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

To: John Vosilla who wrote (39577)	8/30/2005 10:56:32 AM
From: X Y Zebra	Read Replies (2) \| Respond to of 306849

Are you expecting bubble market residential to crash or just certain most speculative segments within those markets? i am not predicting anything, but i would expect that instead of a 'crash' i think that it would be a slow grind to return to more sane levels, particularly in markets where speculation has been less (i.e. properties where people are living in them rather than sitting empty because a speculator bought it) the overextended guys will probably punt at a price level where stronger buyers would rescue them (of course that depends at what level of the ponzi pyramid one got in... if the person in question is a 'general' i suppose he will do ok... if he is a foot soldier, well, rats... he will be decimated contrary to the stock market were many companies, including formerly reputable ones, their paper was worth cents... real estate has an intrinsic value that will motivate the vultures to buy at 'x' price.... so a dramatic collapse i do not see happening. What about commercial in bubble markets being at such low cap rates? ah well... nevada you must be talking about.... well... if demand for such property subsides, again, a return to more reasonable levels gradually . however, i am not sure that the appetite for what is considered prime real estate will ever subside particularly when nevada seems to be doing something right.... [that the rest of the nation cannot figure out, namely, charge less taxes, and let 'sinful' activities pay for whatever revenue the government needs] which brings me to a little off topic here, but if instead of fighting the so call 'war on drugs' i would do this... 1. take the crime out of drugs: the nation is hooked on them ANYWAY, legal or otherwise; war on drugs or not, they STILL get stoned away... ---> legalize all drugs 2. TAX the shit out of them: in stead of handing a printing money license to psycholocos and gangsters (what's the difference -gg) let the biggest gangster of all (i.e. the government) take a big bite out of the loot of psycolocos and minnow gangsters. once and for all stop f**** the businessman and the regular citizen with taxes up the wazoo. let the criminals pay for a great deal of taxes anyway... income producing RE has a better base value than any residential mania-based value RE, therefore, yes, if the income for such property declines, then values will be lower, the other element is cap rates... if interest rates do go up (aggressively) then the chances for cap rates to become higher (and hence lowering the values of properties) will be more probable. the thing is.... most commercial real estate loans are influenced by longer term rates (example 10 year note) and those rates actually have gone down since april... i believe currently are about 4.17% or so.... that is not too bad... so all these clamoring of armaggedon... i think they are reading far to many biblical stories and they have some sort of guilt trip that forces them to dream dire events like crucifixions, public stoning, feet placed in boiling water and many other torturing based on spanish inquisition stories... remember the 1970's people behave like troglodytes going for gas, and a bunch of hippies went berserk and lived in communes because they said the planet was running out of oil and i do not know what other mary-and-juana-up-in-smoke-theories they had ? all bullshit. if you bought real estate in the 70's by now you are a very rich old fart... so yes, those who behave like pigs in mud and get leveraged irrationally will suffer because like all markets, real estate will go up and down.... but real estate historically, has a very relentless upward curve... like chinese torture.... drip, drip, drip, drip... (meaning up, up, up, up...) so let them howl and howl.... auuuuuuuuuuuuu armaggedon is coming.... (but quietly, just buy, buy, and buy real estate that makes sense...) no, not coastal condos, but ugly, non-glamorous warehouses with small shops... they are nice cash cows (moooo)... and if you can muster the cash... go for the gems of all times... ---> self storage facilities <---- i remember the days i used to go to a banker and ask for financing help to buy them ole metal buildings... banker would scoff at me and say: are you crazy ? we don't lend on metal buildings, they are ugly.... yep... very ugly, (except when you go to the bank and deposit all them little checks and coin) all of a sudden the banker wants to know where are you finding all this $$$$ -roflmao We seem to be on the same page on midwest/flyover country. indeed... isn't that poetic ? all those cheap-reasonably-priced-properties... yielding all that beautiful cash... rolling in every month... aah nothing like such green art... so many zeroes after a few digits to their right.... let them fools have NY, LA, and all that peninsula full of crocodiles and bugs... let ALL the baby-boomers retire where the sun shines in all its power and let them sweat like pigs in mud and oh yeah, let them have all the hurricanes they wish.... i'll just keep an eye on them ugly warehouses and watch the news of the .... ahem... real estate bubble -lol more here: Message 21650381 p.s. now remember, i said warehouses.... NOT whorehouses -g