Buying distressed properties for cash has been a gold mine for
a friend of mine in Miami. Sure, the society portrays folks
like that as "vultures", but in reality banksters and mortgage
brokers were vultures, when they made that loan, painted it
as AAA, insured it, and pocketed the cash.
Obviously, it IS a gold mine, when you can buy a property
50% below current value. In liquid markets the equivalent
would be buying the Spoos at 600, while it trades at 1200.
Of course, the danger is that the Re market is not all that
liquid, and a distressed property is often vandalized.
FWIW, during SHTF in 1998 in Russia (when the Russian govt.
defaulted on GKO, the equivalent of domestic treasuries),
Re values tripled in local currency, but fell in real terms,
despite skyrocketing interest rates. The act of default
on domestic bonds was not anticipated by LTCM computers,
so LTCM blew up. -g- |
