[HLS]

In response to the OP…

Do you want a place to live OR an investment ?

I once had an interesting meeting with a FNMA employee who referred to the west coast and east coast as the “bookends”
I have never forgotten our conversation.

Although fortunes have been made in the past from real estate, I think the game is over for a VERY long time. All the talk of moving up and keeping the house as a rental is so 60’s-70’s-80’s..
Financing and qualifying today are COMPLETELY different than any previous time in history.

It worked well back then because it was affordable.
In many “bookend” states it just doesn’t make sense anymore.

A house is a stucco box to live in. You can buy one or you can rent one. Either way the use is the same.

I still believe in real estate. The tax benefits are tremendous. For an investment to make sense, I want cash flow today, not lofty anticipated appreciation that may not happen, AND I also want maximum depreciation for added cash flow.

You can only depreciate a dwelling, not land.
Land in most of the bookend states is high.
You get much better ROI from states in between the bookends.

If you want to gamble on appreciation, it’s your choice. If you want an investment that really makes sense now, look to 40 other states.

Markets repeat themselves. The DOW hit 1000 for the first time around 1965 and didn’t break out above that until 1984. NINETEEN YEARS..There was opportunity in between if your timing was right.

In every market, people chase performance. It usually doesn’t work.

Corresponding to the breakout of the stock market in the 1980’s was the inception of 401K’s starting in 1980… the market didn’t break out for no reason…..

The fuel for igniting the stock market to DOW 15,000 was not 1500% growth in America, it was manipulation and greed combined with the explosive contributions of clueless people putting money into something that they did not understand, EXACTLY LIKE BUYING HOUSES.

Stocks have only pulled back about 40%+ from the recent peak, so far.

It’s a different world today and comparisons to peak prices in either houses or stocks are simply foolish. Neither mean ANYTHING, except what a foolish person paid EXPECTING that it would go up more…

Markets are fueled by fear and greed, nothing more. It doesn’t matter what the product is.
Without manipulation of SOME SORT, markets don’t rise by themselves.

The worst is yet to come. Buckle your seat belt, it’s going to be a rough ride.

DOW Stock Market History:
http://www.creatingwealth.co.nz/history_dow_jones_index.htm

[HLS]

In response to the OP…

Do you want a place to live OR an investment ?

I once had an interesting meeting with a FNMA employee who referred to the west coast and east coast as the “bookends”
I have never forgotten our conversation.

Although fortunes have been made in the past from real estate, I think the game is over for a VERY long time. All the talk of moving up and keeping the house as a rental is so 60’s-70’s-80’s..
Financing and qualifying today are COMPLETELY different than any previous time in history.

It worked well back then because it was affordable.
In many “bookend” states it just doesn’t make sense anymore.

A house is a stucco box to live in. You can buy one or you can rent one. Either way the use is the same.

I still believe in real estate. The tax benefits are tremendous. For an investment to make sense, I want cash flow today, not lofty anticipated appreciation that may not happen, AND I also want maximum depreciation for added cash flow.

You can only depreciate a dwelling, not land.
Land in most of the bookend states is high.
You get much better ROI from states in between the bookends.

If you want to gamble on appreciation, it’s your choice. If you want an investment that really makes sense now, look to 40 other states.

Markets repeat themselves. The DOW hit 1000 for the first time around 1965 and didn’t break out above that until 1984. NINETEEN YEARS..There was opportunity in between if your timing was right.

In every market, people chase performance. It usually doesn’t work.

Corresponding to the breakout of the stock market in the 1980’s was the inception of 401K’s starting in 1980… the market didn’t break out for no reason…..

The fuel for igniting the stock market to DOW 15,000 was not 1500% growth in America, it was manipulation and greed combined with the explosive contributions of clueless people putting money into something that they did not understand, EXACTLY LIKE BUYING HOUSES.

Stocks have only pulled back about 40%+ from the recent peak, so far.

It’s a different world today and comparisons to peak prices in either houses or stocks are simply foolish. Neither mean ANYTHING, except what a foolish person paid EXPECTING that it would go up more…

Markets are fueled by fear and greed, nothing more. It doesn’t matter what the product is.
Without manipulation of SOME SORT, markets don’t rise by themselves.

The worst is yet to come. Buckle your seat belt, it’s going to be a rough ride.

DOW Stock Market History:
http://www.creatingwealth.co.nz/history_dow_jones_index.htm

[HLS]

[quote=Kingside]HLS,

How does the rumor you are hearing relate to Fannie Mae’s program for investor financing for its foreclosures?

http://www.fanniemae.com/homepath/financing/index.jhtml

Seems like they are sending mixed messages[/quote]

HOMEPATH is an EXTREMELY limited program…

The guidelines for buying RENTAL properties is getting TIGHTER and tighter..

Here is what I received this morning from a major lender:

Second Home and Investment property guides have been updated to reflect that first time
homebuyers are not eligible for 2nd home or investment property transactions if they have not owned a PRINCIPAL residence in the past 3 years. The previous guides stated the borrower must have owned a (any) home in the past 3 years.
This change is effective immediately.
***************************************
This may not apply to all lenders. It may or may not be a FNMA/FHLMC guideline…yet

There are other crazy guidelines. If you do not have a 2 year documented history of being a landlord, you will need to qualify for multiple home carrying costs AND have 6 months documented reserves to cover PITI.. without any credit for rental history…

All of these (excessive, extreme) guidelines a few years ago would have prevented the largest bubble in the history of the world from inflating, now they will just prevent a recovery from occuring anytime soon…

Something about a horse and a barn door applies…
HLS

[HLS]

[quote=Kingside]HLS,

How does the rumor you are hearing relate to Fannie Mae’s program for investor financing for its foreclosures?

http://www.fanniemae.com/homepath/financing/index.jhtml

Seems like they are sending mixed messages[/quote]

HOMEPATH is an EXTREMELY limited program…

The guidelines for buying RENTAL properties is getting TIGHTER and tighter..

Here is what I received this morning from a major lender:

Second Home and Investment property guides have been updated to reflect that first time
homebuyers are not eligible for 2nd home or investment property transactions if they have not owned a PRINCIPAL residence in the past 3 years. The previous guides stated the borrower must have owned a (any) home in the past 3 years.
This change is effective immediately.
***************************************
This may not apply to all lenders. It may or may not be a FNMA/FHLMC guideline…yet

There are other crazy guidelines. If you do not have a 2 year documented history of being a landlord, you will need to qualify for multiple home carrying costs AND have 6 months documented reserves to cover PITI.. without any credit for rental history…

All of these (excessive, extreme) guidelines a few years ago would have prevented the largest bubble in the history of the world from inflating, now they will just prevent a recovery from occuring anytime soon…

Something about a horse and a barn door applies…
HLS

[HLS]

[quote=Kingside]HLS,

How does the rumor you are hearing relate to Fannie Mae’s program for investor financing for its foreclosures?

http://www.fanniemae.com/homepath/financing/index.jhtml

Seems like they are sending mixed messages[/quote]

HOMEPATH is an EXTREMELY limited program…

The guidelines for buying RENTAL properties is getting TIGHTER and tighter..

Here is what I received this morning from a major lender:

Second Home and Investment property guides have been updated to reflect that first time
homebuyers are not eligible for 2nd home or investment property transactions if they have not owned a PRINCIPAL residence in the past 3 years. The previous guides stated the borrower must have owned a (any) home in the past 3 years.
This change is effective immediately.
***************************************
This may not apply to all lenders. It may or may not be a FNMA/FHLMC guideline…yet

There are other crazy guidelines. If you do not have a 2 year documented history of being a landlord, you will need to qualify for multiple home carrying costs AND have 6 months documented reserves to cover PITI.. without any credit for rental history…

All of these (excessive, extreme) guidelines a few years ago would have prevented the largest bubble in the history of the world from inflating, now they will just prevent a recovery from occuring anytime soon…

Something about a horse and a barn door applies…
HLS

[HLS]

[quote=Kingside]HLS,

How does the rumor you are hearing relate to Fannie Mae’s program for investor financing for its foreclosures?

http://www.fanniemae.com/homepath/financing/index.jhtml

Seems like they are sending mixed messages[/quote]

HOMEPATH is an EXTREMELY limited program…

The guidelines for buying RENTAL properties is getting TIGHTER and tighter..

Here is what I received this morning from a major lender:

Second Home and Investment property guides have been updated to reflect that first time
homebuyers are not eligible for 2nd home or investment property transactions if they have not owned a PRINCIPAL residence in the past 3 years. The previous guides stated the borrower must have owned a (any) home in the past 3 years.
This change is effective immediately.
***************************************
This may not apply to all lenders. It may or may not be a FNMA/FHLMC guideline…yet

There are other crazy guidelines. If you do not have a 2 year documented history of being a landlord, you will need to qualify for multiple home carrying costs AND have 6 months documented reserves to cover PITI.. without any credit for rental history…

All of these (excessive, extreme) guidelines a few years ago would have prevented the largest bubble in the history of the world from inflating, now they will just prevent a recovery from occuring anytime soon…

Something about a horse and a barn door applies…
HLS

[HLS]

[quote=Kingside]HLS,

How does the rumor you are hearing relate to Fannie Mae’s program for investor financing for its foreclosures?

http://www.fanniemae.com/homepath/financing/index.jhtml

Seems like they are sending mixed messages[/quote]

HOMEPATH is an EXTREMELY limited program…

The guidelines for buying RENTAL properties is getting TIGHTER and tighter..

Here is what I received this morning from a major lender:

Second Home and Investment property guides have been updated to reflect that first time
homebuyers are not eligible for 2nd home or investment property transactions if they have not owned a PRINCIPAL residence in the past 3 years. The previous guides stated the borrower must have owned a (any) home in the past 3 years.
This change is effective immediately.
***************************************
This may not apply to all lenders. It may or may not be a FNMA/FHLMC guideline…yet

There are other crazy guidelines. If you do not have a 2 year documented history of being a landlord, you will need to qualify for multiple home carrying costs AND have 6 months documented reserves to cover PITI.. without any credit for rental history…

All of these (excessive, extreme) guidelines a few years ago would have prevented the largest bubble in the history of the world from inflating, now they will just prevent a recovery from occuring anytime soon…

Something about a horse and a barn door applies…
HLS

[HLS]

[quote=4plexowner]”trapped equity”
what happened to the idea that we pay down a mortgage and someday own our real estate free and clear?[/quote]

That has gone the way of the dodo bird….
Along with moms staying home with the kids, having dinner as a family, being a “company employee” for your entire career, kids respecting their elders, and waiting at least until high school to have sex.
That was at a time when you could go outside to play until the street lights came on and when you got hurt doing something stupid you didn’t sue the person whose property you were playing on.

It was a time when houses in Southern California could be bought for 2X an annual income and TV’s were black and white. You had to get up and change the channel, and you had to actually answer the phone and say hello to find out who was calling… among other things.

The new culture is to have both parents work, not to make money to save, but to fund an excessive lifestyle saddled with debt and live beyond your means.
Let someone else bring up your kids, have an entitlement attitude, run up debt without any clue of how it will get paid off, the govt teaches people to be victims, and to spend not save…
Lease a car instead of buying one.
and constantly hearing $19.95 PLUS SHIPPING & HANDLING.

You MUST learn how to say “it’s not my fault”

The new mantra is “debit or credit ?” and “push 1 for English”

Want a reminder of how life was not so long ago ? Watch an episode of Ozzie & Harriet or Leave it to Beaver, if you can find one and if you don’t know what I am talking about, I can only say that I’m sorry.

Today you have the “luxury” of believing in a 401K as a false sense of security and knowing that you can get a reverse mortgage so your “house can start paying you” at time in life when you are afraid of getting scammed by an investment advisor with a sure thing..

The empire has crumbled.

[HLS]

[quote=4plexowner]”trapped equity”
what happened to the idea that we pay down a mortgage and someday own our real estate free and clear?[/quote]

That has gone the way of the dodo bird….
Along with moms staying home with the kids, having dinner as a family, being a “company employee” for your entire career, kids respecting their elders, and waiting at least until high school to have sex.
That was at a time when you could go outside to play until the street lights came on and when you got hurt doing something stupid you didn’t sue the person whose property you were playing on.

It was a time when houses in Southern California could be bought for 2X an annual income and TV’s were black and white. You had to get up and change the channel, and you had to actually answer the phone and say hello to find out who was calling… among other things.

The new culture is to have both parents work, not to make money to save, but to fund an excessive lifestyle saddled with debt and live beyond your means.
Let someone else bring up your kids, have an entitlement attitude, run up debt without any clue of how it will get paid off, the govt teaches people to be victims, and to spend not save…
Lease a car instead of buying one.
and constantly hearing $19.95 PLUS SHIPPING & HANDLING.

You MUST learn how to say “it’s not my fault”

The new mantra is “debit or credit ?” and “push 1 for English”

Want a reminder of how life was not so long ago ? Watch an episode of Ozzie & Harriet or Leave it to Beaver, if you can find one and if you don’t know what I am talking about, I can only say that I’m sorry.

Today you have the “luxury” of believing in a 401K as a false sense of security and knowing that you can get a reverse mortgage so your “house can start paying you” at time in life when you are afraid of getting scammed by an investment advisor with a sure thing..

The empire has crumbled.

[HLS]

[quote=4plexowner]”trapped equity”
what happened to the idea that we pay down a mortgage and someday own our real estate free and clear?[/quote]

That has gone the way of the dodo bird….
Along with moms staying home with the kids, having dinner as a family, being a “company employee” for your entire career, kids respecting their elders, and waiting at least until high school to have sex.
That was at a time when you could go outside to play until the street lights came on and when you got hurt doing something stupid you didn’t sue the person whose property you were playing on.

It was a time when houses in Southern California could be bought for 2X an annual income and TV’s were black and white. You had to get up and change the channel, and you had to actually answer the phone and say hello to find out who was calling… among other things.

The new culture is to have both parents work, not to make money to save, but to fund an excessive lifestyle saddled with debt and live beyond your means.
Let someone else bring up your kids, have an entitlement attitude, run up debt without any clue of how it will get paid off, the govt teaches people to be victims, and to spend not save…
Lease a car instead of buying one.
and constantly hearing $19.95 PLUS SHIPPING & HANDLING.

You MUST learn how to say “it’s not my fault”

The new mantra is “debit or credit ?” and “push 1 for English”

Want a reminder of how life was not so long ago ? Watch an episode of Ozzie & Harriet or Leave it to Beaver, if you can find one and if you don’t know what I am talking about, I can only say that I’m sorry.

Today you have the “luxury” of believing in a 401K as a false sense of security and knowing that you can get a reverse mortgage so your “house can start paying you” at time in life when you are afraid of getting scammed by an investment advisor with a sure thing..

The empire has crumbled.

[HLS]

[quote=4plexowner]”trapped equity”
what happened to the idea that we pay down a mortgage and someday own our real estate free and clear?[/quote]

That has gone the way of the dodo bird….
Along with moms staying home with the kids, having dinner as a family, being a “company employee” for your entire career, kids respecting their elders, and waiting at least until high school to have sex.
That was at a time when you could go outside to play until the street lights came on and when you got hurt doing something stupid you didn’t sue the person whose property you were playing on.

It was a time when houses in Southern California could be bought for 2X an annual income and TV’s were black and white. You had to get up and change the channel, and you had to actually answer the phone and say hello to find out who was calling… among other things.

The new culture is to have both parents work, not to make money to save, but to fund an excessive lifestyle saddled with debt and live beyond your means.
Let someone else bring up your kids, have an entitlement attitude, run up debt without any clue of how it will get paid off, the govt teaches people to be victims, and to spend not save…
Lease a car instead of buying one.
and constantly hearing $19.95 PLUS SHIPPING & HANDLING.

You MUST learn how to say “it’s not my fault”

The new mantra is “debit or credit ?” and “push 1 for English”

Want a reminder of how life was not so long ago ? Watch an episode of Ozzie & Harriet or Leave it to Beaver, if you can find one and if you don’t know what I am talking about, I can only say that I’m sorry.

Today you have the “luxury” of believing in a 401K as a false sense of security and knowing that you can get a reverse mortgage so your “house can start paying you” at time in life when you are afraid of getting scammed by an investment advisor with a sure thing..

The empire has crumbled.

[HLS]

[quote=4plexowner]”trapped equity”
what happened to the idea that we pay down a mortgage and someday own our real estate free and clear?[/quote]

That has gone the way of the dodo bird….
Along with moms staying home with the kids, having dinner as a family, being a “company employee” for your entire career, kids respecting their elders, and waiting at least until high school to have sex.
That was at a time when you could go outside to play until the street lights came on and when you got hurt doing something stupid you didn’t sue the person whose property you were playing on.

It was a time when houses in Southern California could be bought for 2X an annual income and TV’s were black and white. You had to get up and change the channel, and you had to actually answer the phone and say hello to find out who was calling… among other things.

The new culture is to have both parents work, not to make money to save, but to fund an excessive lifestyle saddled with debt and live beyond your means.
Let someone else bring up your kids, have an entitlement attitude, run up debt without any clue of how it will get paid off, the govt teaches people to be victims, and to spend not save…
Lease a car instead of buying one.
and constantly hearing $19.95 PLUS SHIPPING & HANDLING.

You MUST learn how to say “it’s not my fault”

The new mantra is “debit or credit ?” and “push 1 for English”

Want a reminder of how life was not so long ago ? Watch an episode of Ozzie & Harriet or Leave it to Beaver, if you can find one and if you don’t know what I am talking about, I can only say that I’m sorry.

Today you have the “luxury” of believing in a 401K as a false sense of security and knowing that you can get a reverse mortgage so your “house can start paying you” at time in life when you are afraid of getting scammed by an investment advisor with a sure thing..

The empire has crumbled.

[HLS]

Focus on housing IS a waste, but it greased the economy for a few years… only now are people starting to realize that the “grease” was actually KY Jelly, which is being used for its intended application.

Many industries profited handsomely.

The tax incentives and backing of financing creates an artificial, manipulated market.

“Saving homeowners” that have nothing to save is also artificially keeping prices high.

With 401K’s allowing pre tax dollars to be “invested” but hitting people with a 10% penalty if they want THEIR money, this also allows for an artificial, manipulated market and allows thousands to profit handsomely, while millions are along for the ride, thinking that they understand what they are doing, until they realize that they don’t…

It’s all a pyramid scheme/ shell game built on the greater fool theory that is fun to play until you lose, and only then do people think it is unfair. While it’s going up, nobody sues or complains.

Everything works until it doesn’t work anymore.. HLS

[HLS]

Focus on housing IS a waste, but it greased the economy for a few years… only now are people starting to realize that the “grease” was actually KY Jelly, which is being used for its intended application.

Many industries profited handsomely.

The tax incentives and backing of financing creates an artificial, manipulated market.

“Saving homeowners” that have nothing to save is also artificially keeping prices high.

With 401K’s allowing pre tax dollars to be “invested” but hitting people with a 10% penalty if they want THEIR money, this also allows for an artificial, manipulated market and allows thousands to profit handsomely, while millions are along for the ride, thinking that they understand what they are doing, until they realize that they don’t…

It’s all a pyramid scheme/ shell game built on the greater fool theory that is fun to play until you lose, and only then do people think it is unfair. While it’s going up, nobody sues or complains.

Everything works until it doesn’t work anymore.. HLS

[HLS]

Focus on housing IS a waste, but it greased the economy for a few years… only now are people starting to realize that the “grease” was actually KY Jelly, which is being used for its intended application.

Many industries profited handsomely.

The tax incentives and backing of financing creates an artificial, manipulated market.

“Saving homeowners” that have nothing to save is also artificially keeping prices high.

With 401K’s allowing pre tax dollars to be “invested” but hitting people with a 10% penalty if they want THEIR money, this also allows for an artificial, manipulated market and allows thousands to profit handsomely, while millions are along for the ride, thinking that they understand what they are doing, until they realize that they don’t…

It’s all a pyramid scheme/ shell game built on the greater fool theory that is fun to play until you lose, and only then do people think it is unfair. While it’s going up, nobody sues or complains.

Everything works until it doesn’t work anymore.. HLS

[Author]

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