Yes, but did you need to be a lawyer to afford that $13,000 dollar house? Did you require more than one income to buy that house? I see no reason why this generation should just expect so much less. People constantly just say that this is the way things are today. That’s why I love the fact that buyers are not buying. They do have the power to not participate in this downward spiral.

Well, if buyers aren’t buying, you can’t prove it by me. I have three escrows of my own open (none of them with lawyers), and three buyers that I’ve referred to other agents who have escrows open. I don’t think there are any lawyers in that group either but I haven’t double checked.

In fact, there are thousands of people every month in Sacramento County and nearby areas for whom the long term benefits of home ownership are more important than the short term declines in price that have become so *de rigeur* in the media. Are there thousands less than last year? Yep. But to say buyers aren’t buying is incorrect.

Wow, so there are no “buyers on the fence” that I have been hearing so much About??? If you are right I would be MUCH more worried if as you say, the buyers are buying. Interesting to hear that you believe prices are perfectly in line with Sacramento wages and that you totally dismiss my comparisons between what a house used to cost working families. But well, you are, afterall a realtor.

A lot of those buyers who were on the fence got off it in October, as I’ve reported earlier. There are some who’ll remain tenants indefinitely, I’m sure — and many of those no doubt will be lamenting how bad interest rates are in five years after prices have dropped even more.

Did I say I believed prices are perfectly in line with Sacramento wages, or did you put those words in my mouth in response to my statement that there are still buyers willing to buy in this market? Hmm, scroll up and, what do you know.

I didn’t totally dismiss your comparisons between what a house used to cost working families. On the contrary, I’m inclined on the face of it to agree with you that the ratio of average salary to housing costs was higher in the 1950s — the post World War II era was recently noted in a historical program I watched for the availability of cheap, low cost housing. That’s the whole (somewhat tongue in cheek) point of my original article, you’ll recall — how much the price of homes have gone up in the last 50 years.

Also, when I’ve talked to people of that generation, most of them tell me that their mortgage payments — which seem so absurdly low by today’s standards — felt like a lot of money at the time.

Actually, I am after all a “Realtor®”, please note the capitalization and the registered trademark. And yes, that does mean I sell houses to people who want to buy them. I don’t confuse those people with you, but neither does my appreciation of your participation here lead me to play along with you in denying their existence. 1,135 people used a Realtor® to close an escrow on a home in Sacramento County in October. But it’s a big fence as well. Sit where ever you feel comfortable.

Oh, I don’t live in Sacramento..just grew up there. I live in a large, rent controlled(in the sense that rent can only be raised about 1.7% a year, in 6 years I have never had a rent increase) apartment in San Francisco. Here there are no options to buy which in a lot of ways is a relief as it becomes a non-issue since we love living here. I think it would be much more emotional to live in Sacramento and have real estate held just out of reach for so many. Thus all the creative financing during the panic years. My mom was a typist 1 for the federal government and had a custom house built in Carmichael for around $35,000.00 in 1974. It was tight for a single parent, that is for sure. You see, my comments about Sac wages was what I was referring to in my statements about needing a Lawyers wages to buy a 350-400k house. You were I guess so fixated on the profession I used as an example to get it. Sorry if this seemed like putting words in your mouth. Correct me if I’m wrong (I know you will!) but you seem to imply that if you are waiting to buy a house you are only concerned with the short term losses and do not realize the in the long run your house will appreciate. Sorry, this seems very ignorant to me, especially from an expert in the field. People are waiting for many reasons, many can’t afford anything (or would not live in the areas were they have options) and as there is a downward trend in prices, can wait and see what happens. Sure a house will appreciate in 20 years, but who wants to pay a hefty mortgage for 6 years (totally a guess, say you lose 10-15%, then it’s flat, then after 6 years you see slow appreciation) when you could have waited and possibly had a mortgage on the same house that is a few hundred dollars less. You could invest that money, put it in a college fund for you kid, buy groceries, whatever. Also, I thought interest rates were going down? And I know as a Realtor you do not hold a gun to anyone’s head and make them buy a house, and I know that now (whenever that may be) is always a good time to buy.

Actually my article was a bit less sinister than that (at least I hope it was). When the gentleman came in and told me that absurdly low number, it just struck me recently that no one is focused on the long term gains, so the “2,214 Per Cent” title was really just a tongue in cheeck shot across the bubblers’ bow.

Believe me, I’m sympathetic to the fact that prices put home ownership out of the reach of many. Heck, I moved here to escape Bay area prices in 1996 and picked up my 1700 square foot three bedroom in an El Dorado County suburb for $145,000. If I had to buy my house this year, I don’t think I could afford it.

Recently, yes, interest has gone down. But by historical standards, we’re still in a period where they’re quite low already. I expect our high prices to go down more and our low interest to go up more, but anyone who tells you that whether the relationship between the two makes the fence-sitters right or those buying now right is lying about how much they know.

Sure, there are a lot of things to spend your money on that are worthwhile. Presents of chocolate and negotiable securities are especially appreciated.

And by the way, Mark, thanks again for chiming in. I do appreciate the comments, even if my gruffness sometimes makes it look like I don’t.

I should get over that. I might sell more houses.

I’m not sure that the fence sitters are wrong. Isn’t the bottom line the monthly payment of your fixed rate mortgage regardless of interest rates? I mean, are you saying that if interest rates were 8% that home prices would not go down more? Would people who couldn’t afford $2,500 today be able to afford $3,000.00 tomorrow? Also, if your house loses value and stays flat until who knows when, wouldn’t you actually be losing value due to inflation as well? I really can’t find any fault with waiting to say that those fence sitters are wrong in any way. I would only add to that, if you found a house today that you LOVE and the fixed rate mortgage was 1/3 your income (and you were relatively debt. free) then I see no reason to wait. If you LOVE a house that the mortgage is 1/3 your income I can’t imagine you have much to worry about, at least financially in life..indeed.