TAA wrote:
Millennials can easily buy homes. Just not in expensive places they feel entitled to live in.
Which places are the expensive places?
TAA wrote:
Millennials can easily buy homes. Just not in expensive places they feel entitled to live in.
Which places are the expensive places?
Picture me trollin wrote:
Mr. Obvious wrote:in the long run housing prices have to move in some sort of tandem with wages. There are a lot of local and shorter term exceptions to that general rule. I am not following the market closely enough ti know what the present trendlines are
May be being propped up by foreign investors and others
Rolling is right, many wealthy Argentinian, Chinese and Russian investors see U.S. real estate has an attractive asset class since their currency is often manipulated, their equity markets are far more volatile and difficult to value and their economies are tied to more basic industries like mining and energy.
voice of reason wrote:
Picture me trollin wrote:May be being propped up by foreign investors and others
Rolling is right, many wealthy Argentinian, Chinese and Russian investors see U.S. real estate has an attractive asset class since their currency is often manipulated, their equity markets are far more volatile and difficult to value and their economies are tied to more basic industries like mining and energy.
What do you think?
State of Bankruptcy wrote:
Anything purchased by debt financing will eventually deflate in the upcoming asset implosion. Buying with debt is simply moving demand forward. The Federal Reserve going back to Greenspan have done everything possible to inflate asset prices, including real estate and stocks, and the debt which supports those assets. We are about at peak debt now and there is nowhere much to go with ZIRP (0 or low interest rates) available to the financier class. Real estate prices will spiral with every Boomer lowered to to his grave, but it will happen much sooner. Any asset which is also a liability for another party will come to the same end. The coming-of-age baby boomer demographics, two-earner households and debt explosion largely brought about "economic miracles" of the 80s/90s.
I don't blame Millennials for not buying into this Ponzi. However we will see who gets the value of the asset: the kids ./ grandkids now in the basement or
the hedge fund / private equity hoodlums with reverse mortgage schemes
senior / assisted living hellholes
casinos
doctors / Big Pharma / Healthcare
property taxes or all tax collector public entity thieves for that matter
Same goes for tuition prices. If there was no government loans or backing / bailout of any loans, and the borrower could default on the debt like any other debt, then the tuition would likely plummet by half in order to fill the seats. Funny that one can buy a Big Mac on a credit card and puke it or sh-t it out 5 minutes later and then default on the debt or discharge it in bankruptcy, but can't do the same with student loans. There are two sides to every deal, even bad deals. College or lender needs to have their own skin in the game and bear the responsibility of their diligence or lack thereof. Because debt money spends the same as cash (but unlike cash has to be paid back with interest), the college tuition is "what the market can bear", and that market includes borrowers, even foolish or misinformed borrowers. The cash buyer has to (or chooses to) compete with those buying with debt.
I will save the history of why a dollar in 1913 (creation of Federal Reserve Bank) is worth about 2 cents today for another post, but in general the further you are away from where the actual dollars are emitted the lower the value of the dollar, from either historical basis or current basis. (i.e. for the latter: you cannot compete with Goldman Sachs to finance and manipulate tankers / prices of crude oil; you cannot compete with JP Morgan when they naked short the silver market.
Is is just astonishing that none of the the articles I ever come across in the mainstream media concerning the minimum wage - either pro or con - ever raise this issue. What could a jr./ sr. in high school with a most available jobs say in "the bad old mid/late -70s" for example, buy versus his counterpart today? Most I knew could easily buy 5 year old cars for cash.
The best and only thing which should have been done in 2007-2009 is let every TBTF crash without a bailout. Oh, with regard to the TBTF bailouts what economic / political "-ism" might that be? Its all on your debt tab now, Millennials. My advice is to get off the economic grid in any / all ways possible or amass the political will and power to "Ctrl-Alt-Del" the debt - all of it.
So my choices are to:
keeping renting and hide money under my mattress
buy a house with cash
buy with a cash and turn around and finance over 30 years with 3.75% so can invest in stock market
Please advise.
ndnsns wrote:
TAA wrote:Millennials can easily buy homes. Just not in expensive places they feel entitled to live in.
Which places are the expensive places?
Vancouver Canada. Makes San Fran look like a bargain bin.
centro does it better wrote:
Two words: laissez faire
All you Bernie fans think we need to attack the free market with a hacksaw to equalize everything. If that's not communism, I don't know what is.
Communism is where the workers own their own labor and the means of production as opposed to capitalism where a handful on non-workers own everything.
So should we not buy houses because it's all a scam?
Scam or no? wrote:
So should we not buy houses because it's all a scam?
Yes
We are entitled generation. We have powers. Yes drop all home prices in the USA. We have college dept that other generations never had, I think. We are so far beyond other generations due to our special powers. Move Obama Care to older generations only, even though we voted for it. Why don't all older generations just die and go away so we can use our powers and have millions.
Yess wrote:
Scam or no? wrote:So should we not buy houses because it's all a scam?
Yes
Why keep renting if you can buy a house with cash or build one yourself?
Do prices have to come down?
That's a good question.
Prices did come down after 2008 as a market adjustment to reality.
But market conditions have caused prices to creep up.
And it's not just the low interest rates.
Low interest rates don't always make home values go up, and rising interest rates do not mean prices will go down just to keep the same mortgage payment.
Inventory, or homes available for sale has a big impact on prices/value.
People were shell-shocked when their homes lost so much value in the bubble burst.
Some still don't have enough equity to sell, and others just don't feel comfortable trusting the market to sell.
So there are fewer established homes for sale then would normally be.
Fewer choices means higher prices.
The biggest equity gains people are seeing are not by values going up, but by paying their mortgages down.
People do not like selling their house for less than they paid for it so I don't see prices going down for that reason. They will just hold on to their homes.
Low cost new construction may be the answer but if they are competing against few established homes then they won't sell too low.
The young people's best shot at buying a home is that home prices stay put and their wages go up.
Then there is the whole mortgage industry.
They have over-corrected and do not give loans very easily.
While appraisers are more conservative and do not give high appraisals.
The bottom line with all of this is that those with a lot of money will do well in the current market and those that are cash poor and middle to low income are worse off than before the boom even started.
The inequality gap seems to widen.