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on this I agree with you, but it is for this reason there are so many distressed properties which people are struggling to sell and which are driving down prices. One just has to drive along Carpenter Firestation Road in West Cary and the disaster of Cameron Pond sub-division 'rusty pylons' and the 540 'scar' stares you in the face. Other posters have described other neighborhoods will similar issues which make the homes difficult to sell and I feel sorry for the people who are left high and dry like this.
Good homes in good locations will always sell, but in this market they also are impacted by the 'drag effect' of the problem homes which are being substantially discounted to move.
Is that a real drag or just a statistical discussion story?
Perhaps there is value in considering and applying the following to housing.
Person A buys 100K of stock in company WWWW in 2000 at $50 per share.
Person B buys 100K of stock in company XXXXX in 2000 for $50 per share.
Each stock during the bull run hit $150.00 per share and at the peak each shareholder was over joyed.
However today each stock is back to $50.00 per share and each investor is still holding their initial share purchase. Is each investor part of the lost decade in stocks?
Perhaps yes or perhaps definitely NO!
What if I say company WWWW for the decade paid no dividend and company XXXXX paid an average 6% yearly dividend. It is the individual story and not the headline story that counts.
Perhaps there is value in considering and applying the following to housing.
Person A buys 100K of stock in company WWWW in 2000 at $50 per share.
Person B buys 100K of stock in company XXXXX in 2000 for $50 per share.
Each stock during the bull run hit $150.00 per share and at the peak each shareholder was over joyed.
However today each stock is back to $50.00 per share and each investor is still holding their initial share purchase. Is each investor part of the lost decade in stocks?
Perhaps yes or perhaps definitely NO!
What if I say company WWWW for the decade paid no dividend and company XXXXX paid an average 6% yearly dividend. It is the individual story and not the headline story that counts.
Also, how much did they lose per share (hint: the answer is nothing). Some people would view it as they lost $100 per share - but that is only paper value that was never realized.
Also, how much did they lose per share (hint: the answer is nothing). Some people would view it as they lost $100 per share - but that is only paper value that was never realized.
Which is the great analogy for the housing market. Guess what people especially elsewhere. Your house should have never been worth that much and it will be a long time for it is again. It was a bubble based on unrealistic and unsound financing practices. So if you look at what your house should have been worth it wasn't that high. However some of us did manage to sell at levels that were not sustainable. If you doubled your money in a year during the dot com bubble that was not a realistic gain and only a few actually translated it into real money. Once the selling of anything starts to pick up the price can head down as buyers decline the opportunity to buy at a higher price.
There's no way to know that prices now are low just because they have gone down a bit. To continue the theme of automaker stocks, look at GM 2 years ago - it was the lowest it had been in a generation. That's a can't lose deal if I've ever seen one! Except for the minor problem that they went bankrupt and stockholders were all but wiped out.
There is only one best time to buy a house and you only know it was the best after it has passed and even then you never know if 10 years down the road might be even better. If you always wait for the best time to buy then you will never end up buying.
The argument about is it a good time to buy a house somehow turns into is it the single best time in history to buy a house. No one will ever know that because history never ends. The dynamics are always changing.
People can try to convince themselves that now is not a good time to buy a house, but history disputes that at every turn. It is a very good time to buy if you are ready to buy.
Not if the woods are between you and another development with a stream down the middle.
That's what I have. I have a really good back yard, deep woods and a stream right in the middle of the woods. There is no way for a road to go back there and it is a protected watershed area. I have one of the premier lots in the entire neighborhood. That was a major factor in my choice.
Gotcha a hitter going from 350 to 325 is in a slump but he is still hitting well in hindsight when he goes back up to 335. Not as high as before but darn good. No one denies or questions that there is a slowdown in housing. Yes there is a slow down or decline. The question is when has it bottomed? Like trading the 325 hitter because he is slumping and having him go on a 15 for 20 tear with his new team in real life or his fantasy team in a fantasy league. Yah gotta roll the dice if you want to make it at some time and since this is about investing you can be like most small time retail investors and look in the rear view mirror to see what to do. You have done a great job convincing your self that the glass is leaking and some agree with you and others don't. Some will buy and others won't. Some will sell and others won't. Thus is the joy of the market place. Happy trails to you as you have a path and may it work out for you. My path and the path of others is not loaded with many naysayers and thus far I have no complaints.
That's what I have. I have a really good back yard, deep woods and a stream right in the middle of the woods. There is no way for a road to go back there and it is a protected watershed area. I have one of the premier lots in the entire neighborhood. That was a major factor in my choice.
Ain't it grand. I don't know about you but I thank my buyers agent for landing me in great fashion. The wonderful part is I didn't have to pay her a cent. The builder did.
You have done a great job convincing your self that the glass is leaking and some agree with you and others don't. Some will buy and others won't. Some will sell and others won't. .
No you completely misunderstand . I get irritated by the constant RaRa from one or two Realtors pushing how good the housing market here is when this is patently untrue. You previously used Wall Street as an analogy and my immediate thought was "pump and dump'. At least these days the SEC provides some level of governance to make sure the 'pumpers' don't profit. There is no equivalent governance in respect of similar pumping the housing market
You can see how bored everyone else is with this thread by the total lack of posts from anyone other than yourself, a couple of realtors, one or two others, and myself posting the alternative perspective which is the housing market is still struggling.
Last edited by Beermat; 09-18-2010 at 07:44 AM..
Reason: correction
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note the words "housing slump"
.
. I get irritated by the constant RaRa from one or two Realtors pushing how good the housing market here is when this is patently untrue. You previously used Wall Street as an analogy and my immediate thought was "pump and dump'. At least these days the SEC provides some level of governance to make sure the 'pumpers' don't profit. There is no equivalent governance in respect of similar pumping the housing market 
