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Also, with tightening/freezing credit and rising unemployment, home prices in many areas still have a long way to go before anyone sees a bottom in the market. You will kick yourself later if you buy right now, that's for certain, but not for the reasons the OP stated.
From July 23rd till today, the New York Stock Exchange (NYX) has lost over 50% of its value. The S&P, Dow and NASDAQ have lost over 25%. In. Under. Three. Months.
Can anyone-- in any state-- really claim that this is not going to drive prices down further?
From July 23rd till today, the New York Stock Exchange (NYX) has lost over 50% of its value. The S&P, Dow and NASDAQ have lost over 25%. In. Under. Three. Months.
Can anyone-- in any state-- really claim that this is not going to drive prices down further?
Well, essentially a lot of people are pulling money out of the equity markets into a form of cash. This cash can be used either to pay off debts, put into short term savings, or to buy other hard assets.
For those who believe that "hyper" inflation or some form of inflation is going to come on... using that cash to fully purchase hard assets is a very viable possibility.
Housing has already been highly discounted in some markets... and hence with cash on hand... some areas can benefit from this withdrawal of cash from the equity markets into the housing market.
Just like what happened after the stock market crash in the 2000s... a lot of people withdrew their equity stakes... and placed it into hard assets.
Except after the market crash in 2000, housing wasn't a declining asset, it was on it's way up. Remember, right now housing is the bubble that's bursting. In 2000 it was tech.
Also I get the whole hyperinflation thing, but even that isn't a sure bet (half are screaming inflation and half are screaming deflation). Calling it wrong could prove very costly.
Just like what happened after the stock market crash in the 2000s... a lot of people withdrew their equity stakes... and placed it into hard assets.
-chuck22b
Most of what the average joe has in stock is their retirement fund, they aren't going to be cashing out of their retirement fund and then buying real estate. Also, getting out of stocks doesn't mean you're in cash. Many are just converting to Money Market or Bonds.
You come up with the oddest arguments in support of real estate....still in the denial stage I guess?
In my eyes now is a great time to buy. I have a very stable income. I move every three years and own 2 houses. What ever one that I am not living in is always rented for $200 over my morgtage payment. I am looking at buying 2 forclosed homes at really good prices and having them as rentals. I love the fact that half the people on here are telling everyone to rent. It means that I can charge more
In my eyes now is a great time to buy. I have a very stable income. I move every three years and own 2 houses. What ever one that I am not living in is always rented for $200 over my morgtage payment. I am looking at buying 2 forclosed homes at really good prices and having them as rentals. I love the fact that half the people on here are telling everyone to rent. It means that I can charge more
Oh you big player. I hope you have cash to purchase those foreclosures.
I have enough to put 35% down on each. With the intrest rate drop the other day. I dont see how I can go wrong. Even if I dont have renters I can still cover the payments.
I dont see how I can go wrong. Even if I dont have renters I can still cover the payments.
Wow, even if you don't have renters you can cover the payments! You can pay to keep two houses empty just in case I suppose you need an extra place to sleep? I only wish I had to pay each month to own my investments....
Would you be interested in buying some swamp land?
Most of what the average joe has in stock is their retirement fund, they aren't going to be cashing out of their retirement fund and then buying real estate. Also, getting out of stocks doesn't mean you're in cash. Many are just converting to Money Market or Bonds.
Yep, people cashing out their 401k can't use the cash without paying a huge penalty on top of the losses they've already taken.
Quote:
You come up with the oddest arguments in support of real estate....still in the denial stage I guess?
I've noticed this as a pattern recently from several different posters. The data obviously shows house prices going down while inventory rises, the economy is getting worse, and the outlook from even normally optimistic sources is pretty bad. The obvious conclusion would be to hold off a bit and wait for things to stabilize.
But I've seen at least 3 or 4 threads this week with bizarre scenarios - from Zimbabwe-level hyperinflation to the collapse of the US banking system - that conclude that since this extremely unlikely event might happen, you should definitely buy a house now.
What's the deal? Are these outlandish scenarios the only way to rationalize buying a house? If so, I think that tells you what the correct decision is, for now at least.
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