Exactly my thinking: I think many many people have bought these areas thinking that they were part of a genuine turnaround rather than part of an industry driven speculative bubble. In some locations i think it is fair to say that a type of neighborhood turnaround has occured, but in other areas the second that appreciations stop my feeling is that very little money will continue to flow into neighborrhood improvements and thus the turnarounds will be incomplete: although rising rents may partially offset this.
Housing Rolling Along 2
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Exactly my thinking: I think many many people have bought these areas thinking that they were part of a genuine turnaround rather than part of an industry driven speculative bubble. In some locations i think it is fair to say that a type of neighborhood turnaround has occured, but in other areas the second that appreciations stop my feeling is that very little money will continue to flow into neighborrhood improvements and thus the turnarounds will be incomplete: although rising rents may partially offset this.
This point we agree on. Despite Chicago pioneering the "integrated communities," I suspect this is going on in metro areas nationwide. Some of the neighborhoods are lipstick on pigs...humboldt, little italy, Hyde Park, Lakeview, Bucktown... And yes, the scary part is that people are putting up very large sums of money to live in these "blue sky" neighborhoods.
However, this only lends favorably to my position regarding metro real estate bubbles.
However, this only lends favorably to my position regarding metro real estate bubbles.
would this be considered a bubble in the air ?
excerpts from NYTIMES today
http://nytimes.com/2005/11/30/nyreg...&en=f47c278e23647f71&ei=5094&partner=homepage
-$430 a Square Foot, for Air? Only in New York Real Estate-
-(Nov. 30) - The price of air has gone up in Manhattan.-
-It's now $430 a square foot.-
-Two New York City developers have agreed to pay a record-setting amount for "air rights" so they can build a 35-story apartment tower with views of Central Park from the high floors.-
-Previously, New York appraisers say that the high end for the price of air hovered around $200 a square foot.-
-"Nothing shocks me anymore," said Daniel F. Sciannameo, an appraiser at the Albert Valuation Group. "This market is absolutely crazy." -
excerpts from NYTIMES today
http://nytimes.com/2005/11/30/nyreg...&en=f47c278e23647f71&ei=5094&partner=homepage
-$430 a Square Foot, for Air? Only in New York Real Estate-
-(Nov. 30) - The price of air has gone up in Manhattan.-
-It's now $430 a square foot.-
-Two New York City developers have agreed to pay a record-setting amount for "air rights" so they can build a 35-story apartment tower with views of Central Park from the high floors.-
-Previously, New York appraisers say that the high end for the price of air hovered around $200 a square foot.-
-"Nothing shocks me anymore," said Daniel F. Sciannameo, an appraiser at the Albert Valuation Group. "This market is absolutely crazy." -
The equity loan you can get is usually the lesser of the difference between (current valuation - mortgage balance) and your equity in the property, then taking a discount based on your credit rating.
So, if the net valuation is negative, you cannot get a loan.
If the net valuation is less then the equity you built up, you will probably get a loan lower then that.
Of course, it also depends on your relationship with the bank or mortgage company
