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

To: Spekulatius who wrote (10649)	5/12/2003 9:53:31 AM
From: pass pass	Respond to of 306849

it's really difficult to trade houses like you suggested, ie, cut loss by selling one and buying another somewhere else. The paperwork and commission will exacerbate the situation. This is the reason that Greenspan is not too worried about housing bubble because he felt the transaction cost acts as a deterrent. I plan to "average down" in real estate. If the houses get really cheap, then I will buy another one (assuming I have cash and credit). Averaging down on stocks can be a trap, but housing should come back up as long as you have the stamina

To: Spekulatius who wrote (10649)	5/12/2003 12:18:21 PM
From: Lizzie Tudor	Respond to of 306849

I doubt that renters in Burlingame will pay you a decent rent as a percentage of your invested capital, do they? The rental market is what scares me most about RE in the bay area. As anyone who has tried to rent here for years can attest, all during the 90s- even as early as 91/92 timeframe- it was IMPOSSIBLE to rent a house in the BA. 10 renters for every house available, even apartments were tight. There were a number of reasons for this but H1-Bs certainly contributed. Flash forward to today, we are way way overbuilt in the rental dept. Huge "luxury" rental complexes in foster city are empty, and H1-Bs are being sent home and quotas for those are going down and may never return to the levels we had in the 90s. These days, if somebody wants cheap labor in SV, they offshore the task (which has its own issues). Anyway the tight rental mkt is gone even for houses and that is a new phenom here. I'm ok with my houses which are not in Burlingame btw. One is SF, the other mid-peninsula. I LOOKED in Burlingame when I was trying to buy, no luck. BTW I also think (no proof of course) that mid-peninsula expensive homes took the biggest hit price-wise because of the sheer number of bogus bubble companies that happened to exist here. Webvan, inktomi, companies like that that used to employ thousands are totally gone. At least in SJ they have companies that lasted like Cisco. Anyway I am kindof an armchair RE investor so no swapping in and out of houses for me, just a personal preference although you are probably right the prudent thing to do would be to sell one of these and diversify into other investments. But you know that old thing about houses, you fall in love with them! I have definitely, without question lost money on these and I intend to file for a property tax reassessment when I have enough evidence things have fallen though.