I Never Saw it Coming ...

Someone asked me the other day why I don't own a house. Considering my age and income, its a pretty good question.

There are lots of reasons I haven't bought a house yet. Some of it just goes to my lifestyle. I want it to be as flexible as possible because I really don't know where life is going to take me. Three years ago, you could have never made me believe that I would move to Seattle. Just a year ago, I was prepared to stay in Washington a few more years. Each time an opportunity came, I grabbed it because there was nothing like a house holding me back.

But that's not the real reason, or at least not the whole reason. It's much more a convenient story I tell to people so they just leave me alone. I'm a traditionalist when it comes to buying a house. I want it to put down 20%, a 30 year fixed mortgage, and I want to only spend about 33% of my gross income a month. When I finally got to the point I could put 20% down on a place, the places I could afford just didn't seem worth the money. I couldn't understand how someone like me, who earns well above the average, couldn't afford a decent place.

So I waited while the prices kept going up. I knew they would eventually come down because I just looked at my own situation. If someone like me, who saves like crazy, earns lots of money, and lives a understated lifestyle couldn't afford something, how could everyone else. So I waited while all my friends told me I was being stupid. It was hard, believe me. Logic seemed to be flying out the window because prices kept going up and up. But I knew things would eventually come back to a sane level. They had to.

That's why when I read articles about the problems in California housing prices, I just laugh. Just read the subtitle, "People in L.A. are coping in ways they never imagined with a crisis they never saw coming."  How did people not see this coming?  I saw it coming five years ago when I refused to buy a house here.  I saw it three years ago as I left the state.  I saw it two years ago as the peak was finally hit and prices topped out.

However "mean" it sounds, I just don't feel sorry for any of these people.  I really don't.   People bought something they could never afford.   Now that sanity is returning to the world, people are looking for others to pay for their mistakes.  The sad part is, it will happen.  The government will step in and help.  That's just how things seem to work around here these days.  Not sure what that does to moral hazard or how people like myself, people who don't get into these types of problems, will react.  What are your thoughts?  Did you see it coming?