Comments on: A look back in time: One of Our Favorites Part 1 http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html Southern California is Experiencing a Real Estate Bubble like never before Fri, 04 Feb 2011 01:16:46 -0700 hourly 1 http://wordpress.org/?v=3.1 By: zephyr http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html/comment-page-1#comment-1024 zephyr Sun, 26 Nov 2006 00:09:00 +0000 http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html#comment-1024 The Toll guys knew more than they admitted to knowing. They put out their positive spin at the same time that Mr. Toll was selling large amounts of Toll Brothers stock during the summer or 2005. Looks like his view was less optimistic than the official company line.<BR/><BR/>$650,000 is the median price for Toll houses countrywide - not for OC. That is an important distinction overlooked by the first comment above. $650k is about three times the national median. Toll is clearly targeting affluent buyers. The more affluent buyers are less sensitive to interest rates since they generally have much larger down payments, trading up with equity. That doesn't much matter though, since prices will continue to decline with or without interest rate increases (I expect rate decreases).<BR/><BR/>The decline started more than a year ago. I think we have about two more years to go before we reach bottom, and then the slow recovery will begin.<BR/><BR/>Toll will be selling fewer houses for a while. But they will not go out of business. The Toll guys knew more than they admitted to knowing. They put out their positive spin at the same time that Mr. Toll was selling large amounts of Toll Brothers stock during the summer or 2005. Looks like his view was less optimistic than the official company line.

$650,000 is the median price for Toll houses countrywide – not for OC. That is an important distinction overlooked by the first comment above. $650k is about three times the national median. Toll is clearly targeting affluent buyers. The more affluent buyers are less sensitive to interest rates since they generally have much larger down payments, trading up with equity. That doesn’t much matter though, since prices will continue to decline with or without interest rate increases (I expect rate decreases).

The decline started more than a year ago. I think we have about two more years to go before we reach bottom, and then the slow recovery will begin.

Toll will be selling fewer houses for a while. But they will not go out of business.

]]> By: Nozferatu http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html/comment-page-1#comment-1025 Nozferatu Sun, 19 Nov 2006 19:42:00 +0000 http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html#comment-1025 $650K can be considered affluent IF you buy a home in the traditional sense and can comfortably afford a $3-4K/month payment. <BR/><BR/>With ARMs/NEG-AM's, zero down, etc...yes..that's not affluent...but it also isn't owning a home. $650K can be considered affluent IF you buy a home in the traditional sense and can comfortably afford a $3-4K/month payment.

With ARMs/NEG-AM’s, zero down, etc…yes..that’s not affluent…but it also isn’t owning a home.

]]> By: bubble_watcher http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html/comment-page-1#comment-1026 bubble_watcher Fri, 17 Nov 2006 14:56:00 +0000 http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html#comment-1026 I think it will be interesting to watch these guys (Toll) change their 'tune' with the passage of time..<BR/><BR/><I>Anyone else care to make any prognostications if the pros couldn't get their own business right?</I><BR/><BR/>I'm going to predict that at the end of the bubble, this company will be out of business. I think it will be interesting to watch these guys (Toll) change their ‘tune’ with the passage of time..

Anyone else care to make any prognostications if the pros couldn’t get their own business right?

I’m going to predict that at the end of the bubble, this company will be out of business.

]]> By: Anonymous http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html/comment-page-1#comment-1027 Anonymous Fri, 17 Nov 2006 02:31:00 +0000 http://www.socalbubble.com/2006/11/look-back-in-time-one-of-our-favorites.html#comment-1027 Love this statement:<BR/><BR/><I>In general, we have a more affluent buyer base. The average price of a Toll Brothers home is about $650,000. </I><BR/><BR/>This statement doesn't make any sense. $650k is the median home price in OC. Median doesn't define affluence. I would consider affluence more like above the 85th percentile or so. In effect he is admitting that there is a bubble since the median home price is targeting affluent buyers. Love this statement:

In general, we have a more affluent buyer base. The average price of a Toll Brothers home is about $650,000.

This statement doesn’t make any sense. $650k is the median home price in OC. Median doesn’t define affluence. I would consider affluence more like above the 85th percentile or so. In effect he is admitting that there is a bubble since the median home price is targeting affluent buyers.

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