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Hello.
I badly want to move, but with the economy so uncertain, I am uncertain about when and where. I am currently a renter, retired, with strict budget restrictions;and want to move somewhere where the rents and costs of buying a home are low. I thought I'd wait till after Xmas and see how retail did, and hopefully which ever way that goes will cause the economy to settle down in some direction. Right now what everyone I know is seeing is that rents are still high, and prices [excluding homes and cars] keep going up, inspite of the 'recession'. Do you think rents will continue to go up, or go down in the coming months??
natalie456
Hello.
I badly want to move, but with the economy so uncertain, I am uncertain about when and where. I am currently a renter, retired, with strict budget restrictions;and want to move somewhere where the rents and costs of buying a home are low. I thought I'd wait till after Xmas and see how retail did, and hopefully which ever way that goes will cause the economy to settle down in some direction. Right now what everyone I know is seeing is that rents are still high, and prices [excluding homes and cars] keep going up, inspite of the 'recession'. Do you think rents will continue to go up, or go down in the coming months??
natalie456
I don't know what your time horizon is but I would wait it out for several years.
These are my reasons:
There is no such thing as a jobless recovery, thats voodoo economics. Thats like saying an omelette without eggs. Expect the economy to get worse.
1.)Foreclosure rates are expected to rise in 2010 due to option arms/alt a loans resetting. More forclosures = more housing supply = lower housing prices. Rents will continue to go down. Rents are a function of the wealth of the renter. As more people lose their jobs and more people become broke, the lower rents will become. Foreclosures from resetting loans will taper off in 2012. Foreclosures from job losses will taper off when?
We are in a renters market and will continue to be in a renters market for quite some time.
2.) Interest rates will rise either intentionally or not. Ben Bernanke will have to raise interest rates soon to avoid the increasing inflation he is causing. If not, interest rates will rise by themselves as the market will require higher interest rates for all the debt we are accumulating. Once interest rates start rising, housing prices will start to fall. Housing would be falling right now if it wasn't for all the stimulus the government is adding to the housing market i.e. $8,000 tax credits.
I would be more worried about inflation in the near future as that has the potential to destroy your income. We are turning into a stimulus economy. You can't print money forever, once you stop printing due to rising inflation, everything built upon the stimulus will fail.
Wait several years and you will find some bargains even compared to what you are seeing right now.
Hello.
... I thought I'd wait till after Xmas and see how retail did, and hopefully which ever way that goes will cause the economy to settle down in some direction. ....
The only thing that is "stimulating" the economy right now is the government. When that gives out, we are headed back down the slope. In fact it will probably be worse because all the stimulus spending is keeping the real problems from being addressed.
Monkeykid said it pretty damn well. Let me add more on the rental housing market for the future. Rents will climb like homes climbed from 1998 to 2004. All these people who have lost their homes have to live somewhere. These people will not be able to buy another home for at least 7 years and maybe more due to their ruined credit. All these people will become renters. This will create a new demand for rentals. Demand makes prices go up up up.
I am in the construction industry. Single family detached homes and especially single family attached home building is almost non existant anywhere in the USA. But guess what is booming. Multi family apartment housing. And they are becoming more and more like human filing cabinets the builders try to get more units per acre then ever before. These multi family buildings are going up all over. Do you think all these builders know something?
We also have a whole nother wave of foreclosures coming. All these fools.....oops I mean investors who are out there buying what they think are bargains are going to get bitten. We all seen them on TV. They buy a foreclosure for $200,000 today that sold 4 years ago for $600,000 and think they got a grand bargain. Sounds good anyway. Well the house they just paid $200,000 for will be worth maybe $140,000 next year and what do you think these investors are going to do with that property? Walk away.
Home value will continue to fall for quite a few more years. Dont say no. We said no in 2004 when value peaked. We said it will never go down. We been saying those words every month since then and been wrong each time. If you ever played the stock market then you know how to play momentum. And right now my money is on the downward momentum of falling home prices.
Thanks for the replies, but time is short for moving
Thanks to you who responded so well to my query about what the economy is going to do. However, I can't wait a few years for the simple reason that I am in my sixties, very unhappy where I am, and want to make the most of my remaining time. I certainly don't dwell on aging, but I am aware of it and don't plan as I would have even in my 50's. With this in mind, anyone have any ideas about how I should proceed in this economy, in regards to rental housing and locations, ect?
natalie456
Thanks to you who responded so well to my query about what the economy is going to do. However, I can't wait a few years for the simple reason that I am in my sixties, very unhappy where I am, and want to make the most of my remaining time. I certainly don't dwell on aging, but I am aware of it and don't plan as I would have even in my 50's. With this in mind, anyone have any ideas about how I should proceed in this economy, in regards to rental housing and locations, ect?
natalie456
I wish so much that people would start buying homes again. But they are not and I would never say buying home now is a good investment, because it ain't. If you are just renting then location really only matters when it comes to your safety and what goodies they provide.
Save your money that might be a down payment on a home. It's just too risky. Ask this question every 6 months to a year and get a feel for the sentiment around you.
Hello.
I badly want to move, but with the economy so uncertain, I am uncertain about when and where. I am currently a renter, retired, with strict budget restrictions;and want to move somewhere where the rents and costs of buying a home are low. I thought I'd wait till after Xmas and see how retail did, and hopefully which ever way that goes will cause the economy to settle down in some direction. Right now what everyone I know is seeing is that rents are still high, and prices [excluding homes and cars] keep going up, inspite of the 'recession'. Do you think rents will continue to go up, or go down in the coming months??
natalie456
I believe rent prices will stay the same or increase in the next few years. My reasoning, rent has been increasing because people can't afford the houses they bought, so there has been a huge increase in renters and a huge decrease in owners. That means landlords now have more demand for their unit(s), so they are able to raise prices. I believe there will be more foreclosures in the next few years, which will mean more renters.
A shift from owners to renters will increase rent prices and decrease home prices. This shift will continue until rent prices get unfordable and home prices get affordable. The pattern will than repeat, which explains why there has been multiple real estate bubbles in the past. Does this make sense?
Vegas has some amazing deals on houses and condos right now. If you can get a loan, it's actually cheaper to own than rent there. You need to look at your finances and crunch the numbers to know whether moving would be a good decision (financially), but if you can afford it, I say do it. You only live once, but make sure you can actually afford it because you don't want to spend your last 20-30 years broke and even more unhappy.
Last edited by Jonotastic; 12-30-2009 at 03:17 AM..
There is no such thing as a jobless recovery, thats voodoo economics. Thats like saying an omelette without eggs. Expect the economy to get worse.
This can be debated, it's debated among economists in fact. Some believe you can be in a recovery, even if unemployment continues to increase.
Currently, the rate of unemployment has been increasing each quarter, meaning jobs are still being lost. However, jobs are being lost on a much smaller scale than before. In order for the economy to recover, the market has to be restructured. In order for the market to restructure, some companies will have to close, which will drastically increase the unemployment rate. The reason why the unemployment rate is loosing less jobs than before is because there are less companies closing now than before. The unemployment rate is starting to stabilize, which is a sign in my opinion that we are in the beginning of a recovery. Good companies are seeing their profits again, within the next couple years, I believe we will be in a noticeable and strong recovery. So, even though the unemployment rate is still increasing, the rate at which it is increasing is much less than before, which is why (in my opinion and some economists), you can be in a recovery, but still have an increasing unemployment rate.
It all depends where you are at in expectations of cost of living. If where you are at is not great and the cost of living is high, you might actually cost yourself more to stay where you are. Being on a fixed income and using assets to fund your expenses because you are selling while the market is still a bit low and loosing future gains. Take a look at the difference between the areas and break down the costs, then if it works out move...if not then stay.
As for the future, who knows. People have been banging the drum of economic collapse for 2 years and it's never happened, the chicken littles do it every time there is a recession in the last 200 years, and it won't. It's fun watching the predictions come and go every months, people never admit they are wrong they just say "Just you wait" and predict it for next month. Repeat ad nauseum. Even if it does, you are screwed no matter where you are at. Might as well be some place you like.
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Thanks for the replies, but time is short for moving
