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SD Transplant
ParticipantSD Worker,
I guess in real value the house is already depreciating because:
1) You’re talking about the mighty U.S. Dollar $ (taking a hit). Hence, count the depreciation of your asset by at least 5% this year. It is a Global economy after all.
2) Don’t forget inflation (not the one reported by our economists….I mean real inflation).
3) You already stated that prices are down from the peaks of 2005.
4) Opportunity cost (assuming you had some $ down or the delta between rent vs buy).If you add all this up, with conservative figures under each point (3% for each), you’re already down 12%.
SD Transplant
ParticipantSD Worker,
I guess in real value the house is already depreciating because:
1) You’re talking about the mighty U.S. Dollar $ (taking a hit). Hence, count the depreciation of your asset by at least 5% this year. It is a Global economy after all.
2) Don’t forget inflation (not the one reported by our economists….I mean real inflation).
3) You already stated that prices are down from the peaks of 2005.
4) Opportunity cost (assuming you had some $ down or the delta between rent vs buy).If you add all this up, with conservative figures under each point (3% for each), you’re already down 12%.
SD Transplant
ParticipantSurveyor,
You brought up the most important issues about this/these complex(s). The area is nice/new/clean, but the lack of backyards and parking is pretty bad.
If you have a party with more than 3-4 cars, your guests would park in the street. Moreover, some of the driveways are so short that even your own car cannot fit, except when parked inside the garage.
The entry in these houses seems awkward to me, but I guess it is a house. However, I have heard comments from some folks in the neighborhood they would rather RENT across the street (Westview/Compass Point) than buy a place (after a 2 year experience). You get a better place &ammenities for 50% of the cost of owning a house on Westview Pkwy.
My 2 cents…
SD Transplant
ParticipantSurveyor,
You brought up the most important issues about this/these complex(s). The area is nice/new/clean, but the lack of backyards and parking is pretty bad.
If you have a party with more than 3-4 cars, your guests would park in the street. Moreover, some of the driveways are so short that even your own car cannot fit, except when parked inside the garage.
The entry in these houses seems awkward to me, but I guess it is a house. However, I have heard comments from some folks in the neighborhood they would rather RENT across the street (Westview/Compass Point) than buy a place (after a 2 year experience). You get a better place &ammenities for 50% of the cost of owning a house on Westview Pkwy.
My 2 cents…
SD Transplant
ParticipantJust got back from Eastern EU last night. I spent some time(3 weeks) in Hungary and Romania. I can’t tell you that I spent 2.2 EURO/a bottle of water in Budapest or about $3.08 (at 1.4 to 1 conversion rate). The $ is getting killed and traveling costs for the regular American are skyrocketing.
I can not begin to tell you the real estate bubble inflating daily in Romania (I’ve heard/read Bulgaria too). Prices are extremly high vs. incomes and most of the buyers are:(1) other transplants working in the Western EU, (2) flippers, and (3) people lying to banks about their income to qualify for a easy loan. I was fairly shocked to see banks paying these prices for some below mediocre places (old communist like apartments).
Anyway, as long as credit is cheap or available (at least initially), people will continue buying (or stretching to buy). I laugh when I hear EVERYONE talking about RE investments and secure/high returns in short time. I guess S&P or Moody’s can’t rate risk properly in these countries yet. One would think they learn fast, but I guess RE in the emerging markets it is a “new economic model”….
I can not wait to see how these newly adopted econmic & RE standards hold up. I don’t think the Eastern Block has an economic model for recovery since they did not experience a true economic cycles in their newly open markets (so called capitalist market models).
SD Transplant
Participantlniles,
I think you missunderstood. All I was saying/confirming is, as follows (replying):
1) My criteria for buying is base on GRM notes above (I only need a place to live, so I won’t invest more in RE than that)
2) I replied with the terms of my rent stating that if the rates of the rent/leases (stay the same – around 1% / year) for me, and the priceses won’t come down to the GRM expectations that I have, I will rent for a long time.
Vis-a-vis my math …I’m not sure what was wrong with it, but I guess I could have been more explicit.
SD Transplant
Participantlniles,
I think you missunderstood. All I was saying/confirming is, as follows (replying):
1) My criteria for buying is base on GRM notes above (I only need a place to live, so I won’t invest more in RE than that)
2) I replied with the terms of my rent stating that if the rates of the rent/leases (stay the same – around 1% / year) for me, and the priceses won’t come down to the GRM expectations that I have, I will rent for a long time.
Vis-a-vis my math …I’m not sure what was wrong with it, but I guess I could have been more explicit.
SD Transplant
ParticipantI guess you’re assuming the rents will raise significantly.
Here is my lease renewal for this year $25/month more. I just got my notice 2 days ago.currently lease $2020
new lease $2045
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Total increase $25/monthPercentage increase 1.23%
I can live with that. in fact, I could be renting for a loooong time.
I guess this springs up a new post, WHAT’S YOUR RENT INCREASE THIS YEAR???
SD Transplant
ParticipantI guess you’re assuming the rents will raise significantly.
Here is my lease renewal for this year $25/month more. I just got my notice 2 days ago.currently lease $2020
new lease $2045
______________________
Total increase $25/monthPercentage increase 1.23%
I can live with that. in fact, I could be renting for a loooong time.
I guess this springs up a new post, WHAT’S YOUR RENT INCREASE THIS YEAR???
SD Transplant
ParticipantRa633,
For me (my family) it’s quite simple. I will wait until it makes finacial sense (GRM – gross rent multiplier) will be somewhere between 120-150 for the areas I’m looking as well as economic conditions for my family (job security/outlook). I know the later will have to suffer in the new economic conditions that are lagging.
Hence, my current townhome (currently estimated at $450k or 225 GRM will have ways to go)
willing to buy @ 120-150 GRM which would make it $240k-$300k townhouse.
anyone else?
SD Transplant
ParticipantRa633,
For me (my family) it’s quite simple. I will wait until it makes finacial sense (GRM – gross rent multiplier) will be somewhere between 120-150 for the areas I’m looking as well as economic conditions for my family (job security/outlook). I know the later will have to suffer in the new economic conditions that are lagging.
Hence, my current townhome (currently estimated at $450k or 225 GRM will have ways to go)
willing to buy @ 120-150 GRM which would make it $240k-$300k townhouse.
anyone else?
SD Transplant
ParticipantI think the most common one that makes me laugh, goes like this: “I rather own than rent”…….and I always find myself wanting to reply: IT IS THE BANK THAT OWNS IT (stupid), YOU JUST KEEP THE NOTE PAYMENTS FOR 30 YEARS….then you call it “own it”.
SD Transplant
ParticipantI think the most common one that makes me laugh, goes like this: “I rather own than rent”…….and I always find myself wanting to reply: IT IS THE BANK THAT OWNS IT (stupid), YOU JUST KEEP THE NOTE PAYMENTS FOR 30 YEARS….then you call it “own it”.
SD Transplant
ParticipantSince I am the least qualified to comment or pretend to comprehend w/out a bias religion in general, I think I will recommend some insightfull reading by Mircea Eliade. He’s one of the first authors in the world to do a comparative historic review of religions in a book & publish it.
“The Sacred and The Profane: The Nature of Religion”
by Mircea EliadeHe was translated into many languages, and I know he’s published many more books along the same subject. My father, a retired journalist now, has been pushing me to read his work for the longest time. However, I am behind on my dad’s recommended reading list, so I am working on “Never Eat Alone” by Keith Ferrazi.
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