Is the "pocket" theory of Seattle just a myth?

[moosejaw]

Hi all...I have followed the blog and forums for a while, and made my real estate choices based on things as best I knew.

The great thing is, most of my choices came out perfect, and I have prepared myself for the worst...but I would love some opinions on my choices.

I had owned a home in Ballard, and decided to cash out to pay off my loans, have a chunk of cash. I was going to go cash and wait, and rent. My wife had other opinions.

So we bought a home on Queen Anne where both her and I work. We cut all transportation costs, as well as having a MIL that supplies 12k/year.

My thinking was, I don't want things to go down, but if they do I have a bit of a buffer.

I came very close to selling my home a few months ago, just to get out of the way of the bubble, but continually heard that Queen Anne(downtown Seattle area) is a pocket that won't be hit by a bubble...or not as much etc...

I would love to hear opinions on this pocket theory. I don't love living in fear, and I need to live somewhere. Costs for renting are not far off for what I have, and I doon't get the deduction of mortgage interest.

Anyways, please share.

[Lionel]

Mossejaw, it sounds like you have your finances under control, so I wouldn't sweat any price declines, especially if you're happy where you are. As to Queen Anne being special, it made me smile, as I am from a very special neighborhood in Los Angeles, Pacific Palisades, and poeple there (and in the surrounding areas) also cannot believe that price declines are possible. To the contrary, I think because these areas are so insulated from reality, and so convinced that everyone wants to live there, real estate continues on an upwards path even when all indications point to a broad decline, and this makes them even more vulnerable to large price declines. I have a good friend who lost 400K in the matter of months back in the 90's in the Palisades when he bought the house next door to his before he had sold his own house. Ask him if price declines are possible in desirable areas.

[moosejaw]

[perfectfire]

[Ubersalad]

[Jay]

[Ubersalad]

[Lionel]

[BallardRat]

[moosejaw]

[rose-colored-coolaid]

[B]

[Alan]