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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: microhoogle! who wrote (27963)3/10/2005 12:22:20 PM
From: GraceZRead Replies (2) of 306849
 
What is interesting about that 7 year average is that I've known people who have done exactly that and made a tremendous amount of cap gains moving every seven, moving up to nicer and nicer houses and others who continually lost money until they were forced to rent dumps. What I do know is that people who buy at the low end of the cycle, stay in one house for years and years can beat renting.

One of my tenants who wanted to buy my rental way back when would be seriously ahead right now if she had done that. As it stands now she is about a year away from not being able to afford to rent my house due to the fact that her income is fixed (she is retired) but rents are subject to inflation. This is happening even though we've had below average inflation in rents for the ten years she's lived in the property and I've been slow to raise her rent. She will need subsidized housing for the rest of her life as opposed to being able to cashout with 150k. If she owned the property at the time she wanted to buy it (I offered to help her get financing and she backed out) she'd have lower expenses than she has now and she could afford to live in the property for the rest of her life. It's a three bedroom and she could have rented out the two other rooms for more than the entire mortgage payment. Instead she's one step away from the poor house.
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