One more thing with other investments such as stocks , gold , mutual fund , if you feel that market is going down then you can get out of the market quickly where as in the housing market if it starts going down then you cannot come out of the market within a day or two, then in my opinion housing market is much more riskier than all other markets as an investment.

Thanks hopesrforever27 & ashedfc. Makes an ultimate sense.

RE is easiest to understand and short term prediction as compare to any other complex investment but media and salesman kill the common sense of common man. Sometime people love to talk with same kind of people what they want to listen.

Investor needs to bring own money for stocks, gold and mutual fund but RE investor needs little money to play big number RE investment game.

Simple example - if you go to the bank and ask for 20k loan for car that is more difficult and higher interest rate than 500K mortgage. It's all about risk exposure to bank and RE risk is taken care by Govt intervention in free market.

In the middle of recession when unemployment rate is 10%+ and all the sectors are doing bad but RE is doing great not because people are richer but debt is cheapest possible. Low interest rates are great idea to pay debt faster but this time reverse happened and people are more in debt.

People are living paycheck to paycheck with low interest rates and bought the over priced asset. With higher interest rates in future and asset deflation they will feel double pinch and that will end not better than stupid Americans.

Why buy in this market when - rent < mortgage interest payment+taxes+maintenance+condo fee and negative capital gains in future due to deflation. Buyer should work on saving for big down payment.

When to buy:

Good down payment, higher interest rates, tighten mortgage conditions and not competing with people who have nothing to loose is way to go buying RE. That brings lower price possible and trends towards upward.

Quote:

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Originally posted by ashedfc

Quote:

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Originally posted by hopesrforever27

One more thing with other investments such as stocks , gold , mutual fund , if you feel that market is going down then you can get out of the market quickly where as in the housing market if it starts going down then you cannot come out of the market within a day or two, then in my opinion housing market is much more riskier than all other markets as an investment.

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Exactly - YOU GOT IT. (100% correct)

By the time people understand, housing is going down - it always too late. When the flood of sellers start listing their homes for Sell, that triggers a downward price spiral, causing more sellers listing, & more price falling , causing more listing & more falling & so on.

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Indeed investing in house is a very risky and I’m not in favor of that

But if you go through my post I have not said that buy house for investment, I was referring to buy house for shelter not for investment (just mentioned about hidden savings)

I think there are substantial differences between what defines a home and what defines an investment.

A home is a place of safety, security, and comfort. It is a place where smiles abound and a memories are made. Home, is where the heart doth dwell.

An investment is a place where money is given the opportunity to appreciate. It is a place where risk is involved and profits are both made and lost. An investments, is where the dollar doth dwell.

Hence I think it is hard to own both a home and in investment.

A HOME IS A HOME REGARDLESS OF WHAT THE MARKET DOES.
When we pay for home we are buying potential. We are buying a comfortable and safe place of residence. We are still getting that for every dollar we spend regardless of the house value.

Let’s say does the insulation let in more cold when the house is worth $50,000 less than you paid for it? Does the carpet feel less soft now that the value has decreased? Do you kids have trouble sleeping because the housing market is in a slump? So why do we worry?

If your house value increases – great. That is icing on the cake. If it decreases – what does it matter? You got the home at the time you needed a home. As long as we are happy in house we don’t care how much it is worth. At the same time, we view our home as a long-term piggy bank (hidden savings)

Our home is a home. It provides a place for us to lay our heads. Provides the shelter we need. It keeps us safe.

To me buying house is not a investment it’s a personal comfort choice. A house should be a place to live. Not an investment where you “hope” to make money someday when/if you sell it. Those days are gone in this market and economy.

Quote:

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Originally posted by rahul_singh23

Thanks hopesrforever27 & ashedfc. Makes an ultimate sense.

RE is easiest to understand and short term prediction as compare to any other complex investment but media and salesman kill the common sense of common man. Sometime people love to talk with same kind of people what they want to listen.

Investor needs to bring own money for stocks, gold and mutual fund but RE investor needs little money to play big number RE investment game.

Simple example - if you go to the bank and ask for 20k loan for car that is more difficult and higher interest rate than 500K mortgage. It's all about risk exposure to bank and RE risk is taken care by Govt intervention in free market.

In the middle of recession when unemployment rate is 10%+ and all the sectors are doing bad but RE is doing great not because people are richer but debt is cheapest possible. Low interest rates are great idea to pay debt faster but this time reverse happened and people are more in debt.

People are living paycheck to paycheck with low interest rates and bought the over priced asset. With higher interest rates in future and asset deflation they will feel double pinch and that will end not better than stupid Americans.

Why buy in this market when - rent < mortgage interest payment+taxes+maintenance+condo fee and negative capital gains in future due to deflation. Buyer should work on saving for big down payment.

When to buy:

Good down payment, higher interest rates, tighten mortgage conditions and not competing with people who have nothing to loose is way to go buying RE. That brings lower price possible and trends towards upward.

Quote:

---

Originally posted by ashedfc

Quote:

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Originally posted by hopesrforever27

One more thing with other investments such as stocks , gold , mutual fund , if you feel that market is going down then you can get out of the market quickly where as in the housing market if it starts going down then you cannot come out of the market within a day or two, then in my opinion housing market is much more riskier than all other markets as an investment.

---

Exactly - YOU GOT IT. (100% correct)

By the time people understand, housing is going down - it always too late. When the flood of sellers start listing their homes for Sell, that triggers a downward price spiral, causing more sellers listing, & more price falling , causing more listing & more falling & so on.

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'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)

Why do RE experts not simply advice to the people - "It’s better to wait and see next couple of months. At this point all indicators are favoring home buyers every month. We will see more listing and price down in future. If you still want to buy and ready to take risk then it's your choice"

I personally know few people in USA who bought for living and still paying the mortgages. Their mortgage is less than their current home value. They already lost down payment and current monthly mortgage payment is bringing o returns. I think people on this forum do not know that kind of families/friends.

As per my understanding - it's home, sweet home, long term, warm place, kids are happy, own place to call, wife is happy is not a financial advice. My friend - family and kids need financial stability first. Let emotion does not write on common sense.

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Lower price always matter. Hard truth:

When you have exactly same experience, education and job but your colleague getting double salary - it’s really painful.

When your friend bought exactly same model car in same city but he paid few grand less than you - That is painful.

Same for RE - when your neighbor moved in cookie cutter home which he bought 100k cheaper (20%-30% less) and he is already many many years ahead of you and not paying double amount of 100K to bank (including interest on 100k principal) - It's painful.

Quote:

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Originally posted by Blue_Peafowl

A home is a place of safety, security, and comfort. It is a place where smiles abound and a memories are made. Home, is where the heart doth dwell.

An investment is a place where money is given the opportunity to appreciate. It is a place where risk is involved and profits are both made and lost. An investments, is where the dollar doth dwell.

Hence I think it is hard to own both a home and in investment.

A HOME IS A HOME REGARDLESS OF WHAT THE MARKET DOES.
When we pay for home we are buying potential. We are buying a comfortable and safe place of residence. We are still getting that for every dollar we spend regardless of the house value.

Let’s say does the insulation let in more cold when the house is worth $50,000 less than you paid for it? Does the carpet feel less soft now that the value has decreased? Do you kids have trouble sleeping because the housing market is in a slump? So why do we worry?

If your house value increases – great. That is icing on the cake. If it decreases – what does it matter? You got the home at the time you needed a home. As long as we are happy in house we don’t care how much it is worth. At the same time, we view our home as a long-term piggy bank (hidden savings)

Our home is a home. It provides a place for us to lay our heads. Provides the shelter we need. It keeps us safe.

To me buying house is not a investment it’s a personal comfort choice. A house should be a place to live. Not an investment where you “hope” to make money someday when/if you sell it. Those days are gone in this market and economy.

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Mush watch video - See the future.
The poor are always exploited by opportunists.

The below link will take you to a Global TV News video, it demonstrates the difficulty people are having refinancing their 0 down mortgages.

http://www.globaltvedmonton.com/video/index.html?releasePID=L6qSyNfaWQmVUDcP7H4CXuOFmBT1lRxo


The expansion of available credit allowed many low income families an opportunity to buy a home for nothing, they are the ones that are mostly responsible for driving house prices up to parabolic levels, as without them, there would have been far fewer move up buyers.

The Govt, Realtor, home builders and mortgage brokers proceeded on the low income families ability to obtain 0 Down 40 Year Mortgages, what they knew would be mortgages that would never be paid back.

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BMO seeks 34 missing parties in mortgage-fraud lawsuit

http://www.theprovince.com/news/seeks+missing+parties+mortgage+fraud+lawsuit/3392117/story.html

The bank launched a $120-million suit against hundreds of Albertans, alleging they were complicit in fraudulent sales involving more than 200 properties across the province.

What is the difference between professional and salesman?

Professional's advice- Who can minimize the risk of their clients and maximize the potential gains in future with current resources and knowledge.

Salesman - Telling the people after things are done and advising clients "It's a right time to buy and sale".

Now all the salesman like Phil Soper would not surprise what is happening in market. Where were they 6 months ago?

Again same Q........Why do RE experts not simply advice to the people - "It’s better to wait and see next couple of months. At this point all indicators are favoring home buyers every month. We will see more listing and price down in future. If you still want to buy and ready to take risk then it's your choice"

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Homebuyers shouldn’t expect hot deals as housing market cools: experts

http://www.thestar.com/article/848178--homebuyers-shouldn-t-expect-hot-deals-as-housing-market-cools-experts


“Over time, if you were to look at the last 40 years, it’s much more common to see sellers’ markets than buyers’ markets,” said Phil Soper, president of Royal LePage.

“It comes down to the different psychology that exists between buyers and sellers. Buyers are very quick to adjust to a down market and sellers are very slow to adjust to a down market. Sellers stubbornly hold onto their perception of what their home is worth, whereas buyers turn on a dime.”

Soper expects to see sales decline dramatically from last July’s near-record activity, but predicts there will be little change in home prices when the Canadian Real Estate Association releases its monthly sales figures Monday.

Seasonally-adjusted home sales fell 8.2 per cent in June from the month before and shrunk 19.7 per cent compared to June 2009. However, the average Canadian home price sat at $342,662 compared to $326,689 in 2009.

“You would think prices would come down more rapidly given the drop in sales,” said Sal Guatieri, senior economist with BMO Capital Markets.

Quote:

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Originally posted by rahul_singh23

What is the difference between professional and salesman?

Professional's advice- Who can minimize the risk of their clients and maximize the potential gains in future with current resources and knowledge.

Salesman - Telling the people after things are done and advising clients "It's a right time to buy and sale".

Now all the salesman like Phil Soper would not surprise what is happening in market. Where were they 6 months ago?

Again same Q........Why do RE experts not simply advice to the people - "It’s better to wait and see next couple of months.

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