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Old 04-25-2008, 10:38 AM   #21
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It is kind of a stretch to consider a $2,000,000 building or farm as liquid or investable, especially right now due to the real estate problems. I understood it to mean your bank accounts plus your investment accounts, for example.
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Don't forget that, by definition, that $2M building or farm is valued at market. That means it would sell for $2M today and is liquid. Maybe it would have sold for $3M a couple of years ago, but today it's worth $2M.

Even if the $2M was appraisal value, I think in most areas today, popping it on the market for 10% - 15% below a fresh, accurate appraisal would probably move it. Not that big an adjustment for purposes of this study.
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Old 04-25-2008, 10:51 AM   #22
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Don't forget that, by definition, that $2M building or farm is valued at market. That means it would sell for $2M today and is liquid.
Valued by who? It's not like fungible assets like stocks or bonds, for which there actually is an active market and you can get up-to-the minute quotations from willing buyers.

That's one of the problems with real estate investments: most valuations are no more than rough guesstimates of what a notional buyer might, perhaps, maybe, be willing to pay.
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Old 04-25-2008, 10:56 AM   #23
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Valued by who? It's not like fungible assets like stocks or bonds, for which there actually is an active market and you can get up-to-the minute quotations from willing buyers.

That's one of the problems with real estate investments: most valuations are no more than rough guesstimates of what a notional buyer might, perhaps, maybe, be willing to pay.
I'm sure there are some areas where there are few sales and finding comparables is difficult. But here in the Chicago suburbs, the markets have slowed but there is still plenty of activity to establish good estimates of market prices.

Evidence of this is the fact that the so-called experts can give estimates of how much housing values have dropped.

For a study like the one we're discussing, why would you need "up to the minute" market data? If your real estate investment has fallen 5% - 10% in the past few months and you didn't pick up on that, would it matter?

I assume you are a renter?
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Old 04-25-2008, 11:14 AM   #24
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No, we own our own house, mortgage-free.

The agent who helped us buy it several years back has recently advised us that it's worth $X. That seems plausible, given what other similarly-sized properties have recently sold for. But I don't factor that notional value into our net worth.

I do agree that valuing houses is generally easier than commercial or rural properties.
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Old 04-25-2008, 11:30 AM   #25
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(And I read the title of this and thought Nebraska? :confused: Warren Buffett and who else? Duh. Is NE a common acronym for Northeast?)
Every time I see someone refer to NE I think of Nebraska, since I grew up there.

Omaha actually has 3 in the top 400 richest in American--Buffett, Ricketts (Ameritrade), and Walter Scott (took over Kiewet construction).
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As you mention a million isn't all that much any more but a billionaire can live any where he wants so the choice is pretty obvious IMHO
And that looks like California to me, though it'd be nice if they showed numbers instead of a graph.
Interactive Map: Hometowns Of The Rich 400 - Forbes.com
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Old 04-25-2008, 11:43 AM   #26
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And that looks like California to me, though it'd be nice if they showed numbers instead of a graph.
Interactive Map: Hometowns Of The Rich 400 - Forbes.com
You can find the information you want in the book mentioned above: Bernstein and Swan, All the Money in the World: How the Forbes 400 Make - and Spend - Their Fortunes (2007).
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Old 04-25-2008, 11:58 AM   #27
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It amazes me that the real money in the country is still on the East coast.
After reading through the thread, I came back to your orignal post Orchidflower. The data does seem to support the real money still being concentrated out East. But, of course, for any given individual, that doesn't necessary imply that the most desirable lifestyle is out East!
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Old 04-25-2008, 12:22 PM   #28
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I'm putting this in so you can see which counties are the wealthiest. Note all the activity around Detroit. The State is in dire straights, but somebody around Motor City is whistling another tune...

Image:Highest per capita income counties.PNG - Wikipedia, the free encyclopedia
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Old 04-25-2008, 01:09 PM   #29
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I'm putting this in so you can see which counties are the wealthiest. Note all the activity around Detroit. The State is in dire straights, but somebody around Motor City is whistling another tune...

Image:Highest per capita income counties.PNG - Wikipedia, the free encyclopedia
Interesting!! Thanks. That definitely explains Michigan's ranking as #14 out of all the states, in percentages of millionaires. I had no idea!
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Old 04-25-2008, 01:32 PM   #30
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There's more money on the coasts at least in part because it's so much more expensive to live there, and you NEED more money to be able to afford it there.
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Old 04-25-2008, 01:54 PM   #31
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After reading through the thread, I came back to your orignal post Orchidflower. The data does seem to support the real money still being concentrated out East. But, of course, for any given individual, that doesn't necessary imply that the most desirable lifestyle is out East!
I guess I'm not seeing the data here, unless you are just counting millionaires as having "real money". For one thing, a million doesn't go very far in a lot of places, especially either coast. In the midwest, with the lower cost of living, especially real estate, it does mean more.

I think of the "real money" more as being held by billionaires and mega millionaries. The billionaire numbers are easier to find. I found a better link to the states count of the richest 400: The Forbes 400 - Forbes.com and chose the Filter by State pull-down.

California has a lot more than New York. Texas looks to be the clear #3 unless there is a state I'm forgetting to check. Probably Florida and Illinois next. States like Washington and Nevada have 5-6, just like New Jersey, Massachusetts, Virginia and Maryland. The east coast states are smaller and there are more of them so they start to add up, but the population density is a lot higher too.

So looking at it from those 400 people, the big wealth looks to be mostly concentrated in the NYC financial center and Silicon Valley, and then smaller pockets around other areas like LA, Chicago, south Florida, and then somewhat scattered. There are more large cities in the east so there are more of these small pockets there.

I don't really care that much, but it bothers me a bit when someone takes one statistic and draws a much bigger conclusion out of it than it merits. I've just done the same thing with 400 billionaires, so I wouldn't say I've disproved the notion. My point is that another statistic to look at to determine where the "real money" is leads to a very different conclusion. I don't really know which one is right, it really depends on your definition of "real money". I thought in past discussions on this board most people had agreed that $1M isn't rich. I thought we had a poll, but I can't find it with a quick search.
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Old 04-29-2008, 12:00 PM   #32
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Here you go: Percentages of Millionaire Households by State | Personal Finance Hacks. Louisiana is reportedly in 44th place (at 4.24%) and Mississippi is dead last (3.85%).
NJ has to be in the upper 3 of that list. If they didn't have at least $1M, how would they afford the property taxes?

FWIW, I live there.
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Old 05-01-2008, 04:26 AM   #33
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I'm wondering how they collect this data ?
Yeah, I especially love the precision. Millionaire households in New York? Not 380k, not 381k, but 381,786.
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Old 05-07-2008, 07:43 PM   #34
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(And I read the title of this and thought Nebraska? :confused: Warren Buffett and who else? Duh. Is NE a common acronym for Northeast?)
First thought was Nebraska also, then New england, never did hit on Northeast.

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Every time I see someone refer to NE I think of Nebraska, since I grew up there.
I've passed through every state east of the Mississippi, except for Rhode Island, and only one state west of it, Nevada. Do you realize how hard it is to pass through rhode Island unless you are going on business?
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Old 05-07-2008, 08:00 PM   #35
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First thought was Nebraska also, then New england, never did hit on Northeast.

I've passed through every state east of the Mississippi, except for Rhode Island, and only one state west of it, Nevada. Do you realize how hard it is to pass through rhode Island unless you are going on business?
My only time in Rhode Island was ~35 years ago, when my sister was stationed there (USN).
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Old 05-08-2008, 07:08 AM   #36
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First thought was Nebraska also, then New england, never did hit on Northeast.

I've passed through every state east of the Mississippi, except for Rhode Island, and only one state west of it, Nevada. Do you realize how hard it is to pass through rhode Island unless you are going on business?
The typical way I've seen folks differentiate between NE (Nebraska) and the NE (North East), is typically using "the" just before the initials. Kind of context related. A small breakdown can occur (unless someone reads the threads), when someone refers to the NE area. This can be the North East area of the US, or the New England area, or the Nebraska area.
Like this:
I live in the NE, as opposed to someone mentioning in an earlier thread that they live in the NW.
The NE portion of the US is very seasonal.

Acronyms abound in today's society. I've worked on projects where there were compound acronyms (acronyms within acronyms).
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Old 05-08-2008, 07:13 AM   #37
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First thought was Nebraska also, then New england, never did hit on Northeast.

I've passed through every state east of the Mississippi, except for Rhode Island, and only one state west of it, Nevada. Do you realize how hard it is to pass through rhode Island unless you are going on business?
How is Nevada one state west of Rhode Island? See how context means everything. Evidently you meant east of the Mississippi, and only one state west of the Mississippi.
Not to mention you used "the Mississippi" in referring to "the Mississippi river".
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Old 05-08-2008, 07:21 AM   #38
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I've passed through every state east of the Mississippi, except for Rhode Island, and only one state west of it, Nevada.
How cool! Someday you should go to R.I., for completeness' sake.
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Old 05-08-2008, 07:50 AM   #39
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Considering most of the northeast states (7 of the top ten) would fit inside CA or Alaska (both in the top ten), dividing by state is meaningless.

As for calculating RE net worth - my guess is most RE was missed by the study because it's hidden away in trusts and corporations. The numbers are actually higher than stated. My guess is, I am NOT included (but easily clear the required hurdle).
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Old 05-08-2008, 10:20 AM   #40
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Newport RI is a pretty nice town, and one can make a nice weekend out of touring the old style mansions that are open to the public. For someone interested in turn of the last century building and craftsmanship, they're spectacular. In one the former owner wanted a wood paneled room overlooking a very nearby ocean, but the moisture and salt wreaked havoc with the wood so he had the walls plastered and hand carved and painted to look exactly like wood. You can put your face an inch in front of it and swear you're looking at a wood panel, until you touch it and its hard and ice cold. Amazing.

Providence also has some really excellent italian restaurants that all have little packs of guys sitting around a table in the back who look like Sopranos extras.
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