[cr]

[quote=DaCounselor]”I’m from the “being early is being wrong” school. Instead of calling a top in ’01, anyone who bought then is likely to still have a tremendous return on their investment.
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Only if they sold!
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Nope. Most people who are still holding an ’01 purchase are still way up. Like I said in my earlier post, they could probably discount their property today to sell it fast and still be way up. There is really no way around the fact that someone who called the top in ’01 and therefore decided not to buy then has missed out on making a large pile of money.
[/quote]

What I think Kewp means is the equity they may have (assuming they didn’t tap it with a HELOC) is only gained when they sell. Equity is essentially useless unless you’re borrowing against it or selling the asset. (or for bragging rights)

You only missed out on making money in a speculative bubble, where you had to time the jump in and out properly. If you try to get out now you’d be lucky to get a 2001 price in some areas.

And even if you bought in 2001, didn’t refi and have equity you are going to lose it. There’s nothing to stop prices from falling below 2001 levels.

[cr]

[quote=DaCounselor]”I’m from the “being early is being wrong” school. Instead of calling a top in ’01, anyone who bought then is likely to still have a tremendous return on their investment.
________________________

Only if they sold!
________________________

Nope. Most people who are still holding an ’01 purchase are still way up. Like I said in my earlier post, they could probably discount their property today to sell it fast and still be way up. There is really no way around the fact that someone who called the top in ’01 and therefore decided not to buy then has missed out on making a large pile of money.
[/quote]

What I think Kewp means is the equity they may have (assuming they didn’t tap it with a HELOC) is only gained when they sell. Equity is essentially useless unless you’re borrowing against it or selling the asset. (or for bragging rights)

You only missed out on making money in a speculative bubble, where you had to time the jump in and out properly. If you try to get out now you’d be lucky to get a 2001 price in some areas.

And even if you bought in 2001, didn’t refi and have equity you are going to lose it. There’s nothing to stop prices from falling below 2001 levels.

[cr]

[quote=DaCounselor]”I’m from the “being early is being wrong” school. Instead of calling a top in ’01, anyone who bought then is likely to still have a tremendous return on their investment.
________________________

Only if they sold!
________________________

Nope. Most people who are still holding an ’01 purchase are still way up. Like I said in my earlier post, they could probably discount their property today to sell it fast and still be way up. There is really no way around the fact that someone who called the top in ’01 and therefore decided not to buy then has missed out on making a large pile of money.
[/quote]

What I think Kewp means is the equity they may have (assuming they didn’t tap it with a HELOC) is only gained when they sell. Equity is essentially useless unless you’re borrowing against it or selling the asset. (or for bragging rights)

You only missed out on making money in a speculative bubble, where you had to time the jump in and out properly. If you try to get out now you’d be lucky to get a 2001 price in some areas.

And even if you bought in 2001, didn’t refi and have equity you are going to lose it. There’s nothing to stop prices from falling below 2001 levels.

[cr]

[quote=DaCounselor]”I’m from the “being early is being wrong” school. Instead of calling a top in ’01, anyone who bought then is likely to still have a tremendous return on their investment.
________________________

Only if they sold!
________________________

Nope. Most people who are still holding an ’01 purchase are still way up. Like I said in my earlier post, they could probably discount their property today to sell it fast and still be way up. There is really no way around the fact that someone who called the top in ’01 and therefore decided not to buy then has missed out on making a large pile of money.
[/quote]

What I think Kewp means is the equity they may have (assuming they didn’t tap it with a HELOC) is only gained when they sell. Equity is essentially useless unless you’re borrowing against it or selling the asset. (or for bragging rights)

You only missed out on making money in a speculative bubble, where you had to time the jump in and out properly. If you try to get out now you’d be lucky to get a 2001 price in some areas.

And even if you bought in 2001, didn’t refi and have equity you are going to lose it. There’s nothing to stop prices from falling below 2001 levels.

[cr]

[quote=Rustico]
I think you must be leaving equity and the beneficial proportionate cash flow shift of later years of owning out of the picture. The person who has not accomplished home ownership often uses up or uses a good portion, of their assets or retirement benefits or to provide shelter(to taste) in their later years.

Rent impedes one’s ability to invest the same as a mortgage does. Rent impedes it in perpetuity and gets worse with time as compared to a fixed mortgage. People are bothered by risk and poor returns now but they could be cutting into future costs of shelter with those poorly performing investment dollars instead.

I am assuming we are considering reasonable timing in the purchase of a house or condo and rent at or near their initital mortgage payment threshold.
[/quote]

Good point, but then that takes into account how long you live, what you do after you retire, and how much you need.

The rent calculator is a tool, not a decision maker. $2000/mo saved today is worth a lot more than $3000 in 30 years, but that’s not to say I want to still be renting when I retire.

For me personally, my rent is less than a third of what I would spend on a house. With prices falling, I just save that 2/3s until the price is right.

[cr]

[quote=Rustico]
I think you must be leaving equity and the beneficial proportionate cash flow shift of later years of owning out of the picture. The person who has not accomplished home ownership often uses up or uses a good portion, of their assets or retirement benefits or to provide shelter(to taste) in their later years.

Rent impedes one’s ability to invest the same as a mortgage does. Rent impedes it in perpetuity and gets worse with time as compared to a fixed mortgage. People are bothered by risk and poor returns now but they could be cutting into future costs of shelter with those poorly performing investment dollars instead.

I am assuming we are considering reasonable timing in the purchase of a house or condo and rent at or near their initital mortgage payment threshold.
[/quote]

Good point, but then that takes into account how long you live, what you do after you retire, and how much you need.

The rent calculator is a tool, not a decision maker. $2000/mo saved today is worth a lot more than $3000 in 30 years, but that’s not to say I want to still be renting when I retire.

For me personally, my rent is less than a third of what I would spend on a house. With prices falling, I just save that 2/3s until the price is right.

[cr]

[quote=Rustico]
I think you must be leaving equity and the beneficial proportionate cash flow shift of later years of owning out of the picture. The person who has not accomplished home ownership often uses up or uses a good portion, of their assets or retirement benefits or to provide shelter(to taste) in their later years.

Rent impedes one’s ability to invest the same as a mortgage does. Rent impedes it in perpetuity and gets worse with time as compared to a fixed mortgage. People are bothered by risk and poor returns now but they could be cutting into future costs of shelter with those poorly performing investment dollars instead.

I am assuming we are considering reasonable timing in the purchase of a house or condo and rent at or near their initital mortgage payment threshold.
[/quote]

Good point, but then that takes into account how long you live, what you do after you retire, and how much you need.

The rent calculator is a tool, not a decision maker. $2000/mo saved today is worth a lot more than $3000 in 30 years, but that’s not to say I want to still be renting when I retire.

For me personally, my rent is less than a third of what I would spend on a house. With prices falling, I just save that 2/3s until the price is right.

[cr]

[quote=Rustico]
I think you must be leaving equity and the beneficial proportionate cash flow shift of later years of owning out of the picture. The person who has not accomplished home ownership often uses up or uses a good portion, of their assets or retirement benefits or to provide shelter(to taste) in their later years.

Rent impedes one’s ability to invest the same as a mortgage does. Rent impedes it in perpetuity and gets worse with time as compared to a fixed mortgage. People are bothered by risk and poor returns now but they could be cutting into future costs of shelter with those poorly performing investment dollars instead.

I am assuming we are considering reasonable timing in the purchase of a house or condo and rent at or near their initital mortgage payment threshold.
[/quote]

Good point, but then that takes into account how long you live, what you do after you retire, and how much you need.

The rent calculator is a tool, not a decision maker. $2000/mo saved today is worth a lot more than $3000 in 30 years, but that’s not to say I want to still be renting when I retire.

For me personally, my rent is less than a third of what I would spend on a house. With prices falling, I just save that 2/3s until the price is right.

[cr]

[quote=Rustico]
I think you must be leaving equity and the beneficial proportionate cash flow shift of later years of owning out of the picture. The person who has not accomplished home ownership often uses up or uses a good portion, of their assets or retirement benefits or to provide shelter(to taste) in their later years.

Rent impedes one’s ability to invest the same as a mortgage does. Rent impedes it in perpetuity and gets worse with time as compared to a fixed mortgage. People are bothered by risk and poor returns now but they could be cutting into future costs of shelter with those poorly performing investment dollars instead.

I am assuming we are considering reasonable timing in the purchase of a house or condo and rent at or near their initital mortgage payment threshold.
[/quote]

Good point, but then that takes into account how long you live, what you do after you retire, and how much you need.

The rent calculator is a tool, not a decision maker. $2000/mo saved today is worth a lot more than $3000 in 30 years, but that’s not to say I want to still be renting when I retire.

For me personally, my rent is less than a third of what I would spend on a house. With prices falling, I just save that 2/3s until the price is right.

[cr]

Does anyone else think this market turn around of the past month or so (fueled largely by financials) is another clam before the Alt-A storm?

Or have we really seen the bottom for thesse guys?

Personally with another half trillion resetting this year I don’t see how banks could avoid further suffering even if they actually hold none of the mortgages at all.

[cr]

Does anyone else think this market turn around of the past month or so (fueled largely by financials) is another clam before the Alt-A storm?

Or have we really seen the bottom for thesse guys?

Personally with another half trillion resetting this year I don’t see how banks could avoid further suffering even if they actually hold none of the mortgages at all.

[cr]

Does anyone else think this market turn around of the past month or so (fueled largely by financials) is another clam before the Alt-A storm?

Or have we really seen the bottom for thesse guys?

Personally with another half trillion resetting this year I don’t see how banks could avoid further suffering even if they actually hold none of the mortgages at all.

[cr]

Does anyone else think this market turn around of the past month or so (fueled largely by financials) is another clam before the Alt-A storm?

Or have we really seen the bottom for thesse guys?

Personally with another half trillion resetting this year I don’t see how banks could avoid further suffering even if they actually hold none of the mortgages at all.

[cr]

Does anyone else think this market turn around of the past month or so (fueled largely by financials) is another clam before the Alt-A storm?

Or have we really seen the bottom for thesse guys?

Personally with another half trillion resetting this year I don’t see how banks could avoid further suffering even if they actually hold none of the mortgages at all.

[cr]

This is the best rent vs. buy calculator I’ve come across

http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1&ex=1185336000&en=92a35496df194374&ei=5070&oref=slogin#

True with renting you don’t own the place, but typically there is a savings in renting, and after 30 years of accumulating that savings you can end up with more cash depending on your rate or return.

Since the claim is the market typically returns 10%/yr you’d likely end up better than a house that returns 2-4%/yr. And you’d still have to sell the house.

[Author]

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