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Streetcars - the true end of suburbia begins

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Re: Streetcars - the true end of suburbia begins

Unread postby vtsnowedin » Sat 30 Aug 2008, 06:33:52

8) If and when the government goes tits up and law and order breaks down the first thing that people will do is band together and reestablish at least the order part of it. In the citys the Mafia and the unions may well take over( Like they havent already) but rest assured someone will be in charge and there will be rules to follow. In the country people will form and call out the milita to control squaters and roving gangs.That way a few do the guard duty while the rest get to work doing what needs to be done to survive with a lot less oil.
The money will probably be worthless so you will pay the bills with barter of labor and or material goods. If you are not producing your share in a peacful way you won't be eating tonight. All this mad max BS won't last a week.
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Re: Streetcars - the true end of suburbia begins

Unread postby ReverseEngineer » Sat 30 Aug 2008, 06:47:04

$this->bbcode_second_pass_quote('vtsnowedin', ' ')If and when the government goes *** up and law and order breaks down the first thing that people will do is band together and reestablish at least the order part of it. In the citys the Mafia and the unions may well take over( Like they havent already) but rest assured someone will be in charge and there will be rules to follow. In the country people will form and call out the milita to control squaters and roving gangs.That way a few do the guard duty while the rest get to work doing what needs to be done to survive with a lot less oil.
The money will probably be worthless so you will pay the bills with barter of labor and or material goods. If you are not producing your share in a peacful way you won't be eating tonight. All this mad max BS won't last a week.

Well, that isn't EXACTLY how it has worked out for FerFal down in Argentina, now has it?

No doubt, eventually somebody takes control, but short term (which could last years), just getting to "work" you will have to protect yoursefl from carjackers and the like. Cops will be taking Bribes, since they won't be paid.

If the economic crash is as significant as it seems it will be, all bets are off. Ownership of property is the least of your worries here.
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Re: The true end of suburbia begins

Unread postby emersonbiggins » Sat 30 Aug 2008, 10:28:23

$this->bbcode_second_pass_quote('vtsnowedin', 'E')very renter can expect to pay the full costs of the space he rents plus a profit to the landlord to cover the risk the landlord has taken. because of this renting is always more expensive than owning on a square foot basis but people usually rent much smaller spaces than they would chose to buy outright leaving the impression that renting is cheaper.

If the rental property was bequeathed in a will to the landlord (inheriting his/her parents' house, for instance), or the note was fully paid off, it's quite possible that such a property will be rented out at far below the current purchase cost. In fact, there are many instances in the bubble states of homes renting at half the monthly cost of a comp purchase.
"It's called the American Dream because you'd have to be asleep to believe it."

George Carlin
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Re: Streetcars - the true end of suburbia begins

Unread postby vtsnowedin » Sat 30 Aug 2008, 11:19:28

8O R.E. Are you saying we are like Argentina?? I think the USA is quite a different case. Just look at our experence in the great depression. Widespread unemployment and hunger but very little lawlessness though some say we were close at times. And this during prohabition with Al Capon and all that.
Today of course is a differnt time and we have decades of widespread drug use. The gangbangers may try to loot and pillage but the citizenrey will quickly band together and hang them.
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Re: Streetcars - the true end of suburbia begins

Unread postby shortonoil » Sat 30 Aug 2008, 13:10:36

ReverseEngineer said:
$this->bbcode_second_pass_quote('', 'I')f the economic crash is as significant as it seems it will be, all bets are off. Ownership of property is the least of your worries here.

I keep seeing comparisons to our present situation and the Great Depression. That is not an equivalent comparison.

The world’s Central Banks have over the last year injected more than one $ trillion into the financial system to prevent an all out collapse of the monetary system. They are still inputting $50 to 100 billion per WEEK to further stem the tide of economic collapse. So far it has not worked, the crisis is getting worse. The credit markets are continuing to deteriorate.

Unlike the GD, what we are seeing is the collapse of the monetary system. PO assures that our debt based fiat currency can not be maintained. It is now not possible to create enough new debt to produce the money necessary to service the debt that is already held. Consequently, unlike GD One the next Greatest Depression will result in the end of our present currency system.

Any attempt to maintain wealth in the form of paper assets, will most likely be nothing but an exercise in futility. The new currency issued after the demise of our present one will not convert 1:1 from the old currency. It will probably be in the area of 100:1.

GD1 was an economic collapse, GD2 will be the demise of the entire monetary/financial system. The ramifications of this will be unpredictable, but most economic activity will stop for some period of time!
"Paper money eventually returns to its intrinsic value: zero." --Voltaire 1761
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Re: The true end of suburbia begins

Unread postby cube » Sun 31 Aug 2008, 03:11:30

$this->bbcode_second_pass_quote('vtsnowedin', '.')..
2. The end of cheap credit= A major drop in home prices not ownership. Perhaps prices will drop 70% or more.
...
Totally disagree.
1) Okay I'll give you credit for seeing that the end of cheap credit would mean a drastic fall in home values but it would also mean a severe drop in home ownership rates.
If we look at the homeownership rate in the USA for the past 100 years we can see that it has clearly risen.
Credit standards are much more "loose" now then a 100 years ago.
Is it a happy coincidence that the homeownership rate has risen in tandem with a greater availability of cheap credit or is there a relationship? ---> *rhetorical question*

2) Even without factoring in higher energy prices, the end of cheap credit would also mean the end of big homes. If banks become more stingy with their money either by demanding higher interest rates, down payments, and shorter payoff times then by default that means Joe Sixpack can only afford a smaller home. If everybody can only afford a smaller home in the future then that would mean a severe contraction of suburbia. It wouldn't make any sense to have everybody spread out like today if people can only afford to buy a home half the size.

agreed? y/n
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Re: The true end of suburbia begins

Unread postby cube » Sun 31 Aug 2008, 03:45:32

$this->bbcode_second_pass_quote('emersonbiggins', '')$this->bbcode_second_pass_quote('vtsnowedin', 'E')very renter can expect to pay the full costs of the space he rents plus a profit to the landlord to cover the risk the landlord has taken. because of this renting is always more expensive than owning on a square foot basis but people usually rent much smaller spaces than they would chose to buy outright leaving the impression that renting is cheaper.

If the rental property was bequeathed in a will to the landlord (inheriting his/her parents' house, for instance), or the note was fully paid off, it's quite possible that such a property will be rented out at far below the current purchase cost. In fact, there are many instances in the bubble states of homes renting at half the monthly cost of a comp purchase.
emersonbiggins I don't know if you're getting frusterated but I sure am.

I have this theory that EVERY society has at least 1 rule they believe in which makes no damn sense. For example the French believe they can have job security simply by writing it into law. They have 35 hour work weeks, 2 hour lunch breaks, a minimum of 5 weeks vacation, some of the highest taxes in the world, and it's impossible for a company to layoff an employee.
It confuses the French greatly why they have such a high unemployment rate. Geez I wonder why??? :roll:

But of course the USA is no better we have our own silly rules too!
In the USA there seems to be this Indoctrination that Americans go through thanks to the mainstream financial media which would make even the minister of propaganda of Nazi Germany proud ---> and that is the belief that home ownership is ALWAYS superior to renting.
It amazes me the human capacity to not see something even when it's sitting under their nose. I've literally talked to people who are sitting in homes right now that are valued at less then what they bought it for but the people still think it's a "good" investment because in the long term everything must go up according to their theory.
*smacks forehead - and cries in frustration*
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Re: Streetcars - the true end of suburbia begins

Unread postby ReverseEngineer » Sun 31 Aug 2008, 04:18:26

$this->bbcode_second_pass_quote('vtsnowedin', '8')O R.E. Are you saying we are like Argentina?? I think the USA is quite a different case. Just look at our experence in the great depression. Widespread unemployment and hunger but very little lawlessness though some say we were close at times. And this during prohabition with Al Capon and all that.
Today of course is a differnt time and we have decades of widespread drug use. The gangbangers may try to loot and pillage but the citizenrey will quickly band together and hang them.

We are not a whole lot different from Argentina, just bigger. They were a very middle class society through the 80s and early 90s, but they also built a lot of that on credit, and they really were not producing that much to justify it. When they could not meet debt obligations, the currency went south, and so did the society.

I certainly do not see our society in general as being homogenous enough to sustain rule of law here, heck your own dissertation on "gangbangers looting and pillaging" is a clear message that in an economic crash you would support rounding up "gangbangers". What are gangbangers anyhow? Just other people who got shut out of the economic system before you did, like Argentina went south before we did.

At the time of the Great Depression, the US was a quite different place, mostly agricultural and a lower opulations overall. Oil was plentiful. There was a road out of the problems. Not so in this deperession. Too many people in too many citys/suburbs with no means of supporting themselves if the economy tanks. They cannot instatly revert to the land, go clamming in the Chesapeake Bay, because half the clams are dead anyhow now and there are twice as many people.

I gather people mostly do not like my Mad Max scenarios, but frankly I haven't yet heard a good argument to tell me why they aren't the most likely ones. FerFals Argentina stuff is a very good verification of what will happen in economic meltdown. It won't be different here, just bigger and probably more violent than it is there. Because when it happens here, ti will be happening everywhere, there won;t be a currency of last resort to go to, FerFal himself has offshore assets that have allowed him to survive as long as he has in Buenos Aires. That won't be true for most Americans caught in the maelstrom.
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Re: Streetcars - the true end of suburbia begins

Unread postby shortonoil » Sun 31 Aug 2008, 09:08:18

vtsnowedin wrote:
$this->bbcode_second_pass_quote('', '.')..
2. The end of cheap credit= A major drop in home prices not ownership. Perhaps prices
will drop 70% or more.


At the present, the major reason for default in the US is because what is owed on the home is greater than the remaining equity in the house. As home prices continue to fall this will only acerbate the foreclosure rate. Consequently, home ownership will fall and continue to fall!

As RE said:

$this->bbcode_second_pass_quote('', 'W')ho owns these houses? Whoever moves into them and can hold onto them!


In the near future many ex-home owners will be able to quick-claim their previously owned properties. With the banks rapidly approaching the point when they will not be able to maintain properties, and will actually not even want them, many of those deeds will never be contested. With the confusion that has occurred in the MBS transfers of title, many of the “real” owners can not even prove that they own anything.

As RE said, the day is not far away when, if you can hold them you will own them.
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Re: Streetcars - the true end of suburbia begins

Unread postby vtsnowedin » Sun 31 Aug 2008, 10:16:30

8) A point here. The government reports home ownership rates in a very misleading way. They count anyone paying on a morgage as being the owner which is really not the case. They would count the occupant of a 500k Mc mansion with a 499k balance on his morgage as as much of an owner as the neighbor that owns his 75k doublewide outright. In fact all the Mcmansion owner owns is the mail box.
They should report home ownership as the equity not borrowed against which would give a much more accurate picture of the countrys financal position.

Why Americans with the means borrow to buy a bigger house than they need when they could pay for a house that is more suitable or at least make a very large down payment on it is an absurdity that dismays me.

On the rent or own debate. There are many times when renting is cheaper than buying. Anytime the subject is going to be in an area for a short time like graduate students or military familys there isnt time to recover points or closing costs. They should rent. Also buying into a bubble that is about to pop is a famously bad idea and renting until the bottom of the cycle ,if your crystal ball is good enough to show you when to jump, will save you a lot.
With that said it is true that for the same property over the life of a full thirty year morgage owning it will be almost certainly cheaper than renting it from whom ever dose own it.

On full cost? I should have said the full "real "cost. The owner that has inherited has a lower real cost then somone that just bought at market. The rent market reflects the average real costs of the properties in the market and their mix of new to old. If rent rates were driven only on replacement costs not compensating for depreciation and condition they would be through the roof. That owner cited was still making a profit based on his cost.

America is not prone to military dictatorships and coups though some will undoubtably argue the point. Our reaction to a financal meltdown will be quite different than anything seen elsewhere. People with very little equity in their propertys will be told to take their mailbox and go but people with a majority interest in their homes will retain them. The idea that squatters will somehow accuire clear title to property just by invading and defending it for a while is out to lunch. There are better less violent options and we as a society will chose the more orderly route.
Let the bombs fly:-)
Last edited by vtsnowedin on Sun 31 Aug 2008, 10:20:11, edited 1 time in total.
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Re: The true end of suburbia begins

Unread postby Javaman » Sun 31 Aug 2008, 10:16:45

$this->bbcode_second_pass_quote('emersonbiggins', '')$this->bbcode_second_pass_quote('Javaman', '')$this->bbcode_second_pass_quote('cube', '')$this->bbcode_second_pass_quote('Javaman', 'I')f cheap credit disappears, it will be as difficult to buy a house in the city as in the suburbs, if not more so, given the prices.
Rent
Hey, great idea... give all of your housing money to a landlord, make him rich. And at the end of 15 to 30 years you are still... paying rent!

Renting = service, like paying the utility company for 10 years and having nothing to show for it. Do you complain about this as well?

Renting provides flexibility in this market, especially, where buying without some skin in the game all but ensures a negative equity position for months (years?) to come. In a bear market with a shrinking tax base, owning a home will become a losing proposition.


One would pay for utilities in a city or a suburb, so your earlier comment is irrelevant. Besides, being able to store and cook food at home saves money over eating out, so in fact one does have something to show for those utility bills.

Having a more or less fixed housing cost, either by owning a home outright or having a fixed rate mortgage, is an advantage that you should not underestimate. If you rent a house or apartment in the city, expect your rent to go up dramatically if/when people start moving back into cities. Actually, expect your rent to go up dramatically, even if people don't move back.

One can easily get twice the floor space by owning a suburban house, compared to renting a modest, decently maintained city apartment, yet pay hundreds less per month. This comparison will continue to hold true.
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Re: The true end of suburbia begins

Unread postby MarkJ » Sun 31 Aug 2008, 11:30:05

$this->bbcode_second_pass_quote('vtsnowedin', 'E')very renter can expect to pay the full costs of the space he rents plus a profit to the landlord to cover the risk the landlord has taken. because of this renting is always more expensive than owning on a square foot basis but people usually rent much smaller spaces than they would chose to buy outright leaving the impression that renting is cheaper.


Yes, costs of chasing and collecting rent from deadbeat tenants, court costs of evicting tenants, fees to supervise removal of tenants, costs to store/dump the remaining possessions of tenants, repairing thousands of dollars in property damage caused by tenants, tenant lawsuits, tenant complaints, tenant vs tenant conflicts, tenant-caused/reported code violations, lost time, lost money, wage garnishments, garbage removal, code compliance, fewer landlords, fewer multi-family homes and fewer apartments buildings keep rents higher than owning in some regions.

Many of my tenants can buy an older modest existing home in fairly decent shape for what they pay in rent.
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Re: Streetcars - the true end of suburbia begins

Unread postby cube » Sun 31 Aug 2008, 12:56:15

$this->bbcode_second_pass_quote('vtsnowedin', '8')) A point here. The government reports home ownership rates in a very misleading way. They count anyone paying on a morgage as being the owner which is really not the case. They would count the occupant of a 500k Mc mansion with a 499k balance on his morgage as as much of an owner as the neighbor that owns his 75k doublewide outright. In fact all the Mcmansion owner owns is the mail box.
They should report home ownership as the equity not borrowed against which would give a much more accurate picture of the countrys financal position.
vtsnowedin, let me give you some "friendly" advice.
Just swallow your pride and admit that you're wrong.
My original statement that cheap credit availability and homeownership rates go together in tandem is as ironclad as it gets.
Your refusal to admit that is NOT helping you.
You may think you're quite clever sitting here and cooking up new definitions but I can assure you the overwhelming majority of everybody reading this is just shaking their head.
It's better to be a fool for only 5 minutes by admitting error rather then be a fool for life by tap dancing around an issue that is overwhelmingly ridiculously obvious.

the choice is yours vtsnowedin
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Re: The true end of suburbia begins

Unread postby mos6507 » Sun 31 Aug 2008, 13:05:08

$this->bbcode_second_pass_quote('ReverseEngineer', '
')There just is no way here to maintain the illusion of Property Ownership in the aftermath of Peak Oil. Its going to be a free for all, and whoever can take contorl of a property and hold it then will "own" it, at least until somebody else takes him out and takes control of it.


Every debate about the future seems to always devolve into zombie hordes.
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Re: Streetcars - the true end of suburbia begins

Unread postby shortonoil » Sun 31 Aug 2008, 13:10:41

MarkJ said:

$this->bbcode_second_pass_quote('', 'M')any of my tenants can buy an older modest existing home in fairly decent shape for what they pay in rent.


They can also lose 40% of their equity over the next couple of years. Now, that’s a plan!

You seem to be ignoring one simple, well documented and well publicized fact. HOUSING VALUES ARE GOING DOWN, and fast and hard.

Anyone who purchases a home, anywhere, at this time is just plain STUPID beyond imagination.
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Re: The true end of suburbia begins

Unread postby cube » Sun 31 Aug 2008, 13:17:38

$this->bbcode_second_pass_quote('MarkJ', 'M')any of my tenants can buy an older modest existing home in fairly decent shape for what they pay in rent.
You may find this interesting MarkJ being a landlord.
If we look at rent payments relative to the total value of the property it is a pittance.
One reason for this is because a landlord hopes his property will increase in value and he'll make a capital gains profit.
This justifies the low rent to home value ratio he is collecting, especially in places like California.
however....
In a PO world where the economy is steady state it does not make sense to expect home values to rise.
How can it?
The population is in a steady state so there cannot be more potential buyers of real estate in the future then what exists in the present.
It must be the same! :lol:

This should either cause rent prices to go up and or home values to drop significantly. I think in a PO world, if you are a landlord you should expect the rent to cover the full cost 100% of your property within 10 years. (10% per year or 7% compounded annually for 10 years == 100%)
In today's world with real estate still significantly overpriced the rent to home value ratio is such that you'd have to probably collect rent for 20 years to pay off the home. At the pinnacle of the real estate boom it was easily 30 years.
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Re: Streetcars - the true end of suburbia begins

Unread postby vtsnowedin » Sun 31 Aug 2008, 13:24:46

$this->bbcode_second_pass_quote('shortonoil', '[')b]MarkJ said:

$this->bbcode_second_pass_quote('', 'M')any of my tenants can buy an older modest existing home in fairly decent shape for what they pay in rent.


They can also lose 40% of their equity over the next couple of years. Now, that’s a plan!

You seem to be ignoring one simple, well documented and well publicized fact. HOUSING VALUES ARE GOING DOWN, and fast and hard.

Anyone who purchases a home, anywhere, at this time is just plain STUPID beyond imagination.


Sure Rents will remain stable out past 2025. Why buy anything at any price? With GW we can just live in tents.
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Re: The true end of suburbia begins

Unread postby cube » Sun 31 Aug 2008, 13:36:28

$this->bbcode_second_pass_quote('mos6507', '')$this->bbcode_second_pass_quote('ReverseEngineer', '
')There just is no way here to maintain the illusion of Property Ownership in the aftermath of Peak Oil. Its going to be a free for all, and whoever can take contorl of a property and hold it then will "own" it, at least until somebody else takes him out and takes control of it.


Every debate about the future seems to always devolve into zombie hordes.
and this is your vision of the future?
Image

Image
Excuse me if I do not also share your optimism.
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Re: Streetcars - the true end of suburbia begins

Unread postby shortonoil » Sun 31 Aug 2008, 15:38:48

vtsnowedin said:

$this->bbcode_second_pass_quote('', 'S')ure Rents will remain stable out past 2025. Why buy anything at any price? With GW we can just live in tents.


There are now 18.5 million vacant homes in the US. Most of these will be abandoned in the next few years because the owners will not be able to afford their taxes and upkeep. The ones that don’t get stripped will be free for the taking (if you can pay the taxes). There will be no shortage of housing.

Food - well that’s a different story.

Over the next 5 years the US GDP will fall by 28% (Available Energy) and we are headed into the worse depression in probably the last 1000 years. It will take us at least 40 years to get out of it. You are still thinking like a 2005 Oil Age man; but in reality, the Age of Oil is rapidly coming to an end!
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Re: Streetcars - the true end of suburbia begins

Unread postby yesplease » Sun 31 Aug 2008, 17:37:16

$this->bbcode_second_pass_quote('shortonoil', 'O')ver the next 5 years the US GDP will fall by 28% (Available Energy) and we are headed into the worse depression in probably the last 1000 years. It will take us at least 40 years to get out of it. You are still thinking like a 2005 Oil Age man; but in reality, the Age of Oil is rapidly coming to an end!
Spooky, ya forgot something! The energy cost of GDP has been dropping since the oil shocks of the 70s/80s.
Image
$this->bbcode_second_pass_quote('Professor Membrane', ' ')Not now son, I'm making ... TOAST!
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