Still.....the disparity gap widens...... - Page 5 - PeachParts Mercedes-Benz Forum

Skid Row Joe · #61 04-01-2011, 01:25 PM

Quote:

Originally Posted by buffa98

Every market is different pure and simple. In the area he is talking about (where I grew up so I can speak about it) a basic 3 BR house on a city lot can be had from the mid 20's to the mid 30's.
What if anything could be purchased in your area for that amount? Most likely not much. It is basic supply and demand. There are (were) more people willing to move to AZ than were willing to move to Kittaning or Butler PA by a long shot.

The whole issue is not parasitic in any means it is basic good business sense. As soon as the market started to correct itself the smart people turned and burned, un fortunely someone always gets caught. It is the basic economic cycle that has been going on since the 1930s.

BUT the issue is because of govt meddling in the market (since the 30's) we have never gotten the 4th step of an economic cycle which is prosperity. We are held in recovery,recession or stagnation. Remember the Dot com bubble? Same thing. You could make a mint in a very short time.

Jim Cramer (a financial guy "Mad Money") has an expression: Bears make money bulls make money and pigs get slaughtered.
That is exactly what happen to you and every one else that bought a house based on the current cycle with out looking down the road. What goes up must come down. There are very few areas in the country that never have a housing issue. NYC (and surrounding burbs) Boston, Hartford CT, and Chicago come to mind. Not that there are not housing issues BUT those market dont lose money.

Extremely well put, Buffa98.

People unhappy with their financial situation sometimes turn to the government to reset their lives. That's exactly the wrong place to look for help, since they were a major source of scr#wing up the gameboard in the firstplace.

Assess the situation you are in and improvise to reset it to your liking. -Not the exact wording, one of the branches of the U.S. Military drives into their recruits so they don't end up sitting in a foxhole crying. In essence the Military pounds into the heads of their soldiers to improvise, improvise, improvise to overcome - doing something, not just sit on your hands waiting for help (the government) to arrive to do it for you. If you wait for them to help you, help will never arrive.

Hatterasguy · #62 04-01-2011, 02:23 PM

Quote:

Originally Posted by pj67coll

That's only partially true. When investors see an undervalued "assett" they buy and this has the effect of pushing the prices up. It's rather like quantum physics. The act of looking at the situation changes the situation itself.

Like the oldest proffession in the world huh? Seriously who'se we? I thought you were a small scale home builder to the elite. That's not the same thing at all as I'm talking about.

No. He's simply artificially inflating the price which is what caused the whole cockup in the first place.

- Peter.

What you fail to understand is that the investor is not inflating the price, unless you assume the buyer that bought those houses and the bank are idiots. The investor didn't set the price the market did, which was $60k, he could have asked $100k but he wouldn't have gotten it.

What your doing is picking out one small group in the market and singling them out, and its just not there fault.

Every single person and institution who bought, sold, and financed property at the height of the market is responsible. You yourself supported the high prices by purchasing.

I dislike being called a "parasite" for doing my job and making a living.

roflwaffle · #63 04-01-2011, 02:58 PM

The investor can inflate prices, but I'm not sure if that's applicable now. It certainly was during the last housing bubble and while people buying for the usual reasons did contribute a small amount it was primarily caused by people using homes as investments.

pj67coll · #64 04-01-2011, 04:56 PM

Quote:

Originally Posted by Hatterasguy

What you fail to understand is that the investor is not inflating the price, unless you assume the buyer that bought those houses and the bank are idiots.

The banks were perfectly happy to lend money to people who had not a snowballs hope in hell of being able to pay it back. I don't know what you call that but I call it idiotic.

Quote:

The investor didn't set the price the market did, which was $60k, he could have asked $100k but he wouldn't have gotten it.

"The market" does not exist. It is merely a function of the activities of people. Supply and demand etc. Absent the "investor" the price would not have risen nearly as high as it did. Especially here with effing californians dumping their million dolllar shacks and buying two or three homes here for cash. That's two or three homes that regular folks who need a house will have to pay a ****load more for than if they were sitting empty looking for regular people to buy them as homes without the parasite in the loop.

Quote:

I dislike being called a "parasite" for doing my job and making a living.

Once again I thought you were a small volume builder? Is that not so? If it is then you are obviously not the kind of parasite of which I speak.

- Peter.

buffa98 · #65 04-01-2011, 09:40 PM

Quote:

Originally Posted by pj67coll

The banks were perfectly happy to lend money to people who had not a snowballs hope in hell of being able to pay it back. I don't know what you call that but I call it idiotic.

"The market" does not exist. It is merely a function of the activities of people. Supply and demand etc. Absent the "investor" the price would not have risen nearly as high as it did. Especially here with effing californians dumping their million dolllar shacks and buying two or three homes here for cash. That's two or three homes that regular folks who need a house will have to pay a ****load more for than if they were sitting empty looking for regular people to buy them as homes without the parasite in the loop.

Once again I thought you were a small volume builder? Is that not so? If it is then you are obviously not the kind of parasite of which I speak.

- Peter.

The banks were forced to lower their standard as lenders due to the Community Redevelopment act of 1993-4?

This was a feel good law based on a bunch of goofy data that bank having strict standards for large loans(mortgages) were somehow being discriminatory towards minorities.

When I bought my first house (1990) I HAD to have a minimum of 15% as a down payment in order to get the loan. Along come this law and presto! no down payment ? No issue! Interest only? Sure!! No Verified income? Absolutely!! And so it started. people that had no business taking on a large loan did so by the millions. So as a market example FL: As fast as they could get slapped together (and I do mean slapped together) They were being processed and sold.

Fast forward about ten years. Most of these houses (I refuse to call them homes, A home is an emotional thing whereas a house is a physical structure) were bought by and financed with a type of loan that is doomed to fail. Either an ARM, Interest only of a 7/1 with a balloon.

When the market started to correct itself these overpriced mass produced houses lost billions in value. (Another truth in an economic sense) THe people that were left holding the bag were the taxpayers (via Fannie and Freddy). Because the "owners" HAd little if any of their own money tied up in the house, they walked away, Which in turn put more on the market and the law of supply and demand reared its ugly head( More supply, less demand overall market price drops etc etc etc). At the risk of sounding crass there are people in this country that should be renters plain and simple. They base there monthly or weekly budgets on what payment they can afford not what can I pay cash for and own. I have stated this previously on here. My grandparents (both sides) raised 3 and 6 children respectively through the depression. On both side the statements were close to be the same. You "need" credit. But you should never buy anything on credit that you cant pay off! Now realizing that a house for $6250 is long gone(but they did have a mortgage and my grand father made about $4500 a year back then) It still holds true. People are confusing "wants" with "needs". Two cars(traded every 3 years) the bigscreen, the 4 br McMansion that looks like every other house on the block, eating out 4 time a week are the one that got caught.

I truly feel sorry for the ones that are trying to make it work with the houses they purchased during this time but I will still stand by my statement that if the Govt would stop meddling in the markets WE would all be better off.

The parasites you refer to I call slum lords. The true business type trying to make money are shrewd (My $.02)

Ok Rant over.

C280 Sport · #66 04-01-2011, 10:22 PM

Quote:

Originally Posted by pj67coll

People who buy multiple homes as "investments" are parasites in my opinion.

- Peter.

Shame on us for owning 2 homes both that are paid off.......

layback40 · #67 04-01-2011, 10:33 PM

Quote:

Originally Posted by C280 Sport

Shame on us for owning 2 homes both that are paid off.......

More shame still if you own an apartment block??
What about a commercial office building?
It all sounds like "a few have nots *****ing about the haves".
We are to forget about the expenses of owning these buildings & the fact that we may be providing a roof over some ones head !!

C280 Sport · #68 04-01-2011, 10:42 PM

Quote:

Originally Posted by layback40

More shame still if you own an apartment block??
What about a commercial office building?
It all sounds like "a few have nots *****ing about the haves".
We are to forget about the expenses of owning these buildings & the fact that we may be providing a roof over some ones head !!

Yes we still have all the buildings+buisness and storage. Just remodled a 3rd floor appartment actually. Looks beautiful

And your right about have not's *****ing about the haves. FYI to everyone look around there is always someone with more then you. Its life get over it LOL. I do not understand why everytime I come on this forum its always someone crying about how someone has more then they do. You dont see me getting jealous when a friend of the family called us and told us they bought the $10 Million home on Broadway in Saratoga, Springs, New York. If anything I am happy as hell for them and hopefully it works out good....But I could just think that way because I am actually "in the game"

alamostation · #69 04-01-2011, 11:01 PM

Quote:

Originally Posted by pj67coll

People who buy multiple homes as "investments" are parasites in my opinion.

- Peter.

The mayor and city counsel of Detroit call them "Angels."

jplinville · #70 04-01-2011, 11:54 PM

Quote:

Originally Posted by buffa98

Every market is different pure and simple. In the area he is talking about (where I grew up so I can speak about it) a basic 3 BR house on a city lot can be had from the mid 20's to the mid 30's.
What if anything could be purchased in your area for that amount? Most likely not much. It is basic supply and demand. There are (were) more people willing to move to AZ than were willing to move to Kittaning or Butler PA by a long shot.

Our home sits on the hill, overlooking the Allegheny and butts up to Bull Creek. The modest prices up here are in the mid 40s and up. Go down the hill, and the prices drop considerably. Ours is one of the only in the neighborhood with a driveway, as it sits on a lot and a half. Most of these houses have on street parking only.

New Kenn has a few places we are looking at, but I'm not seeing that area as a viable investment, as there are too many section 8s there, and prospects for future sales don't look too well.

In the Pitts, I can pick up a row house for about $7k, invest a few bucks and rent it out at a comparable rate to the surrounding area. Knowing what the same properties were listed at 2 years ago, I should be able to double my investment within the next 5 years, as well as generate a monthly income while waiting on the market.

Here in Tarentum, things are looking up. There are 8 renovations in a 2 block radius from my home...and decent number of them are on the auction block and can be had for less than 10k, fixed up and resold for more than the initial investment.

Allow me to put it this way...My employer paid to move me from UT to here, and have done the same to 4 other employees in the last 4 months. Our production and hiring numbers are up, reflecting growth in the manufacturing sector here. I know of 2 other medium to large companies in the area that are doing the same. These are indicators to better times in the near future. Let's not forget the fact, that after a mere 4 months of employment with this company, I received a raise equal to 14% in my wages, and we have been working 50+ hours per week since May of last year.

Those indicators are telling me that between now and the next 6 months is the time to invest in real estate here.

It truly is a buyer's market...you just have to be willing to take the risk and and hold it for a while til the time is right to sell.

Skippy · #71 04-02-2011, 12:14 AM

Quote:

Originally Posted by jplinville

The modest prices up here are in the mid 40s and up. Go down the hill, and the prices drop considerably.

In the Pitts, I can pick up a row house for about $7k, invest a few bucks and rent it out at a comparable rate to the surrounding area.

I am jealous right now. If I could buy a decent house in my area for 40 grand, I'd get two (for cash), rent one out and share the other with a rent-paying roomate. I just checked the real estate ads. Median home price here is still 283,000. The good news is that prices seem to have come down from the last time I checked only a month ago. I'm seeing stuff that I can almost afford.

Bad news-I walked into my bank today and found they're offering mortgages at 3% down. Will they never learn?

layback40 · #72 04-02-2011, 03:45 AM

I think I get it now.
All of us that can afford to buy a second house should give our money to the banks so that those who cant afford a house can borrow the money from the bank & buy the house.
Then they can get into trouble when they cant make the payments & have the bank foreclose on them.
Then the bank can loose a packet of money on trying to sell the property & either need the government to bail them out or loose the money that we invested in the bank in the first place.
Then the cycle can start all over again.

Have I got it right then ??

roflwaffle · #73 04-02-2011, 04:00 AM

Quote:

Originally Posted by buffa98

The banks were forced to lower their standard as lenders due to the Community Redevelopment act of 1993-4?

The CRA is from 1977, and it doesn't appear that any of the legislative changes would have influenced the housing bubble. What could have was lack of federal regulation such that the loans were consistent with safe and sound operation, but that happens on an administration by administration level. If the administration during the bubble was not insuring that the loans were safe and sound then there could be problems with any loans regardless of who they were to. Something similar happened after 9/11 after thousands of FBI agents were transfered from white collar crime to terrorism, so naturally there was a lot of white collar crime that slipped through. One bill that did have a large influence on the bubble was the repeal of the Glass-Steagle act, but the whole formation of the bubble was due to many other factors.

buffa98 · #74 04-02-2011, 11:33 AM

Quote:

Originally Posted by roflwaffle

The CRA is from 1977, and it doesn't appear that any of the legislative changes would have influenced the housing bubble. What could have was lack of federal regulation such that the loans were consistent with safe and sound operation, but that happens on an administration by administration level. If the administration during the bubble was not insuring that the loans were safe and sound then there could be problems with any loans regardless of who they were to. Something similar happened after 9/11 after thousands of FBI agents were transfered from white collar crime to terrorism, so naturally there was a lot of white collar crime that slipped through. One bill that did have a large influence on the bubble was the repeal of the Glass-Steagle act, but the whole formation of the bubble was due to many other factors.

The original was, I am remembering a big to-do with Clinton signing a bill to "make it easier to get a mortgage" Maybe an extension or an add on?

buffa98 · #75 04-02-2011, 11:39 AM

Quote:

Originally Posted by Skippy

I am jealous right now. If I could buy a decent house in my area for 40 grand, I'd get two (for cash), rent one out and share the other with a rent-paying roomate. I just checked the real estate ads. Median home price here is still 283,000. The good news is that prices seem to have come down from the last time I checked only a month ago. I'm seeing stuff that I can almost afford.

Bad news-I walked into my bank today and found they're offering mortgages at 3% down. Will they never learn?

Again ther are a lot more people that would live in Carson City NV than Bradford PA( where I grew up)

Case in point:

http://www.colliganrealty.com/proppages/17_Derrick_Road.htm
http://www.colliganrealty.com/proppages/58_Clarence_Street.htm

This is just 2 that are for sale, How ever there has been a steady decline in this area since the late 70's. If the GOVT would get out of the oil business this area would blossom again