly and the cans sticky and hard to flatten beneath our child sized sneakers. I would have been embarrassed to be seen by any of my classmates or friends. One indelible image that pops up is that of me and my sister, aged ten and five, both with poles and garbage bags in hand standing next to my mother, who had taken a break to find us and was holding my baby sister, a toddler on her hip. A white man with a soda saw us and deliberately made a beeline for us, sidestepping several garbage bins, and placed the can directly in my bag. I wonder if what he saw was a brown family on the edge of poverty. Looking back, I wonder about my parents’ decision to let their ten and five year-old daughters roam around scavenging cans on their own but longer feel shame or embarrassment. It is these long-forgotten memories involving my earliest experiences in how hard it is to earn money that influence how I view money today. My youngest sister who luckily grew up as our family prospered, I feel, has a much more careless attitude toward money. ($100 for a two piece swim suit!!!) She’s has decidedly middle-class tastes while my low-income inner-self consciousness has become more prominent since the home-buying obsession started. I used to roll my eyes when my mother marched into the grocery store to demand a 30 cent price difference after discovering an error on the receipt. Now, I’m right there along with her demanding the same thing.

Bought a New Car

While fighting a very serious bug, I managed to buy a new car--a Honda Fit Sport, one of the new lines of relatively inexpensive subcompact cars with good mileage like the Toyota Yaris. In a word, they are cute. The Honda Fit kind of looks like a little bulldog, short and rounded. Anyway, "raising" a car, as the Chinese idiom goes that likens the cost of a car to the cost of raising a child, will put a kink in my house buying scheme. Car payment, insurance, gas and maintenance will definitely add up as well as the attendant costs in wanting to go out more in my cute new car. Nevertheless, I'm looking forward to when the car arrives in 3 weeks. These cars are in short supply. I vetted 10 dealerships and still had to special order the car at MSRP. One thing I refused to do was to pay the dealership markup.

It may be a combination of being ill (still) and the beginning of summer, but the urgency to buy a home, or at least to track the housing bubble, has faded. What will happen will happen but in the meantime...I got a cool new car!

Not Dead!

I'm not dead, just really sick. =(

Affordable Sac of Tomatoes

According to the California Association of Realtors, Sacramento is the 2nd most afforable area in the state for first time homebuyers. Excuse me if I don't Yippee kai-yay because realtor associations lack credibility (witness the repeated predictions of a bottom/rebound of the real estate market and the $60 million they will spend to convince buyers that now is a good time to hire them) and the minimum qualifying household income for a medianly priced home is still $62,640. The U.S. Census pegs the medium household income of Sacramentans at only $49,894!

The Sacramento region is the second most affordable area in the state for first-time homebuyers, according to a report released Thursday by the California Association of Realtors. In Greater Sacramento, 43 percent of households could afford to buy an entry level home, up from 40 percent last year. The first-time buyer median price was $310,670, with a minimum qualifying income of $62,640. The percentage of households who could afford to buy an entry-level home in California stood at 25 percent in the first quarter, down slightly from 26 percent for the same period a year ago.

Harbinger of Doom

Forbes reports that the Commerce Department reported today that building permits fell 8.9% in April— the worst decline in almost two decades—and is an indication that the real estate market has yet to hit bottom. After reading the interesting posts over at the Dr. Housing Bubble blog, I’m not sure whether I should feel vindicated or depressed. Depressed is more the mood for the day because even though it’s good that home sales prices have slipped in recent months, rather than being isolated, the housing sector meltdown is only a harbinger of impending economic doom. According to various media reports, the housing fiasco is bleeding into other sectors, fewer cars sold, more expensive groceries etc, causing a ripple effect in our economy. Witness the weakened dollar. Ultimately, according to Dr. Housing Bubble, the economy will get worse, possible leading to inflation which means that the money I’m saving for a home purchase may not be able to buy as much even if sales prices drop. It’s not exactly a rosy picture painted.

The drop caught economists by surprise. Many had expected a more modest 3.1% decline. In March, building permits actually increased 1.8% after a large fall in February. The dismal figure underscores the massive correction currently taking place in the housing market, which has been plagued by suprime fallout and inventory gluts this year. Homebuilders, eager to burn through their oversized inventories, are now holding back on new building permits for future construction.

Advice on "Black Mole"

I love reading advice columns, thinking that the more I shore up information, the less intimidating the homebuying process will be. Here's a nice question from Inman Real Estate news about "black moles" that keep coming back. It brings up creepy images like a Stephen King novel or an Asian horror flick and also brings up the point that you should know what is included (or not included) in an home inspection. Assuming anything when buying a house could have serious consequences.

Dear Barry,
We bought our home about one year ago. At the time, our home inspector found some minor defects, but nothing was mentioned about black mole. After moving in, we noticed some black stains in the closets. But then the rainy season came, and we found black mole on most of the upstairs walls, especially in the corners. What upsets us most is that the former owners never mentioned a word about black mole. In fact, their disclosure statement said everything was OK. We've tried washing the mole off, but it just returns. What can we do legally, and how do we get rid of the mole? --Renee

Dear Renee,
Mold (not "mole") has been widely publicized as a significant health hazard and should have been disclosed by the sellers, assuming that they were aware of it. Your discovery immediately after closing escrow indicates that they should have known. If they deny knowledge of any mold infection, you would have to prove that they knew about it, and that could be very difficult. Mold disclosure is generally regarded as outside the scope of a professional home inspection and is routinely disclaimed in most home-inspection contracts. However, when evidence of mold is unavoidably visible on exposed surfaces, failure to make some manner of disclosure is hardly justifiable for a competent home inspector. The least an inspector could say would be, "Black stains noted on upstairs walls. A professional mold survey is recommended." The growth of mold is caused by excessive moisture conditions, often accompanied by a lack of adequate ventilation. What you presently see on wall surfaces may be an indication of additional mold within the wall and ceiling cavities. Therefore, mere cleaning is not the way to resolve the problem. To determine the extent of the mold
infection in your home, have a mold survey performed by a qualified professional.

Realtor's Six Percent

Well, the wireless connection didn't last but I still have access to the Internet via the family computer. 60 Minutes did a segment questioning whether the six percent commission for Realtors is still needed. Hey, I'm all for paying Realtors if they put an equal amount of time and effort to earn their thousands of dollars worth of commission.

For realtors, the six percent commission is sacrosanct. It's remained in place, even as the price of homes has quadrupled over the past 25 years.

But as correspondent Lesley Stahl reports, things are beginning to change. What happened to travel agents, stock brokers and book sellers – the encroachment of the Internet – is beginning to affect real estate agents. And the sacred six percent is under assault from online discounters.

Dream House Sold?

Making the most of my iffy wireless connection, I offer one more post for the day to make up for recent inactivity. (If it keeps up, I'll be much more active blogging from the comfort of my humble abode)

A house that I've been monitoring on MLS went into a pending sale recently. I'm sad because this well could have been my dream house! It was the right price, was in a good location, had 2 bed, 2bath, big yard, 1,300 sq feet and looked very well-kept. Now I'm lamenting that I wasn't ready to buy yet. Sometimes I think lurking on MLS is bad because it feeds my house lust. My motto in my head of "Wait, waaaiittt" is drowned out by the impulse to buy now. Good thing that a financial barrier of actually having very little money keeps my big eyes in check.

My NetWorth IQ

I stumbled upon this site for tracking one's net worth at My Networth IQ.

The idea behind it is that its a personal finance social network hybrid. People can not only track their net worth but also share the information with their friends/strangers on the Internet. I'm not sure how prudent that is (again, the paranoia) but it's an interesting idea. I've signed up for an account but am keeping the information from the public for now.

You can peek at my net worth . According to CNN Money, there is a disparity between what my net worth should be according to my age and income bracket. Average adults under 30 have a net worth under $5,000. I'm way ahead there. However, for my income bracket, I should have much more net worth in the 100K range. Looks like I have a lot to go.

Bailout for Borrowers

New York Senator Chuck Schumer is urging Congress to spend $300 million of taxpayer money on counseling and outreach for homeowners facing foreclosure. That doesn't sit right with me as this action circumvents the notion of personal responsibility. Nobody forced these borrowers or lenders to engage in activities leading to this market crash. New Century just announced the termination of 2,000 employees. There has to be consequences in order to exact change. Carol Lloyd of the San Francisco chronicle sums it up succinctly in a recent column on the notion of a short sale where debt forgiveness is a "win-win" situation.

It's a weird facet of American society, which better rewards those who try to live the American dream and fail miserably than those who live within their means. In the end, those left carrying a fat debt, bad credit scores and lingering regrets are as much a mirror of our system as all the happy homeowners who make their mortgage payments month after month.

Monkey Reaching for Branches

A free Wall Street Journal column called "Why What You Have is Never Enough" examines the transient nature of happiness and why Americans are complelled to get a bigger house, a better job and still are unsatisfied. It reminds me of an ex who disapproved of me applying for a better paying job within 6 months of landing a new job. He described me as a monkey constantly reaching for another branch even before settling the one I just landed in. True, some of the insights in the article resonates but that is not going to stop me from realizing my ambition of home ownership. I'm not there yet so I HAVE to be the monkey continuing to swing from branch to branch.

We may have life and liberty. But the pursuit of happiness isn't going so well. As a country, we are richer than ever. Yet surveys show that Americans are no happier than they were 30 years ago. The key problem: We aren't very good at figuring out what will make us happy. We constantly hanker after fancier cars and fatter paychecks -- and, initially, such things boost our happiness. But the glow of satisfaction quickly fades and soon we're yearning for something else.

This Interactive House Value map shows whether house values are overvalued based on historical data. Statistically normal house values are determined with consideration to house prices, interest rates, household incomes, population densities, and historical premiums or discounts paid to live in certain areas over time.

In Debt We Trust

Last night I watched most of a documentary newly released on DVD called "In Debt We Trust" which examines the credit card industry and the consumerist culture it encourages, leading to crushing debt for millions of Americans. While interesting, I found the documentary heavy-handed and a bit overbearing. Felt more like a 20/20 episode rather than a documentary. It places the blame of consumer debt squarely on the shoulders of the credit card industry but rarely mentions consumer responsiblity to stop spending. Also, the film draws a comparison between buying a house/real estate and modern day serfdom because the mortgage turns us into slaves to credit for 30 years. Ouch!

With things not going so well for them lately on other fronts, Republican politicos have taken to emphasizing a hale U.S. economy -- though that is something few Americans feel in their own pocketbooks. Some reasons for those clashing perceptions are explored in vet documentarian Danny Schechter's "In Debt We Trust," which portrays a nation hobbled and preyed upon by credit card companies and other lenders. When this borrowed-money bubble bursts, he suggests, another Great Depression could arrive.

I'm a Plankton!

I love this LA Land blog post that likens first time homebuyers to plankton--seemingly small and insignificant but essential to the health of the whole real estate ecoystem. Price the plankton out of the market and everyone suffers.

Plankton, of course, are almost microscopic organisms that serve as food for higher life forms. Without plankton almost every fish and mammal in the sea could not survive, since most species depend upon other fish for their existence and plankton are the initial building blocks of the entire process. In the case of real estate, the plankton would be the first-time buyer (perhaps a young married couple) with a desire to own their own home but with very little capital to carry it off. When the time comes that they can’t pull it off – either through an inability to come up with a down payment, or to service the monthly mortgage – then the ‘plankton’ would disappear and the rapid escalation in housing prices would ease as well.

Dogs, Retirement and Foreclosure

One of my favorite places to lurk is the New York Times. In particular, the Real Estate section offers interesting articles on what renters, homebuyers in highly urbanized areas must contend with for access to limited space. Sure, California’s home values are high but rent is manageable and our dogs typically don’t have to go through the interview process to rent an apartment as this article illustrates. I am very glad I’m not a New Yorker. I don’t think I can deal with rats and high rents at the same time. Plus, my unruly dogs probably wouldn’t pass the co-op board test.

Scott Burns’ new column on retirement realities is a good read. Summary: Americans don’t save enough and have overly optimistic expectations. Although saving for a house is a top priority, the need to put money away for the future also pulls at the purse strings. I’d rather pay the piper today when I’m young and healthy than later when I’m 80.

If there is a mythical god in charge of retirement, it would have to be Janus. Best known as the Roman god with two faces – one looking forward, one back – Janus was the master of beginnings and endings.

You and I see this every month in magazines: advertisements for luxurious retirement condos in Florida and Arizona, world-girdling cruises and mind-boggling automobiles being enjoyed by energetic silver-haired seniors.

Editorial content looks the other way. It warns us of dementia, incipient poverty and the inevitability of long-term care.

Is it possible that retirement – for most people most of the time – is somewhere in between?

The LA Times also had an interesting story today about a newbie trying to buy a foreclosed home. The auction arena is competitive with seasoned professionals who make a living off buying foreclosed homes. The process sure sounds intimidating.

Many see trouble in falling home prices and rising foreclosures. Karen Krynen sees opportunity. So after dropping her two children off at preschool one day last month, Krynen headed for Los Angeles County Superior Court in Norwalk, where foreclosed houses were being auctioned on the steps outside.

Past Due

PBS aired a very interesting segment called Past Due and Pay Day about the housing bubble and homeowners who borrowed with interest-only loans. They caught up with people who bought at the height of the Northern California market in 2005. Some are floundering and some are in default. Too sad, too bad but taxpayers should not footing the bill for these mistakes. Funny that in response to recent legislation to create a fund to help people in mortgage trouble, the Sacramento Business Journal created a poll to ask if the government should get people out of the housing bubble mess. When I voted, the results were 100% NO. Let's hope the legislators get the idea loud and clear.

The Pull of Haley's Comet

So, here I am back again after a lapse induced by too much TV. A while ago, I watched a Cold Case episode that stopped me in my tracks and prompted a deletion of some posts on this blog. So what does Cold Case have to do with my personal quest to own a home? Wellll…this Cold Case episode was about a middle class family with 100k in Bonds. The mother of the family tells her sister about the bonds in case anything happened to the couple, thinking the sister can use the money to take care of their only son. The sister, however, is married to a low-life heroin addict. He finds out about the 100K, kidnaps the kid for ransom, chickens out once the police get involved and ends up selling his nephew to a pedophile. Cue the tears: the boy dies trying to escape by swimming across a harbor. The tragic course of events initiated from an innocuous disclosure of wealth scared the beejuses out of me and triggered a bad case of paranoia. (Yes, I am one of those people highly susceptible to advertising and horror movies. Abandoned VCRs after the Ring)

I don’t even have that kind of money or kids or have sisters married to junkies but the episode struck such a chord that I immediately deleted the majority of the blog entries referring to my personal wealth (or lack thereof). In my Asian family, we are naturally reticent about money matters anyway so the TV episode just exposed my worst fears.

My original intent was to abandon this blog altogether until I had safely bought a house but I keep getting pulled back, kind of like the gravitational force of Haley’s comet. Let’s hope I post more than once in 70 years now. =P

A Town bulit on Subprime Loans

This article just drums home the point that borrowing more than you afford is a risky business, not just for you but your neighbors as well.

A town right on the default line

Pi Day and Free Wall Street Journal Access

FYI: Today is Pi Day (No, not Pie as in Apple but Pi as in the infinity number that people like to recite to show they are smart). Also, the Wall Street Journal Online site is Free today.

Survey on workers living paycheck to paycheck:

http://bostonworks.boston.com/news/articles/2007/03/12/many_us_workers_live_paycheck_to_paycheck_survey/
So sad that more women than men can't live comfortably on their earnings and don't save as much. Do you live paycheck to paycheck? I do, but by choice and a very stringent savings plan.

Lessons a SFH learns at a home workshop: http://www.twincities.com/mld/twincities/living/special_packages/single_female_homeowner/16895105.htm
This is a new column I discovered that is about the viewpoint of one single female homeowner on the East coast.

Living in an Amsterdam Canal House: http://www.nytimes.com/2007/03/14/realestate/greathomes/14GH-2NDSUBAmsterdam.html?_r=1&ref=realestate&oref=slogin
It's always fun to see what kinds of home other people live in even though it might not be to everyone's taste.

Subprime Lending May Hit Capital: http://www.sacbee.com/103/story/137592.html
The old sacatomato isn't immune either.

Closing on a House, a Life Story Told in Art: http://www.nytimes.com/2007/03/14/nyregion/14artist.html?ref=nyregion
A pair of investors buy a house to renovate and gets a house full of art left behind by a previous owner. As said before, a house is not just a building, it's a home with pieces of people inside.

A subprime borrower's tale: http://money.cnn.com/2007/03/14/magazines/fortune/sanon.fortune/index.htm?postversion=2007031411
A personal tale of woe puts a qualitive face to the market's decline.

Back from the brink, poor no more: http://articles.moneycentral.msn.com/SavingandDebt/LearnToBudget/AmIPoorNotAnymore.aspx
Yay. I love happy endings about people in debt.

Buy Me: High Grunge

Another episode of HGTV's Buy Me, another lesson learned: never, never ever buy a new house without having sold your old one. Well, actually two lessons; Don't hire a friend for an agent either.

In this episode, spacey couple Sonya and Allan's hired their agent friend to sell their house full of cracks, clutter and an over-the-top Grecian-style bathroom before they go bankrupt paying for two houses. They impulsively bought a new dream home before selling their house in the city and can't make both mortgage payments. Now, six months later, they faced foreclosure. Desperate to sell, they weren't too happy with their agent/friend Perry who didn't even show up to several open houses. In the end, they accepted a low offer of $340,000. Had they not been in a number crunch, who knew what the house would have fetched?

Renovations gone overboard

So, I wasn't able to catch the first day of Buy Me's Budget Breaker's Week due to a propensity to nap. I did catch the second day though titled "Revamping for a Sale" about a woman who originally bought a Georgian style house but poured in a whopping $380,000 worth of renovations to update it to compete with new construction that was going up across the street. She enlisted her sister as an agent. I think her sister hates her because she kept insisting on spending money to update the building, building dormers to make the house look bigger, knocking down the front living space wall for a more open living space, which turned out to be a big mistake. Even after $30,000 more in renovations, the house still didn't sell even after listing at $875,000 - a $75,000 loss. This really opened my eyes up to the fact that a house is a home, yes, but it also is an investement. Going overboard in renovations can really hurt you in the resale market.

HGTV Budget Breakers Buy Me

Been busy these past few weeks. Work is heating up and I've been involved in my hobby as a translator of manga. This weekend, though, I discovered HGTV. It's always been there on the dish but funny, I'd never actually seen a show. Once I did, however, I am hooked. Spent the whole weekend glued to HGTV watching home makeovers and real estate shows. Yeah, its that obsessive-compulsive side rearing its ugly head. This Monday, HGTV startes a special theme call "Budget Breakers" about people who use their homes to get out of debt. I will tune in because it's interesting. Besides, nothing else much to watch on Mondays. Better than Wife Swap.

Listening to the Voices in Your Head

So, my nucleus accumbens and insula, according to this NY Times article here, are responsible for the glut on my Mastercard bill. Who knew?

Last year, after surveying shoppers’ passions, behavioral economists at Carnegie Mellon University developed what they call the Tightwad-Spendthrift scale.
But this kind of survey reveals only what shoppers choose to confess. To find out more, the economists teamed with psychologists at Stanford to turn an M.R.I. machine into a shopping mall. They gave each experimental subject $40 in cash and offered the chance to buy dozens of gadgets, appliances, books, DVDs and assorted tchotchkes. Lying inside the scanner, first you’d see a picture of a product. Next you’d see its price, which was about 75 percent below retail. Then you’d choose whether or not you’d like a chance to buy it. Afterward, the researchers randomly chose a couple of items from their mall, and if you had said yes to either one, you bought it; otherwise you went home with the cash. The good news, for behavioral science, was that the researchers saw telltale patterns, which they report in the Jan. 4 issue of the journal Neuron.

Don't Hold Your Wee for a Wii

This NY Times piece "Too High a Price" speaks for itself. My family has a Nintendo Wii. We got it off Craig's List in a covert operation involving secret handshakes, paranoia and cover-ups and the system sure is fun. However, it's not worth a life.

CNN Says I can afford Ohio, not California

Here's an morbid CNN article about the declining affordability of housing for Americans.

"An annual income of about $85,000 is needed to afford median-priced homes; salaries have not seen modest gains, according to a study. In the New York metropolitan area, a $500,000 median-priced home required a $171,000 annual salary. The median-priced home in San Francisco, the most expensive U.S. market, was $759,000, requiring income of $260,000. In less-expensive Chicago, the median-priced home cost $254,000, requiring an $87,000 salary.
On the opposite end of the spectrum, Mansfield, Ohio, homes cost a median $85,000, requiring $29,118 in income."

Geez Louis. It seems like I can afford to live in Ohio. I like corn but not that much.

Give More Than You Can

Giving more than you can really isn't the way to get rich. In fact, its the opposite. Living on a strict budget of $15 for the rest of the month, I just gave away $11 of that grand sum. Don't ask me why I'm on such a strict budget. It's a tale for the weekly postings. Anyhow, I met a older guy on the light rail last night and he ran through a long story about him being a Veteran whose check hadn't come in and that he'd already gotten two light rail tickets and really needed to get home and he already had a dollar, could I spare 75 cents? I was telling the truth when I said I didn't carry cash. I somehow discovered 75 cents at the bottom of my bag and sent him on his merry way. Hope he didn't spend it on booze instead.

I usually never just hand money out to people who ask. However, I've been stranded before with no money and th fact that he had half of the amount needed worked in his favor. The rest of the $10 I handed over to our company's Foodlink drive. I just hadn't gotten around to donating and the deadline is today. And, the fact that I was one of the food drive coordinators made it embarassing that I hadn't added to the pot. In my defense, I was roped into the job on my first day here at my new job because nobody else wanted to do it. I remember being poor and getting canned food from charity. Lots of V8, corn, tomato soup and beans.

The Seed of Want

I can pinpoint the exact moment when I began lusting after a house of my own. After much screaming, angst and anger, my boyfriend and I had just broken up for the third time that year. Drowning in the tail end of our seven-year relationship, we took the next logical step: we got engaged and began house hunting. It made a crazy sort of sense at the time that a 30-year financial commitment built around brick and mortar would bind us together in a way that love and stardust couldn’t. I know. Don’t ask me what the hell I was thinking.

In 2005, the real estate market in California was hot, really hot. Houses, even Psycho-vibe ones with a body in backyard and REDRUM scrawled on the walls, were commanding top dollar as long as it had at least two bedrooms and a working bathroom, vengeful ghostly presence optional. The interest rate was low, Adjusted Rate Mortgages (ARM) offered easy affordability and new construction was popping up like resurgent daises after a heavy snow. You would think that after the heady days of the tech boom and bust in the early 2000s, Californians would have learned to exercise caution. If everybody plus their grandmother and Strudel the bichon-fritz wants to get in on the game, the Titantic is more than likely due for a rendezvous with an big, market chilling popsicle. But, the thing is, Californians are suckers; we believe in magic. Proximity to Hollywood and near constant sun brings a propensity for goofy, contagious, completely unfounded optimism. How else to explain the re-election of our Govenator?

I was ambivalent about home ownership even though I was 26, had no debt and was vested in my job at a high-flying Public Affairs firm. Raised in a culture where a female child didn’t leave home until she married, the concept simply never entered my mind. I’d only barely begun to question tradition by moving out to an apartment of my own when I turned 25. (I’d stayed close to home for college) My parents didn’t speak to me for a year and still refer to the decision as the Aiya-Disgraceful-American-Daughter-Bring- Shame-to-Ancestors incident. Really.

M. and I had a great time looking at a half-dozen houses. I was intrigued not with the houses themselves but with the staged décor. They all looked like budget Martha Stewart on Prozac. People actually decorate powder rooms and make striped orange paint work? Who would have thunk? But, it still didn’t inspire me to part with close to half a mil. Until, that is, I saw the one house that made me go all gooey.

It was a two-story sandstone colored house built with soaring ceilings, rounded archways, a ridiculously spacious master bedroom suite and a gorgeous tiled bathroom with a whirlpool hot tub. Oh Lordy, the bathroom alone made my knees weak. The house was also full of secret nooks and crannies, unexpected, whimsical space that made you want to linger to enjoy the surprise and go around the corner to find the next discovery all at the same time. I fell deep in unexplainable, rushing-to-your-head, put-your-head-between-your-knees, Romeo-and-Juliet type love.

I purred in M’s ear, “This house is so sexy.” He looked at me with wide eyes, not fully comprehending. I’m usually the demure Asian girlfriend stereotype. I pushed M down on the master bedroom bed which, of course, was a sham display frame that almost collapsed under his weight. “I want to jump your bones. Right N.O.W,” I said throatily.

He drove us home very, very fast.

We didn’t buy the house. Our relationship came to its inevitable end just as the real estate bubble burst. I’m lucky that I wasn’t burdened with an inflated mortgage and a disgruntled man at the same time. But, the seed of want was definitely planted. The desire gnaws at me like a dog niggling at a bone.

This is the chronicle of my journey to become a single female with house.

Some women are stimulated by hormones, food, Prada, whatever. I salivate at the thought of an affordable, 3 bed/2 bath with hot tub. I’m weird but also one of the new women of this age. World, watch out.