Floridians Forgo Beer, Take $200 Vacations as Home Prices Fall

[Purveyor]

March 26 (Bloomberg) -- Miami-area homeowner Richard Welch is spending $70 less on groceries a week after his house lost $145,000 in value. Rita Roland cut off 11 inches of hair to save on salon trips, and Victor Parris stopped drinking his favorite brands of dark ale.

``Absolutely, I feel less wealthy than I did in 2006,'' said Welch, 48, a corporate tax auditor. He said he and his wife, Barbara, are slashing spending by 30 percent, including canceling their cable television.

The residents of Melrose Cove, a Miramar, Florida, subdivision 23 miles (37 kilometers) north of Miami, are cutting back after regional house prices tied with Las Vegas in dropping more than any other U.S. metropolitan area in January. They're giving up shopping trips, restaurant dinners, movies and vacations, demonstrating how the housing market is damaging consumer spending and sentiment.

The Melrose Cove homeowners' association expects to bring in $20,000 less in dues this year as residents struggle to pay bills. The group plans to reduce spending on landscaping, painting and other improvements by $41,000, said Welch, the association's president.

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House as Bank Account

``I looked at my house as a bank account that was going to accrue interest on a daily, monthly, annual basis,'' she said. ``I'm looking at not gaining money on this stock that I call a house, and may actually lose money.''

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http://www.bloomberg.com/apps/news?pid=20601109&sid=agS7mdIK7mjg&refer=exclusive

[RB TexLa]

1. That would all make sense if they were selling their homes in the near future

[Warpy]

4. ....or if their monthly expenditures were going up

instead of paper profit in the house going down.

Still, it's nice to see people finally confronting the reality of living within their means, although they do look like they are freaking out just a little.

[quadriga]

2. True patriots, I'm reminded of the Victory Gradens during WWII

Rejoice in the homeland. What's that you say? Oh those people are greedy selfish bastards? Oh well, fuck them then.

[hobbit709]

3. This line-House as Bank Account

My wife and I never considered our house as that. We looked at it as a home to live in. We have less than six years left to pay on it at under $500/mo. We can't think of any reason to borrow more money against it and go that far in the hole all over again. What I see as part of the mortgage crisis is that too many people were buying houses as an "investment" instead of a home. all investment involves a risk of losing your shirt-sometimes literally.