Q&A: Housing Bubble Blogger – Newsweek Business – MSNBC.com
But something about the mania just didn’t sit right with Ben Jones. The Texas native learned a hard lesson in the 1980s, when the savings and loan scandal hit and real estate slumped just as he was preparing for a career in the property market. “I jumped in at the worst possible time,” the 42-year-old recalled from his home in Sedona, Arizona. That experience, coupled with a background in corporate accounting, made him wary of highflying markets, so when he saw housing appreciations rocket up and mortgage-lending restrictions sink low, Jones decided that this was a housing bubble, and he was going to warn his friends.

At first Jones just sent his cautionary data and news bites by email, but after a couple of months, he found blogging was a better way to get the word out. The blog, www.thehousingbubbleblog.com, quickly evolved into an information supercenter for real estate addicts. Jones posts news stories economic data, and analysts’ reports on the housing market (often minutes after their release), then lets his many contributors loose to offer their own analysis and rebuttals.

In early 2005, Jones was one of a handful of bloggers raising the red flag about real estate prices amid a sea of industry pom poms. Now it seems that even realtors are talking about a “cooling”—if not a bursting of the bubble—as prices sag and interest rates rise. Meanwhile, Jones’ blog, one of many on the subject, has grown to 85,000 readers a month. NEWSWEEK’s Kathy Jones (no relation) talked to the real estate seer about the power of collaborative blogging and why some readers use his site as an anonymous confessional.

Congrats to Ben Jones for making Newsweek. Does that mean that the bubble is now officially over?

The Housing Bubble Blog » ‘The Unstoppable Ascent Has Stopped’ In San Diego
“San Diego had the wildest run-up among major California cities. The boom was stoked by cheap loans, changes in tax law, creative financing and a generalized mania that fed upon itself. The market also began to fade first in San Diego. Whatever happens here, optimists and pessimists agree, will happen later in the rest of the state.”

“At a sales office in the Ocean Beach neighborhood, broker David Davis said the market had already bottomed out. ‘Our No. 1 industry is now tourism,’ Davis said. ‘Unless they take away the sun, we’ll be fine.’”

“If Davis radiates cheer, the fliers taped to the window outside the office door tell a different story. ‘Huge Price Reduction,’ one says. Another says both ‘Reduced’ and ‘$15,000 Credit.’”

“In some cases, the prices are dropping faster than the fliers can be reprinted. A two-bedroom town home has its price of $324,900 crossed out with a marking pen, replaced by $309,900. Another house, a four-bedroom in suburban La Mesa, has a printed price of $575,000. Below that is handwritten $549,000. Scribbled below that is a new minimum: $499,000.”

This will never happen in the Bay Area. Two reasons:

1) The Bay Area is special.

2) They’re not making any more land.

The Housing Bubble Blog » ‘Own A California Home With 600 Easy Payments!’
“You, too, can own a home in California, with 600 easy monthly payments! Just get a 50-year mortgage! With any luck, you’ll have paid it off before you die!”

“The 50-year mortgage won’t keep monthly payments very low because it’s not really a 50-year mortgage at all. It’s an adjustable-rate mortgage with a 50-year amortization (meaning it’s paid off after 50 years). The interest rate is fixed for the first five years, then moves up or down thereafter, meaning the monthly payment fluctuates as well.”

“‘The monthly payment on the 50-year mortgage would actually be higher than it would be on the 40-year, because the (higher) interest rate overwhelms the (longer) term,’ Kieth Gumbinger explains. Someone who takes out a 50-year, $300,000 mortgage will repay $300,000 in principal and $714,000 in interest over the life of the loan. That compares to $382,000 in interest for a 30-year fixed-rate loan, and $543,000 in interest for a 40-year fixed-rate.”

Wow… that’s a lot of interest payment! But you have to do what you can to buy a place in the Best Place On Earth(TM).

The Housing Bubble Blog
“Jamie Granada, a real-estate agent in Stockton, is relatively new to the field, launching her new career in January. ‘Now you actually have to work hard to sell,’ she said. ‘It’s to my advantage to be new.’ Buyers know it’s a buyer’s market, she said. ‘They’re in the looky-loo mood, trying to see what kind of deal they can get,’ she said.”

“Dale Gray, CEO for the Central Valley Association of Realtors, said that not only are most sellers shocked by this slower market, so are many real-estate agents. ‘You can’t just throw in on the wall and know you’ll get multiple offers in a few days,’ he said.”

Wow, I bet these people had their reality totally shattered. What? Selling a house means actually doing work to get paid?

Will Real Estate Agents start to have bumper stickers that say “Please, just one more bubble!” as well?