Thanks giving.....

I guess we can still call it Thanksgiving, but how many folks out there are really feeling thankful right now. I am so damned lucky I have a job. I am so damned lucky I have fabulous kids with the ability to apply mental or physical effort to a purpose. Or is it luck. If folks are suffering, they likely have brought it on themselves. Oh, sorry. Did I just say that?

I work in the industry of housing. I’ve kinda been in the industry since I can remember. Would I ever buy a house or anything else I couldn’t afford? No, but that’s because I know better. Who doesn’t know better? What does it take to know you can’t afford something? I have a tendency to believe a lack of common sense has played a big part in this whole housing mess. Oh, and greed. Greed might even be a bigger part. Greed from the realtor, the lender, and certainly the buyer.

Not that it matters in any way, shape, or form, but here’s what I think….

Housing has always been a great investment. Until values drop. And guess what? They drop. It’s a roulette game of sorts. If you have the money to play the game it’s one thing. If you don’t and someone comes along and tells you, ‘Hey, I have an idea. I can help you play the game by giving you something for nothing…..up front.’ Why would you listen?? Obviously you didn’t listen when that someone said, ‘and by the way, your payment will be going up because your interest rate will triple in 2 years’. This information is, of course, buried deep in the drivel you’re forced to attempt to read through AND understand when signing docs. Even if you do read it, how many understand what the drivel means? How many care? All you can think about at that point is ‘I’m going to make a fortune in 2 years when I re-sell this puppy!’ Or if you thought you understood the drivel, you may think ‘I will re-fi before my rate goes up and get a whole bunch of cash out and invest in yet another house and just keep doing that until I’m a millionaire or better!’ Right. If values continue to rise. It all seems fantastic. Until values drop.

These problems in real estate have existed for a long time. This time was different. I’ve never seen house values climb so quickly. Houses that sold in 2001 for 100k were selling in 2004 for 350k. What sense did that make? Builders were creating whole neighborhoods where houses were selling faster than they could be built. Even that isn’t unusual but this time it seemed like people were crazed to own a home. So, somewhere along this trail of crazed home buyers, ‘tricky’ financing came into play so that even those who could not afford to buy were suddenly able to. This is where greed came in. Who the hell do we blame for the greed…the buyer, thinking he’s going to make a killing in a couple years; the realtor seeing his never-ending flow of commissions; the guy who sold you the bad loan? Then there was the greedy overseas, who couldn’t wait to get their hands on America’s Mortgage Backed Securities (MBS) and who are now wondering what the hell we’ve done to them!

America is a nation of spoiled brats. What would happen if we didn’t have potable water, a fairly decent infrastructure (much of which is failing), warmth in the winter and a/c in the summer? We want what we want, and we want it now. I reckon many Americans decided they deserved to own a home no matter what it might take. Realtors and lenders obliged. So let’s blame it on the buyers. They’re taxpayers. They’re the ones who are now going to pay to clean up the mess. Yeah, that seems fair. Except that some of us didn’t cause it. I have a feeling those same folks who are running from loans they couldn’t afford in the first place are the folks who will somehow get out of paying taxes.