Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

There is no bubble
Free Republic | 8/24/05 | Self

Posted on 08/24/2005 6:58:33 AM PDT by austinite

Listen folks there is no bubble, take it from me there has been a cosmic shift in real estate investing. Foreign money, "old money", dead baby boomer inheritance money and speculation type money is pouring into the real estate market faster then Carter can make liver pills. There is now absolutely no connection between home ownership and personal income, real estate (residential) in the US is now a global economic comody, just like pork bellys and sugar cane. Who cares if the average income family can no longer afford the average home. Don't worry. Their money is unimportant. They should be renters anyway. The big players control the game now, the little guy is insignificant now and forever.

Housing will appreciate 10,15,20% a year, year in and year out- forever. Don't ever expect a correction. In just ten years the AVERAGE house will be well over $400,000, pricing completely out the average worker, which is a good thing in the long run for the invester class.

Buy a house if you can, actually buy 1,2,3 as many as you can!


TOPICS: Your Opinion/Questions
KEYWORDS: bubblehousing; housing; makeyoufeelfine; realestate; tinybubbles
Navigation: use the links below to view more comments.
first previous 1-20 ... 41-6061-8081-100101-117 last
To: Spottys Spurs

I have two friends one a mortgage broker and the other a realtor. Both told me things are really starting to change since most of the investors are tapped out and are getting hammered with carrying costs. They both told me they think the high property taxes and fuel costs are scaring people off as well as the feeling that the most of the appreciation in many areas has peaked.

So, when people don't see the potential for gain in a lot of these areas, people just are not going to jump at these insane prices anymore.


101 posted on 09/12/2005 12:29:22 PM PDT by chris1 ("Make the other guy die for his country" - George S. Patton, Jr.)
[ Post Reply | Private Reply | To 86 | View Replies]

To: Amish with an attitude

Wait till some of these renters don't pay a few months rent and get to stay there rent free via some landlord tenant judge.

RE is great, but many who have bought into the Carlton Sheets deals have no clue about dealing with tenants and zoning laws.


102 posted on 09/12/2005 12:31:16 PM PDT by chris1 ("Make the other guy die for his country" - George S. Patton, Jr.)
[ Post Reply | Private Reply | To 89 | View Replies]

To: Nonstatist

Everyone I knew who were stock marketeers in the late 90's immediately ran to RE once that market crashed. I knew all I needed know about what is going on when I saw that happen.

Its like the Sopranos episode when they hyped that b.s. stock "limbistics" and all sold out right before they knew the floor would drop.


103 posted on 09/12/2005 12:35:43 PM PDT by chris1 ("Make the other guy die for his country" - George S. Patton, Jr.)
[ Post Reply | Private Reply | To 99 | View Replies]

To: durasell

"Could higher fuel costs this winter push a lot of folks over the financial edge?"

Since so many products are derived from oil, there may be the need for interest rates to rise in order to counteract inflation.


104 posted on 09/12/2005 1:18:26 PM PDT by Amish with an attitude (An armed society is a polite society)
[ Post Reply | Private Reply | To 65 | View Replies]

To: Nonstatist
Sorry, but the Japanese banking system and real estate market is not like the US. Japan has a declining, aging population, which certainly has an impact on residential real estate. Japan does have a home ownership rate of around 60%, which is comparable to ours. Japan has also suffered through almost two decades of deflation/stagflation.

No one is saying the real estate market is sacrosanct. Nor are the stock market, bonds, etc.

105 posted on 09/12/2005 3:08:16 PM PDT by kabar
[ Post Reply | Private Reply | To 99 | View Replies]

To: palmer
I sold in Vienna, but too early (2002) because I thought prices were already too high then. So I have a long commute now, but my monthly payments of all types is about $400 or so.

Most people don't buy their personal residence as an investment. It is where they want to live. They are somewhat insulated from the "housing bubble" presuming they have fixed mortgage rates. Over time housing costs should decrease as a part of their budget just from inflation alone. What has been painful for those of us living in areas of rapid appreciation is the escalating property tax bill. Unless you take some equity out (and increase your debt) increasing home values look great on paper but the net effect is higher taxes. Longer commutes also mean higher gas bills.

I disagree about Loudoun county, I thought there could be one more burst of buying with short supply to drive up prices some more, but now supply has swamped demand. Those 500 tract mansions are not going to be bought at their current prices since speculators have stopped buying and are now selling and the people in Herndon who want to trade up to a tract mansion are priced out.

You may be right in the short term, but not in the long term. When I first moved here in 1970, Tysons Corner was far out. Dulles was a sleepy little airport dwarfed by National. The entire Dulles corridor has been built out, Dulles has doubled in size physically and I would wager that passenger throughput has risen exponentially. The entire area is growing faster than the supply of housing. Eventually, we will see a second Beltway. The demographics will mandate an increase in the housing supply.

Loudon County is the fastest-growing county in the country. From a March 2005 WP article: "With plenty of new jobs being created in Loudoun, and house hunters looking increasingly to Washington's western suburbs for lower-priced property, home sales in the county rose to 11,935 in 2004 from 10,121 in 2003 and 7,762 in 2002."

"But in another sign that Loudoun is no longer the bargain spot it once was, the median sales price jumped to $420,000 in 2004 from $344,000 a year earlier."

"That lifted prices in Loudoun ahead of neighboring Fairfax County, where the median home price was $415,000 last year.

Want to see what it means that Loudoun is the fastest-growing county in the United States, as U.S. Census data show? Just take a peek at the county's residential real estate market.

106 posted on 09/12/2005 3:28:45 PM PDT by kabar
[ Post Reply | Private Reply | To 100 | View Replies]

To: kabar
No doubt Loudoun's growth was phenomenal, but as your article says, 11,935 homes sold in 2004, right now there are 2332 listings. Check it out in http://www.homesdatabase.com/ There is no way all those $800k - $1m tract mansions are going to sell to 2300 suckers. The tide has turned, there are now more speculators selling than speculators buying and the number of immigrants and tradeups isn't going to keep up. I could be wrong (Gspan lowers interest rates to zero or something like that), but I doubt it.
107 posted on 09/12/2005 3:46:23 PM PDT by palmer (Money problems do not come from a lack of money, but from living an excessive, unrealistic lifestyle)
[ Post Reply | Private Reply | To 106 | View Replies]

To: Amish with an attitude

Yes. But I was thinking of a more direct correlation. For instance, there might also be a pull back on consumer speeding.


108 posted on 09/12/2005 3:49:11 PM PDT by durasell
[ Post Reply | Private Reply | To 104 | View Replies]

To: al_again
I'm having trouble telling if this is sarcasm or not.

Extreme sarcasm. And in MHO on target.
109 posted on 09/12/2005 4:01:09 PM PDT by Liberty Valance (There is no restraining men's tongues or pens when charged with a little vanity. ~ George Washington)
[ Post Reply | Private Reply | To 4 | View Replies]

To: palmer

Let's see what the story is ten years from now.


110 posted on 09/12/2005 4:06:03 PM PDT by kabar
[ Post Reply | Private Reply | To 107 | View Replies]

To: kabar

Interesting, our home builder, Pulte, is building a huge 200 complex of apartments on the back edge of the 800 single family home development. Probably to "corner the market"......


111 posted on 09/12/2005 4:28:00 PM PDT by Reaganesqe
[ Post Reply | Private Reply | To 90 | View Replies]

To: Reaganesqe
Interesting, our home builder, Pulte, is building a huge 200 complex of apartments on the back edge of the 800 single family home development. Probably to "corner the market"......

I assume they must have done some research to make an investment of that size.

The U.S. population is growing by about 2.5 million people each year. Of that, immigration contributes over one million people to the U.S. population annually.

Using the Census Bureau's medium projections, U.S. population will grow to 394 million by the year 2050.

The United States has one of the highest natural growth rates (0.7%) of any industrialized country in the world. For comparison, the United Kingdom's natural increase is one quarter the rate of the U.S. at 0.2%, while Germany's natural increase is 0.

Florida's population has grown from 1.9 million in 1940 to 15 million today. That is over a 600% increase in just 50 years.

Where do you think all these new people are going to live and work? We will need to build new housing to keep up with population growth.

112 posted on 09/12/2005 4:38:19 PM PDT by kabar
[ Post Reply | Private Reply | To 111 | View Replies]

To: kabar

Agreed. With intelligent planning, our little town of Dixon, CA is destined to be a thriving modern living/working community of 100,000 within the next ten years. The newer communities have a much better opportunity to grow and develop than those poorly planned, overly-built, traffic infested ones......


113 posted on 09/12/2005 4:55:48 PM PDT by Reaganesqe
[ Post Reply | Private Reply | To 112 | View Replies]

To: Reaganesqe

Based on just a little information I gathered from the Internet, Dixon looks like a nice place to live and is situated in a good location, which should augur well for future growth. Close to Sacramento, UC-Davis, and RT 80, it appears you will grow quickly.


114 posted on 09/12/2005 5:06:47 PM PDT by kabar
[ Post Reply | Private Reply | To 113 | View Replies]

To: austinite
uh oh . . . /grin


115 posted on 09/12/2005 6:29:50 PM PDT by agrarianlady
[ Post Reply | Private Reply | To 1 | View Replies]

To: agrarianlady

bubble bump


116 posted on 09/13/2005 8:16:08 AM PDT by austinite
[ Post Reply | Private Reply | To 115 | View Replies]

To: kabar
We will need to build new housing to keep up with population growth.

Interesting from Standard & Poor's.

Housing Boom, Oversupply of Housing Units Continue to Weaken REITs, says S&P Report

"The number of housing units, particularly apartment buildings, constructed has far exceeded the level of household formation over the past several years -- and the spread continues to widen. Standard & Poor's projects 2.04 million housing starts in 2005, with the formation of only 1.41 million new households. The spread of 630,000 excess units for this year is 4.2 times greater that it was just two years ago. And the average apartment building's vacancy rate more than doubled to 6.9 percent in 2003 from 3.1 percent in 2000. Traditionally, newly formed households have been renters rather than buyers, but with home affordability historically high, many new households have opted to skip renting altogether and many existing households are making the jump to home ownership."

http://biz.yahoo.com/prnews/050915/nyth137.html?.v=25

117 posted on 09/15/2005 11:26:35 AM PDT by agrarianlady
[ Post Reply | Private Reply | To 112 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-20 ... 41-6061-8081-100101-117 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson