Psychology of the Housing Bubble (and its collapse)

[wabmester]

If you're going to talk crazy get a sense of humour.

Back atcha guy!

(How was that?)

 

[honobob]

Back atcha guy!

(How was that?)

I don't think so!

Well, the dogs are OTFH (on the floor Howling)

Oh, OK that was mildly funny............bad dog..bad dogs..........

But on a serious note come'n and throw me a bone! Get it? A bone OTFH!!

 

[thefed]

Well, i didnt read this whole thread, but here's my take on this bubble

Any time sellers are FAR outnumbered by buyers, its a good time to BUY and HOLD

That's what I am doing. I put a small ad in a free newspaper advertising one of my rehabs, and got nearly 100 calls in 3 weeks!!!!

The higher rates mean less qualified buyers, and more renters. More renters than rentals= a slow increase in rent amount.


SO, I decided to 'flip' the game plan arund and buy for the long term...which IMO isnt a very bad retirement plan at all.

For example, I am confident I can acquire at lease two $50k homes for 30k or so (and rehabbing them) each year (todays prices)....buying the next with the equity of the last. My GOAL is to do this for about ten years, renting the whole way. With 15 yr repayment plans, I could easily have 20 homes throwing off a MIN of $500/mo 25 yrs from now. ..10k/month indefinately, with a portfolio value of 1 to 2 mil

that will give me another 25 yrs of 'work' to do, buying/fixing/landlording. But in the end, the payoff should and WILL be MUUUUCH greater than if I had simply invested that firt 30k in an index fund.


I guess this isnt really the point of the thread, but MY point is a bubble = a great time to buy n hold

So

 

[tryan]

With the house, the return was under 7%. He could have been much better off in the S&P -- so much for bursting their bubble.

Weellll, you have to deduct 53 years of inflation adjusted housing expences to make this an apples to apples comparison. Your inlaws could not have lived in an SP500 holding. :

 

[spideyrdpd]

Your not buying the stock exchange comparision to real estate are you ? No one pays cash for a real estate. You cant raise the dividends for the market but ya can raise rents . Over time of course.
Of course real estate is more of a business so its returns should be higher than you would get buying and holding a stock or index.

I kind of wonder where the Trump quote comes from as well. Its not like the s&p would of paid for all of ivana's jewels and her divorce. The man also seems to own/control some expensive real estate. So I doubt if that statement is correct.

 

[lazygood4nothinbum]

florida dec year over year numbers are in. not looking so terrible at the moment.

east coast up: (town percent) miami 7; fort lauderdale 2
east coast down: cocoa beach 3; palm beach 1; st lucie 0 (flat)
west coast down: naples 0 (all data not yet in); ft myers 3; punta gorda 1

right after we listed our house for sale (in palm beach county) the house which is priced above ours raised their asking price by $90k. no idea what she is thinking, but hopefully her upping the ante on hers will help any bidding on ours.

here are pics. first one is of our old backyard. a lot of fun was had at that dock.

and here's the house across the canal from our dock. they just finished building the other week.

 

[Alex]

florida dec year over year numbers are in. not looking so terrible at the moment.

east coast up: (town percent) miami 7; fort lauderdale 2
east coast down: cocoa beach 3; palm beach 1; st lucie 0 (flat)
west coast down: naples 0 (all data not yet in); ft myers 3; punta gorda 1

right after we listed our house for sale (in palm beach county) the house which is priced above ours raised their asking price by $90k. no idea what she is thinking, but hopefully her upping the ante on hers will help any bidding on ours.

here are pics. first one is of our old backyard. a lot of fun was had at that dock.

Very nice. So, why are you selling? are you downsizing?

 

[lazygood4nothinbum]

Very nice. So, why are you selling? are you downsizing?

boy has this area changed over 25 years. it went from really nice to really freaking nice, if you like that sort of thing.

my downsizing possiblities are limited as my residence is but a shotgun cottage. i suppose i could downgrade on land or downsize to a boat, but i already live in the antimansion.

we're selling because financially i think i have to and because it is too sad to hold on. house for sale is inheritance from mom. brother wants to keep it but i feel i need the income stream produced by investing the proceeds. and since none of us want to live there it seems to me to be less of a house & more of a pile of cash losing ground to inflation.