Housing doom and gloom - ENOUGH already !!
- Thread starter Joab
- Start date
C'mon Guys...
Anecdotal evidence like the situation above are hardly representative of the market as a whole. You could locate 10,000 of those 50% reduction situations and it still wouldn't be relevant because it would only make up .2% of all homes for sale right now.
Fact remains that for the market as a whole, existing home prices have lost about 15-17% from the peak in '06 which means we are back to 2005 prices. I would expect for the really over inflated areas to also be back to 2005 prices.
New homes are fairing much better as a whole and are balancing out faster, which is normal.
The vast majority of americans remain unaffected by the housing slump.
Anecdotal evidence like the situation above are hardly representative of the market as a whole. You could locate 10,000 of those 50% reduction situations and it still wouldn't be relevant because it would only make up .2% of all homes for sale right now.
Fact remains that for the market as a whole, existing home prices have lost about 15-17% from the peak in '06 which means we are back to 2005 prices. I would expect for the really over inflated areas to also be back to 2005 prices.
New homes are fairing much better as a whole and are balancing out faster, which is normal.
The vast majority of americans remain unaffected by the housing slump.
If I lived in the US, I would be buying over the next year, because:
1. The markets look like they are bottoming out - though I accept there may be more bad news and falls, the bad news just does not seem to be creating the same angst as it did. People get bored, even of panic. And anyway, banks are starting to realise that they make their money from mortgages.
2. I see Florida developers are buying up some $1 billion of real estate - see:
http://www.marketwatch.com/news/sto...33C716-4A78-4B20-95F7-4E0C479EC7D0}&dist=hppr
If it is worth their while, there must be some value in the market. Also NYC prices were going up earlier this year.
3. People always need places to live and there are going to be more people in the US over the next 20 years.
http://www.census.gov/Press-Release/www/releases/archives/population/012496.html
4. The dollar is rising which means confidence. More confidence = more business. More business = more demand. More demand = higher house prices.
Seems like the odds are getting shorter all the time of a bull run.
All the best.
D
1. The markets look like they are bottoming out - though I accept there may be more bad news and falls, the bad news just does not seem to be creating the same angst as it did. People get bored, even of panic. And anyway, banks are starting to realise that they make their money from mortgages.
2. I see Florida developers are buying up some $1 billion of real estate - see:
http://www.marketwatch.com/news/sto...33C716-4A78-4B20-95F7-4E0C479EC7D0}&dist=hppr
If it is worth their while, there must be some value in the market. Also NYC prices were going up earlier this year.
3. People always need places to live and there are going to be more people in the US over the next 20 years.
http://www.census.gov/Press-Release/www/releases/archives/population/012496.html
4. The dollar is rising which means confidence. More confidence = more business. More business = more demand. More demand = higher house prices.
Seems like the odds are getting shorter all the time of a bull run.
All the best.
D
Karl Case,the economist and co-creator of the S&P/Case-Shiller home-price index has said that he sees "encouraging" signs in US housing.
Sovereign wealth funds are apparently earmarking huge amounts of cash to buy foreclosures,now an investment company has announced intention to invest heavily in,of all places,Florida residential property.Believe me,these guys don't invest anywhere if they don't think it will be worthwhile.
Sovereign wealth funds are apparently earmarking huge amounts of cash to buy foreclosures,now an investment company has announced intention to invest heavily in,of all places,Florida residential property.Believe me,these guys don't invest anywhere if they don't think it will be worthwhile.
Estimated value? By who, the tax assessor? Such estimates are worthless during, and even in the year following, a correction, recession or depression. All that matters in competitive pricing is what people are willing to pay for it, and what you can actually get it for. If there is no benefit between those two, forget it.
I never hold trades overnight. For me, investing in homes is like holding overnight... for years.
Totally agree that value is value is value - and that is what the market is prepared to pay.
On the longer term bet thing, the nice thing about property when it works (or should I say worked) was that you could have the best of all worlds by levering more debt and building up a war chest for investments. That way, you get to hang on to the long term bet (covered by tenants) while also having a cash reserve to invest in other ways (or just pay off your home mortgage).
All the best.
On the longer term bet thing, the nice thing about property when it works (or should I say worked) was that you could have the best of all worlds by levering more debt and building up a war chest for investments. That way, you get to hang on to the long term bet (covered by tenants) while also having a cash reserve to invest in other ways (or just pay off your home mortgage).
All the best.
So when this guy bought a house,I really should have been selling.
Now he wants to sell.
Surely,going on track record,I want to be the other side of this guy's trades?
When he gets out,that's sure to be the bottom.
The point where an amateur fears total meltdown and can feel no more pain.
So, it looks like the real estate (housing bubble) made US economy collapse. This was going for so long, and yet none of us could predict or prevent it? How come and why so?
I would have never guessed it. I think a lot of it was our faith in our fellow man. My thoughts on real estate stemmed from an assumption that people would be prudent and rational. I'm an real estate investment bull, and I made money and continue to make money. But this is because I was prudent and didn't over-extend, and used fixed rate loans to safeguard against the downside risk.
But there were people out there...many more than I would have ever thought...who were buying properties they couldn't afford with stupid or shoddy financial instruments. And those instruments were often sold to banks or investment firms that should have done more due diligence, but they had their own element of trust. I think what got most people is that when the prices were going up, there was a mindset that valuation increases erased buying mistakes. And this feeling create buying mistakes replaced prudence and wariness...people dropped their guard Maybe this is true of all bubbles...stick to fundamentals and be cautious, no matter how it seems like you shouldn't be.
FWIW, I'm a hopeless real estate bull...perhaps because its changed my life for the better...and I still see a silver lining in this. To clarify, I'm talking about income producting properties here. Real Estate has always been a traditional hedge against inflation and is now out of favor. I think its been so battered that people have forgotten what a good inflation hedge it is. Rents are going higher. Prices and rates can't fall too much lower. I think that right now is a heck of a buying opportunity on because we're setting ourselves up to inflate our way out of economic turmoil and then you just can't recall all those dollars. Those dollars will be out there, and inflation will be hard to rein in. Perhaps that is why some restraint is being used even when things look deflationary right...they know it can get bad later. This may be why commodities just had a bubble...because there was one less option on the table for investing for inflationary times. Anyway, when inflation does rear its ugly head, I'll be chasing the bankers down the street and putting money in their pockets to pay off my mortgages with what a loaf of bread might cost.
Hey, I can dream, can't I?Hammer me if you want, but I'm being honest here.
SM