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

To: X Y Zebra who wrote (33135)	6/11/2005 11:44:55 AM
From: John Vosilla	Read Replies (3) \| Respond to of 306849

Keep in mind RE did nothing from 1930-1955 across the board. Of late even in built out NYC, the epicenter of capitalism in the free world we have had 3 major downturns the past 32 years. In Houston, our favorite place for investment next cycle<g>, many condos are still below their late 1970's new construction price. I don't see how values today in bubble markets can be supported without at least doubling wages and rents the next few year, continuation of lax underwriting with low start rate ARM's and interest rates remaining near these record low levels. Just the increases in RE taxes and insurance from 2003-06 will need a 50% increase in rents to be covered... And to top it all off the speculative activity of late has been off the charts. Momentum investors chasing appreciation 2000 miles from home via the internet, preconstruction condo cocktail parties, flipping junk lots in Florida on EBAY ect.....Every mania with this much speculative activity has always ended in disaster. The good news is my prediction is real estate values in most bubble markets will be higher by 2030. Junk lots in remote areas of Florida will still be way below today's prices by then<g>.

To: X Y Zebra who wrote (33135)	6/11/2005 12:03:53 PM
From: bentway	Read Replies (5) \| Respond to of 306849

This is an example of what will happen to many RE "investors". In the dot com crash, people usually lost money they already HAD (at least on paper). I think this one will be worse, and much more widespread. When prices decline in the bubble markets, every speculator will find himself in these guy's position. Your advice to them is to keep paying and hold for 20 years? (post thanks to John Vosilla) Upside down on SFR in Vegas...running out of $$$ Posted by Brandon V. on June 09, 2005 at 17:59:54: Help! Any ideas, comments welcome. My partner and I are in a mess with a brand new house in Las Vegas. Here are the details. 1. AUG 2004, we paid $445,000 for a Pulte model in the community of Aliante, North Las Vegas. 2. 100% financed and still owe roughly the same. 2. Payment is $3000/month. 3. Currently could only sell for about $360,000. 4. Finally found tenants to lease out for $1100/month in APR to reduce neg cash flow to $1900/month. We are running out of cash quickly. We desperately need some ideas on how to get out of this house immediately. Thanks! real-estate-online.com