[Jazzman]

[quote=no_such_reality][quote=spdrun]Exactly. Unless they were walking around the house armed with a gun, it’s unlikely a gun would have helped them.[/quote]

The gun debate is a useless gross simplification applied to an unrelated scenario

This is a mental health issue.

Guns, knives, bombs, powder in envelopes, even poison or cars the tool isn’t the problem[/quote]

No, that is not correct. They are very much part of the problem, for without them the problem would not exist. You cannot detach the tool from the worker, from the deed, just as you can’t detach effect from cause. If BMWs were banned, there would be no deaths caused by BMWs. If you banned shovels, no ditches would be dug.

You are right in that this is a mental health issue. But is also a media issue, social issue, gun control issue, and last but not least, a mindset issue. While the focus is on the underlying causes, such as why someone would commit such an act of violence, the acts of violence continue.

This disconnect is as big a psychological barrier to remedying the immediate problem as the sociopathy, and psychopathy that manifests themselves in these abhorrent events. In other words, the mindset is one of the causes. Change the mindset and you can begin to dismantle the tools. When the tools no longer pose such a big threat the real work can begin on the underlying causes. Priorities are absent from this debate.

[Jazzman]

There is still a lot of soul searching going on in America over this issue. From the outside, the focus on psychoanalysis to try and explain the problem starts to look like an excuse for it, with the unfortunate unintended consequence of deflecting attention away from the real victims. Whether you believe the solution lies in vitamins, psychoanalysis, and better parenting another disaster is waiting to happen. The NRA is credited with highjacking gun control legislation, which addresses the immediate problem of access. If there is even a grain of truth to this, then the exercise of rational prioritizing would appear to be obliquely conspicuous by its absence.

[Jazzman]

http://www.zerohedge.com/
http://dailyreckoning.com/
http://globaleconomicanalysis.blogspot.com/
http://www.calculatedriskblog.com/
http://www.doctorhousingbubble.com/
http://www.housepricecrash.co.uk/

[Jazzman]

[quote=spdrun] the government can’t just take away their civil rights (like it or not, the 2nd Amendment is considered a civil right) because they made an appointment with a professional.
[/quote]
Why not? He was seeing a psychiatrist and owned guns. He went and murdered six people. It seems a bit more that mere reporting failures here.

[Jazzman]

Isn’t the most important thing here that many people lost their lives. The next thing that stands out is that he was seeking psychiatric help, but was still able to buy semi-automatic weapons. However disturbed he was, his actions seem very disproportionate, and copycat in nature. He comes across on his videos as being melodramatic to the point of delusional. But none of that really matters. His actions do, and that he was able to do them.

[Jazzman]

DC has been very sticky. Concentrations of home-price radioactive fallout are strongest the closer to the core reactor (DC) you are, so to hear median prices are falling is good news.

If Rich’s charts are anything to go by, median prices for a metro would appear to track the Case Shiller closely. On a zip level they can get skewed.

[Jazzman]

[quote=FlyerInHi]Looks like it’s unfolding exactly like I predicted. Russia is turning to China.

I was talking to a German colleague… and Germans apparently don’t really trust Americans. They think we are engineering this to develop a European market for our natural gas.

The Germans are saying the CIA (and other western secret services) paid the Maidan protesters.[/quote]

More likely it was fortuitous than engineered. But Germans probably have earned the right to be suspicious.

[Jazzman]

Has anyone invested in crowd sourcing/funding and found it to be worthwhile as an alternative to fixed income investments?

[Jazzman]

Norris Group might be able to help http://www.thenorrisgroup.com/

[Jazzman]

FlyerInHi, my reading is that Yellen’s concerns are about the overall market: “The recent flattening out in housing activity could prove more protracted than currently expected rather than resuming its earlier pace of recovery,” she said.

Inventory has increased in Las Vegas a little, but that is not the issue here. It’s the number of offers received that has fallen off a cliff.

The problem in the UK can probably be isolated more or less to London, and central London in particular. Unfortunately, reliable statistics are not as forthcoming as in the US. One estimate is that 50% of central London buyers are foreigners.

I thought is was interesting that Yellen is concerned by a slow down, and the BoE is concerned by a bubble.

[Jazzman]

[quote=EconProf]Some observations about your guestimates:
The price to rent ratio looks awfully optimistic. Are you sure you can get that high a rent on a $150,000 property?
Landlord insurance looks way high. If it is a condo, why do you need insurance at all?
Property tax will be at least 1.2% of value, or $150/mo.
If your mortgage payment is $600/mo, at least $100 of that will be principal payoff, which is a form of forced savings, or, actually, income, just not cash income.
Glad to see you factored in vacancy cost, repairs, and misc, and put them on a monthly basis, even though they happen infrequently. Many beginners overlook these expenses.
As flu suggests, the long run is what counts, and it depends mainly on the rate of appreciation of the property. The big money in rental real estate is historically made, or lost, due to property values changing over time, not cash flow.[/quote]
I was really pointing out what rent would be needed to cash flow, rather than is achievable. All the other numbers are guestimates as well, but give some idea of what to look for. You definitely need insurance which covers you for liability. The other question is risk and return. The lower the end of the market, the higher the return, but risks increase. Homes are also often older and can swallow a years net income with just one capital expense. I personally have not invested in CA, because I’ve never been able to find my benchmark cap rate. You might have been able to on the court house steps a few years back.

[Jazzman]

[quote=FlyerInHi][quote=Jazzman]That may depend on your definition, but I don’t really want to get drawn into comparisons, as it only ruffles feathers. [/quote]

I think it’s fun and interesting to compare and discuss things. Why do people get ruffled?

Mostly people need to be where they can make a living. Then they want to be where friends and family are.

There’s also a herd mentality where if everyone wants to be in small apartment in London, then prices go through the roof. Supply and demand.

Aside from market based values, I do believe there is certain intrinsic value to real estate. A stone manor house in Dordogne is definitely worth some good money, especially given that it probably could not be built of the same quality today and is situated in a region that has sustained a high quality of life for centuries.

The cultural value is the “soft” part. An American probably wouldn’t relate much to the French lifestyle. It takes a certain personality to relocate to a foreign country, learn the language, culture and make friends. Plus there’s a huge difference between living the life of a retired expatriate vs. that of an immigrant.

Anyway, best wishes to you. Once you settle in Dordogne, you should have an extended house warming period. Any piggington is welcomed to drop by, at his own travel expense, for afternoon tea.[/quote]
There is definitely a predilection for debt in the Anglo sphere. The countries with the largest levels of personal debt are the UK, Canada, and the US in that order. It’s no coincidence that debt and bubbles go hand in hand. It has a very distorting effect on markets, and seems to be well adapted to both corporate and political short termism. As an investor, I want appreciation, but I also want to be able to enter and exit markets without having to sit out large cycles. There is intrinsic value, and there is supply and demand, but housing has been highjacked and too much emphasis put on the importance of its role in the economy. For governments, a robust housing market is good because it fulfills the social requirement of increased home ownership (the American Dream), increased personal wealth, and the economic spin off, growth. Corporations just think in terms of profit, and since manufacturing has been in decline, housing and financial markets are the new economic drivers. They haven’t found a sure footing, and bubbles seem to a permanent fixture of the landscape. You can argue tech bubbles produce some good. Out of all the businesses that fall by the wayside, a few great companies emerge. But do great Mom and Pop home owners emerge from housing bubbles?

[Jazzman]

Absolutely! All Piggs invited. Little plug here to tell your friends. I do have an extra room that will be used as a vacation rental. It has its own entrance and bathroom, use of pool, garden, and breakfast.

[Jazzman]

There is a noodle bar just up the road from me. It is so popular, a line forms outside at 5pm every day. It must be good because everybody else thinks so. I went once and …well, obviously ordered the wrong thing, so went again and wouldn’t you know, it must have been the chef’s night off. So I went a final time to satisfy my curiosity. The moral of the story: Either I don’t like noodles and never knew it, or everyone else likes noodles but have never tasted them. How much does this explain our behavior?

[Jazzman]

The question you need to ask is what do I want from it? Cash flow to break even and hope for appreciation? A rental checks to supplement my income.

Here’s some guestimates

Price Paid $150k
Rent $1,500 a month

Costs
Landlord Insurance $125
HOA’s $400
Property tax $125
(Mortgage) $600
Vacancy rate $125
Repairs $75
Miscellaneous $25
Total $1,475

Net cash $25
Cap rate 0.02%
ROI -/+6% (will depend on whether you think prices are going to go up this year or not. Jury is still out on that one).

Many assumptions built in here, but aim for a rent ratio of one ie for every $100k invested, you need $1,000 rent per month. Allow 50% of rental for costs (excluding mortgage), and you should break even …if you manage it yourself. For SFH you don’t have HOA’s, but you will have to budget for Capital costs.

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