Originally Posted by RawAlex

Until there is a major change in the world wide economy, the interest rates are not going to move. Places like japan are still seeing interest rates at or below 1% typically. I truly doubt you will see anything above 5% in US or Canada in the next 5 years. The reason is pretty simple: Lower interest rates lower the value of bonds, which is how the government borrows money. With Bush digging an economic hole as fast as he can, there is no desire to make that money more expensive. As a secondary effect, it keeps the value of the US dollar down a bit, which raises the prices of imports but makes it possible to produce goods at a competitive rate inside the US, which means more employment, which means more demand for housing, which works best is a low interest rate situation.

Originally Posted by Almighty Colin

The US doesn't control the price of treasuries though. Treasuries are sold in auction. The buyers of treasuries determine the price. As far as the supply side, all other things being equal when the government borrows money by selling bonds that increases the supply of bonds, decreases their price and therefore increases the associated interest rates.

Also, I don't know what you meant by the statement that "Lower interest rates lower the value of bonds". The price of a bond increases when interest rates drop.

The fed keeps increasing the price of credit by raising rates. The higher employment you mention is likely to lead to more rate hikes. Only some other negative economic signs wil keep them from raising rates. There are some so we will see.

*IF* the fed keeps hiking rates, bond yields will likely follow.

But a bubble is a bubble is a bubble. Low rates just further inflate speculation and make the pain all the greater in the end.

Originally Posted by Biggy2

Don't even talk to me about NYC :)

a 1 BR piece of shit pre-1950 800 sq ft apt in midtown goes for 5-600k.
A family friend is selling a building downtown they paid 3-400k for 30 years ago for something ridiculous like 10 or 12 million (its 3 level brownstone downtown with 3 1-BR apts).

Originally Posted by Biggy2

Don't even talk to me about NYC :)

a 1 BR piece of shit pre-1950 800 sq ft apt in midtown goes for 5-600k.
A family friend is selling a building downtown they paid 3-400k for 30 years ago for something ridiculous like 10 or 12 million (its 3 level brownstone downtown with 3 1-BR apts).

Originally Posted by vending_machine

350k in 1975 would be about 1.3M today counting inflation, still a pretty good appreciation ;)

Originally Posted by Eric_aka_RedEyes

We live in California, there isn't a bubble here. It is a slope up and to the right.

Originally Posted by Biggy2

Don't even talk to me about NYC :)

a 1 BR piece of shit pre-1950 800 sq ft apt in midtown goes for 5-600k.
A family friend is selling a building downtown they paid 3-400k for 30 years ago for something ridiculous like 10 or 12 million (its 3 level brownstone downtown with 3 1-BR apts).

Originally Posted by betsyAFF!

I bought in Ft. Greene, Brooklyn right after 9-11.... 2br 1bath 1200 sq foot with a 350sq foot private roof deck for just over 300k. :) It seemed like a shitload of money at the time, but it's almost doubled in value since then. I'm gonna need that cash if i wanna buy out here!

Originally Posted by Matrix

So Lars if you don't mind me asking advice, seeing that you are a man of intellect on this board....my landlords just told me Sunday that they are selling the house I have been renting for 2 years and to either buy it or move out by Jul 1st. I was paying 2200 a month rent and they are selling the house for 600k which would make the payments go up quite a bit. This is Woodland Hills ca. Nice area but the house is not all that great, needs some care and new backyard fence etc. So my question is, do I rent for another year and wait and hope the market bursts or buy now. SO many people are on oppisite sides with this issue. Some say I am throwing money away but otherd say the market has to re-check itself. What do you think.
Thx for the advice. :)

Originally Posted by JJ Gold

I think California law states that they have to give you 90 days and right of first refusal.

Originally Posted by JJ Gold

The biggest pop in this bubble will be when people who have taken out seconds or Ditech'd their way through the last five years start to fall. There will be widespread foreclosures. I want to have some dry powder to take advantage.

Originally Posted by jayeff

The world is facing an economic scenario has never existed before, and China is the key.

Since 1994 China has pegged its currency to the dollar and with the declining value of the dollar against other major currencies, China's currency has itself become undervalued. During that same period the US trade deficit with China has grown beyond $150 billion a year: more than double the deficit with Japan. China has also become one of the US major creditors: almost half of the $2 billion a day that the US borrows is loaned to it by China, Japan, Taiwan and South Korea.

Effectively China has control of the US economy and if China fulfils its committment to the World Trade Organisation to allow its currency to float, the dollar will collapse, shopping at Wal-Mart will become like shopping on 5th Avenue, interest rates will soar and house prices will implode. Apart from the fact that the Chinese have always gone their own way, the only reason this hasn't already happened is that the Chinese have a huge investment in the US to protect.

My highly unqualified guess is that the correction will come within 3 years. A lot depends on what Chinese objectives were in encouraging this situation in the first place and exactly what pressure to revalue other countries put on China in the meantime. The one sure thing is that the US no longer has the industrial base to trade itself out from under, so if the time scale is longer, the ultimate impact will be much greater. Whatever will happen it is near impossible to imagine a scenario that isn't going to be extremely painful for the US.

Originally Posted by Matrix

So Lars if you don't mind me asking advice, seeing that you are a man of intellect on this board....my landlords just told me Sunday that they are selling the house I have been renting for 2 years and to either buy it or move out by Jul 1st. I was paying 2200 a month rent and they are selling the house for 600k which would make the payments go up quite a bit. This is Woodland Hills ca. Nice area but the house is not all that great, needs some care and new backyard fence etc. So my question is, do I rent for another year and wait and hope the market bursts or buy now. SO many people are on oppisite sides with this issue. Some say I am throwing money away but otherd say the market has to re-check itself. What do you think.
Thx for the advice. :)

Originally Posted by LegendaryLars

April 2005: The average sales price for March was $821,695. This is a new all-time record high, and the first time it has exceeded $800,000.


Santa Cruz county Where I live..

fucking retarded.. 700K gets you a 1100 sq ft shack on a 4500 sq ft lot

Originally Posted by SEGuru

This is really Brandy.....off topic.....I can't wait to see you!

Originally Posted by Matrix

Love the shirt Lars. Also thanks for the insight on the housing market, I know no one can predict where the market is going, or like you said, they'd be rich. But it's good to know what others are doing especially if they have experience in that area. thx :)

Originally Posted by SilverCash Thurbs

REITs are great, when my Dad took his public, it was great oppurtunity to sell when it doubled and buy it all back when it plummeted. best way to trade in REITs, be on the inside :)

You watch the Mad Trader on CNN Lars?

Originally Posted by Prowler

Dont come to California, and there is no money in Porn.