Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Politics and Other Controversies
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 07-17-2013, 12:44 PM
 
13,053 posts, read 12,915,899 times
Reputation: 2618

Advertisements

Quote:
Originally Posted by Finn_Jarber View Post
You think people overpaid in 2009 when properties were dirt cheap? You are mistaken. I picked up properties then, and I can assure you I did not overpay. Since when is a car supposed to cost more than a house?
Median home prices in 2009 were around 200k, and a 248k average. That is not "dirt cheap" and you caught the downside of the bubble which was in 2007 where the median was 262k and the average was about 329k. Prior to the 2007 peak, home prices were around 160-170k median, and 180-190 average. You overpaid as the increase in home values to the 2007 bubble was superficial and not representative of the steady increase in home values prior to that period.

As for car values, that is an entire discussion on its own, but it also suffers from the same mentality of "minimum payment" evaluations.


Quote:
Originally Posted by Finn_Jarber View Post
I think I will keep the ones I have because they are bringing in good money in rent. Of course if the market overheats like it did in 2007, then I might sell and wait for another crash, but the values would have to increase a heck of a lot before we get to a "overheated" situation.
Renting is always a profitable market, but it has its own issues. That aside, like I said, home values will drop when interest rates rise. home values rose far past wages and the only reason those prices were viable was due to low interest rates (people still buying because they could afford the minimum payments).

As I said, prices will drop dramatically if interest rates continue to rise.
Reply With Quote Quick reply to this message

 
Old 07-17-2013, 12:48 PM
 
13,053 posts, read 12,915,899 times
Reputation: 2618
Quote:
Originally Posted by malamute View Post
It sounds like the increase in interest rates is helping the economy.

High interest rates are a boon to savers.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 12:53 PM
 
9,855 posts, read 15,170,115 times
Reputation: 5481
Quote:
Originally Posted by Finn_Jarber View Post
OK. I was talking about the "surge" in prices which begun around 2003.

This chart shows the home price increase didn't really jump away from wage increses until around 2002, altough there was a trend which started a long ago. From 1990 to 2000 prices and wages rose at the same pace

I definitely understand what you are saying about the 'jump'. I typically use any statistically significant deviation from historical averages as a leading indicator of the jumps...given how hard it is to predict when we fall off the cliff, I prefer to not be involved in the bubbles after the jump happens.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 12:53 PM
 
29,409 posts, read 21,939,618 times
Reputation: 5455
Quote:
Originally Posted by Nomander View Post
High interest rates are a boon to savers.
Recently the government has been doing everything they can to encourage folks not to save from low interest on CD's in particular like you mentioned before, cash for clunkers, enticing folks to get into debt by buying these zero down homes and cars and everything else. They want us all in debt. Too bad we don't have our own fed reserve to make our own money and all would be well. lol
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:19 PM
 
13,053 posts, read 12,915,899 times
Reputation: 2618
Quote:
Originally Posted by KUchief25 View Post
Recently the government has been doing everything they can to encourage folks not to save from low interest on CD's in particular like you mentioned before, cash for clunkers, enticing folks to get into debt by buying these zero down homes and cars and everything else. They want us all in debt. Too bad we don't have our own fed reserve to make our own money and all would be well. lol
Yep, it is ridiculous. It is amazing how many people suffer from the whole "minimum payment" thinking. They could care less that the 400k home they are buying will actually be around 530k (or higher depending on loan and interest rate), as long as they can afford the minimum payment, thats all that matters! They buy everything from washing machines to cars with the same stupid mentality, throwing away money like they pick it off trees and the government is right there encouraging them to be stupid.

Heck, I remember my grandfather using CD's as a nice income generator. He used to build them, then combine them for higher interest rates. At one time, he was making 14% for a year CD. He even worked up a special account with a bank one time while he was buying a car so he could take advantage of the 0% interest rate on the car while making money on his money in the bank (ie rather than buying the car with cash outright). Basically, the way he worked it out, he was getting paid to buy the car. Can't do that in this freeloader economy though. Everyone wants to think in what they can buy... and then owe, rather than what they have save, and make off it.

What is funny, is that this attitude has actually caused prices on many things to go up. Cars are ridiculous in price because nobody cares about the price, just the minimum payment and there are tons of high interest loan companies out there willing to provide that to anyone and everyone, so... no point in car prices dropping, people can just pay longer on them. It is plain stupid, but hey... when society decides to act stupid, well... you get taken along for the ride with all of the price increases.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:27 PM
 
29,409 posts, read 21,939,618 times
Reputation: 5455
Gotta have all the goodies to impress your friends from the 60" TV to the mcmansion to the new care to your fancy smancy PC and Iphone and on and on it goes. All with no money down of course. Banks loan it all out, securitize it, sell it off over and over again and when you can't make the payments which eventually man can't the fed pays. Quite the system they have going. You/me/us are of course left in the street wondering what ever happened. All was well when you didn't have to put anything down after all. lol Nothing is free.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:42 PM
 
Location: Florida
77,024 posts, read 47,365,447 times
Reputation: 14800
Quote:
Originally Posted by Nomander View Post
Median home prices in 2009 were around 200k, and a 248k average. That is not "dirt cheap" and you caught the downside of the bubble which was in 2007 where the median was 262k and the average was about 329k. Prior to the 2007 peak, home prices were around 160-170k median, and 180-190 average. You overpaid as the increase in home values to the 2007 bubble was superficial and not representative of the steady increase in home values prior to that period.

As for car values, that is an entire discussion on its own, but it also suffers from the same mentality of "minimum payment" evaluations.
Your averages are meaningless, because the prices dropped well below the level before the boom. If you can buy a 3 br townhouse for 60K, which rents for $1700 a month, I can assure you are not overpaying. I think you are reading too much into commentaries as opposed to looking into the markets to see what is going on. If you had looked, you would have found deals which we will not see again in this lifetime.

Quote:
As I said, prices will drop dramatically if interest rates continue to rise.
Even if job situation improves and salaries increase? It is not as simple as you think
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:45 PM
 
Location: Florida
77,024 posts, read 47,365,447 times
Reputation: 14800
Quote:
Originally Posted by hnsq View Post
I definitely understand what you are saying about the 'jump'. I typically use any statistically significant deviation from historical averages as a leading indicator of the jumps...given how hard it is to predict when we fall off the cliff, I prefer to not be involved in the bubbles after the jump happens.
Each person does what they are comfortable with, but people do need a place to live, and therefore will buy houses before the prices jump again.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:47 PM
 
9,855 posts, read 15,170,115 times
Reputation: 5481
Quote:
Originally Posted by Finn_Jarber View Post
Each person does what they are comfortable with, but people do need a place to live, and therefore will buy houses before the prices jump again.
I understand that, I just think pushing this is an extremely shortsighted economic policy by the powers that be. Everyone needs a place to live. Not everyone needs to own a home, and they especially don't need to buy a home for more money that its true worth.
Reply With Quote Quick reply to this message
 
Old 07-17-2013, 02:54 PM
 
Location: Florida
77,024 posts, read 47,365,447 times
Reputation: 14800
Quote:
Originally Posted by hnsq View Post
I understand that, I just think pushing this is an extremely shortsighted economic policy by the powers that be. Everyone needs a place to live. Not everyone needs to own a home, and they especially don't need to buy a home for more money that its true worth.
OK, so if you were renting now, and had the money for down payment for a house, you would not buy because you think the prices are about to fall?
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Politics and Other Controversies
Similar Threads

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top