Real Estate Rollercoaster.

A friend sent this to me just now. He and I were always very skeptical of everyone shitting their pants and rushing out to spend a lot of money (they didn't have) on over-valued homes in the area over the past few years.

I just think it's ridiculous to pay $1 million for a serious fixer-upper family home in this area. And do people really have the kind of cash to be buying homes like that? I do not think they truly do. Sketchy mortgage lenders pushed through approvals on loans at adjustable rates that a significant number of people in this area (especially minorities) are now having trouble dealing with, now that rates have gone up.

To illustrate just how the US real estate market has historically been... I give you the real estate roller coaster ride.

Comments

Anonymous said…
As someone who has been part of the Boston real estate market for 20-years now either myself or with family you touch on good points!

On one hand I feel bad for people that are caught in these stupid loans right now, but I also think they are partly to blame. Did you really think that buying a $800K house in Dot with no money down when your salary is $55K made any sense?

Few points though:

*If you bought smartly with attention to LOCATION, home character and LOCATION - you should still be ok.

*Real estate is still the smartest investment to make in my opinion - you just have to be smart about when and what you buy.

*The problem with this market is very similar to the dot com frenzy. Once it became 'in fashion' to become a house flipper, everyone jumped on the bandwagon and created this artificial market.

Depending on what and where you bought - this is a great time to be selling a house.

--Brevitt!
'omie said…
For some it may make sense. If they do in fact have the cash to place a decent down payment, and are able to pick up something in a hot rental area, then its a terrific investment.

And all these foreclosures make it very enticing for investors to begin doing this.
Me said…
SO true man... For those of us who couldn't afford to buy something in the past few years.. We'll have been saving our money... And now we have a good amount to actually put down on something really nice in a good area. So I guess there is an upside. I just feel bad for people who are finding themselves in tough situations... Because in a way, I feel like they got duped.

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