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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 (42570)	10/4/2005 11:34:18 AM
From: GraceZ	Read Replies (1) \| Respond to of 306849

A lot of the reason people do this is that they see RE as the best place to put their money. It WAS the best place to put money in the last five years and this is always where people screw up, they are always putting money in what had a great return in the previous period without accounting for the fact that investment returns tend to revert to the mean. You put your profits from the previous period into those investments that have lagged in the previous period.

To: John Vosilla who wrote (42570)	10/5/2005 12:48:50 AM
From: Live2Sail	Read Replies (1) \| Respond to of 306849

From strictly a business sense to me it makes no sense to hold your primary residence as a rental when you move out as you can get to keep all the equity tax free and reinvest it somewhere else, leverage, buy more property and get the higher basis for greater depreciation and tax shelter. That most of these residential properties in the bubble markets generate such a puny return on current market value makes it a no brainer these days. People tend to fall in love with their properties too often. That's the power of Prop. 13. Don't sell. Don't sell. Don't sell. There are those here who would disagree, of course.