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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: bozwood who wrote (4681)	8/26/2002 2:56:00 PM
From: Tradelite	Read Replies (1) \| Respond to of 306849

Whoa, there, Boz....when you are in my type of business, YOU NEVER MAKE ASSUMPTIONS ABOUT FUTURE APPRECIATION OR VALUE, nor do you lead anyone else to make the same assumptions. In fact, disclosure forms are provided to homebuyers stating this fact. Why do you bring it up? Demand, supply, current pricing, future demand, future supply--are all topics of logical discussion. But to assume or imply that someone who pays $375K for a house tomorrow is going to do better than the person who bought the same house for $500K today is just not a place where I can go.

To: bozwood who wrote (4681)	8/26/2002 9:24:48 PM
From: Spekulatius	Read Replies (2) \| Respond to of 306849

<< My point is that the financial position of someone who pays $500k for an asset is not the same as the financial position of a person who pays $375k for that exact same asset.>> Of course the person who bought for 375k is much better of even if he has the same payments due to higher interest rates. The reasons are so obvious that its almost embarassing to post them: First there may be a good chance that interest rates come down and he can refinance. If this happens there is a good chance that his property has appreciated because it is more affordable. That does not necessarily imply that a buy at 500k is a bad investment, it just means that the odds to make money are much better if the market were depressed due to higher interest rate.