Economy & Sub Prime housing vs NSX sales?

[NSX GT]

Not sure if the two are related, but I notice that since the sub prime issues and the downward trend on the economy in the last year, I have also notice "NSX for sale" has increase doubled or even tripled. I hope no one on this forum is a victim of the Sub Prime Scandal.

I have a relative who's girlfriend is one of the victims and she just stopped paying the mortgage and will be going into foreclosure. 2 years ago a lot of people used the equity that is no longer there to purchase big ticket items like SUV's etc.. Now, they have lost everything. My brother who bought a house in Oakland hills has lost all equity and his loan is higher than home value now. He's SOL.

I've bought my home in 98, so I'm good. I just did a refinance for 30yrs fixed @ 5.25%. I was at 6.5%.

 

[Daedalus]

There's probably a connection. Not sure how strong the relationship is, since I think listing volume is also seasonal, but people who borrow money they won't pay back are hardly the "victims" of the sub-prime "scandal." Ultimately the real victims will be the taxpayers and wageearners who will pay for this mess one way or another, whether it be through direct bailouts of financial institutions using higher taxes down the road, an erosion of their spending power from inflation and a sinking currency, and/or higher unemployment.

 

[Ski_Banker]

I've bought my home in 98, so I'm good. I just did a refinance for 30yrs fixed @ 5.25%. I was at 6.5%.

5.25% fixed - nice job! good to see responsible Americans still exist.

 

[TyraNSX]

What scandal & what victims? Informed adults signed documents to take out over-sized loans on over-priced houses. Unless there was a gun to somebody's head, they weren't a victim. Just stupid.The hypocrisy of the free market mavens who want private sector profits when things are good and public sector bailouts when things are bad is beyond belief.

Not sure if the two are related, but I notice that since the sub prime issues and the downward trend on the economy in the last year, I have also notice "NSX for sale" has increase doubled or even tripled. I hope no one on this forum is a victim of the Sub Prime Scandal.

I have a relative who's girlfriend is one of the victims and she just stopped paying the mortgage and will be going into foreclosure. 2 years ago a lot of people used the equity that is no longer there to purchase big ticket items like SUV's etc.. Now, they have lost everything. My brother who bought a house in Oakland hills has lost all equity and his loan is higher than home value now. He's SOL.

I've bought my home in 98, so I'm good. I just did a refinance for 30yrs fixed @ 5.25%. I was at 6.5%.

 

[Ski_Banker]

What scandal & what victims? Informed adults signed documents to take out over-sized loans on over-priced houses. Unless there was a gun to somebody's head, they weren't a victim. Just stupid.The hypocrisy of the free market mavens who want private sector profits when things are good and public sector bailouts when things are bad is beyond belief.

I very much agree with you (by trade, by training, by worldview) but I disagree in practice unfortunately. Yes, consumers can be stupid. Yes, they "should" know better. Yes, it's their money so f*** 'em if they make stupid decisions.

However, the democrat-donkey in me realizes that it isn't as easy as saying "if you don't know the rules, or how to play the game (and you get screwed), then it's your fault."

It's not your fault when society does nothing to teach people how to play the game. How to manage money. How to make smart economic decisions.

Frankly (and this is one reason I'm a Junior Achievement volunteer), I think that the public schools in America FAIL in a colossal sense. They FAIL because they teach kids what to know (to go to college, to be productive citizens) but they don't even remotely address how kids should spend their incomes. It's very much like preparing youngsters to be a bunch of rock stars... people that can potentially make loads of $$ but have zero clue how to manage it.

Rant off, but only for now.

 

[kiisaka]

What scandal & what victims? Informed adults signed documents to take out over-sized loans on over-priced houses. Unless there was a gun to somebody's head, they weren't a victim. Just stupid.The hypocrisy of the free market mavens who want private sector profits when things are good and public sector bailouts when things are bad is beyond belief.

Hear, hear!!!!!

I recently read an article about a woman in San Diego who is suing her buyer's agent because she overpaid for the house, and saw the value of the house go down in the recent turmoil.

I mean, if we make a mistake, it's someone else's fault, and if we win some, it's because of our brilliance?

Oh, c'mon!!!

However, I'd expect the number of unnecessary indulgent goods, like NSX, on the market will be going up in order to raise funds. It's not like foreclosures are fun, you know. It's a big black mark on one's credit history, too.

Even with my 30 year fixed 5.5% mortgage I'm now looking for an opportunity to refinance, given that I may be able to refinance as a conforming loan instead of a jumbo.

 

[TyraNSX]

I see your point, but I don't think a 5 yr old needs society to teach him to not touch a hot stove. He needs a parent and/or 1 bad experience. A lot of people are getting their bad experiences now. The school of hard knocks is still a school and those lessons are likely to stick.

And what kid doesn't form some basic thoughts on value and worth when trading baseball cards, hot wheels, etc?

I had no official financial education and managed to live within my means, save, handle a mortgage, and swing an NSX to boot. A lot of that comes from Yankee frugality and growing up close to poor. People can educate themselves by reading (books or online) if they choose to do so and take it upon themselves.

I very much agree with you (by trade, by training, by worldview) but I disagree in practice unfortunately. Yes, consumers can be stupid. Yes, they "should" know better. Yes, it's their money so f*** 'em if they make stupid decisions.

However, the democrat-donkey in me realizes that it isn't as easy as saying "if you don't know the rules, or how to play the game (and you get screwed), then it's your fault."

It's not your fault when society does nothing to teach people how to play the game. How to manage money. How to make smart economic decisions.

Frankly (and this is one reason I'm a Junior Achievement volunteer), I think that the public schools in America FAIL in a colossal sense. They FAIL because they teach kids what to know (to go to college, to be productive citizens) but they don't even remotely address how kids should spend their incomes. It's very much like preparing youngsters to be a bunch of rock stars... people that can potentially make loads of $$ but have zero clue how to manage it.

Rant off, but only for now.

 

[Vega$ NSX]

What scandal & what victims? Informed adults signed documents to take out over-sized loans on over-priced houses. Unless there was a gun to somebody's head, they weren't a victim. Just stupid.The hypocrisy of the free market mavens who want private sector profits when things are good and public sector bailouts when things are bad is beyond belief.

I agree with all of you guys. It really is a case of people biting off more they can chew, not thinking long term (instant gratification) and simply not making wise decisions with their money. And the worst part is that it punishes those who were responsible and were more careful with their money. I know of people who didn't buy homes because they wanted to save up more money before buying. Yet the reckless ones who bought irrationally are getting government aid to help them from foreclosing. Doesn't seem fair does it?

However, at the same time, I can understand where many of these people are coming from. When I bought my first house I was fortunate to really understand the buying processes and to have friends and family to educate me and help me along the process. Otherwise, I would have been at the mercy of my realtor, loan processor, title company etc. There are just so many things going on, so many documents, so many rules, it's impossible to know all of the caveats of purchasing a home, especially if it's your first trip to the rodeo. It's very hard to grasp the concept of an ARM, when you are trying to figure out what an escrow or appraisal is. You really rely on your loan officer and realtor, because it's impossible to read and understand all of the documents thrown at you. Unfortunately, in the time of housing gluttony, there were many unscrupulous people who did not explain or disclose all of the details of what people were getting into. There is a certain honor and responsibility for these people to help their clients understand what they can and can't afford. Unfortunately some of these people did not do this. In fact some of them did the opposite and tried to persuade these people to buy homes that they realistically could not afford just to get the sale. In this regard, I can see how some people feel as if they were scammed.

 

[Ski_Banker]

I see your point, but I don't think a 5 yr old needs society to teach him to not touch a hot stove. He needs a parent and/or 1 bad experience. A lot of people are getting their bad experiences now. The school of hard knocks is still a school and those lessons are likely to stick.

And what kid doesn't form some basic thoughts on value and worth when trading baseball cards, hot wheels, etc?

I had no official financial education and managed to live within my means, save, handle a mortgage, and swing an NSX to boot. A lot of that comes from Yankee frugality and growing up close to poor. People can educate themselves by reading (books or online) if they choose to do so and take it upon themselves.

I don't disagree with you. Really I don't. I just don't think the issue is that simple. Example: A very bright kid grows up in a poor family. The poor family will almost certainly not teach personal finance.

Yes, people can educate themselves on financial discipline. Every necessary resource is readily available to anyone, for nothing more than time. Why don't people utilize the resource?? I don't have a response to this because you're absolutely right. Is it laziness? Lack of time? Or just some flawed reasoning that "My best intuition will help me make good budgeting/investing decisions" Great, and very interesting, point.

 

[Ski_Banker]

I see your point, but I don't think a 5 yr old needs society to teach him to not touch a hot stove. He needs a parent and/or 1 bad experience. A lot of people are getting their bad experiences now. The school of hard knocks is still a school and those lessons are likely to stick.

And what kid doesn't form some basic thoughts on value and worth when trading baseball cards, hot wheels, etc?

I had no official financial education and managed to live within my means, save, handle a mortgage, and swing an NSX to boot. A lot of that comes from Yankee frugality and growing up close to poor. People can educate themselves by reading (books or online) if they choose to do so and take it upon themselves.

I don't disagree with you. Really I don't. I just don't think the issue is that simple. Example: A very bright kid grows up in a poor family. The poor family will almost certainly not teach personal finance.

Yes, people can educate themselves on financial discipline. Every necessary resource is readily available to anyone, for nothing more than time. Why don't people utilize the resource?? I don't have a response to this because you're absolutely right. Is it laziness? Lack of time? Or just some flawed reasoning that "My best intuition will help me make good budgeting/investing decisions" Great, and very interesting, point.

 

[CL65 Captain]

That is complete BS... I want a F430. I want a four car garage. I want a whole bunch of shit. I have excellent credit, I could go out and buy all that crap... but I don't. I don't feel sorry one bit for anyone who overloads themselves on debt and then gets it all taken away.

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

 

[queenlives]

That is complete BS... I want a F430. I want a four car garage. I want a whole bunch of shit. I have excellent credit, I could go out and buy all that crap... but I don't. I don't feel sorry one bit for anyone who overloads themselves on debt and then gets it all taken away.

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

+1

in my book there are darn few "victims" here. free credit / money is like crack to sooooooo many people. sadly, somebody's gotta pay the piper when the time comes as it is now for many people.

if it sounds to good to be true, it probably is.

 

[mickeylex]

Here is my thinking on housing vs. NSX purchases:

(1) Late 2004/early 2005 is when housing prices peaked and people took lots out on equity.
(2) 2005 was also the last model year of the NSX and more than a few people probably used their equity to buy NSXs
(3) If those two data points converge soon, I may be able to find that clean, low-priced 2002-2005 NSX I've been holding out for. :biggrin: :wink:

 

[Daedalus]

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

Sounds like a coworker of mine. He's the frugal one, lives in an average neighborhood, commutes in a 36 year old car. His father passed away several years ago, leaving several million $$$ to his mother. His brother has been milking it ever since, always needing a "loan" for a downpayment, a remodel, a new car, things for the grandchild, etc.

I love the "bailout" incentive structure. Hey, if you make too much money to qualify, just quit working so much. Oh, and you might want to skip a payment or two.

 

[TyraNSX]

I second CL65 Captain. And I am Ski Banker's bright kid in a poor family with no personal finance lessons. If I did it, I doubt there are societal/institutional barriers to learning some basics on money management, finance, and investing. If you can't get motivated to take care of your own money, what the hell on this earth will motivate you for anything?

I don't disagree with you. Really I don't. I just don't think the issue is that simple. Example: A very bright kid grows up in a poor family. The poor family will almost certainly not teach personal finance.

Yes, people can educate themselves on financial discipline. Every necessary resource is readily available to anyone, for nothing more than time. Why don't people utilize the resource?? I don't have a response to this because you're absolutely right. Is it laziness? Lack of time? Or just some flawed reasoning that "My best intuition will help me make good budgeting/investing decisions" Great, and very interesting, point.

That is complete BS... I want a F430. I want a four car garage. I want a whole bunch of shit. I have excellent credit, I could go out and buy all that crap... but I don't. I don't feel sorry one bit for anyone who overloads themselves on debt and then gets it all taken away.

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

 

[sahtt]

There are two sides to every story, I assure you it's not all reckless people trying to be greedy or pushing their luck. Regardless of what ANYONE else says, I've seen first hand [and worked with them] those that have been taken advantage of. There are a lot of realtors/brokers that are here that get very defensive, cite ethics codes, etc. That's fantastic that they follow them, and if everyone else did the same-there issue at hand would be much smaller.

However, the FACTS are that in many cases the appraiser, realtor, and broker all did borderline illegal, absolutely unethical, practices to many people. The appraiser overvalues the home, the realtor gets the bigger cut and refers them to the bastard broker, he gets NO income/job proof and gives them a loan that puts more money in their pockets while knowing if the home doesn't appreciate, there is a good chance the house will be forclosed on during rougher times (no equity-no refinance).

This is unarguable to me, so don't waste your time. I'm not suggesting the majority of situations are like this-just that I wouldn't exactly call it a minority either. It may be more common in TX, that's the only place I've worked with it myself.

There are also tons of people just as many you have mentioned, who got caught trying to push it a little too far and were 'greedy' or what have you. The problem with this situation that is different then before is the financing was more and more leveraged to a house appreciation, so people that use to be able to just sell the home or get refinancing cannot. This problem compounds and compounds on itself and spreads through all sort of investments all over the world, waiting in their mortgage payments for their interest payments.

 

[NSX GT]

You got a point. The taxpayers are the victims in the long run. It is also one of the major causes of this economy going in a downward trend.

About a year or two ago, I read on the front page of the S.F. Chronicle that over 60% of all new home owners are into the Sub Prime loans (interest only or pick your plan/neg amortization) What were these people thinking at the time?
I guess they wanted to experience of the American dream of having a home. A real short term dream. Maybe even fairytale one.

Although, the sub prime people did not have a gun pointed at them at the time of buying, it should have never been offered to them by the loan company. This B.S. would have never happened 4 years ago.

Lastly, I know a lot of these jump the band wagon real estate / mortgage brokers who got greedy and started living it up like big shots buying several homes and exotic cars. Today all of those people are in foreclosure with no job and no clients. They created their own self destruction.
Just my opinion

 

[Vega$ NSX]

There are two sides to every story, I assure you it's not all reckless people trying to be greedy or pushing their luck. Regardless of what ANYONE else says, I've seen first hand [and worked with them] those that have been taken advantage of. There are a lot of realtors/brokers that are here that get very defensive, cite ethics codes, etc. That's fantastic that they follow them, and if everyone else did the same-there issue at hand would be much smaller.

However, the FACTS are that in many cases the appraiser, realtor, and broker all did borderline illegal, absolutely unethical, practices to many people. The appraiser overvalues the home, the realtor gets the bigger cut and refers them to the bastard broker, he gets NO income/job proof and gives them a loan that puts more money in their pockets while knowing if the home doesn't appreciate, there is a good chance the house will be forclosed on during rougher times (no equity-no refinance).

This is unarguable to me, so don't waste your time. I'm not suggesting the majority of situations are like this-just that I wouldn't exactly call it a minority either. It may be more common in TX, that's the only place I've worked with it myself.

There are also tons of people just as many you have mentioned, who got caught trying to push it a little too far and were 'greedy' or what have you. The problem with this situation that is different then before is the financing was more and more leveraged to a house appreciation, so people that use to be able to just sell the home or get refinancing cannot. This problem compounds and compounds on itself and spreads through all sort of investments all over the world, waiting in their mortgage payments for their interest payments.

+1

You did a much, much more elequent job of explaining what I was trying to say above.

 

[otoro]

That is complete BS... I want a F430. I want a four car garage. I want a whole bunch of shit. I have excellent credit, I could go out and buy all that crap... but I don't. I don't feel sorry one bit for anyone who overloads themselves on debt and then gets it all taken away.

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

Well said. People have to realize one thing, equity is not realized unless you cash out.

Had a similar experience this past week. On some totally random tangent, my coworker placed an order for a custom made bedroom set; Newly marketed and design by a famous celebrity. I asked if she had won the lottery and it turns out, she used the money from her "anticipated" tax refund. I gave her a smile, but wondered how any sane person could do such a thing.

 

[Ryanmcd2]

The best thing that my father tought me is to "Be your own banker" If I need something I take a loan out of savings, if I cant do it I dont get it. Yes it's hard but doing this you never have any debt and dont pay 100's of thousands in intrest to the banks / cc's. Cant put 20-30k down on a house stay in a apt. Cant pay for a 30-40k car cash? Get a cheeper one. I love it when my friends tell me, Hey Ryan why don't you get a Ferrari? I tell them "Because I can"

 

[TyraNSX]

I see your point & I'm not saying there weren't sometimes shady (& always stupid) things being done to make these deals happen. But in the end, an individual signed on the dotted line. It is not enough to own a brain, you actually need to use it. If everyone in the room is looking at you like a turkey on the Wed. before Thanksgiving, you should be very worried.

If the same house was $200K a year or 2 ago & now it's $400K, something is very wrong. It is not worth $400K, the builder didn't spend $400K on land, labor, materials, & reasonable profit. It is a delusional market with no basis in reality. What should you do? WALK AWAY! If the cost per sq. ft. is massively inflated from a year or 2 ago or what it would cost to have it built today- WALK AWAY! If you have $1500/month in disposable income & a car pymt & mortgage pymt (conventional, adjustable, int. only, etc) eats $1400- WALK AWAY! My God, even with a conventional if you are spread thin every month, what the hell are you going to do if you need surgery or get injured & are laid up for any amount of time? Or your car suddenly needs major repairs? Or if little Timmy needs braces?

You are getting in over your head & should be aware that you are just treading water in the best of times. I don't see how a broker, appraiser, or mtge lender can make one unaware that spending $1400 out of $1500 is cutting it pretty damn close & that one really ought to reconsider proceeding. Now throw an ARM into that & you might as well shoot yourself in the foot.

It is no different than a car salesman selling an expensive car to someone he knows won't be able to handle the pymts on for very long. Especially if it's a young kid who will have sky high insurance too. It is his job to sell cars; not to be your brain, financial planner, or life coach. The dealer will get paid by the bank, after that any problems are between the bank & the buyer. The same thing is happening now, but no one wants to accept responsibility. Everyone is a victim & there is always someone else to blame (& probably sue).

This country has changed from one where people decided whether or not they could afford to purchase something outright to one where we decide if we can afford the payments on something. Apparently a lot of us are incapable of even making that decision correctly. We live for debt, don't save squat, and then point fingers & cry for help over self-inflicted wounds. Part of being in a free market is you are free. Free to think or not. Free to win or lose. Free to take advantage or be taken.

There are two sides to every story, I assure you it's not all reckless people trying to be greedy or pushing their luck. Regardless of what ANYONE else says, I've seen first hand [and worked with them] those that have been taken advantage of. There are a lot of realtors/brokers that are here that get very defensive, cite ethics codes, etc. That's fantastic that they follow them, and if everyone else did the same-there issue at hand would be much smaller.

However, the FACTS are that in many cases the appraiser, realtor, and broker all did borderline illegal, absolutely unethical, practices to many people. The appraiser overvalues the home, the realtor gets the bigger cut and refers them to the bastard broker, he gets NO income/job proof and gives them a loan that puts more money in their pockets while knowing if the home doesn't appreciate, there is a good chance the house will be forclosed on during rougher times (no equity-no refinance).

This is unarguable to me, so don't waste your time. I'm not suggesting the majority of situations are like this-just that I wouldn't exactly call it a minority either. It may be more common in TX, that's the only place I've worked with it myself.

There are also tons of people just as many you have mentioned, who got caught trying to push it a little too far and were 'greedy' or what have you. The problem with this situation that is different then before is the financing was more and more leveraged to a house appreciation, so people that use to be able to just sell the home or get refinancing cannot. This problem compounds and compounds on itself and spreads through all sort of investments all over the world, waiting in their mortgage payments for their interest payments.

 

[steveny]

That is complete BS... I want a F430. I want a four car garage. I want a whole bunch of shit. I have excellent credit, I could go out and buy all that crap... but I don't. I don't feel sorry one bit for anyone who overloads themselves on debt and then gets it all taken away.

My brother and I grew up in the same family, same place... he has a new Mercedes every three years, a big ass house, a big ass boat, and lots of other toys... he's living on cash flow and if it all implodes it's his own damn fault. It's not a product of your environment or society or anything other then "I want, I want, I want".... My Mom has talked and talked and bailed my brother out more times than I want to count... but the dumb ass goes on living like a Rock Star.

Rock stars often die young and leave a stack of bills unpaid but had a hell of a time when they were here.

 

[steveny]

There are two sides to every story, I assure you it's not all reckless people trying to be greedy or pushing their luck. Regardless of what ANYONE else says, I've seen first hand [and worked with them] those that have been taken advantage of. There are a lot of realtors/brokers that are here that get very defensive, cite ethics codes, etc. That's fantastic that they follow them, and if everyone else did the same-there issue at hand would be much smaller.

However, the FACTS are that in many cases the appraiser, realtor, and broker all did borderline illegal, absolutely unethical, practices to many people. The appraiser overvalues the home, the realtor gets the bigger cut and refers them to the bastard broker, he gets NO income/job proof and gives them a loan that puts more money in their pockets while knowing if the home doesn't appreciate, there is a good chance the house will be forclosed on during rougher times (no equity-no refinance).

This is unarguable to me, so don't waste your time. I'm not suggesting the majority of situations are like this-just that I wouldn't exactly call it a minority either. It may be more common in TX, that's the only place I've worked with it myself.

There are also tons of people just as many you have mentioned, who got caught trying to push it a little too far and were 'greedy' or what have you. The problem with this situation that is different then before is the financing was more and more leveraged to a house appreciation, so people that use to be able to just sell the home or get refinancing cannot. This problem compounds and compounds on itself and spreads through all sort of investments all over the world, waiting in their mortgage payments for their interest payments.

Don't forget the people who bought many houses years ago for peanuts and then borrowed out just 70% of the jacked up appreciation so he wouldn't be upside down. Like this guy I know who bought lot's of houses for 15k and then had values placed on them at a 100k which the guy knew was 20-30k more then they were worth so the guy only borrowed 50-70k when the bankers were trying to give him 125k. He grew up in a really financially poor family too.:wink: :smile:

Same guy kept a lot of his houses debt free because the rent income insures survival over the long term. This caused him to buy a used Ferrari instead of a new one. :frown: :biggrin:

 

[Searchin4acoupe]

Don't forget the people who bought many houses years ago for peanuts and then borrowed out just 70% of the jacked up appreciation so he wouldn't be upside down. Like this guy I know who bought lot's of houses for 15k and then had values placed on them at a 100k which the guy knew was 20-30k more then they were worth so the guy only borrowed 50-70k when the bankers were trying to give him 125k. He grew up in a really financially poor family too.:wink: :smile:

Same guy kept a lot of his houses debt free because the rent income insures survival over the long term. This caused him to buy a used Ferrari instead of a new one. :frown: :biggrin:

Where do you see the landlord/rental market going if we find ourselves in an extended recession/depression? In the short term, those who cannot get mortgages, will have to rent, but how do you see that scenario evolving through an extended downturn?

 

[steveny]

Where do you see the landlord/rental market going if we find ourselves in an extended recession/depression? In the short term, those who cannot get mortgages, will have to rent, but how do you see that scenario evolving through an extended downturn?

There was very little change here in the economy as far back as I can remember. Most everyone is blue collar or less. So everyone was already broke. Those people who did over extend are few but they are out there. I flipped a lot of homes during the boom but I spoke personally or knew the buyer as a long term tenant. Out of all the houses I sold only one went to foreclosure and that was because of a divorce. I tried to talk the guy out of buying the place because I saw it coming but he was PW.

The rental market here will see a trend up wards in the amount of people from the tenant pool we have to pick from. The rents will increase a little more then normal. Now in CA I see the rents raising substantially.

edit...I also see some great opportunities to lease option some of the single families. People just refuse to see slow and steady wins the race.