One American household out of 10 under water

[patientlywaiting]

Just watched ABC News. Things will get very ugly.

Too bad they don’t have video online. But here’s the story.

——–

Mark Zandi, chief economist of Moody’s Economy.com, said, “The last time we saw so many homeowners with so many home values that were worth less than the amount of mortgage they owed was back in the Great Depression.”

http://abcnews.go.com/Business/story?id=4332334&page=1

[patientlywaiting]

Looks like it’ll get worse from 8.8 million owners under water to 15 million households under water by the end of the year.

——
By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report.

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=atrbI3FEV3.I

[DoJC]

I wonder what the correlation to underwater homeowners to walk-away ratio will end up? That and what the ratio of underwater to foreclosure will be? Those two will greatly home prices over the next 2-3 years. That and what happens to the mortgage rate!

– Doug

[Bugs]

The numbers are so staggering that it’s hard to conceptualize them in other than abstract terms.

[34f3f3f]

It is frightening to think that one in every ten people you know who owns a home in is negative equity, but I wonder what the distribution for this figure is demographically and geographically? It would be interesting to draw a national map with with the hot spots, and cool areas.

[sdrealtor]

I’m not sure but my impression was that this is shotty reporting. I believe the true statisitic is 1 in 10 mortgages is underwater not 1 in 10 households. So we can pull out all the homes across the US owned free and clear of which there are many albeit not so many around here. I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater. I also wonder whether they are assuming that all HELOC’s are at there credit limits which is far from true nationally. I’d love to see someone get to the bottom of the study behind this statitics to suss out what the real situation is.

[barnaby33]

Im with sdrealtor on this one. Here in SD, I’d have no problem buying that, but not nationwide. Too many places especially in the middle of the country just didn’t see the huge run-ups, Places like Kansas City. I don’t have counter numbers but that would just be beyond staggering.

Josh

[Multiplepropertyowner]

Lack of equity in your home does not signify underwater. All it means is that that particular asset is in a stagnant position. Underwater is the inability to meet your monetary commitments.
My last property was bought back in July 2007. It is upside down, but I figured this in. I bought it as a 10-15 year hold to hopefully cash in to pay for my 5 year olds college needs. If that does not work out, I will have to keep it as a rental.

I thought the piece on the nightly news portrayed it (the 10% of people upside down) in a really bad light. The real issue is, what % of these folks are in financial straights. Seems to me that the media is just feeding on this. Every night this last week Charles Gibson led with a story on the housing market. It is all about the ratings.

[patientlywaiting]

Underwater means negative net-worth, when you owe more than your assets are worth.

In this case, we are talking about houses “under water.”

The numbers are staggering. Since most families have nothing of value but their houses and cars, this puts them in a negative networth position. Many will find that filing for bankruptcy is a no brainer.

[patientlywaiting]

Underwater means negative net-worth, when you owe more than your assets are worth.

In this case, we are talking about houses “under water.”

The numbers are staggering. Since most families have nothing of value but their houses and cars, this puts them in a negative networth position. Many will find that filing for bankruptcy is a no brainer.

[patientlywaiting]

Underwater means negative net-worth, when you owe more than your assets are worth.

In this case, we are talking about houses “under water.”

The numbers are staggering. Since most families have nothing of value but their houses and cars, this puts them in a negative networth position. Many will find that filing for bankruptcy is a no brainer.

[patientlywaiting]

Underwater means negative net-worth, when you owe more than your assets are worth.

In this case, we are talking about houses “under water.”

The numbers are staggering. Since most families have nothing of value but their houses and cars, this puts them in a negative networth position. Many will find that filing for bankruptcy is a no brainer.

[patientlywaiting]

Underwater means negative net-worth, when you owe more than your assets are worth.

In this case, we are talking about houses “under water.”

The numbers are staggering. Since most families have nothing of value but their houses and cars, this puts them in a negative networth position. Many will find that filing for bankruptcy is a no brainer.

[Multiplepropertyowner]

Lack of equity in your home does not signify underwater. All it means is that that particular asset is in a stagnant position. Underwater is the inability to meet your monetary commitments.
My last property was bought back in July 2007. It is upside down, but I figured this in. I bought it as a 10-15 year hold to hopefully cash in to pay for my 5 year olds college needs. If that does not work out, I will have to keep it as a rental.

I thought the piece on the nightly news portrayed it (the 10% of people upside down) in a really bad light. The real issue is, what % of these folks are in financial straights. Seems to me that the media is just feeding on this. Every night this last week Charles Gibson led with a story on the housing market. It is all about the ratings.

[Multiplepropertyowner]

Lack of equity in your home does not signify underwater. All it means is that that particular asset is in a stagnant position. Underwater is the inability to meet your monetary commitments.
My last property was bought back in July 2007. It is upside down, but I figured this in. I bought it as a 10-15 year hold to hopefully cash in to pay for my 5 year olds college needs. If that does not work out, I will have to keep it as a rental.

I thought the piece on the nightly news portrayed it (the 10% of people upside down) in a really bad light. The real issue is, what % of these folks are in financial straights. Seems to me that the media is just feeding on this. Every night this last week Charles Gibson led with a story on the housing market. It is all about the ratings.

[Multiplepropertyowner]

Lack of equity in your home does not signify underwater. All it means is that that particular asset is in a stagnant position. Underwater is the inability to meet your monetary commitments.
My last property was bought back in July 2007. It is upside down, but I figured this in. I bought it as a 10-15 year hold to hopefully cash in to pay for my 5 year olds college needs. If that does not work out, I will have to keep it as a rental.

I thought the piece on the nightly news portrayed it (the 10% of people upside down) in a really bad light. The real issue is, what % of these folks are in financial straights. Seems to me that the media is just feeding on this. Every night this last week Charles Gibson led with a story on the housing market. It is all about the ratings.

[Multiplepropertyowner]

Lack of equity in your home does not signify underwater. All it means is that that particular asset is in a stagnant position. Underwater is the inability to meet your monetary commitments.
My last property was bought back in July 2007. It is upside down, but I figured this in. I bought it as a 10-15 year hold to hopefully cash in to pay for my 5 year olds college needs. If that does not work out, I will have to keep it as a rental.

I thought the piece on the nightly news portrayed it (the 10% of people upside down) in a really bad light. The real issue is, what % of these folks are in financial straights. Seems to me that the media is just feeding on this. Every night this last week Charles Gibson led with a story on the housing market. It is all about the ratings.

[barnaby33]

Im with sdrealtor on this one. Here in SD, I’d have no problem buying that, but not nationwide. Too many places especially in the middle of the country just didn’t see the huge run-ups, Places like Kansas City. I don’t have counter numbers but that would just be beyond staggering.

Josh

[barnaby33]

Im with sdrealtor on this one. Here in SD, I’d have no problem buying that, but not nationwide. Too many places especially in the middle of the country just didn’t see the huge run-ups, Places like Kansas City. I don’t have counter numbers but that would just be beyond staggering.

Josh

[barnaby33]

Im with sdrealtor on this one. Here in SD, I’d have no problem buying that, but not nationwide. Too many places especially in the middle of the country just didn’t see the huge run-ups, Places like Kansas City. I don’t have counter numbers but that would just be beyond staggering.

Josh

[barnaby33]

Im with sdrealtor on this one. Here in SD, I’d have no problem buying that, but not nationwide. Too many places especially in the middle of the country just didn’t see the huge run-ups, Places like Kansas City. I don’t have counter numbers but that would just be beyond staggering.

Josh

[sdrealtor]

I’m not sure but my impression was that this is shotty reporting. I believe the true statisitic is 1 in 10 mortgages is underwater not 1 in 10 households. So we can pull out all the homes across the US owned free and clear of which there are many albeit not so many around here. I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater. I also wonder whether they are assuming that all HELOC’s are at there credit limits which is far from true nationally. I’d love to see someone get to the bottom of the study behind this statitics to suss out what the real situation is.

[sdrealtor]

I’m not sure but my impression was that this is shotty reporting. I believe the true statisitic is 1 in 10 mortgages is underwater not 1 in 10 households. So we can pull out all the homes across the US owned free and clear of which there are many albeit not so many around here. I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater. I also wonder whether they are assuming that all HELOC’s are at there credit limits which is far from true nationally. I’d love to see someone get to the bottom of the study behind this statitics to suss out what the real situation is.

[sdrealtor]

I’m not sure but my impression was that this is shotty reporting. I believe the true statisitic is 1 in 10 mortgages is underwater not 1 in 10 households. So we can pull out all the homes across the US owned free and clear of which there are many albeit not so many around here. I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater. I also wonder whether they are assuming that all HELOC’s are at there credit limits which is far from true nationally. I’d love to see someone get to the bottom of the study behind this statitics to suss out what the real situation is.

[sdrealtor]

I’m not sure but my impression was that this is shotty reporting. I believe the true statisitic is 1 in 10 mortgages is underwater not 1 in 10 households. So we can pull out all the homes across the US owned free and clear of which there are many albeit not so many around here. I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater. I also wonder whether they are assuming that all HELOC’s are at there credit limits which is far from true nationally. I’d love to see someone get to the bottom of the study behind this statitics to suss out what the real situation is.

[kewp]

It would be interesting to draw a national map with with the hot spots, and cool areas.

Not quite what you are looking for, but…

The “Map of Misery”

http://www.businessweek.com/common_ssi/map_of_misery.htm

Of course, not everyone with a pay-option-ARM has negative equity. But I would bet the clear majority do.

[Multiplepropertyowner]

PW,
My point was that having neg equity is not that big of a deal if you can manage the position. It is only a temp situation that will in time turn. I just feel that the piece on ABC painted everyone with neg equity in a position of distress. If you have a fixed loan that you can manage the debt service you are not in distress, just waiting for better timing.

[Multiplepropertyowner]

PW,
My point was that having neg equity is not that big of a deal if you can manage the position. It is only a temp situation that will in time turn. I just feel that the piece on ABC painted everyone with neg equity in a position of distress. If you have a fixed loan that you can manage the debt service you are not in distress, just waiting for better timing.

[Multiplepropertyowner]

PW,
My point was that having neg equity is not that big of a deal if you can manage the position. It is only a temp situation that will in time turn. I just feel that the piece on ABC painted everyone with neg equity in a position of distress. If you have a fixed loan that you can manage the debt service you are not in distress, just waiting for better timing.

[Multiplepropertyowner]

PW,
My point was that having neg equity is not that big of a deal if you can manage the position. It is only a temp situation that will in time turn. I just feel that the piece on ABC painted everyone with neg equity in a position of distress. If you have a fixed loan that you can manage the debt service you are not in distress, just waiting for better timing.

[Multiplepropertyowner]

PW,
My point was that having neg equity is not that big of a deal if you can manage the position. It is only a temp situation that will in time turn. I just feel that the piece on ABC painted everyone with neg equity in a position of distress. If you have a fixed loan that you can manage the debt service you are not in distress, just waiting for better timing.

[kewp]

It would be interesting to draw a national map with with the hot spots, and cool areas.

Not quite what you are looking for, but…

The “Map of Misery”

http://www.businessweek.com/common_ssi/map_of_misery.htm

Of course, not everyone with a pay-option-ARM has negative equity. But I would bet the clear majority do.

[kewp]

It would be interesting to draw a national map with with the hot spots, and cool areas.

Not quite what you are looking for, but…

The “Map of Misery”

http://www.businessweek.com/common_ssi/map_of_misery.htm

Of course, not everyone with a pay-option-ARM has negative equity. But I would bet the clear majority do.

[kewp]

It would be interesting to draw a national map with with the hot spots, and cool areas.

Not quite what you are looking for, but…

The “Map of Misery”

http://www.businessweek.com/common_ssi/map_of_misery.htm

Of course, not everyone with a pay-option-ARM has negative equity. But I would bet the clear majority do.

[kewp]

It would be interesting to draw a national map with with the hot spots, and cool areas.

Not quite what you are looking for, but…

The “Map of Misery”

http://www.businessweek.com/common_ssi/map_of_misery.htm

Of course, not everyone with a pay-option-ARM has negative equity. But I would bet the clear majority do.

[34f3f3f]

It is frightening to think that one in every ten people you know who owns a home in is negative equity, but I wonder what the distribution for this figure is demographically and geographically? It would be interesting to draw a national map with with the hot spots, and cool areas.

[34f3f3f]

It is frightening to think that one in every ten people you know who owns a home in is negative equity, but I wonder what the distribution for this figure is demographically and geographically? It would be interesting to draw a national map with with the hot spots, and cool areas.

[34f3f3f]

It is frightening to think that one in every ten people you know who owns a home in is negative equity, but I wonder what the distribution for this figure is demographically and geographically? It would be interesting to draw a national map with with the hot spots, and cool areas.

[34f3f3f]

It is frightening to think that one in every ten people you know who owns a home in is negative equity, but I wonder what the distribution for this figure is demographically and geographically? It would be interesting to draw a national map with with the hot spots, and cool areas.

[Bugs]

The numbers are so staggering that it’s hard to conceptualize them in other than abstract terms.

[Bugs]

The numbers are so staggering that it’s hard to conceptualize them in other than abstract terms.

[Bugs]

The numbers are so staggering that it’s hard to conceptualize them in other than abstract terms.

[Bugs]

The numbers are so staggering that it’s hard to conceptualize them in other than abstract terms.

[DoJC]

I wonder what the correlation to underwater homeowners to walk-away ratio will end up? That and what the ratio of underwater to foreclosure will be? Those two will greatly home prices over the next 2-3 years. That and what happens to the mortgage rate!

– Doug

[DoJC]

I wonder what the correlation to underwater homeowners to walk-away ratio will end up? That and what the ratio of underwater to foreclosure will be? Those two will greatly home prices over the next 2-3 years. That and what happens to the mortgage rate!

– Doug

[DoJC]

I wonder what the correlation to underwater homeowners to walk-away ratio will end up? That and what the ratio of underwater to foreclosure will be? Those two will greatly home prices over the next 2-3 years. That and what happens to the mortgage rate!

– Doug

[DoJC]

I wonder what the correlation to underwater homeowners to walk-away ratio will end up? That and what the ratio of underwater to foreclosure will be? Those two will greatly home prices over the next 2-3 years. That and what happens to the mortgage rate!

– Doug

[patientlywaiting]

Looks like it’ll get worse from 8.8 million owners under water to 15 million households under water by the end of the year.

——
By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report.

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=atrbI3FEV3.I

[patientlywaiting]

Looks like it’ll get worse from 8.8 million owners under water to 15 million households under water by the end of the year.

——
By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report.

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=atrbI3FEV3.I

[patientlywaiting]

Looks like it’ll get worse from 8.8 million owners under water to 15 million households under water by the end of the year.

——
By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report.

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=atrbI3FEV3.I

[patientlywaiting]

Looks like it’ll get worse from 8.8 million owners under water to 15 million households under water by the end of the year.

——
By the end of this year as many as 15 million U.S. households may owe more on their mortgages than their homes are worth, according to an estimate from Jan Hatzius, chief U.S. economist of New York-based Goldman Sachs Group Inc. That may fuel an increase in foreclosures, erode prices, and increase mortgage bond losses, he said in a Feb. 1 report.

http://www.bloomberg.com/apps/news?pid=20601109&refer=home&sid=atrbI3FEV3.I

[Deal Hunter]

I agree the media is feeding off the misery and paranoia of the markets. The big and “smart” money are moving in where everyone else is walking away from. Conventional lenders aren’t lending, so hard money is stepping in and making a killing. Buyers aren’t buying, so foreign investors are scooping up the deals.

I’m barely squaring my debts with rents, but the rents are stronger now that mortgages are harder to get.I’m doing fine with the properties I got in 2001 and 2003, but I too fell for an easy to get mortgage and got a property in 2006 that I’m a couple of hundred dollars negative on each month.

I’ll be able to handle it and am encouraged that my area (Las Vegas) has a strong economy. My only regret is that I’m short on enough cash to get in on some of the unbelievable deals available now. I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back.

[patientlywaiting]

” I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back. ”

How long is your line? 2 or more generations? If your long line of investors was successful, you’d have an inheritance and oodles cash to scoop up those amazing deals you’re talking about.

Sure, real estate comes back but, in the mean time, you need enough money to wait it out and still provide for your family.

I don’t see how anyone with negative net-worth is not in distress. I would be.

I do think that press is looking for ratings. But they haven’t begun to explain to the American people the severity of this crisis.

[patientlywaiting]

” I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back. ”

How long is your line? 2 or more generations? If your long line of investors was successful, you’d have an inheritance and oodles cash to scoop up those amazing deals you’re talking about.

Sure, real estate comes back but, in the mean time, you need enough money to wait it out and still provide for your family.

I don’t see how anyone with negative net-worth is not in distress. I would be.

I do think that press is looking for ratings. But they haven’t begun to explain to the American people the severity of this crisis.

[patientlywaiting]

” I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back. ”

How long is your line? 2 or more generations? If your long line of investors was successful, you’d have an inheritance and oodles cash to scoop up those amazing deals you’re talking about.

Sure, real estate comes back but, in the mean time, you need enough money to wait it out and still provide for your family.

I don’t see how anyone with negative net-worth is not in distress. I would be.

I do think that press is looking for ratings. But they haven’t begun to explain to the American people the severity of this crisis.

[patientlywaiting]

” I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back. ”

How long is your line? 2 or more generations? If your long line of investors was successful, you’d have an inheritance and oodles cash to scoop up those amazing deals you’re talking about.

Sure, real estate comes back but, in the mean time, you need enough money to wait it out and still provide for your family.

I don’t see how anyone with negative net-worth is not in distress. I would be.

I do think that press is looking for ratings. But they haven’t begun to explain to the American people the severity of this crisis.

[patientlywaiting]

” I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back. ”

How long is your line? 2 or more generations? If your long line of investors was successful, you’d have an inheritance and oodles cash to scoop up those amazing deals you’re talking about.

Sure, real estate comes back but, in the mean time, you need enough money to wait it out and still provide for your family.

I don’t see how anyone with negative net-worth is not in distress. I would be.

I do think that press is looking for ratings. But they haven’t begun to explain to the American people the severity of this crisis.

[one_muggle]

Real estate always comes back

I don’t know dude, there are a couple of significant trends that could make any significant rebound pretty far off.

For the last 30 yrs housing prices have gotten a boost from ever lower interest rates, and that will almost certainly not be the case over the next 30 yrs.

Baby boomers are beginning to switch from net home buyers to net home sellers, which is a trend that will get worse since a large fraction of them planned (and/or will need) to sell their house to fund retirement.

RE in some areas, like NYC and San Fran will probably always bounce back, but one industry towns, like Vegas, have a history of staying busted. Post-steel boom areas like Pennsylvania and upstate NY have never recovered the loss of that industry.
I don’t doubt that people will keep on gambling, but the water situation in the Southwest is getting dire, and will put a limit on growth, while surrounding states relax ordinances on local gambling. Though, the crappy dollar is keeping people in the states, so you have that going for you.
IMHO the odds on an eventual (~decade) RE recovery in Vegas are not bad, but I don’t think it is a certainty. There’s an awful lot of still-overpriced inventory, and not all that much demand. It’s kind of hard to see what is going to fuel another boom.
Good luck.

[Mean Reversion]

Real estate always comes back.

Sure it does. But isn’t it important how long it takes?

Are we talking 2 years or 20 years? That’s kinda important dontcha think?

[Mean Reversion]

Real estate always comes back.

Sure it does. But isn’t it important how long it takes?

Are we talking 2 years or 20 years? That’s kinda important dontcha think?

[Mean Reversion]

Real estate always comes back.

Sure it does. But isn’t it important how long it takes?

Are we talking 2 years or 20 years? That’s kinda important dontcha think?

[Mean Reversion]

Real estate always comes back.

Sure it does. But isn’t it important how long it takes?

Are we talking 2 years or 20 years? That’s kinda important dontcha think?

[Mean Reversion]

Real estate always comes back.

Sure it does. But isn’t it important how long it takes?

Are we talking 2 years or 20 years? That’s kinda important dontcha think?

[Eugene]

I personally know a guy who’s most likely underwater even though he bought his house with 20% down of his hard earned money. I tried to talk him out of the purchase, too.

Unless he loses his job, he won’t walk away. There’s no point. His monthly carrying costs are MAYBE $500 more than it would cost him to rent a comparable house. Is $500/month worth ruining your credit history?

Don’t assume that everyone who’s underwater will walk.

[HappyHouseHunting]

Esmith,
But isn’t that the point of all these conversations we have? Your friend may have been a prudent buyer in the microeconomic sense but he was a f*cked borrower in the macro world? That is the point of the thread “Harveston Down the Drain.” How smart is it to sit in a house that you can well afford to stay in,but is now worth $100,000 to $200,000
less? Doesn’t the opportunity cost of your money weigh in?

Not only that, how many prudent buyers thought they were buying into one kind of neighborhood only to find out any ninny with a pulse could buy there? A lot of people on this web site are looking for upper middle class neighborhoods and they do so for a reason but suppose you thought you were buying into that but it was all a lie? Those people were stretching beyond their reach and buying more home than they should have and are in a different neighborhood altogether.

I think this is going to get a whole lot worse.

HHH

[Deal Hunter]

I’m only 2nd generation RE investor. My parents bought SFR to rent out. They still have their dozen or so all paid for and giving them income. Their philosophy was to put a crap load of money down and pay off the mortgage. They didn’t help me get any of my rentals – although they did give me a “gift” of cash to buy my house after I got married.

I’ve followed all their advice, except for the one house I got in 2006. I didn’t put enough down to make it so the rent covered the mortgage. The other ones I have are cash flowing.

Whether it takes 2 years or 20, ALL my investments produce an income – through rent. The PROBLEM in real estate happens when people try to employ the appreciating nature of real estate to make quick money through flips. That’s how people end up “underwater.”

In any kind of economy, but especially a recessionary and hightly inflationary economy like the one we are in today, the fundamentals (and wisdom) of buying an income-producing asset are as sound as they have ever been.

[Deal Hunter]

I’m only 2nd generation RE investor. My parents bought SFR to rent out. They still have their dozen or so all paid for and giving them income. Their philosophy was to put a crap load of money down and pay off the mortgage. They didn’t help me get any of my rentals – although they did give me a “gift” of cash to buy my house after I got married.

I’ve followed all their advice, except for the one house I got in 2006. I didn’t put enough down to make it so the rent covered the mortgage. The other ones I have are cash flowing.

Whether it takes 2 years or 20, ALL my investments produce an income – through rent. The PROBLEM in real estate happens when people try to employ the appreciating nature of real estate to make quick money through flips. That’s how people end up “underwater.”

In any kind of economy, but especially a recessionary and hightly inflationary economy like the one we are in today, the fundamentals (and wisdom) of buying an income-producing asset are as sound as they have ever been.

[Deal Hunter]

I’m only 2nd generation RE investor. My parents bought SFR to rent out. They still have their dozen or so all paid for and giving them income. Their philosophy was to put a crap load of money down and pay off the mortgage. They didn’t help me get any of my rentals – although they did give me a “gift” of cash to buy my house after I got married.

I’ve followed all their advice, except for the one house I got in 2006. I didn’t put enough down to make it so the rent covered the mortgage. The other ones I have are cash flowing.

Whether it takes 2 years or 20, ALL my investments produce an income – through rent. The PROBLEM in real estate happens when people try to employ the appreciating nature of real estate to make quick money through flips. That’s how people end up “underwater.”

In any kind of economy, but especially a recessionary and hightly inflationary economy like the one we are in today, the fundamentals (and wisdom) of buying an income-producing asset are as sound as they have ever been.

[Deal Hunter]

I’m only 2nd generation RE investor. My parents bought SFR to rent out. They still have their dozen or so all paid for and giving them income. Their philosophy was to put a crap load of money down and pay off the mortgage. They didn’t help me get any of my rentals – although they did give me a “gift” of cash to buy my house after I got married.

I’ve followed all their advice, except for the one house I got in 2006. I didn’t put enough down to make it so the rent covered the mortgage. The other ones I have are cash flowing.

Whether it takes 2 years or 20, ALL my investments produce an income – through rent. The PROBLEM in real estate happens when people try to employ the appreciating nature of real estate to make quick money through flips. That’s how people end up “underwater.”

In any kind of economy, but especially a recessionary and hightly inflationary economy like the one we are in today, the fundamentals (and wisdom) of buying an income-producing asset are as sound as they have ever been.

[Deal Hunter]

I’m only 2nd generation RE investor. My parents bought SFR to rent out. They still have their dozen or so all paid for and giving them income. Their philosophy was to put a crap load of money down and pay off the mortgage. They didn’t help me get any of my rentals – although they did give me a “gift” of cash to buy my house after I got married.

I’ve followed all their advice, except for the one house I got in 2006. I didn’t put enough down to make it so the rent covered the mortgage. The other ones I have are cash flowing.

Whether it takes 2 years or 20, ALL my investments produce an income – through rent. The PROBLEM in real estate happens when people try to employ the appreciating nature of real estate to make quick money through flips. That’s how people end up “underwater.”

In any kind of economy, but especially a recessionary and hightly inflationary economy like the one we are in today, the fundamentals (and wisdom) of buying an income-producing asset are as sound as they have ever been.

[HappyHouseHunting]

Esmith,
But isn’t that the point of all these conversations we have? Your friend may have been a prudent buyer in the microeconomic sense but he was a f*cked borrower in the macro world? That is the point of the thread “Harveston Down the Drain.” How smart is it to sit in a house that you can well afford to stay in,but is now worth $100,000 to $200,000
less? Doesn’t the opportunity cost of your money weigh in?

Not only that, how many prudent buyers thought they were buying into one kind of neighborhood only to find out any ninny with a pulse could buy there? A lot of people on this web site are looking for upper middle class neighborhoods and they do so for a reason but suppose you thought you were buying into that but it was all a lie? Those people were stretching beyond their reach and buying more home than they should have and are in a different neighborhood altogether.

I think this is going to get a whole lot worse.

HHH

[HappyHouseHunting]

Esmith,
But isn’t that the point of all these conversations we have? Your friend may have been a prudent buyer in the microeconomic sense but he was a f*cked borrower in the macro world? That is the point of the thread “Harveston Down the Drain.” How smart is it to sit in a house that you can well afford to stay in,but is now worth $100,000 to $200,000
less? Doesn’t the opportunity cost of your money weigh in?

Not only that, how many prudent buyers thought they were buying into one kind of neighborhood only to find out any ninny with a pulse could buy there? A lot of people on this web site are looking for upper middle class neighborhoods and they do so for a reason but suppose you thought you were buying into that but it was all a lie? Those people were stretching beyond their reach and buying more home than they should have and are in a different neighborhood altogether.

I think this is going to get a whole lot worse.

HHH

[HappyHouseHunting]

Esmith,
But isn’t that the point of all these conversations we have? Your friend may have been a prudent buyer in the microeconomic sense but he was a f*cked borrower in the macro world? That is the point of the thread “Harveston Down the Drain.” How smart is it to sit in a house that you can well afford to stay in,but is now worth $100,000 to $200,000
less? Doesn’t the opportunity cost of your money weigh in?

Not only that, how many prudent buyers thought they were buying into one kind of neighborhood only to find out any ninny with a pulse could buy there? A lot of people on this web site are looking for upper middle class neighborhoods and they do so for a reason but suppose you thought you were buying into that but it was all a lie? Those people were stretching beyond their reach and buying more home than they should have and are in a different neighborhood altogether.

I think this is going to get a whole lot worse.

HHH

[HappyHouseHunting]

Esmith,
But isn’t that the point of all these conversations we have? Your friend may have been a prudent buyer in the microeconomic sense but he was a f*cked borrower in the macro world? That is the point of the thread “Harveston Down the Drain.” How smart is it to sit in a house that you can well afford to stay in,but is now worth $100,000 to $200,000
less? Doesn’t the opportunity cost of your money weigh in?

Not only that, how many prudent buyers thought they were buying into one kind of neighborhood only to find out any ninny with a pulse could buy there? A lot of people on this web site are looking for upper middle class neighborhoods and they do so for a reason but suppose you thought you were buying into that but it was all a lie? Those people were stretching beyond their reach and buying more home than they should have and are in a different neighborhood altogether.

I think this is going to get a whole lot worse.

HHH

[Eugene]

I personally know a guy who’s most likely underwater even though he bought his house with 20% down of his hard earned money. I tried to talk him out of the purchase, too.

Unless he loses his job, he won’t walk away. There’s no point. His monthly carrying costs are MAYBE $500 more than it would cost him to rent a comparable house. Is $500/month worth ruining your credit history?

Don’t assume that everyone who’s underwater will walk.

[Eugene]

I personally know a guy who’s most likely underwater even though he bought his house with 20% down of his hard earned money. I tried to talk him out of the purchase, too.

Unless he loses his job, he won’t walk away. There’s no point. His monthly carrying costs are MAYBE $500 more than it would cost him to rent a comparable house. Is $500/month worth ruining your credit history?

Don’t assume that everyone who’s underwater will walk.

[Eugene]

I personally know a guy who’s most likely underwater even though he bought his house with 20% down of his hard earned money. I tried to talk him out of the purchase, too.

Unless he loses his job, he won’t walk away. There’s no point. His monthly carrying costs are MAYBE $500 more than it would cost him to rent a comparable house. Is $500/month worth ruining your credit history?

Don’t assume that everyone who’s underwater will walk.

[Eugene]

I personally know a guy who’s most likely underwater even though he bought his house with 20% down of his hard earned money. I tried to talk him out of the purchase, too.

Unless he loses his job, he won’t walk away. There’s no point. His monthly carrying costs are MAYBE $500 more than it would cost him to rent a comparable house. Is $500/month worth ruining your credit history?

Don’t assume that everyone who’s underwater will walk.

[one_muggle]

Real estate always comes back

I don’t know dude, there are a couple of significant trends that could make any significant rebound pretty far off.

For the last 30 yrs housing prices have gotten a boost from ever lower interest rates, and that will almost certainly not be the case over the next 30 yrs.

Baby boomers are beginning to switch from net home buyers to net home sellers, which is a trend that will get worse since a large fraction of them planned (and/or will need) to sell their house to fund retirement.

RE in some areas, like NYC and San Fran will probably always bounce back, but one industry towns, like Vegas, have a history of staying busted. Post-steel boom areas like Pennsylvania and upstate NY have never recovered the loss of that industry.
I don’t doubt that people will keep on gambling, but the water situation in the Southwest is getting dire, and will put a limit on growth, while surrounding states relax ordinances on local gambling. Though, the crappy dollar is keeping people in the states, so you have that going for you.
IMHO the odds on an eventual (~decade) RE recovery in Vegas are not bad, but I don’t think it is a certainty. There’s an awful lot of still-overpriced inventory, and not all that much demand. It’s kind of hard to see what is going to fuel another boom.
Good luck.

[one_muggle]

Real estate always comes back

I don’t know dude, there are a couple of significant trends that could make any significant rebound pretty far off.

For the last 30 yrs housing prices have gotten a boost from ever lower interest rates, and that will almost certainly not be the case over the next 30 yrs.

Baby boomers are beginning to switch from net home buyers to net home sellers, which is a trend that will get worse since a large fraction of them planned (and/or will need) to sell their house to fund retirement.

RE in some areas, like NYC and San Fran will probably always bounce back, but one industry towns, like Vegas, have a history of staying busted. Post-steel boom areas like Pennsylvania and upstate NY have never recovered the loss of that industry.
I don’t doubt that people will keep on gambling, but the water situation in the Southwest is getting dire, and will put a limit on growth, while surrounding states relax ordinances on local gambling. Though, the crappy dollar is keeping people in the states, so you have that going for you.
IMHO the odds on an eventual (~decade) RE recovery in Vegas are not bad, but I don’t think it is a certainty. There’s an awful lot of still-overpriced inventory, and not all that much demand. It’s kind of hard to see what is going to fuel another boom.
Good luck.

[one_muggle]

Real estate always comes back

I don’t know dude, there are a couple of significant trends that could make any significant rebound pretty far off.

For the last 30 yrs housing prices have gotten a boost from ever lower interest rates, and that will almost certainly not be the case over the next 30 yrs.

Baby boomers are beginning to switch from net home buyers to net home sellers, which is a trend that will get worse since a large fraction of them planned (and/or will need) to sell their house to fund retirement.

RE in some areas, like NYC and San Fran will probably always bounce back, but one industry towns, like Vegas, have a history of staying busted. Post-steel boom areas like Pennsylvania and upstate NY have never recovered the loss of that industry.
I don’t doubt that people will keep on gambling, but the water situation in the Southwest is getting dire, and will put a limit on growth, while surrounding states relax ordinances on local gambling. Though, the crappy dollar is keeping people in the states, so you have that going for you.
IMHO the odds on an eventual (~decade) RE recovery in Vegas are not bad, but I don’t think it is a certainty. There’s an awful lot of still-overpriced inventory, and not all that much demand. It’s kind of hard to see what is going to fuel another boom.
Good luck.

[one_muggle]

Real estate always comes back

I don’t know dude, there are a couple of significant trends that could make any significant rebound pretty far off.

For the last 30 yrs housing prices have gotten a boost from ever lower interest rates, and that will almost certainly not be the case over the next 30 yrs.

Baby boomers are beginning to switch from net home buyers to net home sellers, which is a trend that will get worse since a large fraction of them planned (and/or will need) to sell their house to fund retirement.

RE in some areas, like NYC and San Fran will probably always bounce back, but one industry towns, like Vegas, have a history of staying busted. Post-steel boom areas like Pennsylvania and upstate NY have never recovered the loss of that industry.
I don’t doubt that people will keep on gambling, but the water situation in the Southwest is getting dire, and will put a limit on growth, while surrounding states relax ordinances on local gambling. Though, the crappy dollar is keeping people in the states, so you have that going for you.
IMHO the odds on an eventual (~decade) RE recovery in Vegas are not bad, but I don’t think it is a certainty. There’s an awful lot of still-overpriced inventory, and not all that much demand. It’s kind of hard to see what is going to fuel another boom.
Good luck.

[Multiplepropertyowner]

Well said Deal Hunter.We are from some of the same roots in regard to families in RE. My family got to SD in the 40’s after the war and my Pop’s pretty much built Mission Valley with his partnership group (Mission Valley Inn, The Town and Country and a few others)
You comment on Real Estate always coming back reminded me of his 8 keys to real estate investing.
1. Use other peoples money to make yours. (Thus, i am a big fan of the 100% loan and used for all it was worth)
2. It is not the price you pay, it is the terms of the agreement that matter.
3. You make your best deals when you have the least cash.
4. Never live more then an afternoons drive from your properties.
5. Stay out of stocks!!!!!!
6. Scour the papers for divorce and death notices. Desperate people make desperate decisions.
7. Cash is King
8. Real Estate always comes back.
Follow those rules and you will make a killing no matter what the market conditions!

[Mean Reversion]

#6 is true. #8 is true, but a useless adage.

The rest is true sometimes, but I disagree that they will make you a “killing” regardless of market conditions. They would probably get you in trouble more times than not.

It just happened to work for someone you know.

[Borat]

How do you reconcile “Cash is King” and “Use other people’s money”? Maybe he means “use other people’s cash and you are a king”. Kings get to do that sort of thing.

[Borat]

How do you reconcile “Cash is King” and “Use other people’s money”? Maybe he means “use other people’s cash and you are a king”. Kings get to do that sort of thing.

[Borat]

How do you reconcile “Cash is King” and “Use other people’s money”? Maybe he means “use other people’s cash and you are a king”. Kings get to do that sort of thing.

[Borat]

How do you reconcile “Cash is King” and “Use other people’s money”? Maybe he means “use other people’s cash and you are a king”. Kings get to do that sort of thing.

[Borat]

How do you reconcile “Cash is King” and “Use other people’s money”? Maybe he means “use other people’s cash and you are a king”. Kings get to do that sort of thing.

[Multiplepropertyowner]

I think the point was use others cash when you can, but in the end cash opens doors when you need it done. I would agree that nothing is for certain, but I have just tried to hold somewhat close to these, and it has been good so far. My Dad’s biggest issue was not deals gone bad with sellers, but issues with partners. This one is not his, but I also liked “When business is good, who needs a partner.”

[patientlywaiting]

Christian Menegatti, lead analyst at RGE Monitor, said the firm predicted more homeowners would walk away from their homes if prices continued to drop, regardless of their financial circumstances. If home prices drop an additional 10 percent, Mr. Menegatti said, 20 million households will owe more than the value of their homes.

http://www.nytimes.com/2008/02/29/us/29walks.html?hp=&pagewanted=print

[robson]

According to the census bureau http://factfinder.census.gov
there were 51,234,170 owner-occupied homes with a mortgage vs. 23,852,315 without a mortgage. About 75M owner occupied homes. However, there are 126M total homes. 8.8M homes underwater represents 10% of what exactly? Total owner occupied homes is the closest. A little more clarity in the article would be great, but it definitely doesn’t seem to mean 10% of mortgaged properties. 8.8/51 is more like 16%

[robson]

I might be looking at this wrong, but can someone help me understand the following logic, “I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater.”

Say someone buys a $400,000 home. they get a mortgage for $320,000 and a second for $80,000. The home is now worth $380,000. If they were counting these as separate loans and separate houses, they would conclude that 50% of homes are underwater when in fact 100% of homes were underwater. This miscounting would reduce the percent, not increase it.

[robson]

I might be looking at this wrong, but can someone help me understand the following logic, “I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater.”

Say someone buys a $400,000 home. they get a mortgage for $320,000 and a second for $80,000. The home is now worth $380,000. If they were counting these as separate loans and separate houses, they would conclude that 50% of homes are underwater when in fact 100% of homes were underwater. This miscounting would reduce the percent, not increase it.

[robson]

I might be looking at this wrong, but can someone help me understand the following logic, “I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater.”

Say someone buys a $400,000 home. they get a mortgage for $320,000 and a second for $80,000. The home is now worth $380,000. If they were counting these as separate loans and separate houses, they would conclude that 50% of homes are underwater when in fact 100% of homes were underwater. This miscounting would reduce the percent, not increase it.

[robson]

I might be looking at this wrong, but can someone help me understand the following logic, “I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater.”

Say someone buys a $400,000 home. they get a mortgage for $320,000 and a second for $80,000. The home is now worth $380,000. If they were counting these as separate loans and separate houses, they would conclude that 50% of homes are underwater when in fact 100% of homes were underwater. This miscounting would reduce the percent, not increase it.

[robson]

I might be looking at this wrong, but can someone help me understand the following logic, “I also wonder whether they are considering a 1st trust deed and a 2nd or 3rd loan as separate loans. Thus the first can be ok while the 2nd is underwater increasing the % of loans underwater.”

Say someone buys a $400,000 home. they get a mortgage for $320,000 and a second for $80,000. The home is now worth $380,000. If they were counting these as separate loans and separate houses, they would conclude that 50% of homes are underwater when in fact 100% of homes were underwater. This miscounting would reduce the percent, not increase it.

[robson]

According to the census bureau http://factfinder.census.gov
there were 51,234,170 owner-occupied homes with a mortgage vs. 23,852,315 without a mortgage. About 75M owner occupied homes. However, there are 126M total homes. 8.8M homes underwater represents 10% of what exactly? Total owner occupied homes is the closest. A little more clarity in the article would be great, but it definitely doesn’t seem to mean 10% of mortgaged properties. 8.8/51 is more like 16%

[robson]

According to the census bureau http://factfinder.census.gov
there were 51,234,170 owner-occupied homes with a mortgage vs. 23,852,315 without a mortgage. About 75M owner occupied homes. However, there are 126M total homes. 8.8M homes underwater represents 10% of what exactly? Total owner occupied homes is the closest. A little more clarity in the article would be great, but it definitely doesn’t seem to mean 10% of mortgaged properties. 8.8/51 is more like 16%

[robson]

According to the census bureau http://factfinder.census.gov
there were 51,234,170 owner-occupied homes with a mortgage vs. 23,852,315 without a mortgage. About 75M owner occupied homes. However, there are 126M total homes. 8.8M homes underwater represents 10% of what exactly? Total owner occupied homes is the closest. A little more clarity in the article would be great, but it definitely doesn’t seem to mean 10% of mortgaged properties. 8.8/51 is more like 16%

[robson]

According to the census bureau http://factfinder.census.gov
there were 51,234,170 owner-occupied homes with a mortgage vs. 23,852,315 without a mortgage. About 75M owner occupied homes. However, there are 126M total homes. 8.8M homes underwater represents 10% of what exactly? Total owner occupied homes is the closest. A little more clarity in the article would be great, but it definitely doesn’t seem to mean 10% of mortgaged properties. 8.8/51 is more like 16%

[patientlywaiting]

Christian Menegatti, lead analyst at RGE Monitor, said the firm predicted more homeowners would walk away from their homes if prices continued to drop, regardless of their financial circumstances. If home prices drop an additional 10 percent, Mr. Menegatti said, 20 million households will owe more than the value of their homes.

http://www.nytimes.com/2008/02/29/us/29walks.html?hp=&pagewanted=print

[patientlywaiting]

Christian Menegatti, lead analyst at RGE Monitor, said the firm predicted more homeowners would walk away from their homes if prices continued to drop, regardless of their financial circumstances. If home prices drop an additional 10 percent, Mr. Menegatti said, 20 million households will owe more than the value of their homes.

http://www.nytimes.com/2008/02/29/us/29walks.html?hp=&pagewanted=print

[patientlywaiting]

Christian Menegatti, lead analyst at RGE Monitor, said the firm predicted more homeowners would walk away from their homes if prices continued to drop, regardless of their financial circumstances. If home prices drop an additional 10 percent, Mr. Menegatti said, 20 million households will owe more than the value of their homes.

http://www.nytimes.com/2008/02/29/us/29walks.html?hp=&pagewanted=print

[patientlywaiting]

Christian Menegatti, lead analyst at RGE Monitor, said the firm predicted more homeowners would walk away from their homes if prices continued to drop, regardless of their financial circumstances. If home prices drop an additional 10 percent, Mr. Menegatti said, 20 million households will owe more than the value of their homes.

http://www.nytimes.com/2008/02/29/us/29walks.html?hp=&pagewanted=print

[Multiplepropertyowner]

I think the point was use others cash when you can, but in the end cash opens doors when you need it done. I would agree that nothing is for certain, but I have just tried to hold somewhat close to these, and it has been good so far. My Dad’s biggest issue was not deals gone bad with sellers, but issues with partners. This one is not his, but I also liked “When business is good, who needs a partner.”

[Multiplepropertyowner]

I think the point was use others cash when you can, but in the end cash opens doors when you need it done. I would agree that nothing is for certain, but I have just tried to hold somewhat close to these, and it has been good so far. My Dad’s biggest issue was not deals gone bad with sellers, but issues with partners. This one is not his, but I also liked “When business is good, who needs a partner.”

[Multiplepropertyowner]

I think the point was use others cash when you can, but in the end cash opens doors when you need it done. I would agree that nothing is for certain, but I have just tried to hold somewhat close to these, and it has been good so far. My Dad’s biggest issue was not deals gone bad with sellers, but issues with partners. This one is not his, but I also liked “When business is good, who needs a partner.”

[Multiplepropertyowner]

I think the point was use others cash when you can, but in the end cash opens doors when you need it done. I would agree that nothing is for certain, but I have just tried to hold somewhat close to these, and it has been good so far. My Dad’s biggest issue was not deals gone bad with sellers, but issues with partners. This one is not his, but I also liked “When business is good, who needs a partner.”

[Mean Reversion]

#6 is true. #8 is true, but a useless adage.

The rest is true sometimes, but I disagree that they will make you a “killing” regardless of market conditions. They would probably get you in trouble more times than not.

It just happened to work for someone you know.

[Mean Reversion]

#6 is true. #8 is true, but a useless adage.

The rest is true sometimes, but I disagree that they will make you a “killing” regardless of market conditions. They would probably get you in trouble more times than not.

It just happened to work for someone you know.

[Mean Reversion]

#6 is true. #8 is true, but a useless adage.

The rest is true sometimes, but I disagree that they will make you a “killing” regardless of market conditions. They would probably get you in trouble more times than not.

It just happened to work for someone you know.

[Mean Reversion]

#6 is true. #8 is true, but a useless adage.

The rest is true sometimes, but I disagree that they will make you a “killing” regardless of market conditions. They would probably get you in trouble more times than not.

It just happened to work for someone you know.

[kewp]

5. Stay out of stocks!!!!!!

I dunno, SRS has been a good pick for me!

http://finance.google.com/finance?q=SRS

[kewp]

5. Stay out of stocks!!!!!!

I dunno, SRS has been a good pick for me!

http://finance.google.com/finance?q=SRS

[kewp]

5. Stay out of stocks!!!!!!

I dunno, SRS has been a good pick for me!

http://finance.google.com/finance?q=SRS

[kewp]

5. Stay out of stocks!!!!!!

I dunno, SRS has been a good pick for me!

http://finance.google.com/finance?q=SRS

[kewp]

5. Stay out of stocks!!!!!!

I dunno, SRS has been a good pick for me!

http://finance.google.com/finance?q=SRS

[Multiplepropertyowner]

Well said Deal Hunter.We are from some of the same roots in regard to families in RE. My family got to SD in the 40’s after the war and my Pop’s pretty much built Mission Valley with his partnership group (Mission Valley Inn, The Town and Country and a few others)
You comment on Real Estate always coming back reminded me of his 8 keys to real estate investing.
1. Use other peoples money to make yours. (Thus, i am a big fan of the 100% loan and used for all it was worth)
2. It is not the price you pay, it is the terms of the agreement that matter.
3. You make your best deals when you have the least cash.
4. Never live more then an afternoons drive from your properties.
5. Stay out of stocks!!!!!!
6. Scour the papers for divorce and death notices. Desperate people make desperate decisions.
7. Cash is King
8. Real Estate always comes back.
Follow those rules and you will make a killing no matter what the market conditions!

[Multiplepropertyowner]

Well said Deal Hunter.We are from some of the same roots in regard to families in RE. My family got to SD in the 40’s after the war and my Pop’s pretty much built Mission Valley with his partnership group (Mission Valley Inn, The Town and Country and a few others)
You comment on Real Estate always coming back reminded me of his 8 keys to real estate investing.
1. Use other peoples money to make yours. (Thus, i am a big fan of the 100% loan and used for all it was worth)
2. It is not the price you pay, it is the terms of the agreement that matter.
3. You make your best deals when you have the least cash.
4. Never live more then an afternoons drive from your properties.
5. Stay out of stocks!!!!!!
6. Scour the papers for divorce and death notices. Desperate people make desperate decisions.
7. Cash is King
8. Real Estate always comes back.
Follow those rules and you will make a killing no matter what the market conditions!

[Multiplepropertyowner]

Well said Deal Hunter.We are from some of the same roots in regard to families in RE. My family got to SD in the 40’s after the war and my Pop’s pretty much built Mission Valley with his partnership group (Mission Valley Inn, The Town and Country and a few others)
You comment on Real Estate always coming back reminded me of his 8 keys to real estate investing.
1. Use other peoples money to make yours. (Thus, i am a big fan of the 100% loan and used for all it was worth)
2. It is not the price you pay, it is the terms of the agreement that matter.
3. You make your best deals when you have the least cash.
4. Never live more then an afternoons drive from your properties.
5. Stay out of stocks!!!!!!
6. Scour the papers for divorce and death notices. Desperate people make desperate decisions.
7. Cash is King
8. Real Estate always comes back.
Follow those rules and you will make a killing no matter what the market conditions!

[Multiplepropertyowner]

Well said Deal Hunter.We are from some of the same roots in regard to families in RE. My family got to SD in the 40’s after the war and my Pop’s pretty much built Mission Valley with his partnership group (Mission Valley Inn, The Town and Country and a few others)
You comment on Real Estate always coming back reminded me of his 8 keys to real estate investing.
1. Use other peoples money to make yours. (Thus, i am a big fan of the 100% loan and used for all it was worth)
2. It is not the price you pay, it is the terms of the agreement that matter.
3. You make your best deals when you have the least cash.
4. Never live more then an afternoons drive from your properties.
5. Stay out of stocks!!!!!!
6. Scour the papers for divorce and death notices. Desperate people make desperate decisions.
7. Cash is King
8. Real Estate always comes back.
Follow those rules and you will make a killing no matter what the market conditions!

[Deal Hunter]

I agree the media is feeding off the misery and paranoia of the markets. The big and “smart” money are moving in where everyone else is walking away from. Conventional lenders aren’t lending, so hard money is stepping in and making a killing. Buyers aren’t buying, so foreign investors are scooping up the deals.

I’m barely squaring my debts with rents, but the rents are stronger now that mortgages are harder to get.I’m doing fine with the properties I got in 2001 and 2003, but I too fell for an easy to get mortgage and got a property in 2006 that I’m a couple of hundred dollars negative on each month.

I’ll be able to handle it and am encouraged that my area (Las Vegas) has a strong economy. My only regret is that I’m short on enough cash to get in on some of the unbelievable deals available now. I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back.

[Deal Hunter]

I agree the media is feeding off the misery and paranoia of the markets. The big and “smart” money are moving in where everyone else is walking away from. Conventional lenders aren’t lending, so hard money is stepping in and making a killing. Buyers aren’t buying, so foreign investors are scooping up the deals.

I’m barely squaring my debts with rents, but the rents are stronger now that mortgages are harder to get.I’m doing fine with the properties I got in 2001 and 2003, but I too fell for an easy to get mortgage and got a property in 2006 that I’m a couple of hundred dollars negative on each month.

I’ll be able to handle it and am encouraged that my area (Las Vegas) has a strong economy. My only regret is that I’m short on enough cash to get in on some of the unbelievable deals available now. I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back.

[Deal Hunter]

I agree the media is feeding off the misery and paranoia of the markets. The big and “smart” money are moving in where everyone else is walking away from. Conventional lenders aren’t lending, so hard money is stepping in and making a killing. Buyers aren’t buying, so foreign investors are scooping up the deals.

I’m barely squaring my debts with rents, but the rents are stronger now that mortgages are harder to get.I’m doing fine with the properties I got in 2001 and 2003, but I too fell for an easy to get mortgage and got a property in 2006 that I’m a couple of hundred dollars negative on each month.

I’ll be able to handle it and am encouraged that my area (Las Vegas) has a strong economy. My only regret is that I’m short on enough cash to get in on some of the unbelievable deals available now. I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back.

[Deal Hunter]

I agree the media is feeding off the misery and paranoia of the markets. The big and “smart” money are moving in where everyone else is walking away from. Conventional lenders aren’t lending, so hard money is stepping in and making a killing. Buyers aren’t buying, so foreign investors are scooping up the deals.

I’m barely squaring my debts with rents, but the rents are stronger now that mortgages are harder to get.I’m doing fine with the properties I got in 2001 and 2003, but I too fell for an easy to get mortgage and got a property in 2006 that I’m a couple of hundred dollars negative on each month.

I’ll be able to handle it and am encouraged that my area (Las Vegas) has a strong economy. My only regret is that I’m short on enough cash to get in on some of the unbelievable deals available now. I’m from a long line of real estate investors and we all know one thing for sure – Real estate always comes back.

[Author]

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