Hi,
I have been an observer of this board for quite some time. Also learned a lot of information and valuable things here. I would be happy doing what I have been doing (just reading as a visitor). But I read this post and found it reflected amazingly same kind of confusion as mine. So just registered and want to speak about it.
1. First thing, like want-to-buy, I really face the increase of rent now and really don’t like it. If we are doing math that people can buy something similar with the current rent, why they would hold on long not to buy but rather rent? In another words, why the Condo prices will keep dropping dramatically before being baught? Is everyone “bottom fish”? Or will we see rent dropping in future?
2. I learned from a friend in Citibank (No.1 bank in US) that Citi’s asset is about $3 Trillion. The No.2 is Bank of America, which has a total asset around $2 Trillion. Many other banks have assets over $1 Trillion. Do you think how big the influence of this mortgage crisis would be on these big banks? When I heard that BoA lent CountryWide $2 billion, I thought it’s foolish to do that. But then when I learned how much money BoA has and how the terms would favor it, I started to have a second thought.
3. If you have a magic mirror and know that the price will keep dropping, say (I made up this) 20% for 5 years, will you keep renting all these 5 years? How many more people would be waiting to buy each year? Then at the point of that 5 year reaches, what would happen?
4. Most of the posts here look convincing and well supported with all kinds of data. I remember someone posted earlier this year with support of history figure/curve of stock index, and predicted S&P 500 drop to 500 at this summer. I was shocked upon reading it and was really upset then. Summer is almost gone now. How would you think about this kind of claim/prediction?
Sorry if this seems offending in this board (hopefully not, but just in case). I just want to get some hint to clear my confusion.
