Toothpaste for Dinner

[Alan]

[MichaelDRenter]

I'm new...

JD wrote:

"At the end of his lease he's no better off than he was going in. So forgive me for giving you attitude, I truly am grateful for the renters that increase my wealth, provide me with write-offs and help keep me from having to return to the corporate rat race"


At the end of my lease I've been able to save money, and invest in alternatives other than real estate. Renting a condo has also allowed me to enjoy the things I love most about the PNW, namely the Cascades, Olympics and Puget Sound.

If my renting, helps you too...so be it. I don't see anything wrong with that at all...

However, at the end of my lease I think I will be much better off regardless...

Currently, realestate is 1) to much drain on cash 2) Warren Buffet told me not to. For me, it just doesn't make sense to buy now is all...

[JD@Preview]

Buying isn't always the best thing for everybody especially when you're young have a few wild hairs skewing your priorities. Nothing wrong with that. In another life before real estate I was a contract engineer and frequently out of the country for 6 months to a year at a time. Owning a duplex gave me a place to land when I was back in town that my rental receipts from one side covered 70% of my mortgage. Sometimes I rented my side to other contractors. While all of this is going on I've watched my equity grow by $20,000+ a year at minimal expense to me. Nothing if you consider that my portion of the mortgage was less than half of what it would cost to put a roof over my head in a rental. I don't know about you but I, like most Americans, just don't have the discipline or wherewithall to save $20,000 a year and even fewer of us have the investing savvy of a Warren Buffet. Owning my home(s) has likewise given me the freedom that you say renting has given you. I don't want to suggest that your decision is neccesarily wrong or bad but I do know that for me had I not bought my homes and leveraged them into more real estate I wouldn't be as secure as I am now. If you're young enough that retirement is an abstract concept I can see the reluctance to buy but now in my 50's I wish I'd gotten into it earlier. Maybe at some level my attitude about buying is a desire to let someone younger see what I didn't see when I was young. The value of most corporate retirement plans these days makes the consequences far more dire than for my generation and even then there are too many retirees eating Alpo now. What happens in 30 years? The bottom line is that I wish you well regardless of your decision.

[synthetik]

Personally, I cannot think of a single reason for anyone to buy in this market.

I don't even buy into the argument of "buy and hold" (at this time). Buying right now is probably the most speculative investment you could make other than possibly buying other inflated asset classes (collectibles, art, etc)

Why does the baby boomer generation just seem to not get it when their parents were depression era? (rampant consumerism/conspicuous consumption, no savings [a house is not a savings plan!], disdain for the environment, entitlement mentality and a belief that "i'm going to live forever"). This is a generalization of course however I see most of the 50-65 year olds that I know behaving in this manner.

Probably best to be debt free at this point and take a "wait and see" approach, staying out of the RE market while this thing plays out. A conservative estimate would be 3-5 years before we see a bottom, but a Japanese style 1986 deflation of 15+ years in housing is certainly possible.

Why risk it?

Instead, what is likely to go up in value?

Precious Metals + PM Service Co's (public and private sector, US and global $$ move from increasingly worthless fiat currencies such as the Dollar)

Crude Oil/Energy/Alt Energy (It's a finite resource and the cheap stuff that's left resides in places where people hate us)

Commodities/Raw Materials (need oil to ship it and grow it, developing countries are growing at an ever increasing rate while global oil production has leveled off)

[Alan]

Flip side:

I've owned my own residence for nine years before moving to the PNW. The first house appreciated 8% total over 4 years. The second condo appreicated 2% total over five years. And boy was I glad to get that 2%. At one point equivalent condos were selling 20% below my purchase price. Losing that equity that I had worked so hard to save was not a good feeling.

You got lucky, JD.

[JD@Preview]

I guess it's matter of timing on the condo Alan. My experience (bought my first condo at 20 in 1972) has been slow appreciation. That's always held true in my real estate business until last year. I sold a few condos at significant appreciation primarily, I believe, because single family homes just crept out of reach and because a condo right on the I-5 corridor started looking real good from a tired commuters standpoint. The current spate of condo conversions has probably cooled that demand a bit.

[Matthew]

[JD@Preview]

[Puget Sounder]

[bobfandango]

[SeattleMoose]

Can't believe y'awl are still wrestling with such a troll.

Reminds me of that Kendra Todd doll at Toys R Us....you pull the string and it says:

"Its a great time to buy"

"Buy now or be priced out forever"

"Bubbles are for bathtubs"

"Trust your RE agent"

"Renters are losers"

etc. etc......yawn.

[JD@Preview]

[Lionel]

[JD@Preview]

[Lionel]