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If something unexpected always happens doesn't that make it expected? Therefore you can guarantee that the unexpected will happen and hence predict the future of real estate? Right?
And I don't think anyone here is predicting the exact % of what real estate in 2011 will be compared to today. But one can with a high certainity (obviously not 100%) conclude that the % WILL be lower than today and by a decent margain.
Sure things can happen that alter that in BOTH directions. But with the data provided over the past several months and years it is SAFE to conclude prices still have a ways to correct.
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Also using the unexpected to justify not being able to predict the future of anything is silly...
Some things are predictable. Others are not. Markets are inherently unpredictable. No one can predict lower real estate prices, or higher real estate prices. Not with accuracy. Your projection of future lower prices is nothing more than a guess. "I see bad news, therefore it's going to be bad" is appealingly simplistic. But it does not describe any truth. Prices may be at the bottom today. Or they might go down for 1 more year. Or 10 more years. Nobody knows.
Fortunately, the decision to buy a home should not be tied to guesses of future prices. Since they cannot be predicted. The decision should be based on the desire for homeownership and the ability to comfortably afford the payments. If those criteria are met, and one wants the benefits of owning a home, one must decide to buy.
AND NOW IS A GREAT TIME TO BUY!
Especially since I, a capitalist robber baron, will make big time commissions and enjoy fabulous material benefits on the backs of the proletariat.
Unless something unexpected happens. And something unexpected always happens. Therefore, unless you can guarantee that the unexpected will not happen, you cannot predict the future of real estate. Or anything else.
-Marc
Rofl, not for nothing, but nothing "unexpected" is going to magically sell everyone's house that is on the market today for what they want. Nothing "unexpected" is going to magically stop layoffs. No miracle can offset 10 years of bad economics. And I don't know if you've realized this, but everything "unexpected" that has happened the past 3 years (hedge funds collapsing, bank runs, AIG failure, ponzi schemes) has been nothing but negatives. In fact, you'd be hard pressed to name a single thing that would stop the collapse of housing prices. You can easily predict the future of real estate. It's called analyzing the fundamentals.
As for not being able to predict "anything else.", you may want to study the law of probability. I can 100% guarantee you that a flip of a 2 headed coin is going to land on heads.
But hey, I guess Warren Buffet is just the luckiest guy int he world right? Because you cannot predict the future. /end sarcasm
Like I said, it doesn't take a genius to connect the dots. Increasing foreclosures, increasing unemployment, increasing for sale signs, decreasing sales. This isn't rocket science here. The future of real estate is easily predictable at this point.
Last edited by theoakman; 04-02-2009 at 02:14 PM..
Fortunately, the decision to buy a home should not be tied to guesses of future prices. Since they cannot be predicted. The decision should be based on the desire for homeownership and the ability to comfortably afford the payments. If those criteria are met, and one wants the benefits of owning a home, one must decide to buy.
Complete nonsense. If one can afford to make rent payments even more comfortably, it makes much more sense to wait. Someone who's done so the past 2 years may have just saved themselves up to a hundred thousand dollars. Not for nothing, but that's more than a lot of people's current retirement accounts. Waiting for a better deal can literally be the difference between retiring at age 60 or age 70.
Btw...there are some people that have been predicting lower home prices for a few years. They are batting a thousand. Seems like maybe we can predict the future! Furthermore, real estate bottoms typically last 7 to 10 years.
Most real estate agents are great contrarian indicators. It will probably be a great time to buy when you and the rest of the NAR stop trying to convince everyone that you can't time the market the bottom will be in the rear view mirror when you know it.
Most real estate agents are great contrarian indicators. It will probably be a great time to buy when you and the rest of the NAR stop trying to convince everyone that you can't time the market the bottom will be in the rear view mirror when you know it.
Haha, or better, when they try to convince sellers that their listing prices are too high and if they do not sell now the current sell price will be in the rear view mirror. This argument to sellers is much easier to make as we have done all the work for them.
So stop trying to convince us because we won't buy unless prices go down considerably and do some work at the sellers' side.
Sure things can happen that alter that in BOTH directions. But with the data provided over the past several months and years it is SAFE to conclude prices still have a ways to correct.
Real prices have a way to correct, nominal prices could just as easily go up as down.
Haha, or better, when they try to convince sellers that their listing prices are too high and if they do not sell now the current sell price will be in the rear view mirror. This argument to sellers is much easier to make as we have done all the work for them.
So stop trying to convince us because we won't buy unless prices go down considerably and do some work at the sellers' side.
You forget that we are just dirty renters full of envy. We want to be homeowners so bad and bash the real estate prices based on faulty statistics and unjustifiable historic trends, rent-price ratios, income ratios and other meaningless stats. We throw out predictions from car salesman type prognosticators like Otteau and Shiller. We do all of this because we are jealous of homeownership. We discount how the world has changed over the past 10 years due to black swan events like the Internet that have single handed changed the landscape of real estate prices forever. We hang our hat on compounding economic factors that are just media smoke screens like historical unemployment numbers (which are calculated by only 400 companies) and the failure of major US and foreign banks and automotive companies. We look at data such as historic consumer debt, historic consumer saving trends, and historic late payments on those debts and don't blow off a MINOR .03% increase. We look at silly Y-O-Y real estate values and ignore the more meaningful seasonaly M-M trend.
We my friends are just want to be homeowners. Sucks to be us...
I'm quite happy that there are guys like you & oakman out there, keep those rent checks coming in !
And I'm sure they are happy waiting for prices to drop further before they buy in once it makes financial sense (considering other investment opportunities) or lifestyle choice sense.
I'm in the process of looking for a place to rent at the moment, a place we looked at in Princeton (well West Windsor) on Tuesday, and liked but liked a place we saw afterwards better so we haven't contacted them again, called this morning to tell us they dropped the rent almost 20%. Might hold on on the one we did like a few more days
Of course the places we looked in Florida gets a three bedroom house for the same rent as a 2 bedroom apartment up here - and there's that $500 in the pocket a month from not having to pay NJ income tax.
Complete nonsense. If one can afford to make rent payments even more comfortably, it makes much more sense to wait. Someone who's done so the past 2 years may have just saved themselves up to a hundred thousand dollars. Not for nothing, but that's more than a lot of people's current retirement accounts. Waiting for a better deal can literally be the difference between retiring at age 60 or age 70.
Btw...there are some people that have been predicting lower home prices for a few years. They are batting a thousand. Seems like maybe we can predict the future! Furthermore, real estate bottoms typically last 7 to 10 years.
Most real estate agents are great contrarian indicators. It will probably be a great time to buy when you and the rest of the NAR stop trying to convince everyone that you can't time the market the bottom will be in the rear view mirror when you know it.
Your mistake is regarding real estate only as an investment. It is much more than that. While you are renting your dingy 2 bedroom in Hackensack for 3 years, waiting for the market to bottom and risking the possibility of 15% mortgage rates that will erase the "profit" you never realized by waiting, I was building my horseshoe pit, playing with the kids and dog on MY lawn, which I planted. I was out back having BBQ's and enjoying parties and NOT losing sleep over the noisy tenants next door. I was putting up my 110 inch movie screen and blasting my home theater with 10 speakers till 2 in the morning that I couldn't play at 3% volume in your stupid apartment for fear of waking up the 2 year old malcontent next door who NEVER stops screaming once inadvertently awakened. Oh and those great cooking smells... I sure miss those, along with the roaches they attract.
Be careful what you wait for. It may never come true.
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AND NOW IS A GREAT TIME TO BUY! 
