[heyzeusgarcia]

I think this might be an eye opener. Especially if we could compare it to 2005 or 2006. It might be a better guage of how hard it is to get a loan.
Could we get one of the realtors to help out on this?

[olecapt]

Originally Posted by heyzeusgarcia

I think this might be an eye opener. Especially if we could compare it to 2005 or 2006. It might be a better guage of how hard it is to get a loan.
Could we get one of the realtors to help out on this?

March 2009

Total 2979
Cash 826 - 28%
Auction 29
1034 FHA
228 VA
853 Conv

March 2008
1601 Total
220 Cash - 13.7%

March 2003
2394 Total
192 Cash- 8%


March 2004
3664 Total
363 Cash - 9.9%
3006 Conv
159 FHA
31 VA

Bottom line probably 1/4 to 1/3 investors. The rest are owner occupied.

Note these are only the SFRs...I don't trust condo data.

[lvkewlkid]

heyzeusgarcia, are you talking about Las Vegas or in the General United States?

[SharkyV12]

olecapt, it appears your conclusion of cash buyers are that they are "investors". Which may be correct. In MY case I'll be paying cash because of my planned soon retirement. In my opinion paying off your primary residence is the number one thing you should do when entering retirement, generally speaking, does not apply to all.

Question: Are there demographics available that would support cash buyers as investors? Demographics that might support retiree's buying with cash? Primary residence or rental might be one way to nail it down. All though, it's concievable I may have to rent mine out for a short while if retirement is suddenly side tracked for a bit, making me look like an investor!

I'm talking about Las Vegas myself, but it's an interesting question nation wide as well...

[jjameson922]

Sharky, we are on the same page. I feel the same as you about being in a cash position in retirement but had an eye opener recently when looking in a 55+ community. I assumed all buyers in there would obviously be cash and was shocked to learn how many actually carry mortgages so they will have write offs.

[Fastrudy]

Yes, when you retire and still have tax sheltered money, sage advice dictates that you have a mortgage so that you can claim interest expenses. These interest expenses are used to offset the taxes that you must start repaying again when you tap into your tax shelter. I think (but am not certain, I'm no accountant) that there is an certain age when this starts happening. Perhaps somebody more knowledgable can answer better than me. I am just trying to paraphrase my accountant here.

[olecapt]

Originally Posted by SharkyV12

olecapt, it appears your conclusion of cash buyers are that they are "investors". Which may be correct. In MY case I'll be paying cash because of my planned soon retirement. In my opinion paying off your primary residence is the number one thing you should do when entering retirement, generally speaking, does not apply to all.

Question: Are there demographics available that would support cash buyers as investors? Demographics that might support retiree's buying with cash? Primary residence or rental might be one way to nail it down. All though, it's concievable I may have to rent mine out for a short while if retirement is suddenly side tracked for a bit, making me look like an investor!

I'm talking about Las Vegas myself, but it's an interesting question nation wide as well...

You can't get at accurate numbers easily. You can do a little better by using homes with taxes going to a different address. Or in a given month you can examine all the F (The properties being returned from banks to other ownership) and see if they are having the tax bill sent to the home address.

There are flaws with any of these systems. Using the MLS the way I did I don't separate cash investors from owner occupied paying cash. I presume that number is about 9 or 10 percent as there were few investors in 2003. However some significant part of the conventional buyers are in fact investors. All investors don't pay cash.

The tax data does not differentiate between second home and investors. So it overstates the number of investors.

[Excaliber]

Thanks for the reminder Fastrudy, here's my take on sage tax advice. I'm seeing plenty of stories about retiree's hit hard by the current economy and struggling or failing to pay their mortgage, refinancing, etc. I don't automatically buy into the oft' repeated mantra that having a mortgage makes it easier to itemize and thus save on taxes. Or that you can save more on taxes than you would pay to the bank in interest for your loan. I suspect many of those retired folks simply don't have the cash to pay off their primary and justify it as a 'tax benefit'. I remain skeptical, but will diligently crunch the numbers before dropping the cash... Forgive me olecapt, but I'm sure you know one of the great sale's pitch for a realtor has always been the 'tax advantage' of owning a home. I think the banks and accountants tend to foster that idea as well. It's not always true but universally accepted as truth.

[Fastrudy]

Excaliber, Agreed! When you retire (assuming you have tax shelters that you are going to tap into) get a mortgage to offset, but not a large, burdensome 'young people's' mortgage. Something like 20% of the value of the house. Indeed, the oft-quoted 'tax advantage' depends on the inflation rate; the specific fiduciary circumstances of the individual; as well as their intentions in the future. Some of those unknowns are not predictable. Just have to take your best guess and roll the dice.

[jjameson922]

By age 70, you have to take your IRA's, with the philosophy being, since they are taxed at that point theoretically you will be earning the least income. It remains to be seen if any relief will be given to those in that position since most investments are down 70% or more. I know it's best for us to be in a total cash position and let those investments cook again as long as possible. And if you live on a total s.s. income under $32K, it's not taxed anyways.