View Full Version : Havasu property values up
nodigg
10-08-2003, 03:40 PM
This place is out of control! Take look at one of today's headlines from the local paper.
As real estate values in Lake Havasu City soar, local governments can expect some major increases in property tax revenue.
Some local civic leaders say that’s an even greater argument to lower tax rates.
Last May, the full cash value on vacant land in the Lake Havasu City area totaled about $534 million, according to Ron Nicholson, Mohave County’s deputy assessor.
By the time tax notices are mailed out in January, that figure is on pace to increase by 68 percent to nearly $900 million, Nicholson said. The assessor’s office values property for tax purposes.
mbrown2
10-08-2003, 03:49 PM
Just last week, a realtor called to buy our Dirt...."not gonna happen, would'nt be prudent".... :)
nodigg
10-08-2003, 03:54 PM
Wish I had bought some extra dirt two years ago when I looked at a list 3 pages long between 6 and 10 thousand dollars! I think maybe 40 is the low side now. Who woulda thunk it possible?
phebus
10-08-2003, 03:56 PM
I'm glad we already purchased our retirement home in Havasu. Five more years, (or sooner if my back needs surgery again). Property values are going crazy.
nodigg
10-08-2003, 03:58 PM
What street are you guys on? I am off Palo Verde North at Avalon.
phebus
10-08-2003, 04:00 PM
We are at the south end off Jamaica.
nodigg
10-08-2003, 04:05 PM
Phebus, I notice you are from Rancho Santa Margarita. I just talked to the mrs. at the new Pet Smart down there. LOL! We have a house in Lake Forest close to you I suppose.
Ziggy
10-08-2003, 05:19 PM
phebus:
We are at the south end off Jamaica. North end of Jamaica here :D
Value nearing double since 3/2003
[ October 08, 2003, 06:40 PM: Message edited by: Ziggy ]
Skaterfast
10-08-2003, 07:02 PM
Moved into mine in June for 108k and just saw the same house in the white sheet going for 139k.Equity,don't ya love it.
Yes property values are moving as fast as orange county. It seems like every weekend some one comes buy wanting to buy my extra lot next to our house. We went up to the new golf course last Sunday and they are building some pretty nice places.
2LKHVSU
10-09-2003, 04:36 AM
next to walmart, below the highway.
hot_diggity_dog
10-09-2003, 05:42 AM
The new gig is Contractors buying up every lot they can get their hands :mad: on and then building houses and selling them. :mad:
One contractor had a full page add with six houses on one street. :mad:
It's making it harder to find or purchase lots.
Also a lot of people are taking bids on lots, trying to get the highest bidder. :mad:
Oh well it looks like the new mall of America will be next in Havasu. :rolleyes:
HDD :cool:
Essex502
10-09-2003, 06:32 AM
TCHB:
Yes property values are moving as fast as orange county. It seems like every weekend some one comes buy wanting to buy my extra lot next to our house. We went up to the new golf course last Sunday and they are building some pretty nice places. I suppose you're talking about the "Refuge"? Yeah, we toured the new models on Friday...pretty nice for a $700K house! Lots to $200K and above!! Great view though.
What is going to be needed is a Proposition 13 for Havasu!
Mr.Havasu
10-09-2003, 09:10 AM
Essex502:
TCHB:
Yes property values are moving as fast as orange county. It seems like every weekend some one comes buy wanting to buy my extra lot next to our house. We went up to the new golf course last Sunday and they are building some pretty nice places. I suppose you're talking about the "Refuge"? Yeah, we toured the new models on Friday...pretty nice for a $700K house! Lots to $200K and above!! Great view though.
What is going to be needed is a Proposition 13 for Havasu! Hey Essex502, I'm the office manager in the sales office. I sit at the front desk as you come in. We had several groups through last Friday, you can get in for half of what you quoted, but you can also spend alot more.
phebus
10-09-2003, 12:15 PM
warlock25:
I'm the office manager in the sales office. I sit at the front desk as you come in. We had several groups through last Friday, you can get in for half of what you quoted, but you can also spend alot more. Warlock, what price do the lots start from, and do you have to build within a time frame?
Ziggy
10-09-2003, 01:14 PM
hot_diggity_dog:
The new gig is Contractors buying up every lot they can get their hands :mad: on and then building houses and selling them. :mad:
One contractor had a full page add with six houses on one street. :mad:
It's making it harder to find or purchase lots.
Also a lot of people are taking bids on lots, trying to get the highest bidder. :mad:
Oh well it looks like the new mall of America will be next in Havasu. :rolleyes:
HDD :cool: Absolutely true!! Friend of mine was trying to deal with one of the contractors on a lot and kept getting screwed and upfront $ kept climbing so he told them to pound sand and bought an existing home.
My contractor has a few lots and he never screwed
me at all, like the commercial contractor that
did my tilt up in calif he was a ***** and i didnt even feel it any wants my contractor's number e mail me
Essex502
10-09-2003, 01:53 PM
warlock25:
Hey Essex502, I'm the office manager in the sales office. I sit at the front desk as you come in. We had several groups through last Friday, you can get in for half of what you quoted, but you can also spend alot more. Were you there on Friday? We came in about 1:00 or so and looked at the models. You can't miss my wife as she's a 5'11" blonde. We were in the office for a while talking about available lots and then, I can't remember her name, the salesgal took us over to the models. Nationwide (?) Home's models are a minimum of $300+K for the smallest not counting up to a $105K lot premium. These also aren't the prime lots from what I saw. I wouldn't mind buying a lot outright if I could get a decent one for less than $150K.
[ October 09, 2003, 02:54 PM: Message edited by: Essex502 ]
nodigg
10-09-2003, 02:21 PM
I would have never have believed this would happen so fast three years ago with all the 6-8 thousand dollar lots just lingering on the market. If only...................woulda, coulda, shoulda.
Listed a rental of mine for sale last week at the "HIGH" mark and figured I would have to wait a few weeks or months to move it. IT IS SOLD! ONE WEEK! It was an entry level home I bought for a rental and decided to flip the money on when the renter moved out recently. I bought it in February for $95k. Should have priced it at $150! instead of $135,000. !!!!!!!!!!!Who knew? Same house last year would have been $75,000.!
All I can say is if you are thinking about buying, do it asap!
totenhosen
10-09-2003, 03:28 PM
nodigg:
I would have never have believed this would happen so fast three years ago with all the 6-8 thousand dollar lots just lingering on the market. If only...................woulda, coulda, shoulda.
Listed a rental of mine for sale last week at the "HIGH" mark and figured I would have to wait a few weeks or months to move it. IT IS SOLD! ONE WEEK! It was an entry level home I bought for a rental and decided to flip the money on when the renter moved out recently. I bought it in February for $95k. Should have priced it at $150! instead of $135,000. !!!!!!!!!!!Who knew? Same house last year would have been $75,000.!
All I can say is if you are thinking about buying, do it asap! Just what until the money flow tightens and a bunch of people will start selling their second homes flooding the market and reducing the price.
hd&boatrider
10-09-2003, 03:45 PM
I wish all of you continued sucess but nothing lasts forever. Yes, you can hold on to the real estate and wait out the price drops coming. It is inevitable as far as a drop. Anybody remember the stock market bubble? How soon so many forget. I believe this is one of those bubbles. The advantage here is that you have something real and not a piece of paper. If you have the capital to wait it out (the drop when it does happen) over the long haul you will be fine. If not....well, I am afraid you will feel some real pain. I hope not but that is how I see it. I have put off buying additional properties because I am a pretty conservative guy by nature. There will be many opportunities in the future to scoop up a lot of these properties. Sad to say a lot of people have purchased with baloon payments that will come due or variable rates that will go up. Of course this is all my opinion FWIW. Everybody has to make their own decisions based on what they want however, the ones chasing instead of being out in front are usually left holding the bag.
hd&boatrider
10-09-2003, 04:04 PM
nodigg:
I would have never have believed this would happen so fast three years ago with all the 6-8 thousand dollar lots just lingering on the market. If only...................woulda, coulda, shoulda.
Listed a rental of mine for sale last week at the "HIGH" mark and figured I would have to wait a few weeks or months to move it. IT IS SOLD! ONE WEEK! It was an entry level home I bought for a rental and decided to flip the money on when the renter moved out recently. I bought it in February for $95k. Should have priced it at $150! instead of $135,000. !!!!!!!!!!!Who knew? Same house last year would have been $75,000.!
All I can say is if you are thinking about buying, do it asap! Me thinks you sold at the right time for that particular piece of property Nodigg :) . You made some good profit on that one in a limited time. Be careful and good luck.
nodigg
10-10-2003, 06:29 AM
[/QUOTE]Just what until the money flow tightens and a bunch of people will start selling their second homes flooding the market and reducing the price. [/QB][/QUOTE]
True, there may be a blip on the horizen but last time I checked, they quit making more land. It only goes up in value long term. The last time there was a fall back in prices (CALIFORNIA!) a lot of people got hurt when they "banked" on the inflation factor. Oc course prices have more than doubled since that "blip". I am only looking for long term appreciation and not the quick buck. I got caught in the stock market crap just like almost everyone else. I sure hope this is more sound than that....I want a new boat LOL!
Essex502
10-10-2003, 06:38 AM
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D
nodigg
10-10-2003, 07:01 AM
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D Have to agree with all you said. I'm not un-happy at all with the sale. I was going to list another property and flip the money but the realtor I was talking to said something that made sense to me so I am going to snow bird it and wait to sell in the spring market. Got my fingers crossed that it will buy that new Magic cat I want :D
RD, wanna buy a nice, fully furnished 3bed/2bath with lake views front and rear?
hd&boatrider:
I wish all of you continued sucess but nothing lasts forever. Yes, you can hold on to the real estate and wait out the price drops coming. It is inevitable as far as a drop. Anybody remember the stock market bubble? How soon so many forget. I believe this is one of those bubbles. The advantage here is that you have something real and not a piece of paper. If you have the capital to wait it out (the drop when it does happen) over the long haul you will be fine. If not....well, I am afraid you will feel some real pain. I hope not but that is how I see it. I have put off buying additional properties because I am a pretty conservative guy by nature. There will be many opportunities in the future to scoop up a lot of these properties. Sad to say a lot of people have purchased with baloon payments that will come due or variable rates that will go up. Of course this is all my opinion FWIW. Everybody has to make their own decisions based on what they want however, the ones chasing instead of being out in front are usually left holding the bag. I think your on the money here. Same for California and Havasu. I had two lots near the new golf coarse, not the high dollar ones, that I bought when the coarse was just going in. I have already sold the one to pay off the other. I think the interest rates need to go up before this happens though, but the economy is little stronger everyday, slowly recovering.Once this happens you will hve many options, sounds like a great plan.
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some.
Mr.Havasu
10-10-2003, 08:00 AM
phebus:
warlock25:
I'm the office manager in the sales office. I sit at the front desk as you come in. We had several groups through last Friday, you can get in for half of what you quoted, but you can also spend alot more. Warlock, what price do the lots start from, and do you have to build within a time frame? Custom lots start in the 90's and there is no time frame for you to build. They might require ground cover after a couple of years for dust abatement. I think it will be a good investment, wish I could afford it.
Essex502
10-10-2003, 11:24 AM
bigq:
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some. I have to completely disagree....the same property if held is worth more today barring external factors as I mentioned. You sometimes have to be prepared to wait out the cycle and not panic 'cause you're temporarily upside down. I personally love it when somebody in that situation panics...money to be made by ME!
Essex502
10-10-2003, 11:26 AM
Warlock25 - the sales gals stated that if you did not build within 1 year then you were required by the CC&R's to landscape with a "desert motif" - i.e. gravel, rocks, some plants. $90K? The lot premiums in many cases were more than that! Also, the lower end lots were all that was left.
Ziggy
10-10-2003, 12:55 PM
bigq:
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some. The 80's and much of the 90's was a different mindset and most spent themselves silly...counting on the money still coming in. When that went Ka-poot so did their lifestyle. I had many wanting us to repurchase cars just so they can attempt to hold on to their homes.
Today people are more wise and spend with purpose instead of just trying to have more than the "jones's". RealEstate will constantly appreciate(barring tragities as mentioned before) so long as you ride out any bumps in the road.
BTW-forget where but I had read that Lake Havasu City was the #1 real estate investment market in the States last year. Desirable location with appreciating affordable prices.
But--playing devils advocate here-if the boating somehow gets pummelled(c02,deaths,accidents,etc) that city is in deep secretion.
hd&boatrider
10-10-2003, 01:13 PM
Essex502:
bigq:
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some. I have to completely disagree....the same property if held is worth more today barring external factors as I mentioned. You sometimes have to be prepared to wait out the cycle and not panic 'cause you're temporarily upside down. I personally love it when somebody in that situation panics...money to be made by ME! That is when I will rear my ugly head :)
summerlove
10-10-2003, 03:10 PM
Ziggy:
bigq:
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some. The 80's and much of the 90's was a different mindset and most spent themselves silly...counting on the money still coming in. When that went Ka-poot so did their lifestyle. I had many wanting us to repurchase cars just so they can attempt to hold on to their homes.
Today people are more wise and spend with purpose instead of just trying to have more than the "jones's". RealEstate will constantly appreciate(barring tragities as mentioned before) so long as you ride out any bumps in the road.
BTW-forget where but I had read that Lake Havasu City was the #1 real estate investment market in the States last year. Desirable location with appreciating affordable prices.
But--playing devils advocate here-if the boating somehow gets pummelled(c02,deaths,accidents,etc) that city is in deep secretion. If you recall, one of the major reasons the socal market burst in the early 90's was due to a lack of employment diversication. We were so reliant upon the defense contractors and the military, that when those went away (many did) the fall out was devastating to everyone.
Today's job market is much more diversified than it was then, and a down-turn in one industry will not result in a real estate bust. This was evidinced by the economic damage caused by 9/11, while horrible, it did not have a huge effect on housing.
Havasu is more troublesome since it is a destination - like Vegas. When you lose your discretionary income, the things that you used it for, like recreatrion, 2nd homes, boats, etc, are usually the first to go.
That said, I love my Havasu house and can't wait to enjoy the appreciation, if I ever sell!
I never meant to imply that it is not a good investment as long as you hold onto it. It did correct in the 80's and 90's and it should do it again, it's a cycle, like the market.
As far as personal debt, you need to look at that again. people have more credit card debt and equity debt more than ever right now, at least from what I read.
summerlove:
Ziggy:
bigq:
Essex502:
Many, many people got truly wealthy through real estate. I put my money in it and am doing quite nicely!
I don't believe this "real estate bubble" nonsense. If you look at history, all investments go through up and down cycles, but real estate - barring external factors such as war, nuclear accidents, etc. - always end up going up and up.
Nodigg - ya' left money on the table but so what? Roll it into another property and make more money tomorrow! :D You might want to look at that history again, look at the late 80's early 90's. :D people loosing houses, owing more than the property was worth, short sales, dogs and cats living together :) It won't backdown far I believe but It needs to correct some. The 80's and much of the 90's was a different mindset and most spent themselves silly...counting on the money still coming in. When that went Ka-poot so did their lifestyle. I had many wanting us to repurchase cars just so they can attempt to hold on to their homes.
Today people are more wise and spend with purpose instead of just trying to have more than the "jones's". RealEstate will constantly appreciate(barring tragities as mentioned before) so long as you ride out any bumps in the road.
BTW-forget where but I had read that Lake Havasu City was the #1 real estate investment market in the States last year. Desirable location with appreciating affordable prices.
But--playing devils advocate here-if the boating somehow gets pummelled(c02,deaths,accidents,etc) that city is in deep secretion. If you recall, one of the major reasons the socal market burst in the early 90's was due to a lack of employment diversication. We were so reliant upon the defense contractors and the military, that when those went away (many did) the fall out was devastating to everyone.
Today's job market is much more diversified than it was then, and a down-turn in one industry will not result in a real estate bust. This was evidinced by the economic damage caused by 9/11, while horrible, it did not have a huge effect on housing.
Havasu is more troublesome since it is a destination - like Vegas. When you lose your discretionary income, the things that you used it for, like recreatrion, 2nd homes, boats, etc, are usually the first to go.
That said, I love my Havasu house and can't wait to enjoy the appreciation, if I ever sell! Sounds good to me summer, unfortunately I think we need to be spending soe dough to replenish our forces again, so I could see that defense sector picking up. I think your right about Havasu, vacation spots are first to go.
nodigg
10-11-2003, 12:57 PM
Well I hope the demand stays up for a while longer. Havasu is still a destination town but also is very diverse when it comes to home owners. Some vacation, some retirement but the majority on my street are full time residents. It seemds to be more crowded each year with vacationers and snow birds but also with full timers.
I just had my offer on 10 acres accepted. Now I have to sub-divide and sell a piece to pay for the purchase. Hope it works!
RiverRatMike
10-11-2003, 11:41 PM
I just moved here to LHC from Orang County, May 2003. My g/f and I bought a bran new home with RV parking, 3bedroom 2bath 3 car garage. I so love it here! Bought my home for ONLY $153,500 now it's Oct I bet it's worth alot more than that now!
phebus
10-12-2003, 12:42 PM
Havasu has enough of a year round population to support 7 elementary schools. 2 middle schools, and 1 high school. It isn't just a destination spot.
summerlove
10-12-2003, 01:19 PM
phebus:
Havasu has enough of a year round population to support 7 elementary schools. 2 middle schools, and 1 high school. It isn't just a destination spot. Where would it be w/o the tourists?
phebus
10-12-2003, 04:17 PM
summerlove:Where would it be w/o the tourists? [/b]
A better place to boat? :)
totenhosen
10-12-2003, 06:33 PM
All I know is all these people that are getting in to housing with 2 year or 5 year ARMS that are already having trouble paying the mortgage, just wait until rate until the rates adjust and they can no longer make thier mortgage payments. Thats when I'm going to make tons of $$$ on distressed home sales.
hd&boatrider
10-12-2003, 06:44 PM
nodigg:
Well I hope the demand stays up for a while longer. Havasu is still a destination town but also is very diverse when it comes to home owners. Some vacation, some retirement but the majority on my street are full time residents. It seemds to be more crowded each year with vacationers and snow birds but also with full timers.
I just had my offer on 10 acres accepted. Now I have to sub-divide and sell a piece to pay for the purchase. Hope it works! You are out of control :) Good luck Rick.
hd&boatrider
10-13-2003, 03:03 AM
Got up and couldn't sleep so I was reading some different things and this is something I found. Kind of interesting and scary to think about really:
Spending our way to disaster
The consumer debt bubble in the United States could make the stock bubble seem like nothing.
October 3, 2003: 10:32 AM EDT
By Justin Lahart, CNN/Money Senior Writer
NEW YORK (CNN/Money) - The American consumer has become deeply addicted to spending, running up ever higher levels of debt in order to live in a fashion that is beyond his means. And the world has become equally addicted to the consumer continuing to burn through cash.
It's a dangerous situation -- potentially a bubble that dwarfs even the U.S. asset bubble that burst in 2000 -- and it will be a challenge for policy-makers to keep it from ending badly.
The perseverance of consumer spending over the past several years is credited with keeping the economy afloat, but it didn't come without consequence. In order to keep on living in the manner they became accustomed to during the boom years, Americans went deeply into hock.
"If there's a bubble, it's in this four-letter word: Debt," said Merrill Lynch chief North American economist Dave Rosenberg. "The U.S. economy is just awash in it."
Indeed, consumer credit and mortgage debt are both a higher percentage of disposable income now than they've ever been before. Nor do these rises in debt levels appear justified by the rise in the value of people's homes -- household debt as a percentage of household assets (what you owe versus what you're worth) has also never been so high, according to the Federal Reserve.
How did this come to pass? We live in an economy that has become deeply dependent on the American consumer for growth. U.S. consumer spending accounts for around 70 percent of U.S. gross domestic product. So nobody wants to see the consumer falter, and they have been doing their darndest to make sure that doesn't happen.
The Federal Reserve has cut rates like never before, allowing mortgage rates to come down this year to their lowest recorded levels. Car companies have offered zero percent financing for two years now, and they've recently begun offering it on 2004 vehicles.
But rather than using such rate reductions as an opportunity to save money, consumers have, as a whole, used them as an opportunity to spend more.
"We're a what's-my-monthly-payment nation," said Northern Trust chief U.S. economist Paul Kasriel. "The idea is to have my monthly payments as high as I can take. If you cut interest rates, I'll get a bigger car."
Use your home equity loan to buy this $10,000 mermaid suit!
Financial companies have got into the act, too, offering people ever-more efficient ways of running up debt. Hardly does a week go by without a new credit card offer coming in the mail.
Or consider credit cards like Wells Fargo's NowLine Visa Platinum, which allows you easy access to a home equity line of credit. You can use it, says Wells in its online promotion, to help pay "for everyday expenses, like gas, groceries, clothes, etc."
Eating your house was never so easy.
Codependency, anyone?
Other countries share in the deep commitment to keep U.S. consumers laying out their cash. Big exporters -- Japan and China in particular -- have strived to keep their currencies low against the dollar, allowing Americans, in effect, to buy more of their stuff. U.S. consumer spending accounts for around 20 percent of world gross domestic product.
But here is another situation where the United States is spending more than it makes. The current account deficit -- the gap in the United States' trade in goods and services with the rest of the world -- has risen to about 5 percent of the total economy. That's as high as it's ever been. The chart of the current account gap as a percentage of GDP, incidentally, looks almost exactly like a chart of consumer credit as a percentage of income.
So the world economy is leveraged to the U.S. consumer. And the U.S. consumer is leveraged to the hilt. There are now more registered cars on the road in the United States than there are licensed drivers. America's energy needs, per capita, are nearly twice that of Great Britain's. At some point the U.S. consumer's creditors -- which is to say the rest of the world -- may have second thoughts about how their money is being used. Kasriel compares it to a corporation that uses its stock and bond proceeds to throw big parties, rather than invest them in its future.
Clearly something has to give.
"Nobody can pinpoint when this process will come to an end," said Carlos Asilis, a portfolio manager with the hedge fund Vega Capital Management. "But it is very clear that it can't go on forever. Do you let this bubble grow, or do you do something about it?"
There are signs that U.S. policy-makers are at least partially trying to address the problem, pressing Japan, China and other Asian exporters to let their currencies strengthen against the dollar. This would, they believe, reduce consumer expenditures on imported goods and fuel export growth as well.
But it might not solve the problem of consumers who are continuing, in effect, to eat their seed corn. It would take a powerful disincentive, like a Fed rate hike, to get people to stop spending and start paying down debt and save more. But to do that would be to court the forces of recession.
"We have a Fed that wants a booming economy, but the only way the consumer can continue to fuel the economy is through continued debt accumulation," said Rosenberg. "I don't know if there's an easy way out."
Trailer Park Casanova
10-13-2003, 03:41 AM
Baby Boomers are retireing. Most of them are transfering their home equity to Havasu and it's driving up prices.
The demographics in Havasu are changing from second vacation home purchase to more principal residence purchase.
That's a sign values may hold if the markets slip in the future.
My sister owns Lauries interiors in Havasu.
She decorates some of the new higher dollar model homes.
Says they usually sell out in a day.
Havasu Cig
10-13-2003, 05:26 AM
totenhosen:
All I know is all these people that are getting in to housing with 2 year or 5 year ARMS that are already having trouble paying the mortgage, just wait until rate until the rates adjust and they can no longer make thier mortgage payments. Thats when I'm going to make tons of $$$ on distressed home sales. I was thinking the same thing...A friend that does mortgages said alot of people are going this route so they can get into more expensive houses, but like you said what happens when the rates adjust???
Essex502
10-13-2003, 06:49 AM
There is good debt and bad debt:
Good debt - primary residence and investment property that will appreciate in time as long as expected appreciation is greater than the cost of money over the same period.
(example: houses, rental units, other real property)
Bad debt - all debt on depreciating assets.
(example: cars, trucks, BOATS, credit cards)
Frankly, I believe there is a debt problem in america. Too easy to get credit and way to much of it for most people's own good. Live within your means!
Essex502
10-13-2003, 07:21 AM
Havasu Cig:
totenhosen:
All I know is all these people that are getting in to housing with 2 year or 5 year ARMS that are already having trouble paying the mortgage, just wait until rate until the rates adjust and they can no longer make thier mortgage payments. Thats when I'm going to make tons of $$$ on distressed home sales. I was thinking the same thing...A friend that does mortgages said alot of people are going this route so they can get into more expensive houses, but like you said what happens when the rates adjust??? Simple - people should avoid ARM's. Fixed rate only. People take ARM's because they usually can't afford the cost of money at fixed rates or they hope the rate drops or that they will be making more money when the rate adjusts. All, too many times, their judgement is based on hope. Works for some and doesn't for others.
Essex502:
There is good debt and bad debt:
Good debt - primary residence and investment property that will appreciate in time as long as expected appreciation is greater than the cost of money over the same period.
(example: houses, rental units, other real property)
Bad debt - all debt on depreciating assets.
(example: cars, trucks, BOATS, credit cards)
Frankly, I believe there is a debt problem in america. Too easy to get credit and way to much of it for most people's own good. Live within your means! The one problem with the "good debt" is people have used all the equity in the house and then some. Whne the interest rates go back up and prices on housing starts to correct thses people have a problem. A house that is worth 200k and a 1st, 2nd, even a third that has them owing 230k to 250k. Is this good debt? If they wait it out it will be fine, tax benefits and all, but what if they need to sell for some reason or want to move, then what?
Ziggy
10-14-2003, 05:33 PM
Essex502:
Havasu Cig:
totenhosen:
All I know is all these people that are getting in to housing with 2 year or 5 year ARMS that are already having trouble paying the mortgage, just wait until rate until the rates adjust and they can no longer make thier mortgage payments. Thats when I'm going to make tons of $$$ on distressed home sales. I was thinking the same thing...A friend that does mortgages said alot of people are going this route so they can get into more expensive houses, but like you said what happens when the rates adjust??? Simple - people should avoid ARM's. Fixed rate only. People take ARM's because they usually can't afford the cost of money at fixed rates or they hope the rate drops or that they will be making more money when the rate adjusts. All, too many times, their judgement is based on hope. Works for some and doesn't for others. No ARM for this puppy, fixed rate and not at a payment that would kill if something goes south. Friend went the ARM route and I questioned his motive...answer was not enough down to rate well and liked the lower rate offered, HOPES to refi within the ARM and make out OK.
Now, you consider a boat a bad debt...in my case is wasn't at all..I sold it for $840 less than I paid 10 years ago brand new..lucky? Maybe, but its what the market would bear, in October no less, go figure :rolleyes:
little rowe boat
10-14-2003, 05:38 PM
Property and home values are definately way up in Havasu.My wife and I were in Havasu this last weekend looking and everything was sky high.Even with my union job I could not afford to buy in Havasu right now. :cool:
nodigg
10-14-2003, 06:03 PM
I haven't heard much about the $10 million casino and bridge going in across the water north of town lately. Anybody got the latest poop?
That guy that bought the old island airport land is doing a sub-division on the island that should be a hot property. Hoping to land one of those lots. I think they may have to go lottery on them.
Hopefully all of this will continue to fuel the price increases and stave off the eventual price adjustments.
phebus
10-14-2003, 06:39 PM
nodigg:
I haven't heard much about the $10 million casino and bridge going in across the water north of town lately. Anybody got the latest poop? That guy that bought the old island airport land is doing a sub-division on the island that should be a hot property. Hoping to land one of those lots. I think they may have to go lottery on them.
An island lot would be awesome! I can't wait to make my next bad (not!) investment in Havasu
[ October 14, 2003, 07:43 PM: Message edited by: phebus ]
nodigg
10-14-2003, 06:53 PM
I was kinda hoping they would do a keys kinda thing but it looks like the powers will not allow direct water access for now. Still, it will be close to the water and if they at least get a dock going.................
Essex502
10-15-2003, 10:26 AM
bigq:
Essex502:
There is good debt and bad debt:
Good debt - primary residence and investment property that will appreciate in time as long as expected appreciation is greater than the cost of money over the same period.
(example: houses, rental units, other real property)
Bad debt - all debt on depreciating assets.
(example: cars, trucks, BOATS, credit cards)
Frankly, I believe there is a debt problem in america. Too easy to get credit and way to much of it for most people's own good. Live within your means! The one problem with the "good debt" is people have used all the equity in the house and then some. Whne the interest rates go back up and prices on housing starts to correct thses people have a problem. A house that is worth 200k and a 1st, 2nd, even a third that has them owing 230k to 250k. Is this good debt? If they wait it out it will be fine, tax benefits and all, but what if they need to sell for some reason or want to move, then what? Then they continue to make the payments as they were. If the investment was a good idea in the biggining then it still will be but the profit horizon is farther out. Market will cycle back. What generally happens is someone panics and sells and has to take a loss. Then those that didn't lose their head come in and pick up the property cheap and when the market goes back up the panic sellers lose and the cool-headed buyers win.
Powered by vBulletin® Version 4.2.5 Copyright © 2024 vBulletin Solutions Inc. All rights reserved.