"Buy now or be priced out, FOREVER!!!"

How many of you heard that mantra from real~estate agents and 'concerned friends' who tried to get you to put down your hard earned dollars on an overpriced piece of property during the frenzy of the buying BUBBLE? It didn't matter if you were looking in Malibu, San Diego, San Francisco, Indian Wells or Palm Springs: 'This market is DIFFERENT'. Yes, every market is different. But, so what? The market forces are still the same. Supply and Demand. But there is another force in that equation and that is Affordability. When 2br 2ba sh*thole houses in Burbank are selling for a million dollars you have to ask yourself, 'Who can afford this'? Does everyone who paid a million dollars for a house make enough money to be able to AFFORD living there? Obviously not. The present day situation is a testament to that. Many people bought houses they could ill afford. Some of them bought them with Liar Loans others with Ninja Loans and a host of other lending programs that were set up to make everyone in America a Home 'Owner'. Home 'Debtor' is probably a more appropriate term, but then that is akin to looking at a glass being half~empty.

'Real estate NEVER goes down' people said. 'They aren't making ANY more land'. 'The people here are REALLY rich'. How many times did you hear some of these statements. It's as if the entire community had amnesia and forgot all about the last real~estate collapse of the early 90's. How did that happen? Real estate prices in Beverly Hills dropped by 50% from their highs of the mid to late 80's and we were able to buy a house in the city of Beverly Hills (NOT the 'post office') for $850K. A 3600 sq ft house on a third of an acre just 4 block from the Beverly Hills hotel. Bought it at the bottom of the market in '96 when we were seeing houses in Bev Hills selling for as little as 700K. And people forgot all about that collapse.

Out here in Palm Springs in 2005 to question the real estate market was to commit heresy. My partner and I got into verbal fisticuffs at parties if we ever began to publicly share our views. No one wanted to believe that a market that is predicated on second~home buyers could be exposed to complete and utter collapse. And the fact that people were buying houses with NO money down, and in some cases were even borrowing the closing costs as well, did not seem to faze anyone. Debt beyond means did not seem to spark fear in most people we spoke to. Yes, some people did see the picture as it truly was: a collapse waiting to happen~~~they didn't use their houses as ATM's and did not jump into the 'musical houses' game, instead they stayed put in their houses and watched the conspicuous consumption all around them. Staying out of the buying frenzy was hard work indeed. Out in Palm Springs the market was as hot as the temps.

How I got from 'there' to 'here'...

Hello, I am WillyWanker and I am (soon to be) in Palm Springs. My partner and I used to live in Beverly Hills California and we sold our house and packed our stuff and went traveling around the world for close to two years. We lived in Asia and South America and basically traveled to wherever the mood would strike us. If we enjoyed a town or city, we stayed, if we did not we got on our macs and decided where we would head off to next. after living in a large Beverly Hills hosue with all the luxuries that the city implies, we really pared down to basic needs and we lived with one roll~away each and one bag filled with medicines in case one of us got sick (courtesy of The Beverly Hills Travel Doctor). Our experience was as wonderful and magical as anyone could hope for. We visited pretty much every site we had been wanting to see, we lived for a few months in Buenos Aires where my partner took Spanish lessons, as well as working on his tennis game. Then we bought a penthouse apartment on one of Santiago de Chile's most beautiful streets. But after touring and experiencing so many exotic sights and places, we decided that it was time to come back home to the U.S.

We sold our house in Beverly Hills in 2004 and made a killing on the sale, as we had purchased it for peanuts in 1996. It was a stunning mid~century house designed in 1947 and was owned by Adolph Zukor for a time. Published and looking every bit as glamourous as a house in that neck of the woods should look. So we took our profits and set off. Then when we decided to come back to the U.S., we chose Palm Springs as the next chapter in our lives. My partner and I have been together since 1982 and we have had a wonderful time sharing all our experiences with one another. He is my best friend, partner and lover.

Meanwhile, we came back to California and set out to Palm Springs in early 2006. We had been following the real~estate market and had been gaging the intensity of sales and the heated transactions with skepticism. Everyone and their brother was in some way form or fashion tied to the real estate market here in the desert. Everyone was buying and selling and making outrageous amounts of money and it all seemed to easy and unreal and unsustainable. As, of course, it was.

'Buy NOW or you will be PRICED OUT!!!' were the cries from agents and 'concerned friends'.


I'll have to continue tomorrow. It's time to sit and have a glass of Lambrusco and watch Golden Girls for a bit.

WillyWanker