Quote:
Originally Posted by tisonlyi
There's an long, long way to go for an awful lot of property to fall yet for most of the states and the uk. (the mortgage brokers association in the states, for example, reports today that 10% of mortgages that are not in foreclosure at the moment are delinquent...)
Property has an awful, grinding way back down to it's trend.
-----Added 5/12/2008 at 10 : 45 : 05-----
Oh, and don't bank (sic) on those interest rates, when the market starts to slide for the dollar - and it will - they'll be heading north in fine style.
if you can get something fixed atm, do it.
|
I'm not certain I know what a "fixed atm" is, could you enlighten me?
I would never get an adjustable rate mortgage. I want to know what my loans going to cost me, period.
Let's say you're right and the dollar drops like a rock (personally I think you are right. I think that's part of the plan. Make the dollar worth so little that paying off the people we owe money to is no big deal.) To me that's even more reason to invest in real property. Whether that's real estate or gold or ??? Having something that will never end up being a mere piece of paper in troubled times has almost always been the way to go in the long run.
Let's say you buy a condo or house for 300K that two years ago sold for 1m. (out of my price range but...) and the dollar drops to the point that milk is $50 a gallon. Now that 300K really isn't very much money. Let's see I could pay off my mortgage with how many gallons of milk?
Plus all these people that are losing their homes to foreclosure are going to need some place to live. It's going to be a renters market, not a rentees market. People with property to rent and or lease will have a large pool of rentees to choose from. Sure some people are going to be unable to rent, it's a sad fact but parks are likely to fill with full time campers. But there will be some people who couldn't afford their mortgage because they used their house like a credit card and now owe a shit load on it and the rate adjusted. They'll be able to afford rent but won't be able to qualify for another mortgage. Even if your rent doesn't cover the mortgage, if you can cover it and wait it out for 10 years I think the return on your money will be good. The housing market has crashed, it may crash further. But at some point it will go up. Look at any period in history and over time real estate goes up.
The key here is to look at the long term. You're not trying to make money in the next 6 or 12 months. Or even in the next few years. You're trying to ride out hard times and find someplace to put your cash that after all the cards and chips fall, after the dust settles, will be worth something. The US has a lot of natural resources. Right now things look bad (mainly because they are bad.) But it will turn around, it's just a matter of time. I think that amount of time is going to be significant. People are talking about the middle of Obama's first term. I'm thinking 2018 is more reasonable. I'd like to get to 2018 with as few scrapes and cuts as possible.