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right, bogus wealth creation. The sort of wealth that matters is created in business, not by people trading real estate. We could nationalize our entire real estate market tomorrow and still have a great nation.
Note, i'm not suggesting you can't make money off real estate, just that true wealth from societies point of view is not generated this way.
really!!!!! real estate is a business if its done right. in fact i would never buy a business unless the real estate was part of the deal. rarely is a business worth anything at the end other then its inventory. but if the business pays off the real estate then you got something of value..l
our family did very well in real estate and are selling everything off the last few years in preperation for early retirement.
And....what about the neighborhood? Gilbert is large enough to have significant differences at the neighborhood level. The prices for 3/2 seem to range from $90k to $200k.
It is pretty much all suburbia with a token downtown, no real bad areas in terms of crime. I suspect the variance has to do with distance to highways, community amenities, etc. but not really sure.
really!!!!! real estate is a business if its done right. in fact i would never buy a business unless the real estate was part of the deal. rarely is a business worth anything at the end other then its inventory. but if the business pays off the real estate then you got something of value..l
our family did very well in real estate and are selling everything off the last few years in preperation for early retirement.
I think most of the talk about homes are revolving around someone's single-family property that they live in. This does not include investment, rental, or commercial properties.
really!!!!! real estate is a business if its done right. in fact i would never buy a business unless the real estate was part of the deal.
Well its a good thing you're not interested in business then, as most businesses (especially in cities) don't own the real estate they operate out of.
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Originally Posted by mathjak107
rarely is a business worth anything at the end other then its inventory.
I'm starting to think you've yet to encounter someone that operates a successful business, a business that is only worth its inventory is a failed business. If the business was generating a reasonable profit, then it would have a value greater than its inventory. A successful business is going to sell for 1~3 times its discretionary earnings plus the value of inventory (and other liquid assets).
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Originally Posted by mathjak107
our family did very well in real estate and are selling everything off the last few years in preperation for early retirement.
Like I said, I'm not suggesting people don't make money in real estate, rather I'm suggesting that real wealth isn't generated in real estate.
What exactly did you do to earn the gains you did in real estate? Nothing, you're merely stealing wealth from current workers/businesses that are forced (because its a natural resource) to buy real estate at current values. Hence, real estate results in a transfer of wealth, not the creation of wealth.
I'm not missing anything, no skin in the game is not the situation as it stands today for most people trying to buy. In fact its the opposite, lots of people can't get loans who under pretty good scrutiny should be getting loans. It was the situation before and it caused great distress in the market, but once again it really is important to look at what the situation is today without pulling out too much hair about what it was before or what it might be if things go wrong in the future.
You are missing the point. Hear me out; nobody should be buying a house today unless they can put a lot down or pay cash—that’s skin in the game. The part of your quote, in bold, doesn’t sound right unless they couldn’t provide a decent down payment—that’s no skin in the game!
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...if your talking about the fact that folks used the home they live in as a savings bank....well i agree but nothing wrong with real estate itself
This is what’s not being realized by some posters here. There’s people that are okay with using a home as a savings account (asset). There’s people that are okay with a home that does not or barely keeps up with inflation.
Well its a good thing you're not interested in business then, as most businesses (especially in cities) don't own the real estate they operate out of.
I'm starting to think you've yet to encounter someone that operates a successful business, a business that is only worth its inventory is a failed business. If the business was generating a reasonable profit, then it would have a value greater than its inventory. A successful business is going to sell for 1~3 times its discretionary earnings plus the value of inventory (and other liquid assets).
Like I said, I'm not suggesting people don't make money in real estate, rather I'm suggesting that real wealth isn't generated in real estate.
What exactly did you do to earn the gains you did in real estate? Nothing, you're merely stealing wealth from current workers/businesses that are forced (because its a natural resource) to buy real estate at current values. Hence, real estate results in a transfer of wealth, not the creation of wealth.
whats a business worth at the end? the employees are free to leave when you sell ,the customers are free to leave. unless you have a name thats sellable and brand recognition there may be no value other then left over equipment and inventory.. hmmmmmm lets see i own a store and i charge more for a widget then i paid taking money from my customers pocket... and thats different then me selling real estate for more then i paid... .?
Considering people buy and sell businesses all the time, there is a pretty straight forward answer. A business is worth its assets and ability to generate profit, these are the two things used to value businesses.
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Originally Posted by mathjak107
hmmmmmm lets see i own a store and i charge more for a widget then i paid taking money from my customers pocket... and thats different then me selling real estate for more then i paid... .?
Firstly, I have no idea why you are pretending as if retail businesses are the only type of business. Secondly, yes its different. The retailer is charging more based on what they are doing for their customer, they are providing a convenient location to purchase the item (you'd have to purchase in bulk from a manufacture/distributor otherwise), they are providing help in selecting your item, and so on. On the other hand you've provided nothing, instead you are merely gaining because the community your home exists in has increased in value. Its really just legalized theft, you are stealing from current workers/businesses because you own an asset that can't be produced (e.g., the land) that is necessary for them to live/operate in the area.
wrong. for most small businesses a business's ability to generate profits is based on 2 things that usually have no guarantee of sticking around when a business is sold or changes hands , the employees and the customer base.
heres a secreat as to what made our company so great... we find companies in our industries that are up for sale or having financial difficulty. we have great companies with nice customer bases who are having cash flow issues . we offer the owners a job, we hire the people, the customer base follows along usually and we pay only for useable inventory and equipment.
our company has done this 8 or 9 times already and have taken over the customer bases without paying 1 penny for any of the businesses other then the above. we have seen sooooo many companies that were long time solid profitable companies end up with nothing at the end because they loose the employees and the customer base once things change at the company
Last edited by mathjak107; 01-07-2011 at 05:52 PM..
wrong. for most small businesses a business's ability to generate profits is based on 2 things that usually have no guarantee of sticking around when a business is sold or changes hands , the employees and the customer base.
There is nothing wrong about what I stated, like large corporations, small businesses are valued in terms of their assets and profits. The fact that there is "no guarantee" is irrelevant, there is no guarantee you'll be here tomorrow either. A small business that may have a rough transfer of ownership is going to sell is for less, yet its still going to sell for more than its inventory or assets.
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Originally Posted by mathjak107
we find companies in our industries that are up for sale or having financial difficulty.
As I said, you're talking about failed businesses and you seem to be only thinking of retail businesses.
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