The Beginning of Giving Houses Away.

Quote from jem:

I am not claiming round two of the price increases is starting.

I am responding to all the renters who seem to be cheerleaders for a bursting bubble.

There may not be a such large pullback in the areas that were in high demand by families.
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Hey genius, the thing about renting is that it is dirt cheap in comparison to buying a home right now and the prices have a long way to pull in. Renters take no liability on the property, they need not worry about water or heating costs (huge factor nowdays), no repair cost (unless it was your blatant fault). They have no real commitment to the property, no home debt obligations and the ability to quickly downgrade (or upgrade) due to job loss/financial hardship, etc. If your area goes down, you cant just adjust your mortgage payment even if you home value cuts 25% and keeps dropping, yet you can renegotiate your rent at lease resign or simply move.

People rush out to buy a home with 80% mortgage, thinking they are so smart till all the bills run in, the mortgage payment, utility payments, insurance, taxes, various repairs & fixing up, it's just laughable. Even condos in NYC, you never escape various bills that end up being just like rent because if you dont pay them, you're out. Even worse with coops. If you break down in Excel with a proper comparison, you would be surprised by the results.

I guess it's different with straight cash but with rents being so low, you can take that capital and invest it properly in bonds or dividends and use the proceeds to finance your rent and let the rest accumulate.

Nway, I know most of you think like the old ppl who are married and set in their boring sleepy suburb life, so it's more of an emotional commitment (like marriage). But to pretend that it will keep going up forever is stupid, few areas deserve perpetual appreciation. Financial asset & RE growth in this country can be directly related to the rapid money supply expansion started by Reagonomics, let's not full ourselves. There have been many signs in the last 6 months that the "crash" is coming, you have to look at the key sources of this RE boom to see the trend begin. BTW, someone else had a great post a while ago about how RE turns the corner and it does not proceed the same way as a market dive. I think a study of the Japanese RE bust would give a better idea.
 
Quote from Hydroblunt:

Hey genius, the thing about renting is that it is dirt cheap in comparison to buying a home right now and the prices have a long way to pull in. Renters take no liability on the property, they need not worry about water or heating costs (huge factor nowdays), no repair cost (unless it was your blatant fault). They have no real commitment to the property, no home debt obligations and the ability to quickly downgrade (or upgrade) due to job loss/financial hardship, etc. If your area goes down, you cant just adjust your mortgage payment even if you home value cuts 25% and keeps dropping, yet you can renegotiate your rent at lease resign or simply move.

People rush out to buy a home with 80% mortgage, thinking they are so smart till all the bills run in, the mortgage payment, utility payments, insurance, taxes, various repairs & fixing up, it's just laughable. Even condos in NYC, you never escape various bills that end up being just like rent because if you dont pay them, you're out. Even worse with coops. If you break down in Excel with a proper comparison, you would be surprised by the results.

I guess it's different with straight cash but with rents being so low, you can take that capital and invest it properly in bonds or dividends and use the proceeds to finance your rent and let the rest accumulate.

Nway, I know most of you think like the old ppl who are married and set in their boring sleepy suburb life, so it's more of an emotional commitment (like marriage). But to pretend that it will keep going up forever is stupid, few areas deserve perpetual appreciation. Financial asset & RE growth in this country can be directly related to the rapid money supply expansion started by Reagonomics, let's not full ourselves. There have been many signs in the last 6 months that the "crash" is coming, you have to look at the key sources of this RE boom to see the trend begin. BTW, someone else had a great post a while ago about how RE turns the corner and it does not proceed the same way as a market dive. I think a study of the Japanese RE bust would give a better idea.
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You have a fine head on your shoulders young man. Keep up the good work.
 
Quote from Hydroblunt:

Hey genius, the thing about renting is that it is dirt cheap in comparison to buying a home right now and the prices have a long way to pull in. Renters take no liability on the property, they need not worry about water or heating costs (huge factor nowdays), no repair cost (unless it was your blatant fault). They have no real commitment to the property, no home debt obligations and the ability to quickly downgrade (or upgrade) due to job loss/financial hardship, etc. If your area goes down, you cant just adjust your mortgage payment even if you home value cuts 25% and keeps dropping, yet you can renegotiate your rent at lease resign or simply move.

People rush out to buy a home with 80% mortgage, thinking they are so smart till all the bills run in, the mortgage payment, utility payments, insurance, taxes, various repairs & fixing up, it's just laughable. Even condos in NYC, you never escape various bills that end up being just like rent because if you dont pay them, you're out. Even worse with coops. If you break down in Excel with a proper comparison, you would be surprised by the results.

I guess it's different with straight cash but with rents being so low, you can take that capital and invest it properly in bonds or dividends and use the proceeds to finance your rent and let the rest accumulate.

Nway, I know most of you think like the old ppl who are married and set in their boring sleepy suburb life, so it's more of an emotional commitment (like marriage). But to pretend that it will keep going up forever is stupid, few areas deserve perpetual appreciation. Financial asset & RE growth in this country can be directly related to the rapid money supply expansion started by Reagonomics, let's not full ourselves. There have been many signs in the last 6 months that the "crash" is coming, you have to look at the key sources of this RE boom to see the trend begin. BTW, someone else had a great post a while ago about how RE turns the corner and it does not proceed the same way as a market dive. I think a study of the Japanese RE bust would give a better idea.
More...

So this year is the crash like it was supposed to be last year and the year before.....

The utility of owning a housing far exceeds living in a cardboard box (apartment). People today are not buying to flip.
The employment in an area will dictate the stability of its housing market.
 
i couldnt agree with you more. For some reason your idea is (told to you by the media) that the economy will remain robust next year...what if that by chance doesnt happen. Have you noticed that a bunch of companies are warning on their future earnings?
 
Quote from Covertibility:

The employment in an area will dictate the stability of its housing market. [/B]
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Market psychology runs the show in housing markets - at least in the intermedite term - not employment statistics.
 
Quote from realestatetimer:

Market psychology runs the show in housing markets, not employment statistics.
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Notice the only housing busts in the US have resulted from employment problems in the US - texas (oil) in the 80's and LA (aerospace) in 90's. Japan's can be attributed to their ending of lifetime employment in the 90's,.
 
Quote from Covertibility:


The utility of owning a housing far exceeds living in a cardboard box (apartment). People today are not buying to flip.
The employment in an area will dictate the stability of its housing market.
More...

Don't you mean to say that the utility of a single family house (owning or renting) exceeds living in a box (apartment or multi-dwelling unit)? In large cities, like NYC, most "houses" are multi-dwelling units, or cardboard boxes as you say, no different than apts. In suburbs and rural areas, single family houses are often rented. The distinction you mean to make, as I read it, is not between renting vs owning but single vs. multiple family
 
Eloquent, Shakespeare.

Did anyone read the Osama transcript. He said soon Americans will be feeling it in their houses.

Does anyone know how the increase in construction of houses will be better in the next year?
 
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