bostonbubble.com

[john p]

Nick BP, I have my "Neuman" moments, (the guy on Seinfeld.....) Sometimes the knucklehead gets past my filter....

Anyway, what I mean is that people do their financial planning based on an economic context. If that context changes, it hurts people who have been playing by the rules. He claims that the "rules" aren't "fair", which basically means he wants more wealth to flow to people that aren't getting it currently.

That sounds great, right. Well my wife and I can't refinance because the banks are using "Zillow" to evaluate my house and my Loan to Value is preventing me from getting an opportunity to refinance. So think about this "Stimulus" was meant to help people that were hurt by this global meltdown. If you recently purchased, most likely you can't get the medicine that is being administered; so who benefits? The people that either bought before the bubble, who don't need the help, and the people that are buying now, who also don't need the help. The cherry on the top is that my wife and I have to pay higher taxes on top of it.

Add this to the list of insults, why can the banks use zillow but my town assessor use a figure 100,000 f-ing dollars more to base my taxes? The difference is about 1,300 dollars more in taxes if I paid taxes based on Zillow.... I am getting totally screwed six ways to Sunday. The banks get Stimulus dollars and are told to lend and they're using "Zillow", what the f..ck. And the local government can use their own basis? The State Government makes sure that the state workers get their pension, but the private sector gets their 401k's crushed and have to pay more taxes to replenish the pension fund's losses. When I was living in a rathole apartment for years saving my money nobody was giving me their wealth and I never asked for it. I built my own and now I'm having it taken from me through commuter rail fee increases, property taxes, income taxes, and I can't even refinance like everyone else. If Obama let people who created their own hardships feel the weight of their own stupidity, people like me would be better off.

[JCK]

john,

I recall reading that your assessed value is supposed to reflect the market value. If you home is over-assessed, I think you can have them reassess.

It's probably a pain the ass, but probably better than feeling like you're getting screwed.

[john p]

You're right about having them assess "Market Value", but most towns aren't current because this dropped rather quickly. I mean most comperable homes on the market today have asking prices higher than what I paid, so honestly, I think that my value is closer to the Town's assessment than Zillow.

My issue is that this whole bailout with banks and giving them money to help with mortgages makes the practice of giving mortgages more of public policy as opposed to a private deal between a lender and borrower. If the lenders can choose a basis of evaluation (zillow) that is different than what a town assessor uses, that is a problem in my mind. The distinction between private and public is now grey. If the government never got involved with real estate I would have been much, much better off. First, they allowed the securitization of subprime mortgages which created the toxic investments that sunk our economy, and then they dropped interest rates to help calm the stock market bubble, which in turn created a housing bubble. Then, because they were addicted to borrowing, they kept the cost of capital low when interest rates should have gone which would have lowered prices.

My wife and I are still comfortably living because we planned for what we're dealing with and had a factor of safety built in, it is just frustrating because I'm seeing so many people benefitting from the current situation who were never harmed in any way. I was part of the generation that got the direct hit from this housing bubble and there is no medicine to help us unless we were irresponsible. When the responsible people have to grin and bear it and the irresponsible get bailed out, that causes corrosion in a society.

[john p]

Oh, here's another thing, did anyone notice that if you had a 401k account from an old employer that these employers were cashing you out at the end of the year? I mean was that legal? Don't people who have your money invested in their mutual fund have a fiduciary resonsibility to look after your interest? I mean what was the motivation for these companies to all of a sudden want to cash out your account when the yogurt hit the fan?

There was a lot of stuff going on during this past six months that seems a little shady.

[JCK]

[john p]

The problem was that the government interaction created winners and losers with generations. If you bought more than 8 years ago and caught the lift of the bubble, you got a $200k lift in equity AND now you can refinance to get a historically low rate. The losers are those that came on to the scene during the bubble and you don't have the cushion that others got and you can't get at any stimulus benefit.

I mean it is like watching a referee blow a call and then give a make-up call to the wrong team.

[balor123]

[GenXer]

john p: Something's fishy here.

[balor123]

[balor123]

[balor123]

[john p]

Baylor, I appreciate that you read my posts. I'm putting stuff out there like this because in negotiations people often evaluate their position and the other persons position and what people think is "fair" is typically what they will settle on in a price.

My point is that if I had bought before this Ponzi scheme bubble, I would be able to write it off a little easier, the paper gains.

The whole smiley face line you gave me about people were morons for buying during the bubble because they didn't see the Ponzi Scheme, right? Well, my point is don't judge many of these people that harshly and smugly because I know what it was like back then, and believe me hardly ANYONE was warning. Sure in mid 2007 you saw more and more articles but prior to that, you didn't see Harvard Studies, you had Ivy League elites buying the subprime paper, so even the best and brightest were buying the junk. In fact, Obama was suing banks for not issuing enough subprime loans. Barney Frank fought legislaiton to reform Fannie Mae and Freddie Mac, so our "strongest" leaders were totally on the complete fucking wrong side of this and if they thought our Nation was in financial jeopardy because of the housing bubble, why did they take these positions? So what your saying is that it is ok that Barney Frank, Barack Obama, all the seven figure salary Wall Street Exec's got it wrong, but Joe Six Pack is a fucking moron?

The cost of living index of my town, Halifax is 118 (100 being the US average). Newton is 133, Hingham is 129. Austin, Texas is 87.

My issue with Zillow is that it said that my house was worth $587k in November, and $421k today. I don't think anything has sold at my price point during that period here so my point is that it is not right to use Zillow for public policy, and when a Nation's "Stimulus" plan is to increase lending and the fucking President tells people to go out and refinance, then yes, they ought to have some follow through to make sure that things are going appropriately. I mean my tax dollars paid for bonuses for these assholes and all I'm asking for is to get the same opportunity that everyone else is being extended, because if I don't, I lose buying power relative to everyone else, again, all because the banks are using Zillow. That sucks and I have a right to be pissed. Further, you won't find a house on the market like mine for the PRICE I PAID in 2006.

[balor123]

I'm not calling them morons just saying that people could have done something to avoid getting themselves into this mess, even if it was unreasonable to expect them to realize that they should have. They weren't just caught up in the middle of it. They were market timing (out of need because you can't dollar cost average the price of a house). They are compensated for it sometimes and lose other times. They should have left enough room to account for this risk, which is where the 3x income and long time horizon (5 - 7 years) came in. Instead, they were buying at 4 - 7x income and holding for 2 years because they thought they could predict the housing market. I wouldn't have made that bet any year and for my foresight I don't gain any buying power.

I agree with you that the it isn't fair that bonuses are being subsidized and that some homeowners are getting bailed out. I'd rather see that anger directed at stopping the bailouts than extending it to more people.

Not sure about that cost of living index but that may use household income, which here includes two people rather than one. To get a better idea, find your comparable house in Austin and see what the difference is.

[balor123]

I was wondering this board filtered curse words. I guess I know now

[john p]

My emotion was based on this: