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Old 02-20-2009, 11:22 AM
 
1,985 posts, read 4,863,364 times
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The article is showing you how bad things are in NYC metro area. Well, that's where the atomic bomb exploded, little wonder NYC is going to get hit the hardest in the Northeast.
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Old 02-20-2009, 11:40 AM
 
9,125 posts, read 23,748,232 times
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I looked at the slide show, and had to laugh at the poor lady from Dix Hills. They bought the house in 1993 for $250k, did some renovations, and they're frustrated because it won't sell for $699,000 and it's costing them money to keep owning it. Here's a crazy idea- sell it for $500k and "only" make probably a $150k profit- and that's assuming that you didn't pay down some of the mortgage over the last 15 years of ownership.

Of course, in reality, they probably re-fi'd and took out a home equity loan "because they could", and they owe more than they can realistically sell for now. Oh well- too bad, so sad- don't be so stupid with your money next time.....
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Old 02-20-2009, 11:53 AM
 
786 posts, read 1,659,686 times
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Quote:
Originally Posted by BobKovacs View Post
I looked at the slide show, and had to laugh at the poor lady from Dix Hills. They bought the house in 1993 for $250k, did some renovations, and they're frustrated because it won't sell for $699,000 and it's costing them money to keep owning it. Here's a crazy idea- sell it for $500k and "only" make probably a $150k profit- and that's assuming that you didn't pay down some of the mortgage over the last 15 years of ownership.

Of course, in reality, they probably re-fi'd and took out a home equity loan "because they could", and they owe more than they can realistically sell for now. Oh well- too bad, so sad- don't be so stupid with your money next time.....
well, to be honest, that 250k home in 1993 should at least have doubled in the last 15 years just to keep up with inflation. we're not talking here about some idiot who bought a way overpriced home in 2004 or 2005.
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Old 02-20-2009, 11:57 AM
 
362 posts, read 527,202 times
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Quote:
Originally Posted by kalim2008 View Post
well, to be honest, that 250k home in 1993 should at least have doubled in the last 15 years just to keep up with inflation. we're not talking here about some idiot who bought a way overpriced home in 2004 or 2005.
If you consider 4% increase per yr, it's 450K compounded in 15 yrs.
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Old 02-20-2009, 12:01 PM
 
Location: New Jersey
1,395 posts, read 2,086,414 times
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Quote:
Originally Posted by kalim2008 View Post
dude, with all due respect, you're the kind of guy who got us into this housing bubble in the first place.
not me at all. I'm very responsible with my money, and with the exception of a house, I never buy anything I can't pay for in cash. I do own one credit card, which is used for emergencies only & paid in full every month.

I searched for 2 years for a house that:
  • I could afford.
  • was in a nice area.
  • I liked inside.
last June, I found one, and bought it, because I wanted to get on with my life and not worry about "timing it right" with regards to the market.

with that said, you may accuse me of spinning things in an attempt to spare the equity in my house. but that's not true for me, I just don't care anymore.

on this board, I simply try to present another possible outcome, one that if my theory holds, will be in the best interests of everyone in the country.


Quote:
Originally Posted by kalim2008 View Post
all these graphs show how high the bubble went the last several years, and you think it should continue to go higher.
no, I don't think it should go higher. I think it should stop sliding, or at the very least, slow the rate of descent.

anything can happen, but I just cannot see the USA becoming a 3rd world country, there are too many good citizens for that to happen.
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Old 02-20-2009, 12:07 PM
 
786 posts, read 1,659,686 times
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Quote:
Originally Posted by Delphi View Post
If you consider 4% increase per yr, it's 450K compounded in 15 yrs.
well, i was thinking more of latin american inflation
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Old 02-20-2009, 12:11 PM
 
9,125 posts, read 23,748,232 times
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Quote:
Originally Posted by kalim2008 View Post
well, to be honest, that 250k home in 1993 should at least have doubled in the last 15 years just to keep up with inflation. we're not talking here about some idiot who bought a way overpriced home in 2004 or 2005.
And it probably did double- that's why I said to sell for $500k. The problem is, they're still holding on to the prices they saw in 2004 or 2005, rather than accepting the new reality.
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Old 02-20-2009, 12:13 PM
 
1,529 posts, read 2,966,032 times
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Quote:
Originally Posted by kalim2008 View Post
well, to be honest, that 250k home in 1993 should at least have doubled in the last 15 years just to keep up with inflation. we're not talking here about some idiot who bought a way overpriced home in 2004 or 2005.
Not doubled -- run an inflation calculator on 250K up thru year end 2008 and it puts you at roughly 370K. That's the value of the house in today's dollars.

OK, they did some renovations that might be considered above and beyond normal home upkeep ... you've got to depreciate those renovations since they're "used" now ... so add in 20K or whatever the numbers work out to. Let's be generous and say 30K in true upgrades, after depreciation.

So now we're at 400K.

Now, do we factor in appreciation above and beyond inflation? In normal years, yes, although now we're in a depressed market, so not necessarily.

The bottom line is that anywhere above 400K and these guys aren't losing any money, they're getting back fair value of what they paid for the house and their upgrades, adjusted for inflation to today's dollars. At 400K they have nothing to complain about.

Anything above that is gravy, and they should count their lucky stars. Although I suspect they'll be lucky to sell for anywhere above 400K anytime soon.
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Old 02-20-2009, 12:22 PM
 
786 posts, read 1,659,686 times
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Quote:
Originally Posted by JG183 View Post
anything can happen, but I just cannot see the USA becoming a 3rd world country, there are too many good citizens for that to happen.
How exactly would the USA be a "3rd world country" since it still has the largest economy in the world (although it will be overtaken by China in awhile)? What is your definition of "3rd world"?
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Old 02-20-2009, 12:30 PM
 
365 posts, read 613,973 times
Reputation: 164
this is just ridiculous. how about we all just state the obvious and thank all those who bought houses from banks who gave loans irresponsibly for starting what is now becoming the worst great depression we've ever had?
I'm not so much saying that this is just the buyers fault, but those banks knew what they were doing and they were happily making piles of money and selling bad notes to the highest bidder. Those same banks are now selling those foreclosed homes on ebay to the highest bidder, instead of just refinancing the loan. just incredible
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