Mike. Anyone who still has an ARM deserves to lose all their money. There is no rational behind it. I'm also not familiar with these interest only ARMs buy surely they are not the norm, and cannot be held responsible for price gains.
Hey look!! It's a Fibonacci Cycle. Suggesting health because look at the periods of rapid expansion and periods of a soft landing. Really, once you notice price declines each quater for the last 6 or so, then you know the bubble had topped and now it's time to sell. Thank you so much for posting this.
If you have a product that allows people to buy more house than they should, or could afford, you increase the demand because those people locked out buy fixed rate loans can now , BUY, BUY, BUY!!!! That's one BIG piece of the puzzle here in Southern California. You make comments about how stupid people are that are in ARMS or IO loans. It happens every day. Personally, I'm pulling for 7+ % interest rates, for more reasons than a RE correction. RE won't go to zero like a lot of tech stocks, but, those who say it won't go down as much as 45% haven't been in California for more than 10 years.
? What do you mean by this? Are you talking about interest free ARMs There is a sucker born every minute. Why does everyone take whats happening in California and apply it to the rest of the country? California is in for a correction. A hard one, which will bring it more inline to the rest of the country. Just to clear some things up, I would never purchase a property above $500,000 for investment purposes. I only consider 100-400k. And on the lower end of that scale is preferred.
In SF Bay Area rents dropped precipitously (30% or so) in 2000 and 2001 and have been steady or dropped a bit since then. In the same time housing prices have gone up about 30%. Martin
let me rewrite this: Why does everyone take whats happening in California and apply it to the rest of the country? California is in for a correction. A hard one, which will bring it more inline to the rest of the country. to this (circa 1999): Why does everyone take whats happening in tech stocks and apply it to the rest of the stock market? Tech stocks are in for a correction. A hard one, which will bring it more inline to the rest of the stock market. one bad apple can really spoil the bunch. cali, lv, miami, ny, boston, etc...how you like them bad apples?
Assuming you're talking about a planned unit development (PUD) IMHO, lot prices are up because the PUDs are not being approved fast enough to keep up with demand. As interest rates go up, they will catch up. If I was holding lots, I'd sell them. If I was holding houses, I'd keep them and rent them because I'm seeing rents climbing. Then again, thats what I do.
I've been compiling an average from the classified section of the newspapers here in Tallahassee, FL for quite a while. If you don't know, Tallahassee has not had the price runs like places more to the south. Anyway, ever since October, rents have been climbing, and really jumped in the last couple of months. They are up about 12% or so of what they were a year ago. My take on it is that for a while, there were too many landlords relative to the number of buyers, and since prices on housing have climbed, a lot of those landlords sold off their holdings. So, there are fewer landlords left than there were, and as the rates rise, with the high cost of housing, people are getting shut out of purchases, so the landlords are finally starting to see some income for their patience. In summary, it was a shake out. I'm a member of a landlord association. It has about 20 active members, and at least half of them are millionaires. Probably a quarter of them are multimillionaires. Those multimillionaires are not selling, even though they stand to gain the most. Of course...if they sold, then they wouldn't be in the association...right? But still... SM
Smart money knows best....thanks for the advice. Will look into that...I have no clue what im doing... peace
I agree with you. I've bought real estate and it's been a goldmine. Those other guys are missing a major point ... they're not making any more land. Anyone who bought anything close to the ocean, at least on the southeast coast, has made out very nicely. The argument someone posted about having to pay taxes etc. is not well thought out. Lots that went for $25K 10-12 years ago are now selling at $250K where I'm living ... and the costs (i.e. taxes) in that time period have been miniscule compared to the appreciation.