A woman at my work bought a downtown condo about a year and half ago as an investement. She thought she can buy it and sell it and make an easy $100k. I advised her not to and that the market has reached the peak. She said she got onto a presales list and was able to buy the condo cheaper than the rest of them will be when “officially” released to the market. Now tell me this isn’t one smelly scam of a marketing scheme.
She bought the condo for $575K with anticipation that the future releases will be about $675. She bought it and waited. Finally when they were built the they listed the rest of the condos on MLS for about $625k. Not bad if she could make $50k right? Well those on the MLS didn’t sell and sat there for months. Eventually a few sold for $600k. She put hers on the market for $625k and the real estate agent crook claimed he can sell this at her “cheap” price in a couple weeks. Months went buy and he only showed it to 3 people. Across the street a new condo went up and completely blocked the view of the ballpark from her condo. They also added bleachers on the roof and had a fitness center, pool etc… and sold theirs for $550 and up. She decided to rent it out and took a hit of about $700 a month. Fast forward to today. She had to put it up for $550K and was willing to take the loss since she claims there are about 10 units still unsold in this building. She ended up selling it for $530k. What a lump! Nice little $50k loss right there. I feel bad for her but not really. She like many other wannabe Trumps thought they can “play” the market and be rich. Just like all pyramid schemes, the ones on the bottom get screwed.
We get so desensitized to real estate increases and decreases that it’s easy to lose sight of the fact that this isn’t Monopoly money we’re talking about. $50k is the equivalent of a year’s take home pay for a lot of people.
$50,000 represented a 25% loss in value for a home purchased in 1989, that being the accrued loss over probably 5 years. That $50,000 was the maximum loss during the entire downturn of the last RE bust. Now it’s just a drop in the bucket.
People had a really difficult time recovering from those losses back then because $50k was a lot of money. One can only wonder how many of our current FBs are going to be able to recover after suffering their losses by the time they start exceeding $200k.
We get so desensitized to real estate increases and decreases that it’s easy to lose sight of the fact that this isn’t Monopoly money we’re talking about. $50k is the equivalent of a year’s take home pay for a lot of people.
$50,000 represented a 25% loss in value for a home purchased in 1989, that being the accrued loss over probably 5 years. That $50,000 was the maximum loss during the entire downturn of the last RE bust. Now it’s just a drop in the bucket.
People had a really difficult time recovering from those losses back then because $50k was a lot of money. One can only wonder how many of our current FBs are going to be able to recover after suffering their losses by the time they start exceeding $200k.
It’s in the downtown highrise in what is now called the East-Village. It is a nice place, just now there are so many nicer condos out there for cheaper she had no choice. She already has her own condo and thus couldn’t just walk away from the loan without potentially losing her first home. She makes good money and will recover in a few years but still a hard lesson learned on how not to be a flipper.
Bugs nailed it right though. 50k now is a small decrease where in 2000-2001 that was a HUGE drop. How times have changed.
It’s in the downtown highrise in what is now called the East-Village. It is a nice place, just now there are so many nicer condos out there for cheaper she had no choice. She already has her own condo and thus couldn’t just walk away from the loan without potentially losing her first home. She makes good money and will recover in a few years but still a hard lesson learned on how not to be a flipper.
Bugs nailed it right though. 50k now is a small decrease where in 2000-2001 that was a HUGE drop. How times have changed.
She is lucky to get out at all. I’ll bet that the person buying this gem financed it 100%. The buildings are still going up down here, there are at least five within a few blocks of my place in various stages of completion. Who on earth is going to buy these things?
She is lucky to get out at all. I’ll bet that the person buying this gem financed it 100%. The buildings are still going up down here, there are at least five within a few blocks of my place in various stages of completion. Who on earth is going to buy these things?
