Posts Tagged ‘housing’
Is America Dead?
Tuesday, 23 August 2011
My father and I had a long conversation the other day about his fears for the future of his pension, home and standard of living.
He has spent almost 30 years working for the City of Philadelphia, climbing his way up. He’s finally nearing retirement. These years should be the best for him. He should be looking forward to the freedoms that come with the hard work he has put in, a time for him to enjoy his family and his hobbies and maybe even spoil himself with some of the money he has saved for this day.
But he can’t.
Fixed-Income Hardship
Like most of us, he has serious doubts about the future. He sees costs of all his necessities rising, and is forced to watch the value of his home continue to drop. It’s lost almost 40% of its value in the past two years and is still not stabilizing. The value of his conservative IRA has also dropped.
All this and he is NOT making any more money this year than last. Unfortunately, this is the case for most folks. The chart below shows the quarterly change in wages from 2009-today. This is not the sort of chart you want to see your income — or EKG — look like.
This kind of stagnant income can’t keep up with rising costs. The cost of everything — from food and fuel to insurance and clothing — is up and climbing in a big way. Compare the Consumer Price Index (CPI) chart below to the flat income chart and you can see why things don’t add up for most of us.
Home Sale Prices Are Still Hurting
Last month, Case-Shiller reported home sale prices are barely at Read more
America’s New Inflation Hedge is Real Estate
Tuesday, 14 June 2011
I guess you could call me a “grassroots” investor when it comes to my longer-term ideas. I look out my window, talk to friends and read the back pages of just about every local publication I can get my hands on. I want to find out what’s really happening out there, to find trends that could explode onto the national scene.
Most of the headlines of tomorrow are being hidden by the big headlines of today. They are often talked about in local papers, but can be hard to spot if you don’t look beyond Page 1.
I want to share with you an idea that’s a little unconventional… at least when it comes to inflation. Let me give you a little background.
America’s Struggle Against Inflation
The average American has little or no defense against inflation. For most of us, our home is the ONLY asset we have that keeps up with inflation and thus gives us some protection. You need to own hard assets like real estate and/or precious metals if you want to keep up!
For most Americans, the dream of owning a home is NOT getting any closer.
Impossible loan requirements make mortgages hard to come by. This is exacerbated by the fact that many have had their credit bruised in the recession. Many were perhaps even forced to change jobs or go to work for themselves, which also makes it harder to obtain financing.
If you couple that with the fact that most Americans are still scared to buy anyway, you have a housing market that is ripe for the savvy investor to step in and find deals.
Five to seven years from now, when the economy has stabilized and these issues disappear off of people’s credit reports, you will have a much healthier housing market out there.
If you have the means, you can profit in these tough times!
U.S. Real Estate: Housing, Housing Everywhere, but Not That Much for Rent
There is no doubt that the regular housing market is still suffering and banks are keeping their hands in their pockets when it comes to offering mortgages to prospective homebuyers.
Fannie Mae is the only agency that is helping buyers with less-than-stellar credit and less than 20% to put down on a home. You can expect lending to remain tight and housing to continue to struggle.
But rents are a different story altogether…
Rent rates are up and have been for some time now. In fact, according to the Bureau of Labor Statistics, primary residence rent rates are up over 1.3% over the past year. In this same period the average home value dropped about 5%.
I have been noticing this trend for some time now and finally the mass media seems to be catching on.
After looking at investments in Dallas, I wrote about rental property a year ago. I also warned of a Read more
Smart Investing Daily – The Housing Market is Still NOT Safe
Friday, 17 December 2010
A couple of months back, I wrote about the tremendous deals that can be had if you are an investor buying real estate properties. Obviously, as a qualified, confident buyer, you have quite a selection, as well as many distressed sellers at your beck and call wanting to unload their homes. “Qualified” and “confident” are the operative words — but many Americans still are neither.
Housing Market Pricing Power
Existing new home inventories are high all around the United States. Home sales data does not look like it should in a economic recovery. Year-to-date, there were 4.149 million existing home sales, down 2.9 percent from 4.272 million home sales at this time a year ago.
According to S&P/Case-Shiller, prices are still moving lower: through September 2010, the average home price dropped 2.0% in the third quarter of 2010, after having risen 4.7% in the second quarter, which was Read more
Smart Investing Daily – Two Strong Companies in a Dead Housing Market
Monday, 29 November 2010
I have been examining real estate investments in several different forms since early 2009, when I was one of the first on CNBC to begin recommending it, albeit cautiously.Back then, I was recommending the purchase of XHB, a housing ETF that was trading for about $9, as a diversified proxy for an actual investment in real estate.
I was drawn to XHB mainly because the stock had been beaten down so badly and the homebuilders in particular were in such an oversold condition, it seemed that most of them from a valuation standpoint were pricing in a complete bankruptcy situation. This price action, to me, seemed overdone. The XHB hit a high of almost $20 earlier this year…
Know Your Investment Intimately
When investing, you have to be extremely selective in both the angle at which you invest in a sector you like as well as the vehicle (stock, ETF, option, bond, etc.) that you choose. At certain times,
From Smart Investing Daily – Housing
How to Earn 18% Without Buying a Single Stock
Monday, August 23, 2010
I recently put one of my townhomes on the housing market to sell. It has been completely remodeled and is in a great location at a price that is the lowest in the area and by far the cheapest when compared to similar units in square footage, location and finish out. (No, I’m not trying to sell you my home.)
I have marketed my home on every real estate website out there and even lowered the price of my unit to the cheapest in my building. The home is located in one of the densest and most desirable areas of Dallas, Texas. Even after all that and 40 days on the market, I have had one showing. I’m not looking for pity at all; in fact, taking this frustration in stride I realized there are some real deals to be had out there.
You see, I am also looking to buy another property and boy, do I have a selection, including penthouse condos in the nicest part of town that were once selling for $300,000 and up are now priced below $120,000 in some cases. The plethora of inventory and the current weak state of the American consumer and would-be homebuyer have created an enormous opportunity for those who have a little faith, knowledge, patience and willingness to look for value in the housing market.