There is no Canadian Housing Bubble!

[texasredneck]

This message has been deleted.

[usaone]

Homes sales dont pick up until March.

[texasredneck]

This message has been deleted.

[usaone]

People are walking through 2 feet of snow looking at houses?

This winters weather brought housing to a stand still in Jan and Feb.

We wont know anything until the March numbers come out.

Common sense.

[Aman A.K.A. Ahamburger]

I know sales were way down, however, this is interesting.

Renew your lease - rents could rise 10%:
money.cnn.com/2011/03/15/real_estate/rent_rise_housing/index.htm

[reasonfreedom]

www.bloomberg.com/news/2011-03-23/u-s-new-home-sales-fell-in-february-to-record-low-250-000-rate.html

Just figured I would link.

[reasonfreedom]

Mar 23, 2011 0:34:33 GMT -5 Aman A.K.A. Ahamburger said:

I know sales were way down, however, this is interesting.

Renew your lease - rents could rise 10%:
money.cnn.com/2011/03/15/real_estate/rent_rise_housing/index.htm

Yeah, Mine went from 750 to 800 almost a 7% increase. Of course if you threaten to leave them and point out details of their horrible upkeep they might keep it the same

[reasonfreedom]

This message has been deleted.

[usaone]

Rents increasing dramatically will push people into buying homes.

[reasonfreedom]

Mar 23, 2011 9:58:31 GMT -5 usaone said:

Rents increasing dramatically will push people into buying homes.

I am not so sure about that. I rented for 10 years at multiple apartments and owned a house for 5 years. Owning a house cost alot more although it gives you the freedom. Here are some examples of cost that build up when owning a house. Light bulbs, air filters, gas for cutting lawns, maintenance on the lawn mower, time for upkeep of house and yard, tools need to fix and upkeep house/yard, any repairs needed to the house(roof, water heater, furnace ect.). I could go on with multiple more cost. In an apartment you don't have to pay for any of these. You have to pay for house insurance and land taxes too. Anybody that says it is cheaper to own a house, either doesn't upkeep their house at all or has never rented an apartment. So IMO I don't see why people would want to move into a house besides the freedom factor.

[Aman A.K.A. Ahamburger]

reaons, the sales drop actually points more to a bottom in 2011. I know it sounds crazy, however, i was thinking about it today. I guess we will see if the sales continue to go down more from here.

As far as a owning a house. It's all about timing. Plus, the people who rent you your house are making money.

[vl]

"I am curious as to who is purchasing these previously owned homes. Is it rich investors looking to sit on them for a few years to make a profit on them selling them at higher price values? Does that have an effect on the mid to lower class? How Would the possibility of interest rates going up in a few years also affect the economy?"

The lion's share of housing is still sold below market to third parties after a 60-90 day period where it is offered to buyers who will occupy it first. Subprime and ARMs are still rampant as are defaults in the first year. A current movement gaining ground calls for a forced measure to evaluate taxes on the prevailing like-property sales data and nothing else. In 99% of the markets, that would lop off about 60% more in revenues. Why does the movement exist? Because seniors with cash flow don't want to pay taxes and could care less what it does to their cities as long as there's police protection which is going away as state governments wipe out collective bargaining rights.

We won't see a "bottom" until family-sustaining wages and benefits are paid to the people who will want homes conducive to raising families. That will require suppressing or eliminating the entire GOP agenda. When we see greed recede, we can call the bottom and look around for families that have survived the onslaught war by money-grubbers trying to rule the world.

In the cycle I called TWO YEARS AGO on the MSN sites... we are recycling the same criteria that started this originally. Those who consolidated or refinanced for high debt reasons can't do that again because they are underwater and remain buried in debt. The scenario leans more toward whole-scale abandonment like they are doing in Nevada, than a bottom. I would also think that price-fixing, like what is done in "gated" communities will be called out and owners sued for it. Every little greedy island of manipulation has to fall before home prices stop doing so.

[usaone]

Housing just bottomed........Feb 2011!!

[reasonfreedom]

Mar 24, 2011 7:57:07 GMT -5 usaone said:

Housing just bottomed........Feb 2011!!

You work for CNBC?

[usaone]

Mar 24, 2011 8:46:58 GMT -5 reasonfreedom said:

Mar 24, 2011 7:57:07 GMT -5 usaone said:

Housing just bottomed........Feb 2011!!

You work for CNBC?

Have they called a housing bottom? I dont think so.

[reasonfreedom]

Oh, when I was listening to them for a couple of years they were contradicting themselves every other day. Like job reports are horrible, job reports are great; consumer confidence is horrible, consumer confidence is great; the market is on a down trend, the market is up up up. I prefer to use bloomberg and I am pretty sure that people on that show have called for a housing bottom multiple times.

[decoy409]

reasonfreedom, I chuckle about that as well.

Seems like many simply have forgotten all about Commercial Property. Subdued and kept in restraint for good cause. I know of a similar situation going on in comparison. Has to do with molesters and trying to quell that land acquirement and a property deed that are being scrutinized and under investigation.
Reminds me of this Residential and Commercial property deeply troubling problem going on.
As far as a housing bottom we are a long ways from that. A excerpt from my post this morning,

Quote: WASHINGTON (AFP) - Sales of new houses in the United States have slumped to the lowest level since the 1960's, official data showed Wednesday, offering more evidence of the ongoing crisis in the housing market.

[frankq]

Housing will begin it's rebound this year IMO as I have stated in January. Not that I'm looking for a return to double digit appreciation..New home starts are dismal, but rents are up double digit. New apartments are being started, but not much single family. Housing prices have corrected to the point where owning is making good financial sense again from a cash flow standpoint as compared to rising rents, not as an investment per se. Rates are still great. Banks are back making more conventional type loans where buyers actually have to have a down payment. Banks are turning over repos and many new home developers are buying these homes, rehabbing and rebranding them. Demand will begin to catch up in many areas. Areas that got way ahead of themselves will stay slow for much longer like Nevada and Florida. Michigan is, well, Michigan. Detroit has lost 25% of it's population over the last decade. Commercial development has surged in my (Chicago Western Suburbs)area with strip centers suddenly full or filling with new tenants over the last 9 months, particularly resturants.

[reasonfreedom]

Mar 24, 2011 10:10:57 GMT -5 frankq said:

Housing will begin it's rebound this year IMO as I have stated in January. Not that I'm looking for a return to double digit appreciation..New home starts are dismal, but rents are up double digit. New apartments are being started, but not much single family. Housing prices have corrected to the point where owning is making good financial sense again from a cash flow standpoint as compared to rising rents, not as an investment per se. Rates are still great. Banks are back making more conventional type loans where buyers actually have to have a down payment. Banks are turning over repos and many new home developers are buying these homes, rehabbing and rebranding them. Demand will begin to catch up in many areas. Areas that got way ahead of themselves will stay slow for much longer like Nevada and Florida. Michigan is, well, Michigan. Detroit has lost 25% of it's population over the last decade. Commercial development has surged in my (Chicago Western Suburbs)area with strip centers suddenly full or filling with new tenants over the last 9 months, particularly resturants.

I am just curious as to your factors(with numbers) that will be the rebound or turn around point for the housing market. As I stated in a previous comment before it is in no way cheaper to live in a house than it is an apartment. I have years of personal experience with both, if your good with keeping books on spending then you would know that the house is more expensive to upkeep and live in.

[frankq]

It's not necessarily cheaper in all circumstances, but depending on several factors, it can be almost necessary to own. Families with children have space requirements that cannot be matched by renting an apartment. If you want to do the math, depending on where you live, you can buy at less per square foot than you can rent for. In my area, rents go for $800-$1500/month. The space for such is 600-1000 square feet. So renting has a cost basis of over $100/sq/ft. Utilities still have to be paid, although property tax is factored into the rent, so it's a wash. Conversely, one can buy. reasonable housing in many places for around $100/sq/ft in the general area. Yes, property taxes need to be paid, as well as maintenance, but taxes and interest is deductable. So if one has a $150,000 mortgage at 5%, payments run about $ 1100/mo. but interest is the lions share for many years which can mean 3 grand or more coming back to the owner for many years. Same with taxes with 25% coming back as deduction. With housing at these levels, downside risk is minimal. Rent, on the other hand, has nowhere to go but up, and some day, you will own your home, but you will never own your apartment so rent is forever. Home ownership also offers family quality of life benefits that can't be found in apartment living. I'm good enough at keeping books to know that landlords factor all costs of building ownership, plus a profit, into rental properties. And that includes a factor to account for the occasional vacancy.

[usaone]

Most Americans aspire to own their home. People seem to forget this throughout the last couple years.

[vl]

That's an old discussion of ours, Decoy. Do you remember when Jim Jubak was frothing over REITs? You are correct. Commercial has been held up by banks after they mass-called most small business credit and repossessed or loan sharked the properties. They hold a crap-load and leveraged it as Fed Funds collateral so if it begins to turn, all banks burn with the value adjustments. Apartment complexes are imperiled by another financial disaster. Bank credit was false from Day One and in calling those loans, they would cause massive calamities in the cities where those buildings sit. Bringing in bogus brother-in-law management companies would cost more, help less. They sued and adjusted those credits and pull the rents out instead of allowing the maintenance and rolling refurbishment contracts to continue. in short-- most complexes are wearing out so, building new ones just throws a whole lot of new credit out where values cannot be sustained (and history repeats itself).
Bankers are idiots, not lenders and are clueless about asset integrity and responsibility. Housing isn't stabilizing. Shifty contractors are patching those slum-shacks and renting them to baby-mommas with trailing boyfriends. Values INCREASE because pride of ownership invests in upkeep & remodeling while supporting local amenities and businesses that make living there attractive.

The Financial Sector has to go before we lose everything.

[reasonfreedom]

"Home ownership also offers family quality of life benefits that can't be found in apartment living."

That has nothing to do with price, we were talking about cost. The return you pay on land taxes and interest is not the same you put in. Yeah you will own your house what 20 to 30 years out, but the maintenance on your house will out do the cost of rent any day. Roofing every 5 years, siding, carpeting, remodeling. ect.... . You don't have to pay for any of that in a rental. I pay 800 for 1010 sq 2 bedroom in SC and the same was in Michigan unless you lived downtown. Paying 500 to 800 less to live 2 miles outside of downtown is commonsense, you could always just ride a bike or walk if you can't afford a car. I have already kept the books for living in a house and a rental, the house was much more expensive than rental in the 3 states and 12 apartments I lived in. 5.85% interest on the house 1310 sq 3-bedroom paying aprox. $1100. My expenses for an apartment has never came close to 1100 a month including utilities, which that right there far outweighs all of the maintenance, utilities. You always pay more in land taxes and in interest than you get back. You also have house insurance which isn't the cheapest.

[vl]

I suppose it doesn't help when one of the most relied-on data sources proves to be erroneous... NAR data was consistently based on the WRONG basis of census count. What they missed was-- the ACTUAL month-to-month, year-to-year downward trending... COMPLETELY. So... when you consider how many times the DOW has shot up based on NAR data findings... you have NO ARGUMENT against those who see the Financial Sector as having driven us so far off path that we may NEVER get back.
I used to contribute to the NAR findings about 10 years ago. After that, they hired button-pushers (many of whom didn't own homes) to compile data. It demonstrates that they got the PILE part right, but the COM refers to compost.

We're screwed folks!

www.msnbc.msn.com/id/42258117/ns/business-eye_on_the_economy

[bubblyandblue]

Regarding owning or renting - I believe that owning is cheaper. You figure that the person who is owner of a rental unit has to cover his cost through the renter - I could be wrong.

[Aman A.K.A. Ahamburger]

I'm thinking your right BB. Most people that own rentals make money on the rent every month as well. Hell, interest rates are going up here in Canada for sure later this year, prices will be adjusted shortly after the second round of hikes next year. I would sell my place this year and get a couple rental places down there if I could find someone I trust to look after them, LOL.

[reasonfreedom]

Mar 29, 2011 16:34:26 GMT -5 @bubblyandblue said:

Regarding owning or renting - I believe that owning is cheaper. You figure that the person who is owner of a rental unit has to cover his cost through the renter - I could be wrong.

I wasn't talking from a landlord point of view though, I was talking about the tenant. Since you talking about a landlord point of view, renting is still cheaper because you gain some kind of income. If somebody is paying you rent ex. 1100 or if you own it and you have to pay the 1100 on the mortgage, wouldn't it be cheaper to rent it? Your perspective doesn't seem to have much logic to it sorry. Can you perhaps explain it better?

[bubblyandblue]

Well, when owning a house you get to deduct interest from income and, if you have set your house as a rental you may be able to depreciate as asset. If your not renting out you may have a home office and that portion becomes deductible as a businesss expense. Over all, as the owner of a rental unit, you still have to pay out to cover maintainence and other expenses not passed on to tenant through the agreement. Some folks in the past were able to rent for lower than outflow by capturing the deductions and appreciation on the asset which, proved disasterous when values crashed. If you buy to rent out, and with market uncertainty, you need to buy low so that when everyone else that buys at a higher (later price point was the old logic) you could compete on price because your outlay is lower. If you could buy with cash or, get lower rates in volume loan you could be more competative. If you are a slum lord, you don't maintain property to gain advantage and, if your a new world order slum lord you walk on the loan and collect the rent until your property is forclosed and screw all the tenants by having the bank toss em'. - I'm just saying it's a balace sheet transaction where the owner of the rental needs his profit. Expect rental rates to surge.

[Aman A.K.A. Ahamburger]

Nice post BB!

Is It Finally a Good Time to Buy a House Again?:
www.dailyfinance.com/rtn/press/is-it-finally-a-good-time-to-buy-a-house-again/rfid429807035/?channel=pf

[usaone]

Now is the time to buy Real Estate.

It will rebound sooner and faster than anyone thinks!!