How many of you have second homes? (retiree, vacation, years)
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John Paulson made billions betting against subprime mortgages. Now, he says buying a house is the best possible investment.
If you already own a home, buy a second one. "You won't make returns that good by investing in me," Paulson told the audience at CNBC's Delivering Alpha conference in Manhattan on Wednesday.
Paulson said that back in 2006, he was aware that housing was at its peak. Now, he thinks it's still very close to the bottom.
"I think we're just at the beginning of the recovery. I think it will continue for four to seven years," he said. "It's not too late to get involved."
For the individual investor, locking in a fixed-mortgage rate is also a way to hedge against inflation down the road. He thinks it's unlikely that an uptick in mortgage rates will cause the housing market to cool.
Paulson has been saying this for a few years and influenced our decision three years ago to buy our second place. I did a search earlier today of real estate sales and there are no units for sale in our development and prices are up about 10% with the last sale in May. There was also discussion about paying the principle down sooner. We have no mortgage on the other place and this unit while real nice is off the beach(with pool) and wasn't all that expensive at market bottom when we purchased. Two units sold quickly in the Spring so thus far we have no qualms with Paulsons advice.
Paulson has been saying this for a few years and influenced our decision three years ago to buy our second place. I did a search earlier today of real estate sales and there are no units for sale in our development and prices are up about 10% with the last sale in May. There was also discussion about paying the principle down sooner. We have no mortgage on the other place and this unit while real nice is off the beach(with pool) and wasn't all that expensive at market bottom when we purchased. Two units sold quickly in the Spring so thus far we have no qualms with Paulsons advice.
Oh ABSOLUTELY 3 years ago was a GREAT time to buy. Prices in many, many areas hit the bottom 2 or 3 years ago. We bought our primary home 2 years ago at the bottom. Now, we are getting unsolicited offers almost each month from people that want to buy our house (some for cash). We have NO plans to sell our house ever. But some properties here in our area are selling for near peak prices again. There is almost no good inventory. And some houses are selling within HOURS of getting listed. And they are selling over asking prices.
As to whether buying at today's prices makes sense, I think it all depends on the actual city and how desirable it is. I've always said that in desirable areas, real estate prices will surpass the bubble prices. I just thought it would take at least a decade!
I also agree with the strategy of not having a mortgage if possible in retirement on any properties. I'm not saying it's a blanket scenario that applies to everyone but I've always preferred that strategy heading into retirement and not having any mortgages whatsoever to worry about.
Oh ABSOLUTELY 3 years ago was a GREAT time to buy. Prices in many, many areas hit the bottom 2 or 3 years ago. We bought our primary home 2 years ago at the bottom. Now, we are getting unsolicited offers almost each month from people that want to buy our house (some for cash). We have NO plans to sell our house ever. But some properties here in our area are selling for near peak prices again. There is almost no good inventory. And some houses are selling within HOURS of getting listed. And they are selling over asking prices.
As to whether buying at today's prices makes sense, I think it all depends on the actual city and how desirable it is. I've always said that in desirable areas, real estate prices will surpass the bubble prices. I just thought it would take at least a decade! She had a second home of her home in a golf community closer to Mrytle Beach.
I also agree with the strategy of not having a mortgage if possible in retirement on any properties. I'm not saying it's a blanket scenario that applies to everyone but I've always preferred that strategy heading into retirement and not having any mortgages whatsoever to worry about.
I agree with everything you say and would add having a trusted real estate agent is invaluable. Our agent ha been directly or indirectly involved with about half a dozen family sales over the last three years in three states. Along with my sons we swear by her and the non NC agents she has recommended. She made a North Virginia agent very very happy between our one son and friends of theirs. She has been an excellent buyer agent and worked with us almost two years in NC before we retired.
I agree with everything you say and would add having a trusted real estate agent is invaluable. Our agent ha been directly or indirectly involved with about half a dozen family sales over the last three years in three states. Along with my sons we swear by her and the non NC agents she has recommended. She made a North Virginia agent very very happy between our one son and friends of theirs. She has been an excellent buyer agent and worked with us almost two years in NC before we retired.
Absolutely I think some real estate agents can be great. In some of the places I've purchased many properties, I stick with one realtor. However, in many other places I don't have any loyalty to one particular realtor. In my vast experience buying real estate, I've found more times than not, most realtors are not that great. They are looking out for THEIR best interests instead of MY best interests (or the buyer's interests).
Something wonderful these days are all the resources out there online to do due diligence and research and get data. These days I mostly do my own research when buying. Sites like Redfin, Zillow, Trulia and many major cities have their own websites that are specific to that particular city are great.
Back many years ago we didn't have all of these resources readily available and free and you had to depend more on traditional realtors. Today, you can do a lot of research on your own and see recent comparables, etc. I do still find realtors helpful however but I think most people should do much of the due diligence on their own and not just depend on a realtor's advice no matter where you are buying a second home.
Absolutely I think some real estate agents can be great. In some of the places I've purchased many properties, I stick with one realtor. However, in many other places I don't have any loyalty to one particular realtor. In my vast experience buying real estate, I've found more times than not, most realtors are not that great. They are looking out for THEIR best interests instead of MY best interests (or the buyer's interests).
Something wonderful these days are all the resources out there online to do due diligence and research and get data. These days I mostly do my own research when buying. Sites like Redfin, Zillow, Trulia and many major cities have their own websites that are specific to that particular city are great.
Back many years ago we didn't have all of these resources readily available and free and you had to depend more on traditional realtors. Today, you can do a lot of research on your own and see recent com parables, etc. I do still find realtors helpful however but I think most people should do much of the due diligence on their own and not just depend on a realtor's advice no matter where you are buying a second home.
Due diligence and using a great agent when you find them to do referrals of agents elsewhere will do wonders. Agents survive on referrals and if they think more will follow it is in their best interest to excel. Our NC agent said she almost fell over when she got the commission checks from the NOVA referrals. That agent owed her big and if she got any transplant to NC referrals like us it was a plus. Buyers agents don't cost you any money and can often get you a lower price.
We do at the moment. Two 'second homes', as it were.
A condo in the city. A condo in Florida for the winter. A summer home in "cottage country" up on the river. We're at the latter home right now, until the end of August. September and October back in Toronto, then Florida for the winter (with several foreign trips interspersed.)
Back to Toronto at the end of April, mostly Toronto until July, then cottage again.
Yes, I know it's crazy. But for now it's working (although my husband would be happy to sell the cottage--he puts up with it because he knows I love it.)
Due diligence and using a great agent when you find them to do referrals of agents elsewhere will do wonders. Agents survive on referrals and if they think more will follow it is in their best interest to excel. Our NC agent said she almost fell over when she got the commission checks from the NOVA referrals. That agent owed her big and if she got any transplant to NC referrals like us it was a plus. Buyers agents don't cost you any money and can often get you a lower price.
Be careful though on assuming that all retirees will buy a second home in the USA. Indeed, buyer's agents DO charge commissions in other countries. In several countries buyers AND sellers pay a real estate commission.
But I agree with you in the USA we don't have to worry about buyer's commissions and using the example I gave, you can even get rebates if you structure your purchase the right way asking for a rebate that the realtor will make or using www.redfin.com
Be careful though on assuming that all retirees will buy a second home in the USA. Indeed, buyer's agents DO charge commissions in other countries. In several countries buyers AND sellers pay a real estate commission.
But I agree with you in the USA we don't have to worry about buyer's commissions and using the example I gave, you can even get rebates if you structure your purchase the right way asking for a rebate that the realtor will make or using Real Estate, Homes for Sale, MLS Listings, Agents | Redfin
Yeah I am pretty sure our agent gave part of her commission back to us in appreciation.
Either now or in the past? If you do have a second home, have you enjoyed it or was it too much of a hassle? MSNBC did a segment yesterday that Boomers who have second homes usually end up regretting it, either because of financial reasons or the extra responsibility.
After my father died, my mother gave one summer home, not really worth much, to her sister and sold the other. She wanted to downsize and didn't want the responsibility of a second and third home.
We do at the moment. Two 'second homes', as it were.....
My DH and myself, rather than buy and be responsible for a second home in FL, bought an RV. Now we're not tied to one place in FL and have no responsibility, worries or expense of a second home... yet get to spend winters in FL. We may start spending summers where it's cooler than in TN. We haven't quite made up our minds yet.
It's the least expensive way to go with the least responsibility and we have the freedom of seeing different parts of FL every winter.
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We may start spending summers where it's cooler than in TN. We haven't quite made up our minds yet. 
