It's only a Joke to those who are not buying. I have several Millionair Friends who have picked up Vaction spots in Miami for pennies. A few picked up Some property in Vegas in the last few months. Texas Land and some Commerical Spots are gems! Dealing with local and regional banks, not multinationals. Locals and Regional are more than happy to lend right now, to the right person. It's a blessing to those of US picking up Commerical Space and Land. Keep'm going lower Mr. FED! This is one of the best times ever to buy RE for asset protection. Only one other time like this, Great Depression, 1930s. Prices are so depressed and your able to get a fix rate for under 4.2% soon to be near 3% or even lower than 3%? LOV'N IT!
But will you be lov'n your present purchases when prices bottom out?? Some are predicting the 10-year at 1%. What will that do to prices on the RE you recently dived-in upon?
Then if the fed succeeds in pumping up inflation the government will do the heavy lifting of paying off the mortgage for you. If not u still have the low rates.
While the consensus view... not necessarily correct.... depends upon the supply and affordability. IOW... we could get LOTS of inflation is all things EXCEPT housing.
Then if the fed succeeds in pumping up inflation the government will do the heavy lifting of paying off the mortgage for you. If not u still have the low rates. ------------------------------------------------------------------------------- Maybe..... It's a tricky situation but your are correct, I have locked in low rates as most of the people I know. Key thing is taxes. If Property tax's increase at a fast rate, then this could pose a problem. By fast I mean 100% year over year. As far as what will "Lower" Rates do to current purchase Property? Nothing. As very few buyers are in the Market. The value of property in Texas is not going lower....it is actually stable and in some area's rising. Property Value in Vegas and Florida, where Friends bought...they got in at such for such a low cost...property could collapse another 30% and they are ok. It's a buyers market. Period. But the fact is, middle class has lost purchase power and will continue to. They made up the bulk of Homes/Condo's. The Commerical Property was over-extended and all leveraged "Firms", Banks, Investment Groups, are unwinding at pennies on the dollar. Even with 10 years at 1%, A bulk of purchasing power is out of the market. I doubt 10@ 1% will effect me at all.
Its been my experience that the best time to buy is when rates are high. If you buy when rates are scraping bottom, what do you do on your comm'l loan that needs to be rolled in 5 years and rates are up 300-500 basis points? Answer: bend over.
I doubt the best time to buy is when Rates are High. Second, Fixed rates for long term already locked in for me. Do your homework, Fixed rates are back for Commerical Lending. Third, pay it off before the end of the note..make extra payments...rather than put money in an CD, or Savings. It's not rocket science. Using Property as a safe haven, I didn't invent the idea, I'm just following the smart money I deal with.
In Japan, commercial property lost 90-95% of value. Residential lost, what? Not sure. Could be 80%. John Templeton suggested "RE's bottom will be 90% off of top". Have we seen anything like that here so far? Not arguing a position... just noting observations...
commercial property lost 90-95% of value: You are correct on this and Japan had a lost generation, which we could as well. Im still young, so this is a longer term play. But you have valid "What If' Concerns. If we head the way of Japan, we will have a "revolution". And if that happens, our monitary system will collapse as in Russia. If this is the case, I rather own property as "Foreign" interest will swoop in and bid up assets in America, which is happening right now. If we imploded even more, more Foreign money will move in. The deconstruction of the US, will not destroy it but will put it up for sale, dirt cheap, comparied to the rest of the "Industrial Nations". I rather have "Things" I can unload and sell, than paper money that will be worth nothing in exchange for foreign currency. Of course, odds are, the US will have a sweeping Change in NOV...which will set the country on a course away from falling. So, I believe in the future..RE will be worth a shit tone more than what it is now for a few reasons. Few will own property in the Future. Inventory will be burned through, mostly foreign money buying up RE thus, getting rid of the excess. Inflation will hit our system with a vengence and Hard Assest will rise in value...for the next few decades.