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

To: Jim McMannis who wrote (21943)	7/4/2004 11:29:07 PM
From: ild	Read Replies (1) \| Respond to of 306849

<<<who's buying all these high priced California homes and the high tax bills that come with them.>>> Who cares about 1% tax if your property appreciates 20% a year and does it every year.

To: Jim McMannis who wrote (21943)	7/4/2004 11:43:43 PM
From: Elroy Jetson	Respond to of 306849

I think Henderson NV and Temecula CA are very similar places. Henderson was previously vacant desert land while Temecula was previously a garbage dump. Both are ideal places for new homes until the very instant the real estate bubble collapses. Then everyone will wonder what they were thinking. Both are priced similarly and land prices have increased 4,400% since 1990 in both places - most of it just recently. How are people able to afford to purchase a place in California? The people, whose Condo warming in Beverly Hills I went to on Friday, bought their condo with two "interest only" bridge loans. No one lender will willing to lend the full $691k, even with $150k down, until they sell their previous condo - which is attracting little interest. They obtained the $150k down-payment by obtaining a greater than 100% loan on their existing condo. No other savings available - and two new leased cars as well. After listing their old condo at $675k, now reduced to $615k, she is already talking about renting it out if they can't find a buyer at $550k. She figures after a just a few years renting it, they will be able to sell it easily for more than $750k. I guess she doesn't understand the implications of the fact that their condo is already on offer, without buyers, at $60k below the previous comparable sales.