A big difference between today and the bubble years is the type of financing being used. Back when the Tan Man was pushing exploding ARMs, more than 70% of the buyers took him up on it – today, more than 80% are choosing a fixed rate mortgage:
Plus, those who get stuck not being able to pay when their ARM increases can always loan mod out of it!
http://journal.firsttuesday.us/the-iron-grip-of-arms-on-california-real-estate/7324/
Jim Klinge
Klinge Realty Group
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CA DRE #01527365, CA DRE #00873197
Trustindex verifies that the original source of the review is Google. We sold a home with Jim and Donna and from beginning to end they were consummate professionals. Their initial walk through the property resulted in a list of items to be repaired or updated. They supplied a list of vendors and job quotes to do the repairs and updates. We originally wanted to sell ‘as is’ and just get it over with. They gave us a selling price for ‘as is’ and options for doing a few updates/repairs to doing it all with the selling price for each option. We agreed to do all they suggested and we sold for the exact price they predicted. For every dollar spent we got back more than $2 back in the selling price. And they got that price in a rising interest rate environment! Donna and Jim are extremely detailed and guide you through ever aspect of the sale. There were no surprises thanks to their guidance. We couldn’t be more pleased with their representation. Thank you Donna and Jim, Jerry and MaryTrustindex verifies that the original source of the review is Google. We have known Jim & Donna Klinge for over a dozen years, having met them in Carlsbad where our children went to the same school. As long time North County residents, it was a no- brainer for us to have the Klinges be our eyes and ears for San Diego real estate in general and North County in particular. As my military career caused our family to move all over the country and overseas to Asia, Europe and the Pacific, we trusted Jim and Donna to help keep our house in Carlsbad rented with reliable and respectful tenants for over 10 years. Naturally, when the time came to sell our beloved Carlsbad home to pursue a rural lifestyle in retirement out of California, we could think of no better team to represent us than Jim and Donna. They immediately went to work to update our house built in 2004 to current-day standards and trends — in 2 short months they transformed it into a literal modern-day masterpiece. We trusted their judgement implicitly and followed 100% of their recommended changes. When our house finally came on the market, there was a blizzard of serious interest, we had multiple offers by the third day and it sold in just 5 days after a frenzied bidding war for 20% above our asking price! The investment we made in upgrades recommended by Jim and Donna yielded a 4-fold return, in the process setting a new high water mark for a house sold in our community. In our view, there are no better real estate professionals in all of San Diego than Jim and Donna Klinge. Buying or selling, you must run and beg Jim and Donna Klinge to represent you! Our family will never forget Jim, Donna, and their whole team at Compass — we are forever grateful to them.Trustindex verifies that the original source of the review is Google. WeI had the pleasure of working with Klinge Realty Group to sell our home in Carmel Valley, and I cannot recommend them highly enough! Jim and Donna demonstrated exceptional professionalism, offering expert guidance on market conditions and pricing strategy, which resulted in a quick and successful sale. Communication was prompt and we were well-informed throughout the entire process. For anyone looking for a dedicated and knowledgeable real estate team, look no further! ---Trustindex verifies that the original source of the review is Google. Donna and Jim Klinge of Klinge Realty Group have our highest possible recommendation. From Donna and Jim’s first visit to our house through closing their advice and counsel was candid and honest in all dealings. They kept us fully informed throughout the process. The house sold less than three days after listing with a two-week closing. My wife and I have sold several houses during our lives. This was by far the best experience. Klinge Reality is a premium service realtor. You can’t make a better choice for someone to sell your home fast and for top dollar.Trustindex verifies that the original source of the review is Google. Donna and Jim provided exceptional support and professionalism throughout the entire process. We couldn't have been happier with their efforts. They made our house shine, and thanks to their expertise, it sold above the listing price in the very first weekend! Truly a fantastic experience from start to finish.Trustindex verifies that the original source of the review is Google. This year has been difficult on our family, mainly due to having to sell our home. Thankfully we knew God had a plan for us and working with the Klinge team was a key part of it. It was an obvious decision to work with them again after such an amazing experience when purchasing the same home we needed to sell. The challenge was, how will we do this in so little time with so much going on? Jim and Donna held our hand every step of the way. Whenever an unexpected issue arose they found and provided a solution. Never once did we feel pressured to make a decision and the Klinges were always reassuring after providing the information that the decision was ours to make. Despite the curve balls, they never panicked and exemplified the “can do” attitude, making us feel optimistic and taken care of. Their expertise and professionalism was superb. But of all the reasons to work with the Klinges, the most impactful and valuable is their compassion and genuine care for their clients. We pray that we can one day purchase our forever home and you better believe that Jim and Donna will be representing us - as long as they will have us of course. Thank you again Klinge team! Your execution, experience, and care are unmatched.Trustindex verifies that the original source of the review is Google. Jim and Donna were fantastic! Jim understanding my needs, recommending potential places, pointing out the pros and cons of each property was invaluable. Then when the offer was accepted Donna’s organized guidance through the inspections, paperwork etc made the whole process seem effortless. So grateful that I had them on my side!Trustindex verifies that the original source of the review is Google. We first found Jim through his blog at bubbleinfo.com, which really showcased his knowledge of SoCal real estate. Since then we've done three transactions with Jim and Donna, and they are an incredible full service agency, with Jim's deep market insight and Donna's deft contract and project management. We trust them implicitly in their analysis and strategy, which is based on years of experience. They're always available and on top of things, and we strongly recommend them to anyone.Trustindex verifies that the original source of the review is Google. The Good The Klinge Realty Group operates like a finely tuned machine, with a very personal touch. We contacted them on a Sunday and they were talking to us about our family and our needs on our living room couch the following day. They carefully listened to us and worked with us to identify the best and quickest path to listing within 2 weeks to take advantage of the low inventory conditions in our South Carlsbad neighborhood. They knew our tract specifically and had many previous sales there over the years - they came prepared with a thorough analysis of comparative sales and recommended a pricing strategy that they felt confident would yield offers the first weekend on the market. The Great Over the next two weeks Donna coordinated a range of vendors who she knew from experience could get the preparation to list work we needed done on time and with high quality. Our light tune-up involved excellent experiences with their stagers, landscapers, contractors, electricians, and plumbers. Throughout this period Donna's daily communication was clear, concise, and responsive. Any time we had questions Donna picked up the phone or texted immediately - but almost always, she answered our questions before we even knew we had them. The Outstanding We had a tricky situation with a shared fence that could have delayed our escrow. Donna used superb mediation skills to negotiate the terms of replacement and was personally on site with the fence contractor to make sure everything went smoothly. The fence looks great and escrow closed on time. The Truly Exceptional Our house came on the market on a Wednesday and between then and Monday morning Jim was personally at all three open houses. He was in constant communication explaining potential buyer reaction and strength. As he predicted offers began to come in on Saturday and each one was incrementally higher than the last. At the end we had 5 offers, 4 of which were over list, and the final accepted offer was $100,000 over list. In addition to being over list it included rent back terms that met our needs. The Recommendation For all of these reasons we would strongly recommend The Klinge Team to anyone wanting to sell in North County Coastal San Diego. I had been reading Jim's bubbleinfo.com blog for 15 years and knew when the time came to sell that he would be our first call. Jim Klinge is not your standard realtor. He is keenly aware of market conditions and sales strategies. And, works his tail off - though not as hard as Donna . At this point he's gone from realtor to friend and I plan to have him over to grill and chill at our new place to talk real estate, but also just about life and raising kids in San Diego. He's more interested in relationships than his sales numbers - and that's why his sales numbers are so high. We have already recommended the Klinge's to some close friends and another successful sale is on deck right around the corner...Trustindex verifies that the original source of the review is Google. We recently had the pleasure of working with Jim and Donna from Klinge Realty Group to sell our house, and we couldn't be more satisfied with the experience. From the initial meeting, they listened attentively to our needs and provided invaluable guidance on specific improvements to get our home market ready. Their responsiveness throughout the entire process was truly impressive. Anytime we had questions or concerns, they were quick to address them, ensuring we felt comfortable and informed every step of the way. What stood out the most was their team and extensive network of tradespeople, which made addressing any necessary repairs or updates seamless and stress-free. Thanks to their expertise and dedication, our house sold quickly and at a great price. We highly recommend Jim and Donna to anyone looking to buy or sell a home. They are a fantastic team who truly care about their clients and deliver exceptional results.Load more
Give it up Jim, you will never convince them it was really a finance bubble, not so much a housing bubble.
Crazy financing was the fuel.
Today’s fixed rates were the teaser rates on the bubble-era ARMs. But Wall Street made a bundle!
Also you had “no-down no-doc” loans used to buy new homes, I even saw 125% loans with no doc’s.
It was truly a crazy time.
So is this bubble just a different kind of financing bubble? If the 30 year now is the same rate as the neg-am 3/1 from back in the day? It is just a bubble from the mountaintop as opposed to the back alley.
Big difference of course is nobody is going to get jammed on rate reset etc… if they pick the 30 year. These rates are being held low so the millennials can get off their hipster asses and buy a house at crazy low fixed rates. Of course they are different than generations before them… they aren’t going to marry and have kids and want them to grow up in a house and go to school…. sure, right, whatever.
Don’t forget that the manipulation has simply moved from the front end (getting a loan) to the back end (not foreclosing).
I still remember a mortgage broker calling me on the phone back then. She offered me $5K if I would get a “negative-arm” mortgage with her. She told me the best part of choosing that kind of mortgage would be some months I didn’t have to pay the full monthly mortgage amount if “there were other bills”. I declined.
Another mortgage broker was with Countrywide. We had (heated) discussions about the “Tan Man”. She insisted he wasn’t doing anything illegal and in fact, was her mentor. She raved about the guy! Once in a while I still think of her and wonder if she ever changed her mind — especially when she no longer had a job…
Some Countrywide loan reps were making $1,000,000+ per year – that’s a lot of cake!
Does any one still have one of those country fried option arms? Didn’t they all explode?
“…when the Tan Man was pushing exploding ARMs”
Jim!
You almost rapped!
Ask Kayla. She’ll back me up.
Since we’ve had such a nice influx of immigration the last 10 years, I think the next ten will be the landlord decade. Housing prices will remain steady up with interest rate increases and lack of “affordable housing,” will be punching up the rents nicely.
Maybe I am not remembering correctly but I seem to recall that the biggest culprit in the bubble meltdown was the no-doc stated income loans, where the borrower got into trouble well before the loan “re-set” or “re-cast” because they simply lied about their income level. Whether it was a 3/1 or 5/1 ARM or a HELOC on a previously-owned property to pull equity, the issue was servicing the loan right out of the gate because the stated income was BS. In fact, most of these loans ultimately adjusted to a rate based on the LIBOR, which plunged and actually resulted in a decreased monthly payment. But I think a lot of the loans were already bad by that time, and well before the interest-only period expired.
We obviously have a completely different environment today. Yes, I think values are higher in part due to lower interest rates, but that in and of itself does not scream “bubble” to me. To suggest that values are impacted by prevailing interest rates is – well, can’t you say that about any time in history?
JtR:
I dated a woman, who had intimate knowledge of the corporate financials of Countryfried during its heyday. The only thing TanMan wanted to know at their weekly meetings, was how much company stock could the family liquidate.
PS It just so happens that some of her education took place at a certain campus Kayla would know well.
“biggest culprit in the bubble meltdown was the no-doc stated income loans”
Yes I knew Realtor’s with 10 homes LOL.
It was truly crazy, yet almost no one seems to remember or will say that was the real reason LOL.
anyway IMO.
For the record, I love nicknames! From now on, it’s “Countryfried”. I’m shocked I’ve never heard that one before…
The three Cs all matter: credit, collateral, capacity. The last bubble was caused by completely ignoring all 3. Haters can write whatever they want but ANYONE who has obtained a mortgage in the past few years know there is NO getting around the Cs. Period. End of story.
So guess what? That means you only need to sell your house if something catastrophic happens. Interest rates go up? Oh well, you can stay in your house. Prices drop? Oh well, stick around and wait for inflation – your mortgage is fixed. So whatever bubble we might have is being fueled by people who can make their payments every. single. month. And since everyone needs a roof over their head? Guess what: no one is selling and no one is foreclosing (except the usual rate of divorce / job loss). That’s not exactly the definition of bubble.
Look to other industries (auto) for people ignoring the Cs. It’s not housing.