Real Estate Bubble - Page 2 - GoFuckYourself.com

RawAlex · 04-26-2005, 08:16 AM

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.

I bought my house just over three years ago, the neighbor just sold an almost identical unit for just about twice what I paid - and they are still building behind and around me. Your 800k will get you 4000 sqaure feet on the edge of a golf course or something smaller and older with a water view maybe water edge around here.

Alex

ADL Colin · 04-27-2005, 03:17 AM

Quote:

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.

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.

Herb Kornfield · 04-27-2005, 05:35 AM

It's going to burst hard and really burn a lot of people.

The market is out of control here in Philly, people are paying $300k for houses that were selling at $30k only 4 years ago...

I have seen alot of friends buy a $400k house and are only making $150k a year at best. How they can sleep at night and be comfortable with that much overhead is beyond me. $3,000 a month is WAAAAY to high for a mortgage payment. Dont forget Car notes + kids + lifestyle...

I bought a $97k house in 2001. 3 bed / 2 bath that has 2000 sq ft. I have dumped close to 100k in rennovations into it that I paid cash for as I went along but the mortgage payment is still only $901. The house next to mine that had nothing done over the last 15 years is listed at $200k.

Buy cheaply and live within your means. These people overpaying are going to get burned hard when the market bottoms out. It happened in the late 80s here in philly.... houses were 100k one year and $20k the next.... Now these places are $200k and the old timers are cashing in like mad on the younger folks that have no basis in reality when it comes to buying a home.

sweetcuties · 04-27-2005, 05:47 AM

Yea, I agree it's gonna burst soon. Only certain markets can dictate current rates. Some investments such as land and waterfront lots are the safest bets.

I'm about to get fucked on one of my properties. Just bought another place and decided not to move in. Market rates where I'm at are increasing but I'm predicting 2-3yrs before I see a major increase. There's alot of new construction and people upgrading, so there's alot of houses on the market

Xenophage · 05-25-2005, 01:56 PM

Quote:

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.

Yes Low rates are the feul that stokes this fire.

$5 submissions · 05-25-2005, 01:59 PM

Median house price in California recently hit the $500K mark... Crazy.

There's a bit of a bubble here in the Philippines as well. Really nice US-style single detached housing development units cost over $200K for starters. Pretty mind boggling given the anemic economic growth since 1997.

Biggy2 · 05-25-2005, 02:03 PM

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).

$5 submissions · 05-25-2005, 02:06 PM

Quote:

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).

DAMN... from 400K USD to $12M That's all I gotta say... DAYUUUUUUM that is some PIMP appreciation, man.

hyper · 05-25-2005, 02:06 PM

4700 sq ft $200k ;)

TheSenator · 05-25-2005, 02:14 PM

Quote:

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).

That be of shit property is hot real estate in the mecca of the whole world.

vending_machine · 05-25-2005, 02:22 PM

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

Xenophage · 05-25-2005, 02:24 PM

Quote:

Originally Posted by vending_machine

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

yes a recent stat was 1985 1 mil is no worth 1.8 mil in inflated dollars

axelcat · 05-25-2005, 02:39 PM

Quote:

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.

Cali real estate is sick

betsy · 05-25-2005, 02:40 PM

Quote:

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).

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!

Xenophage · 06-01-2005, 03:27 PM

Quote:

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!

For sure ! congrats !

Matrix · 06-01-2005, 04:29 PM

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.

reynold · 06-01-2005, 05:57 PM

Apart from webmastering, real estate is where the money is now..

JJ Gold · 06-01-2005, 08:13 PM

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.

JJ Gold · 06-01-2005, 08:15 PM

Quote:

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.

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

Matrix · 06-02-2005, 11:01 AM

Quote:

Originally Posted by JJ Gold

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

Thanks for the heads up I'll look into the 90 days, that would help a lot. They did give me the chance to buy it before they put it on the market but my agent told me it is over priced by 50 k comparable to other homes that have sold in the area. I offered 550 but they want to wait until it is on the market before they take the offer thus I either pack up and get a new place or wait and hope the offer will hold but then I may be out a whole lot more when I don't have a place to move to come the end of the month.

sweetcuties · 06-02-2005, 11:04 AM

Quote:

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.

I just had this convo with my friend this morning. Looking forward to the massive forclosures, then rent them out. Once the market turns around within the next 10yrs... I'll be there with a few properties. Everything, be it... real estate, stocks, goes in cycles

czarkazm · 06-02-2005, 11:47 AM

Quote:

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.

at least we have one somewhat intelligent person in this thread.

Xenophage · 06-02-2005, 12:18 PM

Quote:

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.

I would love to be able to answer this question for you. I can not since I have no idea what is really going to happen. If I did i would be far richer than i am today

I am personally not buying any new real estate now my goal is to be 1/3 cash 1/3 stock 1/3 real estate I have been at that for the last 5 yeras. But since I have not bought a property in the last year, last one I did was around 18 months ago. I only buy houses i woudl live in, In case I ever had to, and I try to only buy properties that are break even in case I have to sit on them for 10 or more years. These are the things I do to reduce risk. When i bought my first house to live in, I could barely afford it and it was a leap of faith, in a hot market similar to today. I was nervous I was buying at the top. Since then the house is almost triple what I bought it for. So its impossible for me to give you advice otehr than to tell you what I do.

jimmyf · 06-02-2005, 12:39 PM

Quote:

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

there is a Bubble in the bay area, and I think it's going pop.

If I'm not mis-taken it already has in the commercial.
I was paying $1,450.00 per month for my office in 09/2001 now it rents for $800.00, and I ain't moving back. It went from $595.00 to $1,450.00 within 2 years

SEGuru · 06-02-2005, 12:59 PM

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

taibo · 06-02-2005, 01:23 PM

whoa ... great investments

Xenophage · 06-03-2005, 12:56 PM

Quote:

Originally Posted by SEGuru

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

White trash bash very soon !

Xenophage · 06-04-2005, 10:13 AM

more articles read last night in a few more mags... one had a chart fo the last 100 years of real estate in the US it was fuckign scary !

Matrix · 06-06-2005, 02:09 PM

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

taibo · 06-06-2005, 02:22 PM

living in nyc is pretty expensive

Xenophage · 06-06-2005, 03:02 PM

Quote:

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

My pleasure

Kiwigirl · 06-06-2005, 03:43 PM

Florida has one hell of a bubble. Our property value has increased 40% in 2 yrs.
Pretty good return for real estate.

pxxx · 06-06-2005, 03:45 PM

I don't think it is like that down here.

Xenophage · 06-29-2005, 10:41 AM

Instead of buying more real estate i have decided to invest in Reits with more liquidity than actual properties and mroe diversification across the whole country.

IYR is an ETF that holds tons of Real estate stocks and pays a nice dividend. And I can get out on the turn of a dime when the bubble starts to fade.

Thurbs · 06-29-2005, 10:55 AM

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?

Rinaldo · 06-29-2005, 11:00 AM

i'd rather live on a lake and die happy

Xenophage · 07-18-2005, 02:33 PM

Quote:

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?

Jim Cramer ?

Xenophage · 01-21-2006, 12:29 PM

Burstin yup it is

SinisterStudios · 01-21-2006, 12:55 PM

Quote:

Originally Posted by Prowler

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

Who says you have to be in California to do porn?

Xenophage · 02-20-2006, 10:04 AM

http://patrick.net/housing/crash.html#links

check this out the Bubble is now unraveling

04-27-2005, 05:47 AM	#54
sweetcuties Confirmed User Join Date: Feb 2002 Location: Somewhere Posts: 5,859	Yea, I agree it's gonna burst soon. Only certain markets can dictate current rates. Some investments such as land and waterfront lots are the safest bets. I'm about to get fucked on one of my properties. Just bought another place and decided not to move in. Market rates where I'm at are increasing but I'm predicting 2-3yrs before I see a major increase. There's alot of new construction and people upgrading, so there's alot of houses on the market __________________

05-25-2005, 01:59 PM	#56
$5 submissions I help you SUCCEED Industry Role: Join Date: Nov 2003 Location: The Pearl of the Orient Seas Posts: 32,195	Median house price in California recently hit the $500K mark... Crazy. There's a bit of a bubble here in the Philippines as well. Really nice US-style single detached housing development units cost over $200K for starters. Pretty mind boggling given the anemic economic growth since 1997. __________________ Need a NON-ADULT income stream? We build your YOUTUBE CHANNEL for only $20 per video! For Hire: $3/hour or $400 per month Marketing Specialist Virtual Assistants

05-25-2005, 02:06 PM	#59
hyper Confirmed User Join Date: Mar 2002 Location: Mass Ass Posts: 5,294	4700 sq ft $200k ;) __________________

06-01-2005, 04:29 PM	#66
Matrix Confirmed User Join Date: Jun 2003 Location: Washington Posts: 161	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. __________________ I may be here, I may be there; nobody knows, nobody cares!

06-02-2005, 12:59 PM	#75
SEGuru Confirmed User Join Date: Oct 2002 Location: Fort Lauderdale...on the Intracoastal! Posts: 1,005	This is really Brandy.....off topic.....I can't wait to see you! __________________ AffConEvents.Com \| Tune in Live & Listen to Internet Radio for Webmasters Buy Cheap Text Links

04-26-2005, 08:16 AM	#51
RawAlex So Fucking Banned Join Date: Oct 2003 Location: In a house. Posts: 9,465	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. I bought my house just over three years ago, the neighbor just sold an almost identical unit for just about twice what I paid - and they are still building behind and around me. Your 800k will get you 4000 sqaure feet on the edge of a golf course or something smaller and older with a water view maybe water edge around here. Alex

04-27-2005, 05:35 AM	#53
Herb Kornfield Is on the 1 Industry Role: Join Date: Sep 2002 Location: Philly Burbs Posts: 4,996	It's going to burst hard and really burn a lot of people. The market is out of control here in Philly, people are paying $300k for houses that were selling at $30k only 4 years ago... I have seen alot of friends buy a $400k house and are only making $150k a year at best. How they can sleep at night and be comfortable with that much overhead is beyond me. $3,000 a month is WAAAAY to high for a mortgage payment. Dont forget Car notes + kids + lifestyle... I bought a $97k house in 2001. 3 bed / 2 bath that has 2000 sq ft. I have dumped close to 100k in rennovations into it that I paid cash for as I went along but the mortgage payment is still only $901. The house next to mine that had nothing done over the last 15 years is listed at $200k. Buy cheaply and live within your means. These people overpaying are going to get burned hard when the market bottoms out. It happened in the late 80s here in philly.... houses were 100k one year and $20k the next.... Now these places are $200k and the old timers are cashing in like mad on the younger folks that have no basis in reality when it comes to buying a home.

05-25-2005, 02:03 PM	#57
Biggy2 Confirmed User Join Date: Feb 2002 Posts: 1,821	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).

05-25-2005, 02:22 PM	#61
vending_machine Confirmed User Join Date: Jun 2002 Location: Seattle Posts: 1,062	350k in 1975 would be about 1.3M today counting inflation, still a pretty good appreciation ;)

06-01-2005, 05:57 PM	#67
reynold Too lazy to set a custom title Join Date: Oct 2002 Location: Global Traveler Posts: 51,271	Apart from webmastering, real estate is where the money is now..

06-01-2005, 08:13 PM	#68
JJ Gold Confirmed User Join Date: Aug 2004 Posts: 1,969	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.

06-02-2005, 01:23 PM	#76
taibo Confirmed User Join Date: May 2005 Posts: 3,720	whoa ... great investments

06-04-2005, 10:13 AM	#78
Xenophage Registered User Industry Role: Join Date: Oct 2001 Posts: 12,122	more articles read last night in a few more mags... one had a chart fo the last 100 years of real estate in the US it was fuckign scary !

06-06-2005, 02:09 PM	#79
Matrix Confirmed User Join Date: Jun 2003 Location: Washington Posts: 161	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 __________________ I may be here, I may be there; nobody knows, nobody cares!

06-06-2005, 02:22 PM	#80
taibo Confirmed User Join Date: May 2005 Posts: 3,720	living in nyc is pretty expensive

06-06-2005, 03:43 PM	#82
Kiwigirl Confirmed User Industry Role: Join Date: Mar 2005 Location: Florida Posts: 2,556	Florida has one hell of a bubble. Our property value has increased 40% in 2 yrs. Pretty good return for real estate. __________________ KIWISOURCING OUTSOURCING WITH A TWIST!

06-06-2005, 03:45 PM	#83
pxxx First African GFY Member Join Date: Mar 2004 Location: New Jersey Posts: 12,114	I don't think it is like that down here.

06-29-2005, 10:41 AM	#84
Xenophage Registered User Industry Role: Join Date: Oct 2001 Posts: 12,122	Instead of buying more real estate i have decided to invest in Reits with more liquidity than actual properties and mroe diversification across the whole country. IYR is an ETF that holds tons of Real estate stocks and pays a nice dividend. And I can get out on the turn of a dime when the bubble starts to fade.

06-29-2005, 10:55 AM	#85
Thurbs The Thrilla in Manila Join Date: Sep 2004 Location: Thurbs' Lagoon, Christmas Island Posts: 4,785	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?

06-29-2005, 11:00 AM	#86
Rinaldo Confirmed User Join Date: Sep 2003 Location: South Florida Posts: 5,086	i'd rather live on a lake and die happy

01-21-2006, 12:29 PM	#88
Xenophage Registered User Industry Role: Join Date: Oct 2001 Posts: 12,122	Burstin yup it is

02-20-2006, 10:04 AM	#90
Xenophage Registered User Industry Role: Join Date: Oct 2001 Posts: 12,122	http://patrick.net/housing/crash.html#links check this out the Bubble is now unraveling