Exactly In the more heated areas, if you compare renting the same space vs buying it, it makes little sense to buy unless you firmly believe that your property will keep going up forever & ever. In the northeast you can find some great living spaces & houses to rent at great prices instead paying inflated market prices for the same place. In NYC, rents have always been quite cheap in comparison to buying due to rent laws, unless you're one of the suckers who ends up paying 2k for a shoebox with cockroaches. It is a fact that the rent price index is historically low vs home prices. That trend cant continue forever.
HYDROBLUNT- despite your apparent pastime as implied by your handle...i agree with you 100% you are dead right. i could not have said it better myself. if i had tried, i surely would have screwed it up. glad i sold all my realestate!!! "the home you live in is an EXPENSE"-robert koyasaki
oh great ..THIS guy again. on on ET do you start talking about trading and economics, and wind up getting insulted by a beautician with an inferiority complex!
When I decide to buy real estate for investment purposes, I look entirely on the cash-flows from renting to see 1) which properties can deliver the biggest rate of return 2) which properties generate enough net income to cover atleast 140% of the mortgage. Unlike others in the business, I ignore the appreciation component completely. There is still value in some markets. It's the people who buy into the overpriced markets with 5-year ARM I/O mortgages that are in big trouble if housing prices go flat or start to decline. Interest rates or property taxes will eventually kill them off.
I hope it will also but that's not possible cause then noone would ever invest in a rent producing property and naturally reduce the buying demand. Especially in the NYC boroughs where every other joe shmoe thinks he/she is smart and finances a 2 story house in order to rent it out and have it pay for itself. Use you brain, it can do wonders.
ummm... ever heard of the 'jobless recovery'? Last I checked, we were outsourcing all of our high paying technical and research jobs to india, and our mid paying manufacturing jobs to china and everywhere else. The McKinsey analysis of outsourcing creating jobs back in the US is fundamentally flawed and has been proven clearly as such. I think your statement is eminently true. Unfortunately, not in the way you wish it to be.
Name three people you know who can't find a job who are truly trying to find one. We've been trying to hire a technician position at our firm for 3 weeks and an engineering position for over a year.