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Madison Housing Bubble Blog

What are the things that puzzle, enrage, delight and tickle you as you go about your life in Madison?

Postby narcoleptish » Thu Mar 22, 2007 10:25 am

If only the laws of supply and demand applied to sheppy and his posts.....
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Postby Sheppy » Thu Mar 22, 2007 1:52 pm

uwstudent wrote:Huh? :shock:


Look, Mr. Johnny Q. McLiberalartsmajor, this is what goes on in reality. You wanna get into the real estate game? Do you, you smarmy wet-eared punk? Well then step lively. Watch your step or get stepped on. Madison is the It town of the 2000s and when you're in the big time you need to act like it. Face it, baby, you're at the top right now, you've been at the top since you first stepped off the Greyhound at Memorial Union from Bumblefuck, Iowa. It's time to shape the hell up and act like you're at the top. Here's how:

First, stop being a punk. No one likes a smarmy wet-eared little know it all who just got an A in "World Cultures and Economy" and thinks he can start calling the shots. Know your place and eat the right shit when you have to. I did.

Secondly, do not ever, ever hesititate to drop someone that steps to you. Out here you're gonna get motherfuckers creepin' up on what you got and you cannot ever be asleep at the switch. Like I said, step lively.

Thirdly, once you got your ticket, hold onto that shit for dear life. I remember when I was your age and I cut my first deal. I was riding high and lost focus, and six weeks later I was bankrupt eating shit from a trashcan. Don't let this happen to you, kid.
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Postby aaron » Thu Mar 22, 2007 2:11 pm

I must applaud Sheppy for so eloquently explaining to all of us the "law of supply and demand." Well done. I had no idea.

Perhaps you could enlighten us, then, about the fact that there are so many condo developments around town that are 3/4 (or more) unsold and empty? Why are realtors being asked to leave lights on in empty condos at night so that it will appear that people actually are living there?

Just curious.
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Postby TheBookPolice » Thu Mar 22, 2007 2:17 pm

aaron wrote:Perhaps you could enlighten us, then, about...


Oh no you didn't...

Image
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Postby christopher_robin » Thu Mar 22, 2007 2:23 pm

BD3, BD3, BD3. You feelin' it, dawg? I tell you, I'm liking the beret, man. I'm LIKIN' the beret! That's mad phat, dawg.
Shep, you remind me of my days with Journey. Steve Perry used to sport a hat like that on the road. Way to go, man. Way to go.
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Postby Sheppy » Thu Mar 22, 2007 2:33 pm

aaron wrote:Perhaps you could enlighten us, then, about the fact that there are so many condo developments around town that are 3/4 (or more) unsold and empty? Why are realtors being asked to leave lights on in empty condos at night so that it will appear that people actually are living there?

Just curious.


Oh, man, I tell ya. This is why I resist discussions of real estate on open public forums like this. People are so fucking ignorant. Do you seriously, think, Aaron, that these New York and California investors give a fuck about the lights being left on? Seriously, I think I'm going to pass this post around to my peers out here in NY so we can all get a good laugh out of it. Believe me, these motherfuckers out here like a good hearty laugh. Seriously, I'm going to email this around to them.

Look, pancho: just because you got burned on your condo deal doesn't mean you have to poo-poo the whole thing. You got bit in the ass and I'm sorry. But that doesn't mean these other motherfuckers are going to sit around with their dicks in their hands waiting for all the tenants to sign on the dotted line. These motherfuckers want action and they want it now. You think Hong Kong turned out the way it did because motherfuckers were building shit 100% rented? No way. That's capitalism baby. You gotta pounce like a crouching tiger when the opportunity is hot, lest the hidden dragon show itself and gobble you up and shit you out in the jungle.

See, that's the difference between you and me. I act. You waffle. You're sitting around musing about the interglobal ramifications of your latest failed condo deal whilst I'm on the phone with the Bank of Ireland shouting into the other end to get their Paddy-asses
moving on this bond issue. I don't have time to wait around and drink. Apprantly you do, but maybe that's why you get burned. Too slow to the quick. I don't have time to wait for that shit to fill up. Just pop build it and BAM move onto the next thing.
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Postby TheBookPolice » Thu Mar 22, 2007 2:46 pm

Image

That Guy: Let's cut to the chase. There are two kinds of people: Sheep and sharks. Anyone who's a sheep is fired. Who's a sheep?

Zoidberg: Uh, excuse me? Which is the one people like to hug?

That Guy: Gutsy question. You're a shark. Sharks are winners and they don't look back 'cause they don't have necks. Necks are for sheep. I am proud to be the shepherd of this herd of sharks and I am gonna lead you to the top in this industry...
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Postby wolfsbane » Wed Mar 28, 2007 3:46 am

I've been away for a while. I'm guessing "Sheppy" is a local comedian or performance artist? Taking away all the window dressing, I don't see what big time RE investors that build condos have to do with the subject.

It seems like the point of the housing bubble blog is about ordinary folks who are thinking about buying, selling, or holding a house or two. As such, I'd say it's hard to take seriously. It's hard to consider something an "information source" if it titles and dedicates itself to an extreme conclusion regarding the subject under consideration, and presents only carefully selected references that support the assumed conclusion.

I have researched this, and my conclusions at this point are a lot more moderate and complex. There does appear to be a fairly severe residential real estate bubble in many parts of the country - namely the coasts. If you look at some actual data, Madison clearly isn't in anywhere near the same boat. Look up the population and job growth stats, and the stats cited in this report:

http://www.realtor.org/Research.nsf/fil ... adison.pdf

Madison is significantly below the national average in terms of recent appreciation and crazy loan products. It is above the average in terms of population and job growth, and in terms of home affordability. I have seen estimates of the average percent overvalue from several sources, and the estimates average around 10-15%... hardly the peak of the tulip bulb mania or September 1929. Real bubble regions are sporting overvalue estimates of many times this, and recent histories of explosive appreciation that make Madison look stagnant.

Another issue is about averages. Your house, or the one you are thinking about buying, is not an average, it's a particular house. How it will fare in a price correction depends on a lot of particulars - especially price range and location. The houses that will do the worst in the coming corrections are expensive, extravagant suburban houses - the McMansions you hear about. Sensible entry-level houses will be a whole different deal, as will condos, or older houses with prime strategic locations. The closer you get to important neighborhoods of a city, the more real estate markets become their own micro phenomenon.

Overall, I think Madison will likely experience some price correction in the next few years, as either stagnation or slight depreciation, but it won't seem like the sky is falling unless there is a serious recession or depression. Condos are way oversupplied, and McMansions are stupid and impractical to begin with... both will probably do worse than average for some time. What do you expect?

If you own a practical house with a good location, and plan on staying for many years, there is probably nothing to worry about at all. If you hired a seedy appraiser to provide a high appraisal and leveraged your luxury house to the limit with a new loan to speculate on a second and third home, or pay for a bunch of toys and extravagant vacations, you are probably fucked... but you probably suspected as much when you were making all those dumb decisions in the first place.

If you are thinking about buying now, you should probably rent and wait. Just comparing rent with the cost of a sensible loan on a comparable unit should tell you this. If you are heavily leveraged and likely to move in the next few years, you might want to sell now and switch to renting... This is all fairly non-controversial, sensible stuff for a halfway intelligent person. This Chicken Little blog is just as exaggerated and ridiculous as the mindlessly positive pablum real estate agents are feeding us.
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Postby uwstudent » Wed Mar 28, 2007 4:07 pm

wolfsbane wrote:It is above the average in terms of population and job growth, and in terms of home affordability.

And just what job growth would that be? Walmart?
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Postby Sheppy » Wed Mar 28, 2007 10:07 pm

YES, wolfsbane. There is NO bubble in this town. You are right. But if you think for one second that these motherfuckers are going to leave your shit be you are sadly mistaken. There are motherfuckers out in NY that are plotting a hostile takover of your entire portfolio right now. Don't believe me, I just had lunch with one ruthless motherfucker in Manhattan and this dude is about to pounce all over Madison like Sinbad the pirate. When this guy calls I would highly advise you to pick up the phone, pancho.
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Postby Sheppy » Wed Mar 28, 2007 10:11 pm

uwstudent wrote:
wolfsbane wrote:It is above the average in terms of population and job growth, and in terms of home affordability.

And just what job growth would that be? Walmart?


What did I tell you, kid? I told you to stop being a little punk. You think WalMart is the only place that's hiring large numbers right now in this town? In case you haven't noticed Madison has become an international center of finance and real estate. Why you think there's all these construction cranes around? This is the Dubai of the MIdwest, Chachi. Damn, kid, if you're getting good grades in school than I really wonder about the quality of the University these days. Just last week I was in Malaysia and half these blokes in Kuala Lumpur have their brokers based out of Madison. Wake up.
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Re: Madison Housing Bubble Blog

Postby cgervasi » Tue Aug 10, 2010 8:52 pm

The now-three-year-old parody of a small town boy who moved to the big city and hangs out with the big players is still funny. The people who think that way, who are in reality not as stupid as caricatured here, should stick to the coast with the big players. This is flyover area; just keep on flying.
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info

Postby kiplee09 » Wed Sep 22, 2010 9:15 pm

what is the site all about? i just grew lazy searching for it on the web..is it really all about Madison? cause i am trying to search some details regarding this place.. :oops:
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