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Old 01-28-2008, 12:55 PM   #41
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$1300/mo would get you a $600,000 waterfront cottage in my area.
Crappy 2BR apartment near me for $1300, if you are lucky, have a deposit, and no pets.
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Old 01-28-2008, 12:57 PM   #42
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Some of these people have enormous egos, and some have enormous IQs, and some have enormous nest eggs, and many have all three.
Amen. And many enjoy spirited debate!
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Old 01-28-2008, 12:59 PM   #43
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$1300/mo would get you a $600,000 waterfront cottage in my area.
Wow, the bubble hasn't burst in your area yet?

Here in San Diego you could rent my house for more than our mortgage, it took 5 years of holding it to get to that point, though.
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Old 01-28-2008, 01:07 PM   #44
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Wow, people, have I jumped into a pool of women-eating sharks?
Good counteroffensive!

This isn't a gender issue or a "new-poster-hazing" issue. It's not a race or religion or occupational issue, either. We ask these kinds of questions for anyone who makes such flat assertions about subjects like rent vs own. Investors have to consider points of view that affect their psychology and their comfort zones-- otherwise they just won't follow through on the financial mechanics.

Rich (a contraction of his full name, not his financial status) was trying to get the rest of the posters over to this thread. You'd finished introducing yourself and this thread's subject was being discussed in two different threads, which was perhaps causing some confusion. It's not about you.

I have to admit to a bit of cynical suspicion when a poster responds to a bunch of questions with a counterattack instead of a bunch of answers. If you're interested in asking questions or subjecting your opinions (and your assertions) to analysis & discussion then you won't find a better place. But if you're planning to develop any sort of credibility then you'd better be willing & able to answer questions with data or studies or other links that support your assertions. Hence the Kiyosaki comment.

If you're thin-skinned or easily offended then you're definitely on the wrong board. If you're just here to raise a fuss and direct more traffic to your website then you're the latest of a long line of misinformed posters who were also on the wrong board. If you're here to deliver a lecture... well... good luck with that.
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Old 01-28-2008, 01:11 PM   #45
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$1300/mo would get you a $600,000 waterfront cottage in my area.
Actually, I wasn't at all clear. There are likely liveable $1300 houses here too; but they could not be bought for $300,000.

I guess these rent/buy comparisons are diagnostic of a speculative housing market.

Ha
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Old 01-28-2008, 01:12 PM   #46
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Crappy 2BR apartment near me for $1300, if you are lucky, have a deposit, and no pets.
Well, "waterfront cottage" is a euphemism for a crappy 2-BR place near a navy base, but the price/rent multiple is still crazy.
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Old 01-28-2008, 01:16 PM   #47
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Me thinks Mommy is saying a lot of the good things that some of the people were saying about California real esate prior to it crashing... or investing in internet companies (they used 'technology') prior to their crashing... but they do not stand the test of time...

MMND.... NOBODY that I know of that has any real training in portfolio analysis would be in equities 100%... and nobody would use a 10% rate of return for their calculations. Can you get 10%... why yes... but I would not bet my future on that kind of return...

And tell me, what is YOUR return since Oct or Nov of last year? OR, what is your YTD return?

Don't get me wrong... I am glad you changed your ways and are living the good life... but some of what you say just does not stand up to analysis in the long run.
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Old 01-28-2008, 01:31 PM   #48
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On checking Craigslist, I found that a house in my neighborhood that would now rent for $1500/month, would cost no more than about $185K.

That doesn't make renting seem like much of a wealth builder to me. Again, these things are REGION SPECIFIC and it's very difficult to generalize.
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Old 01-28-2008, 01:34 PM   #49
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On checking Craigslist, I found that a house in my neighborhood that would now rent for $1500/month, would cost no more than about $185K.

That doesn't make renting seem like much of a wealth builder to me. Again, these things are REGION SPECIFIC and it's very difficult to generalize.
That implies a cap rate of around 9%. You should buy as many of those as you can find. Forget the stock market.
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Old 01-28-2008, 01:37 PM   #50
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That implies a cap rate of around 9%. You should buy as many of those as you can find. Forget the stock market.
Heh, you forgetting about vacancy rate, maintenance, insurance (that must be interesting in NOLA), tenant damage, etc.?
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Old 01-28-2008, 01:40 PM   #51
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That implies a cap rate of around 9%. You should buy as many of those as you can find. Forget the stock market.
Not that anyone uses cap rates for single family houses but how can you come up with a cap rate with only two pieces of information on any property? Best that can be said is that it has a gross rent multiplier of 10.3 and that's only good for comparing with properties in that area that are comparable in most physical characteristics.
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Old 01-28-2008, 01:41 PM   #52
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I do not live in a basement in Missoula.

I will will conceed the Pat's have a good football team.

Even though I've owned for thirty years - I still like the idea of rent.

Debate? debate! We don't need no stinking debate - my mind is made up.

heh heh heh - and now that I'm older - Psst Wellesley. naner naner.
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Old 01-28-2008, 01:45 PM   #53
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I just finished up responding to the questions posed on my introduction post.

After a break, I'll return to this thread.

I'd like to preface with a friendly reminder - I did not start this thread. REWahoo asked me a question and I started my partial response last night. In my reply, I asked for feedback on whether or not I was on the right track with how I was interpreting his/her question. I posted ONCE on this thread. I wake this morning to find the conversation took off without me - and I think some of it got a little "awkward". Perhaps my chauvinist antenna was not working properly this morning. I will disregard the comments I found offensive and move on.

We don't need to agree here, especially when we're talking about PERSONAL finance. But I'd like to keep it polite and respectful. And as we all know, real estate market conditions vary wildly depending on location. The blog post referenced is a comparison made that reflects MY local real estate market and is my response to one person's specific question about what would work best for ME.

Okay, taking a time out, then I'll respond further.
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Old 01-28-2008, 01:54 PM   #54
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You could here, but you couldn't get an occupancy permit as there would be a hole in the roof and rats running around in the backyard.

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Sex is irrelevant.
Gender may be irrelevant, but sex isn't...
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Old 01-28-2008, 01:59 PM   #55
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What you have jumped into is a very big pond, and you aren't necessarily the biggest fish.
Some of these people have enormous egos, and some have enormous IQs, and some have enormous nest eggs, and many have all three.
Sex is irrelevant.
This is the money quote.
I'd add that many of been retired longer, and some of us younger.

On the other hand while a fair number of the people, and things like FIRECalc and books have been featured and quoted in Fortune, WSJ, Money Magazine etc. AFAIK you are a first TV celebrity so congratulations :-)

Putting on my good cop hat. 80%+ of the stuff on your blog is good, LBYM, invest in equities, don't mistake your house for an investment strategy etc. I'd also add that I think you are a good writer and your blog contains a lot of content and obviously you have a fair amount of traffic.

I think the other 20% is debatable NoLoadX, rent vs buy, 10% returns etc. But just because it is debatable doesn't mean it is wrong.

If we define the positive goal of this forum as helping people achieve FIRE, then MMND is definitely an ally in this goal. Put it this way if the typical spendthrift 25 year old read her blog and followed her advice would they be financially better off or worse? I think much better so the comparison to Kiyosaki is unfair since he is dangerous to your financial wealth.

On the other MMND since you have sought out and recieved media attention for your message and you are writing a book you have a special obligation to be accurate. I dare say that if your book ideas can endure the scrunity of this forum than they'll hold up fine against any book reviewer.
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Old 01-28-2008, 01:59 PM   #56
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Not that anyone uses cap rates for single family houses but how can you come up with a cap rate with only two pieces of information on any property? Best that can be said is that it has a gross rent multiplier of 10.3 and that's only good for comparing with properties in that area that are comparable in most physical characteristics.
This is from a guy who assumes that forward appreciation will be 11%/year?
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Old 01-28-2008, 02:08 PM   #57
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This is from a guy who assumes that forward appreciation will be 11%/year?
I think I said that I believe annual appreciation rates will be similar to the last 30 years in the areas I invest..oh, wait, that is 11% a year!! Yeah for me! Now back to this cap rate thing that you haven't responded to. Didn't we go thru this way back? I'm thinking I've discovered the weak link in your real estate investment strategy.
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Old 01-28-2008, 02:12 PM   #58
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And tell me, what is YOUR return since Oct or Nov of last year? OR, what is your YTD return?
While MMND takes a short break in responding (I do have some sympathy for her as it does appear she's found herself drinking from a fire hydrant), I took a look at the performance of a couple of the momentum funds offered by NoLoad FundX, the newsletter MMND describes as what she uses to pick her stocks. These are some seriously volatile funds (not that there is necessarily anything wrong with that).

For comparison, the S&P 500 is down approximately 9.4% YTD.

3 month performance for FUNDX. Looks to be down 15.1% YTD.


3 month performance for HOTFX which appears to be a more aggressive momentum fund. Looks to be down 19.2% YTD.
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Old 01-28-2008, 02:18 PM   #59
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I haven't seen anybody post one of the many rent vs buy calculators yet. Make your assumptions, and run the numbers.

Rent vs. Buy - Financial Calculators from Dinkytown.net
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Old 01-28-2008, 02:25 PM   #60
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MMND.... NOBODY that I know of that has any real training in portfolio analysis would be in equities 100%... and nobody would use a 10% rate of return for their calculations.
I think the Kaderli's are 100% equities again; not completely sure. They were 100% before the 2000-2002 market slump.
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