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?