I see it differently.

I don't really care where the market is, I make money either way. I want the market to correct, apartment buildings are to expensive. They need to drop in value about 20%. I am trying to figure where the market is going so I can not only better advise my clients, but so I can invest better.

The currant sub prime defualts are not surprising, I know I saw this coming a over a year ago, and I'm sure Jeff did as well.

Now I'm more interested in where the bottom is and when the upturn will occur.

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

It's a downturn but people still have to move, get divorced and need money its them that gets whacked not me, I don't give crap if your rate is 1%-25% I make more---in fact I do better with higher rates so bring it on. The problem that AHM has is they were NOT charging enough interest and got smoked when the money backed out.

If there is a greed problem its the lack of greed that is depressing the bond market.

Yep, just like the late 70's.

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

and late 80's and middle 90's, so on and so on.

don't let anyone fool you this is a weeding out phase where the weak go back to piss ant jobs while the strong stay strong. Personally I dodged the bullet and dumped inventory before any of this stuff was brewing. I moved into the finance so I can get it coming and going.

Hang on.

You said you were a Mortgage BANKER not a BROKER...

SO how do *YOU* not get "whacked"??

Oh I'm loving the weed out. I hate all the pretend investors and agents screwing everything up.

For example 2-4 family properties are way, way overvalued. But people still were buying them to lose money every month! What a great idea you are now a real estate investor! Now they can't dump them for what they owe. Let the amatures burn!

I don't understand why people will pay $400k for a 3 unit, when the income supports only $250k. What where/are they thinking?!

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

I make the same on the amount regardless of interest rate, people have to do things, people have to borrow and my lights are on. Couple that with fewer lenders/investors/bankers I love this $hit. I do better with higher rates because people come back to lower the rate.

What do you mean how do I not get whacked? If I have to borrow money I have to pay the going rate like everyone else.

A lot of them do it because they think in the long-picture they will be valuable.

When the economy is the tank residential rental does awesome. Like cheap non-durables.

In the big picture is a good idea? Maybe. But it can bitter pill and needs to be well financed.

Would I do it? Hell no.

Beleive it or not the professionals in the industry love this stuff.

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

I know, but it doesn't make any sense. Its a fools gamble.

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

You said you don't get whacked...

Yet you are the BANKER (not a middle-man/broker).

Ergo, if the loan is greater than the value and the borrower walks -- you got whacked.

Depends on what the long-term prospects are for a property.

I can think of a few areas in my state that in the 80's were flying like a kite -- and people kept grabbing at them when things tanked in the 90's...

In the end, the people who kept grabbing watching their values go up 10-fold.

So were they foolish then?

Depends if they are still holdin' the cards.

Take big balls. I bought a property at what *I* thought was the height of the market. Turns out it was the low end of the market... But it was a do-or-die buy, and I took the jump. Worked out well.. other got the shaft in the same situation, they bought at the real high... and now they are jammed up something horrid.

NOOOOOW... show me commerical... Yummy!

I'm becoming disinterested in the small stuff, the numbers are just so weak.

Whats really interesting are the 1,000+ unit places on Loopnet. Those properties are nice because there value is driven by the income. People simply won't buy them unless the cash flow acheives the desired rate of return. Whats even more profitable is buying underpreforming properties and making them preform.

Commercial is much better then residential for many reasons, I'm getting out of residential as soon as possible.

I don't buy for appreciation. I buy for cash flow, and try my best to get appreciation.

Now I just need to figure out how to get a $60,000,000 loan, oh Jeff!

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2016 Corvette Stingray 2LT
1969 280SE
2023 Ram 1500
2007 Tiara 3200

Yep, you'll do better..........apparently, you were just a little boy when the last round of very high interest rates occurred.........so, you won't remember the fallout.

Nobody could move.

Why? Because they couldn't possibly afford the higher interest rates and payments when compared to their existing situation.

You'll be sitting there twiddling your thumbs and waiting for the phone to ring, junior, if the situation worsens.

LOL.........yep, you'll have to sell that huge group of single family homes that you have amassed..........and with your wealth of experience in residential........you're definitely ready for some huge commercial buildings.