One of the reasons we would often hear people use to justify overspending on a home during the bubble was that they wanted to stop “throwing away money” on rent. I would hope that by now most people have realized how ridiculous that concept is, but I thought it might help dispel the notion if…
Tag: mythbusting
King County NOT Running Out of Land
For those that continue to insist that home prices around Seattle are high because “supply isn’t keeping up with demand,” I would like to point out the 2007 King County Buildable Lands Report. This is what the report has to say about building activity in King County from 2001 through 2005: King County gained more…
Homebuying Platitudes vs. Reality
This is a post that I originally wrote for the highly-recommended personal finance blog Get Rich Slowly. As such, the style of writing is more geared toward the audience of that site. However, I felt that the post would be of interest to the readers here as well, so I am re-posting it in its…
Robert Shiller: Fundamentals No, Psychology Yes
For those of you that are interested in more lengthy reading, a new paper by Robert Shiller (as in Case-Shiller) was released this weekend: Understanding Recent Trends in House Prices and Home Ownership (pdf). Here are a couple of money quotes: It does not appear possible to explain the boom in terms of fundamentals such…
The Mythical Equity Locust
There are many arguments to be had between the Seattle Bubble housing bulls and bears, but one belief that seems to be commonly shared is that one of the primary drivers of demand and pricing in our market is a steady stream of rich Californians moving up and driving prices up. The bulls argue that…