Rating: 
Summary: what does chicken little have to say?
Review: I am an investor in one of the markets John talks about. I am leveraged out pretty far and have done very well. I sold my cash cow just 2 weeks before reading the book in order to levearge more cash and buy more property. I went to the local Barnes and Noble to arm myself with yes men and how to make more money off of real estate. John's book caught my eye, I put my other books away and bought this one. I'm glad I did. Because of it, I will make more money than all the yes men. It takes guts to write a book like this, and it takes guts to do what I have to do to protect my family. Yes chicken little, the sky is falling....the storm clouds are gathering. If you need futher proof, just look at all the yes men prior to the tech stock crash. You can still read their predictions in archives. Thanks John for a timely book.
Rating:
Summary: Maybe Mr. Greenspan should give this book a read...
Review: I found the book did an excellent job of giving a "big picture" view of the current status of the US housing market. As I am in the investment industry, the real estate market has concerned me for sometime. If the business side of the economy doesn't recover before the consumer side losses its steam, we could really be in trouble.I share the authors concerns about Fannie Mae and Freddie Mac. Hopefully, with the Treasury now overseeing these two institutions we might see some progress in getting these two goliaths under control. I would have found it helpful if the author spent some more time drawing contrast to some of the previous real estate bubbles that we have seen around the globe. Japan and Hong Kong are two recent examples of what can go wrong when the bubble bursts. As well, it would have been nice to see data prior to 1968. Thirty-five years is still a relatively short period of time.
Rating: 
Summary: Maybe more info than we need
Review: I have read many articles on housing...the pros and cons...the baby-boomers unloading their houses when they retire vs the baby-boomers have to live somewhere when they retire arguements...and so forth.
This book has lots of good statistical information to back up its premises...which seem to boil down to...Buy a home within your means (and he does define how to find that out, which is a good thing if you can't figure it out on your own)...Anticipate that the home market could go down as interest rates rise making your home harder to sell in a pinch (to his credit, he tells you how to avoid that too)...and a few other common sense rules of buying that could be applied to many things. If a person is going to spend 6 figures on anything, you would think that they would take the time to learn what they are doing, but it is obvious to the author and to many other people watchers in the world that too many people just don't put effort into watching where they put their money. So, if you are a person who carefully spends your money without rushing into any purchase, you probably have enough sense to not have to buy this book; and if you are person who is just the opposite, you probably aren't too concerned even now about learning anything about your home purchase, so you aren't even reading this review. Last note: if you were going to buy properties to use for investment purposes, this book could be of assistance. Hope this helps.
Rating:
Summary: No one can predict the future
Review: I have sold two condos over the last five years. I have been trying to decide whether I should rent or buy again. Having read books and articles from both sides, those who believe there is a housing bubble and those who believe prices will level off but not decrease, I have concluded that both make good arguments but only time will tell. I could come up with arguments to rebut everything said in this book and I could come up with arguments to rebut those who don't believe a housing crash will occur. Here are the main arguments in support of a bubble:
*Many people are choosing adjustable rate mortgages. The inevitable increase in interest rates will make mortgages unaffordable for many. Many people will choose to sell their homes, creating excess inventory and lower prices.
*Rental vacancies are at records highs. Rent vs. Buy calculations are most likely to favor renting, driving more people out of the housing market.
*There is a huge gap between monthly mortgages and rents. The wider this gap grows the more likely people will choose to rent rather than buy, driving down demand and therefore prices.
*Only 20 percent of families can afford a home in today's high priced market. Here are the arguments against a bubble:
*While rates will rise in the next few years an improving economy will bring better jobs and pay raises. This means that most homeowners will be able to pay the higher costs of their ARM mortgages. Also, many people who have ARMs can currently afford to pay 30 year rates, but they choose not to, to save money. When they see that rates are rising they can always get in on a good 30 year deal.
*The main reason for the record high rental vacancies is the recession. Many individuals and families have moved back in with parents. An improving economy will drive many of these people into the rental market driving up rents.
*More people entering the rental markets will close the gap between the cost of renting and the cost of a mortgage. *Based on salaries only 20 percent of families can afford a home. However, for those who currently own a home the high rates of appreciation provide them with huge downpayments if they want or need a new home. So when assets are considered a lot more than 20% of families can afford houses despite the high cost. Talbott's book is an interesting read but no one can predict what will happen in the future. The author may be right and he may be wrong. We'll have to wait and see what happens. If you have a home and are wondering if you should sell or if you want a home and are not sure you should buy now I would say don't let Talbott's views sway you. Read more arguments and come to a conclusion based on what seems to be going on in your local housing market. I found a brand new affordable townhouse and I have a large downpayment, so I have decided to go ahead and buy. Even if Talbott is right and the market crashes I can make my monthly payments, which is ultimately what matters. This will be my third purchase and buying sure beats renting.
Rating:
Summary: The fun won't last
Review: If we look around at these real estate prices, I think most of us would have the gut reaction that Talbott is correct. He does a nice job laying out his arguments with data. When you see house prices in places like California (from outside the state), you realize that it just can't go on like this. My own personal example: a cousin who bought a house in the Chicago area for 500,000 in 1999 and sold it 2 years later for 750,000. That is just not normal. The author's use of a housing P/E ratio is enlightening. Real estate insiders tend to argue that houses are a great investment and that there's only an upside to buying a house, but any investment carries a downside risk. The whole idea that housing is a fabulous investment is so new and so in that it just screams "bubble"! Our parents and grandparents bought houses so that they could retire rent-free, not so that they could have a 600% return on investment. I only gave the book 4 stars because the editing is terrible. I could hardly make it through some sentences. McGraw-Hill should really do better. He also assumes that a (married) man is reading the book ("you and your wife"). I'm sure I'm not the only grrl who does the finances. Also, some of the suggestions for avoiding losing money are pretty silly. Would it really be a good investment to build a bachelor pad over my garage to rent out? Should I sell my house where my job is and move out to the boondocks? A big no on both of those. Nonetheless, a worthwhile read.
Rating: 
Summary: Helped me quantify my gut feelings
Review: If you are reading this review, I owe you 2 things about me in the first place. First, I live in San Francisco Bay Area (an extremely expensive housing market) and second, I have felt that the housing market is in trouble for awhile so I was pre-disposed towards the author's point of view. That being said, the author knows his subject matter. I work at an investment company that specializes in money management via quantitative modeling (in the technology group). As such, companies such as mine have an enormous influence on this market as an 'end consumer' of the individual mortgages taken out on homes. The author has done an extremely good job at simplifying the staggerly complex world of fixed income instruments to find the drivers of market forces that influence the world as the individual home owner sees it.
The trend lines and their causes that the author has built explained a lot to me. Written in the end of the year, 2002, the discussion of forces on the companies participating in this vast money pool and how changes in those forces will effect the companies and therefore all of us is proving extremely accurate in 2003. Rates have dived to rare lows with unprecedented speed and now are rising with the same level of velocity - the velocity and depths of the dive driven in large part to the hedging strategies (or lack thereof) of investment companies. The heads of Fannie Mae and Fannie MAC are in trouble for fiddling with their numbers to drop earnings since that is what Wall Street is looking for (and therefore their bonuses are tied to those expectations) and other bad things have all started to rear their heads since this book was written (as the author predicted). Two final thoughts as recommendations. One, the housing market, prices etc... tend to be pretty 'sticky' - so this book should hold is value to you for several years past publication date. The other, is a concept that the author introduces and will give you an idea of where the author is coming from. If you thought houses were priced correctly (or even were expensive) in your area 5 years ago and today prices are significantly higher - - does that mean that all of a sudden everyone woke up and realized how badly they had misunderstood the market and value 5 years ago? Everything was underpriced then and it is correctly priced now, or is something fishy in Denmark instead?? As an educated observer of the pros from the inside - this book is highly recommended cheers! and good luck over the next 10 years
Rating:
Summary: Do Trees Grow to The Sky?
Review: In this thoughtful and fact-laden work, John R. Talbott comes out swinging both with a provocative book title and a curious sort of self-help organization to his ideas. Divided into two parts, (I) - Why the housing market will crash and (II) - Ten things one can do about it; The title says it all- housing prices are at an all time high and they will come down, in not just sort of gently floating way, but with a crash. Such a dramatic and unsettling prediction - stated so starkly- screams for a detailed, comprehensive and cool-headed analysis, and in the first part of the book, Talbott wades right in with a whole array of charts, tables and studies to buttress his point. He provides a history of "Similarities to Other Spectacular crashes" to remind us of similar market situations in the past, and he also gives us scenarios on the timing, depth, scale and geography of his predictions. Finally, Talbot takes us deep into the worlds of Fannie Mae and Freddie Mac: two quasi-governmental organizations that bundle and sell after-market mortgages to the tune of 3.7 trillion dollars. As if on cue, the New York Times recently reported that Allen Greenspan publicly warned that "taxpayers would be at risk" were if the highly leveraged positions of these agencies were to be found wanting in the future. Since most everybody who is an adult (except those who are incarcerated or living at home with their parents) has to deal with housing expenses in one way or another, the second part of the book is logical: So housing prices are going to crash. What do I do now? This part of the book is a bit weaker because of the inevitable diversity of responses that people will have towards falling housing prices. Some will want to consider selling their vacation house now, others will pay down their debt, but I don't foresee a lot of people renting out rooms in their houses or above their garages as Talbott suggests we might need to do. But this is the strange logic with any doom and gloom scenario- If you believe in it, then you would be a fool not to act on its predictions. So at least Talbott is being logically consistent when he advises young couples not to buy a house and that it might be advisable to move out of the big city to a smaller one where the prices are more affordable. Finally, I must mention Talbott has even thought about the market dynamics associated with such dramatic predictions such as are in this book. Acting on the (somewhat self-aggrandizing) insight that a prediction from a qualified analyst can actually move a market one way or another, He asks if this book might actually be itself be the tipping point and the cause the big long noisy slide downward in the housing market. I guess it is going to be up to the readers whether they drastically change their behavior after finishing this book. As for my wife and I, we plan on paying as much of the principal down as possible on our house when we refinance in a couple of months... but we will be optimistic about housing prices when asked. After all, we are both realtors.
Rating: 
Summary: Poor advice for homeowners
Review: In urging homeowners to sell their houses Talbot errs egregiously because he fails to consider the high transaction costs of selling now and buying back at a later date. More importantly, he also fails to factor in the much higher carrying costs that will result to those homebuyers who wait for interest rates to increase. Even a 20% lower price won't compenste for say a 7.5% (or higher) interest rate after the "crash" has occurred. Work the numbers! People who wait will pay more even if they buy for less.
Rating:
Summary: Invest in Real Estate, not this rediculous book
Review: It's amazing, how people continue to ignore the real and tangible benefits to owning real estate, even if your investment was to lose 20% and never recover (this has never happened!). First off, those who don't invest in real estate (and thus themselves), sink money into rent. What an absolute waste! No return, no tax benefits, no brains. You rent for 30 years, you've paid off someone else's mortgage (hundreds of thousands of dollars). You pay off your mortgage for 30 years, the home is yours. At worst, you have a place to live. At best, you've just earned hundreds of thousands of dollars toward retirement, not to mention the tens of thousands you've saved on your tax bill every couple of years. You do the math! It's simply irresponsible to buy into the load of nonsense which is the premise of this book. Do yourself a favor, don't be a loser, don't buy this book. Those who have stayed on the sidelines for the past year have lost out on tens of thousands of dollars and have missed out on the best tax benefit we have. There you are, you've been warned! You've no one to blame but yourself.
Rating:
Summary: The Coming Crash in the Housing Market : 10 Things You Can D
Review: John Talbott's book was written with my wife and I in mind. We live in the Los Angeles "South Bay" and decided to sell our home in Nov 2002, having purchased the home before the run-up in late 1996. I won't disclose the selling or purchase price, but suffice it to say that we netted a little over $100,000 per year of ownership. In 2000, we improved the home by adding a third level with cosmetic improvements throughout, and we accomplished this with home equity proceeds. In late 2001, I was laid-off from a good job in the tech sector. Luckily we were able to continue making the mortgage payments after refinancing to a lower ARM, but my wife supported our efforts along with a little savings. In mid 2002, we began to "read the tealeaves" and had a strong feeling that the housing market was getting out of hand. We decided to sell and capitalize and have now been renting for the last six months. With that said, our intuitions have been confirmed after reading John's book. My wife and I had been doing our own analysis before making the decision and our six sense has paid off greatly. I am happy to sit on the real estate sidelines for the foreseeable future and John's book has confirmed our hypothesis. I mostly suggest this book to people living in areas that have seen the largest housing gains, and I applaud John for his insight in presenting the historic facts and the analogies with the use of P/E to evaluate real estate from the stock market melt down. Do yourself a favor and get your hands on this book! It is an easy read with a down to earth approach. It will assist you in making a determination toward either selling or buying and will open up your eyes.
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