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John Mamula

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Everything posted by John Mamula

  1. Solid. You might want to check out Star Wars while you're at it.
  2. Tulsa has back to back 10+ win seasons and they probably will get 9 or 10 wins this year also. rofl
  3. You do a pirouette and walk into them?*moonwalk away.
  4. XBox 360s suck. Reason why they're called 360s is that when you see one you turn 360 degrees and walk away.
  5. Haven't been able to get through the whole thread yet, but I have been in the process of starting up a new company over the last couple months. Not sure if it is going to be a full time gig or not, but I am acting like it will eventually be. When I am not reading this on my blackberry in my broker class I will add some thoughts.
  6. I'll defer to bagger and LHUCKS on this one. They're the PHX real estate guys.Right now, yes you are seeing 1995 prices if you want to sell in many areas of Phoenix. 65% of homes bought right now off resale listings are foreclosures, and closer to 75% if you get into the outlying areas. So any "conventional" sale of a normal home owner to a buyer is dead because you are competing with foreclosures. Many banks have been instructed to take back as much as they can and liquidate to raise capital. This means they are selling homes at a discount of their loan basis pressuring prices down to levels not seen since the 1990s. For your zip code you have probably lost 30% of value in the last year alone, but again that is basing it off of foreclosures. This is not a normalization of the market, but it is the reality for the rest of 2009 and into 2010. Unfortunately the market can remain irrational longer than some people can stay solvent, only compounding the issue. For Phoenix, from a macro economic point of view we were very strong in 2006 through most of 2008 in terms of job growth, emplyoment rates, interest rates, etc. With employment growth and in migration growth going negative for the next year at least we now have an additional downward pressure on home pricing above and beyond the speculator inventory and sub prime / alternative loan inventory. Inventory is going to be coming on the market due to job loss. I have no idea what you bought it at or what Zillow says it is worth, but I would imagine given what you said it would sell for right around $200k? If you can sit tight, I would for at least another year to hopefully not compete with foreclosures. Unfortunately when I was discussing this issue with tGunZ two years ago I stated in my disbelief that if prices fell like gunz was saying, the entire banking system would be on the verge of collapse. Well here we all are, and there is still a process of deleveraging that needs to happen.
  7. Mr. Pickles sure seems to have gotten sassy in my absence. I think a sitcom is in order.
  8. that's nothing. my former boss, now current client was worth $500M in 2005. he will be declaring bankruptcy this year.lots of millionaires losing everything right now who made their fortunes during the r/e bust of the early 90s. now there's a lot of new people coming in who will become millionaires off of these misfortunes. the question is whether these new people will be more conservative near the peak and bank their cash or reinvest all the way through the cycle losing everything.Why do you think these guys lost so much? How did folks vested so heavily in the market not see the correction coming? Obviously they're crazy intelligent or else they wouldn't have been so successful early in the bubble. Do you think these guys got greedy, or lazy, or both? yeah, but most people's personal residence is the biggest investment they'll make in their entire lives. buying at the top of a bubble can wipe out years/decades of that investment. if you were to evaluate the ROI of buyers who buy the exact same property who bought at two different times (2006 vs. 2009), by 2020, you'll see a huge difference, in my opinion.losing 20-50% of equity in one's personal residence is nothing to sneeze at bagger, especially if you're making payments on that lost equity.a lot of people made all their money in r/e, thought they were smarter than others, had huge egos, were greedy, lost focus on risk mitigation, and thought that they could out maneuver the market. the majority also have a horrible understanding of capital markets and think that the availability of capital will always be there throughout all cycles.bottom line, most people that had a huge runup and lost it all hadn't gone through a cycle with their own money before. some may have done it with public companies, but it is a completely different beast when its your own money and liquidity is finite.on to your second point, you're right a loss of 20%-50% of equity is nothing to sneeze at. people that overpaid near the peak in temecula or other fringe areas in overheated r/e markets may be better off walking away from their home especially if they're in poor mortgages or have realized the area they are in is not a desirable long term area to live. there's no doubt that people that got sucked in at the peak are in a world of hurt, however in 10 years many will have likely recouped all of their losses and made a solid return their investment even from their horrendous initial basis, as long as you're in a fundamentally strong market like the sun belt or so cal.there's a mantra in r/e that you make your money on the buy, not on the sale, and is something i strongly believe in. you're right someone that buys in 2009 will do much much better than someone who bought in 2006. however, if that person who bought in 2006 can make the payments and love living in their home over the long run they will have significant equity in their house.my parents bought their home in 1978 in SoCal and still live in it. bought it for $90k, it is now worth in today's market of around $800k (down from $1.1M around the 2006 peak).this is the long run i am talking about.you're obviously doing your homework, more than most people do, so i think when you decide to buy you'll be in at a good basis.
  9. that's nothing. my former boss, now current client was worth $500M in 2005. he will be declaring bankruptcy this year.lots of millionaires losing everything right now who made their fortunes during the r/e bust of the early 90s. now there's a lot of new people coming in who will become millionaires off of these misfortunes. the question is whether these new people will be more conservative near the peak and bank their cash or reinvest all the way through the cycle losing everything.investments are so different than personal residences. investments in r/e you do need to time the market unless you're in a cash flowing rental. personal residences you just need to get into a place you can afford and ride the roller coaster as you'll go through 4-5 of these cycles in your adult home owning life.
  10. This brings up an interesting point for discussion. Not talking about you personally, but on a macro level, using the above situation as a hypothetical:What happens if/when the appreciation that was used to "move up" in house is lost in a RE correction?For example: First time home-buying couple buys 200k condo in 2002. 0 down, interest only, as was oft the case the past 5 years (and it keeps the numbers clean and easy). By 2005, home is valued at 400k. Couple has a baby on the way, so they sell and take the 200k profit, and put it down on a 600k home. Now their mortgage is 400k, on their new place.RE bubble bursts. 600k home corrects to 400k. Couple has now lost their "move up" equity that was captured at their initial sale. So I guess my question is, how does one make a move up without giving it back during the correction, w/o sitting out the correction in a rental?in this example, as long as you can afford your monthly payment and are not forced to move...who cares.maybe that means they're not moving up again for a very long time, if ever again. but the key is always affordability of the payment in my mind.
  11. This is the sentiment that kills me. I'm not telling you that you CAN'T or even SHOULDN'T have a house like that. What I don't get it the DESIRE to have a house like that. (I felt like UBF typing that...)Wouldn't it be more effective financially to not buy a :mcmansion: and instead buy another property and rent it out? You are probably already doing this, so I suppose this comes down to "I have all this money and I don't know what to do with it." effective financially? maybe, although rentals have their own risks.it comes down to buying a place we want to live in for 10 years and as we'll be having kids within that time period buying a house that you'll grow out of too soon has its own costs. we took the approach of getting as much sf at a good deal as we could knowing that in the long run that will appreciate. more sf appreciating = more equity. you then have the added benefit of living in a house you love so it is also a quality of life issue. i could do a lot of things in my life that would be more financially effective. i think everyone could. but you need to balance that with quality of life. this was a balance that made sense for us.
  12. my 3300 sf house will be too small if/when we have 2 kids.will likely add a 700 sf casita out back if/when that happens.casita? 700 sq. ft.?WTF?My apartment is about 850 sq. ft., 2BR. I lived in a 1BR (not studio) apartment that was under 40 sq. meters (like 400 sq. ft.). Are you using the extra room to store wheatback pennies or something?two things you need to know:1) bagger has moolah. boatloads.2) bagger is bullish on RE. That should explain it. YWIA1. all relative i guess...i wouldn't say boatloads and its not something i'd be doing in the next 5 years so it will be an entirely different picture then. it's definitley not something i'd be doing today, or in 2-3 years.2. long term, in AZ? of course.look, i've lived in small studios. i get it. but when you get married and look to have a house that you'll live in for 10 years all of a sudden you realize how much space you eventually will want (notice i didn't say need).could you take my footprint of my house and put in 5 bed / 3 bath and be fine? sure. i was just responding to the point of there are 3300 sf homes that only have 3 bedrooms...so your point of 8 kids is way off.personally i think our office and master is a little too big and would prefer a 3rd bedroom...but whatever.I think this should be directed to Z. I'm not hating on your choices - if money wasn't a problem for me I'd also have/want a bigger house. Two thumbs up from me.oh i didn't think you were hating...just explaining.believe me, i fully understand the difference between wants and needs. my wife and i could move back into my 1100 sf condo and be fine like we lived when we were engaged.we honestly don't even use half our house now. but we'll be here for a long time and found a compelling enough buy that we wanted to stretch now and grow into it.
  13. my 3300 sf house will be too small if/when we have 2 kids.will likely add a 700 sf casita out back if/when that happens. its not really the sf that makes it too small, but the bedroom design.you see some homes that are 2500 sf with 5 bedroooms, but very small and small common areas.if we want a guest bedroom, once we have our 2nd kid and they both get older, they'll each get their own room, which means no guest bedroom.do we need a guest bedroom...no. but having a casita as a guest house and man cave is always a good option...plus building one for $150 / sf and having it be valued at $300 / sf is instant equity.i guess its all relative...my former boss' house is 14k sf. o.Obig fan of the casita. I'm hoping for 1500 sf when i buy. really goes to show you how location means everything.difference is in AZ this isn't my first or wive's first place. we each owned a condo. there is no way we could afford this place without already climbing a rung on the property ladder selling my wife's place and using the equity for our down payment.believe me, growing up in LA i know how there is a much higher barrier to enter owning property in SoCal.this is one reason i'll likely never move back...my quality of life and cost of living can't be matched living in SoCal.
  14. my 3300 sf house will be too small if/when we have 2 kids.will likely add a 700 sf casita out back if/when that happens.casita? 700 sq. ft.?WTF?My apartment is about 850 sq. ft., 2BR. I lived in a 1BR (not studio) apartment that was under 40 sq. meters (like 400 sq. ft.). Are you using the extra room to store wheatback pennies or something?two things you need to know:1) bagger has moolah. boatloads.2) bagger is bullish on RE. That should explain it. YWIA1. all relative i guess...i wouldn't say boatloads and its not something i'd be doing in the next 5 years so it will be an entirely different picture then. it's definitley not something i'd be doing today, or in 2-3 years.2. long term, in AZ? of course.look, i've lived in small studios. i get it. but when you get married and look to have a house that you'll live in for 10 years all of a sudden you realize how much space you eventually will want (notice i didn't say need).could you take my footprint of my house and put in 5 bed / 3 bath and be fine? sure. i was just responding to the point of there are 3300 sf homes that only have 3 bedrooms...so your point of 8 kids is way off.personally i think our office and master is a little too big and would prefer a 3rd bedroom...but whatever.
  15. blarg.resale inventory is slowly coming down which is a good sign given the amount of foreclosures coming on the market. sales velocity is dramatically up...mainly due to foreclosures being purchased as soon as they come on the market. with that said PHX still has about 2x as much inventory as it should...currently about a 10.5 month supply as i calculated it today.like LA or SD, submarkets on the periphery are getting slaughtered, core areas are muddling along. still see some zip codes in PHX with YOY increases in the low single digits, but those are few and far between.we still haven't seen all of the homebuilders or banks collapse, and will likely see that throughout the end of 2008. this will continue to put downward pressure on pricing although land has already bottomed as publics are starting to run out of lots and are for the first time in a couple years buying dirt...the last two years all sales have virtually been from investors buying and holding lots.we're likely going to start making investments back into the market in late Q1 09 or Q2 09 more likely. it's ugly, and is going to be ugly for a few more months at least. but we also see some huge opportunities here. we're looking to line up institutional investors over the next 6 months to jump back in by the timeline mentioned above.with that said, with the losses we've taken this year, our parent may just decide to spin us off or sell us.
  16. my 3300 sf house will be too small if/when we have 2 kids.will likely add a 700 sf casita out back if/when that happens. its not really the sf that makes it too small, but the bedroom design.you see some homes that are 2500 sf with 5 bedroooms, but very small and small common areas.if we want a guest bedroom, once we have our 2nd kid and they both get older, they'll each get their own room, which means no guest bedroom.do we need a guest bedroom...no. but having a casita as a guest house and man cave is always a good option...plus building one for $150 / sf and having it be valued at $300 / sf is instant equity.i guess its all relative...my former boss' house is 14k sf. o.O
  17. michigan has been and will continue to be a horrible housing market. fundamentally population-->employment-->housinglook at michigan demographics and its not hard to figure out that is a dead market.
  18. my 3300 sf house will be too small if/when we have 2 kids.will likely add a 700 sf casita out back if/when that happens.
  19. with home prices falling, why in the world would you not sell? This strategery is completely lost on me.You're holding onto RE that is cash flow negative in a depreciating market?the prices have stopped falling in my complex. for my unit there have been multiple sales comps that have sold at $275k over the last 6 months. nothing is listed even below $285k anymore (which is why i said i could sell it today quick for $275k). the issue in phoenix is that there currently is NO market. we're on pace for 15k permits (45k is normal). resales typically are at a volume of 3x new permits.this is a good thing to get inventory back on track, which is more of an issue with resales than new builds. however, i am seeing a trend of resale inventory going forward decline (we have 6k units pending sale in phoenix currently, compared to 3k in january). we've been averaging 1k of sales a week for the last month (up from 500 a week in january).in phoenix, and especially scottsdale we're within a 5% or so range of the bottom. now we're not going to be screaming up from the bottom any time soon. 2008 is a wash and likely so will most of 2009. most of the sales i am seeing are short sales and foreclosures, homes that are going for screaming deals. while this does put some downward pressure on pricing as long as people don't have to move, their prices will be sticky. there are no foreclosures or short sales in my complex currently so we haven't seen that.but most importantly, why would i sell now? you don't sell low if you don't have to. and right now i don't have to. what incremental dollars i lose over the next couple years will pale in comparison to what i could sell my unit at in a normalized market.as an fyi, there are lake units in my complex that traditionally sell for $75k more than the park units (i'm a park unit). lake units today are selling at $450k. there is still a market for them since they offer a unique value proposition...lake views in AZ (even if it is a man made lake). there is such a glut of "normal" condo units that it has drastically reduced the pricing of my unit to where the spread is now $175k between lake units and park units. i don't think that extra $100k gap will be filled dollar for dollar by 2010, but even if it is half, i will have made myself a lot of money by treading water renting my place out.I guess the part that blows me away is the fact that people will pay 275k for a home that they can rent for $1100. To me, that screams "Prices are out of whack, and must fall much further". It certainly doesn't suggest a bottom, IMO.But again, I defer to you because I don't follow the PHX market very closely. I know it's mentioned with Vegas and SoCal as the most overpriced markets and the bubble leaders, but that's about all I know.GL. i didn't buy it for $275k.rental prices in phoenix are very deflated right now. during the boom you had a lot of condos that have now been converted to rentals, you have speculators and investors renting, and people like myself who are renting.the supply in the rental market has nothing to do with the basis of my home.
  20. well of course. but you can say that for every market.in 2005 i had conversations with my buddy who does a lot of rentals and we were saying how much you could sell my place for ($380k at the peak). i was tempted but here's the rub...where do you live? this wasn't a rental then. it was my primary residence. i am not about to go rent a place lowering my standard of living and giving up tax breaks at the potential of my place giving up value.if i knew then what i know now would i have done it? sure. but if you try to time every market and dump your primary residence at a projected peak, you may very easily be renting for 4-5 years something that is not an option for me.i did consider selling the place and buying a smaller place so if i was buying that at the top at least i would have pocketed some equity but again i would be cramming down on my lifestyle.trust me tommy, once you buy your first place, you will understand how you will never go back to renting again. and honestly if you buy right, you don't need to. as long as you can afford your monthly payment you just ride out the downturns and enjoy the long term appreciation a house has always given its owner.
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