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Thread: housing: a bottom is emerging

  1. #61

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    Quote Originally Posted by cubical View Post
    Just because there is a lot of something, doesn't make it a good buy.
    Who wants to buy a home in Detroit, cheap, rock bottom prices...
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  3. #62
    Site Staff - Moderator Brian4Liberty's Avatar
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    bump
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  4. #63

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    I wonder what percentage of commercial real estate can be converted into residential real estate...

    Even if residential real estate is bottoming...that bottom (in real terms) will go on for AT LEAST another decade...

  5. #64

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    The Fed is buying mortgage backed derivatives. They said they would continue action at least until 2015 to provide certainty. I think housing may go back up, but as much because they are inflating a new bubble as because it has reached bottom, although as you say, a bottom had to come eventually. I think it is a combination, at least, however.
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  6. #65

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    property values have no where to go but down imho. notice i say values not price. price may go up based on inflation but unless jobs are created.. there is very little they can do to keep the market propped up forever. just look at japan. good land and quality properties will always command more in any market. if rates tick up to where they should be -- we're toast.

    commercial is a time bomb. most commercial deals were done on a nearly 100% LTV with a 5-7 year balloon... that was 6-7 years ago.

  7. #66

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    Quote Originally Posted by thoughtomator View Post
    As far as a housing bottom goes... no chance. Shadow inventory is higher than ever, and at some point the banks will need to unload, as their accounting fraud can't make up for a lack of actual cash when the electricity bill comes due. Interest rates, of course, have nowhere to go but up.
    ^^^-This-^^^ & vvv-This-vvv

    Quote Originally Posted by sailingaway View Post
    The Fed is buying mortgage backed derivatives. They said they would continue action at least until 2015 to provide certainty. I think housing may go back up, but as much because they are inflating a new bubble as because it has reached bottom, although as you say, a bottom had to come eventually. I think it is a combination, at least, however.
    It's ironic to me that millions of houses are withheld from the market for the sole purpose of artificially propping up the value of the loans on millions of others. Fucking central meddlers.

    Housing would have bottomed out much lower than it has already, had assets backing all the toxic mortgages been dumped/liquidated in fire sales onto the market by banks in the absence of protection from a counterfeiter of first resort. The Fed is trying to give banks staying power, with an artificial scarcity distortion -- intended only to keep remaining asset values and their associated debt instruments artificially high -- while hoping for a demand wave to kick in that will re-inflate a deflated bubble (or keep it from deflating even more rapidly than it has). But even that has its limits.

    Even the squatting vultures would have grown impatient, tired of subsisting on interest Manna from the Fed, so it makes sense that the Fed would want to buy up and lock those assets away, to keep them from flooding onto the market. Even so, that once-overvalued supply will eventually more-than-trickle back into the market. Land can sit empty, but empty houses need to breathe, or they crumble and lose value. That supply cannot be withheld from for long, and anything that makes its way back into supply through privileged developers is not going to sit idle. It will be sold. If that happens rapidly enough, further downward pressure on prices will result. Inflation could mask that, but absent the Fed actually opting for a massive portion of American real estate going literally into ruins, I see the actual values going further down.

  8. #67

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    So in another 13 years or so we will once again be able to buy a home near where we work?

    Why does this dream sound so hollow?

  9. #68

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    You can buy a 3 bedroom 2 bath 1 or 2 car garage single family house on a quarter acre of land in Port Charlotte Florida,( between sarasota and ft myers ) named one of the best places in the country to retire for less than 50 grand. It goes up from there but what more could you want? 50K? The identical house 2 1/2 hours away in Broward Cnty with an entirely different vibe would cost you more than 4+ times that.

    Some places are ridiculously cheap and one of the most pathetic things I've heard when responding to a house for 50K is " who will give me a job?". Unbelievable.

  10. #69

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    Follow me now...

    Massive.Systemic.Currency.Devalution.

    ABCD.

    Anything.Bernanke.Can't.Destroy.

    Lock that rate and let the banks and the Fed eat the inflation.

    Here's the gist.

    Even the Pentagon is getting Fed up with these banker boys.

    Gold.Is.Money.

    Huge portions of the American Elite know this and understand that the long term success of America depends on it's credit markets/currency and honest transactions with foreign countries.

    The US still has some of the biggest gold piles/reserves in the world. Held by who?

    A lot of it held at protected military outpost.

    When foreign creditors finally give the US its credit shock - it will be quickly smoothed over. I doubt otherwise.

    This is supportive of MORTGAGES. Asset values.

    Your American properties - other than ravaged inner city ghettos...are of spectacular value.

    It aint all doom and gloom.


    Silver's revaluation will ultimately trump that of golds (but gold, per ounce, still worth more).

    Gold for international trade, silver for the people. It will end up looking a lot like that.

    Yeah, that's my call.

    Much like 1929, 2008 and the 4-5 years after are the worst.

    Things begin to pick up and build after that.

    Or huge war.

    Teetertoters are not always fun, folks.

    WW3 aside - American debt is better then most soverign debt.

    My ultimate point is if you are NOT a speculator when you purchase an American property right now, my guess is 15,20, 25 years from now a lot of you will be happy for it.

    Those who do it right will enjoy that in under 10 years.

    People who tend to frequent RPF, also tend to be dilligent, hard working and big picture type of folk. Big picture includes time frames of 25+ years.

    Your BUBBLE POPPED ALREADY!!!

    The housing bubble has not popped around the world in other countries!

    Yet demand for land never ends.

    Which means, over the course of a 7+ year time frame...American properties are among the highest quality and most adequately valued.


    I shit you not.

    I scan properties in the Canadian and the US markets.

    As a general investor, I feel you markets have AMAZING deals to be had.

    Location, Location, Location - is in effect. SOME mortages/neighbourhoods will go near 0. MOST mortgages and MOST American properties will hold quite nicely.

    BUT. I speak of accurate generalization. :-)

    Farm land in both our countries are among the super nova's of economic value over the course of the next 20 years.
    Last edited by Seraphim; 09-28-2012 at 09:22 PM.
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  11. #70
    Site Staff - Moderator Brian4Liberty's Avatar
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    Quote Originally Posted by Steven Douglas View Post
    It's ironic to me that millions of houses are withheld from the market for the sole purpose of artificially propping up the value of the loans on millions of others. Fucking central meddlers.

    Housing would have bottomed out much lower than it has already, had assets backing all the toxic mortgages been dumped/liquidated in fire sales onto the market by banks in the absence of protection from a counterfeiter of first resort. The Fed is trying to give banks staying power, with an artificial scarcity distortion -- intended only to keep remaining asset values and their associated debt instruments artificially high -- while hoping for a demand wave to kick in that will re-inflate a deflated bubble (or keep it from deflating even more rapidly than it has). But even that has its limits.

    Even the squatting vultures would have grown impatient, tired of subsisting on interest Manna from the Fed, so it makes sense that the Fed would want to buy up and lock those assets away, to keep them from flooding onto the market. Even so, that once-overvalued supply will eventually more-than-trickle back into the market. Land can sit empty, but empty houses need to breathe, or they crumble and lose value. That supply cannot be withheld from for long, and anything that makes its way back into supply through privileged developers is not going to sit idle. It will be sold. If that happens rapidly enough, further downward pressure on prices will result. Inflation could mask that, but absent the Fed actually opting for a massive portion of American real estate going literally into ruins, I see the actual values going further down.
    Got that right.
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  12. #71

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    Quote Originally Posted by Lafayette View Post
    Wait till the commercial property defaults start to hit...
    I thought this was supposed to happen in 2011?

  13. #72

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    I bet your wrong. .....we are not bottomed out
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  14. #73

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    @Seraphim

    I agree 100% with the ABCD philosophy but there is a grave flaw in your thinking on real estate. Real estate is not an investment. It is a durable consumer good. That misconception is a major, major reason why people can't make sense of the housing bubble. You don't buy a refrigerator or a car as an investment; a house is in the same category. Costs $ to maintain, degrades over time into worthlessness if you don't. That is not a characteristic consistent with the nature of an "investment".
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  15. #74

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    Real estate is not an investment.
    Many, many people would disagree with you on that statement. This doesn't explain why people can't make sense of the housing bubble - the reason they can't make sense is because the FED and banks are lying through their teeth, manipulating interest rates and foregoing traditional accounting methods. It is one big fabricated market and they change the laws and rules as they see fit.

  16. #75

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    Quote Originally Posted by cbc58 View Post
    Many, many people would disagree with you on that statement. This doesn't explain why people can't make sense of the housing bubble - the reason they can't make sense is because the FED and banks are lying through their teeth, manipulating interest rates and foregoing traditional accounting methods. It is one big fabricated market and they change the laws and rules as they see fit.
    People don't understand the housing bubble because they are either uneducated or just stupid. I remember in my investment class in 2003 it was common knowledge the housing market would eventually go down. This was a few years before prices got really absurd. Additionally, in 2006 when I was in Phoenix, all the real estate companies converted their apartments to condos to capture in the high prices in expectation the market would collapse. Point is that most educated people knew what was really happing in real estate even before the collapse or bubble. As usual its the average person who gets confused about every bubble and every bottom.

  17. #76
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    We are not at the bottom , of, anything. We will see , 2016 or so , maybe.

  18. #77
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    Price wise, if we are not at the bottom, we are close in my opinion. But like the overall economy (and actually BECAUSE of the overall economy) it will be a long time before you see dramatic improvements. If you are thinking about buying, this is a pretty good time.

    Additionally, in 2006 when I was in Phoenix, all the real estate companies converted their apartments to condos to capture in the high prices in expectation the market would collapse.
    Once the bubble burst, they started converting things back into apartments since the demand for rentals rose by so much (and so did rental rates).
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  19. #78
    Site Staff - Moderator Brian4Liberty's Avatar
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    Quarterly bump.
    "Foreign aid is taking money from the poor people of a rich country, and giving it to the rich people of a poor country." - Ron Paul
    "Beware the Military-Industrial-Financial-Corporate-Media-Government Complex." - B4L update of General Dwight D. Eisenhower
    "Debt is the drug, Wall St. Banksters are the dealers, and politicians are the addicts." - B4L
    "Totally free immigration? I've never taken that position. I believe in national sovereignty." - Ron Paul


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  21. #80
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    Quote Originally Posted by FindLiberty View Post
    real estate taxes - gotcha
    They get added to your rent too. You don't escape them if you don't buy. If you do buy, you get something for that money you are otherwise just giving away every month. I just paid off my mortgage and got rid of that expense- effectively increasing my spendable income by about one third. Can't do that with rent.
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  22. #81

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    Quote Originally Posted by Zippyjuan View Post
    They get added to your rent too. You don't escape them if you don't buy. If you do buy, you get something for that money you are otherwise just giving away every month. I just paid off my mortgage and got rid of that expense- effectively increasing my spendable income by about one third. Can't do that with rent.
    It is property that can be stolen at any time. Property taxes AND capital gains AND estate taxes. You get nothing for that money unless the people who own the money WANT you to get something.
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  23. #82
    Site Staff - Moderator Brian4Liberty's Avatar
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    Bubble time again. There is an interesting TV show about property bidding wars in Arizona. No inspections, no knowledge of the interior, as is. Many episodes end with a statement that they make money no matter how bad a deal they got, due to housing prices rising so fast.

    http://dsc.discovery.com/tv-shows/property-wars
    Last edited by Brian4Liberty; 12-30-2012 at 02:23 PM.
    "Foreign aid is taking money from the poor people of a rich country, and giving it to the rich people of a poor country." - Ron Paul
    "Beware the Military-Industrial-Financial-Corporate-Media-Government Complex." - B4L update of General Dwight D. Eisenhower
    "Debt is the drug, Wall St. Banksters are the dealers, and politicians are the addicts." - B4L
    "Totally free immigration? I've never taken that position. I believe in national sovereignty." - Ron Paul


  24. #83

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    ABCD.

    Anything Bernanke Cannot Destroy.

    Currency and credit markets are about to go into their "shit show" stage.

    If you are a viable producer and smart with money, there are great residential opportunities in the USA right now. Detroit/NYC/Atlanta and other inner cities don't count, everyone knows the inner cities are decaying zoo's.

    The periphery of cities and into smaller towns, rural areas (USA) are prime real estate in the whole world.

    Do not forget, the whole Western world is in a housing bubble. Some places have popped, like the USA. That puts Americans at the forefront of recovery, in that sense, you are ahead of the pack.

    Here in Canada, our housing bubble POP has just begun. The real damage will not be known for about 2 years.

    Quote Originally Posted by Brian4Liberty View Post
    Bubble time again. There is an interesting TV show about property bidding wars in Arizona. No inspections, no knowledge of the interior, as is. Many episodes end with a statement that they make money no matter how bad a deal they got, due to housing prices rising so fast.

    http://dsc.discovery.com/tv-shows/property-wars
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