Real Estate: "People Quit Doing Math..."
SoCal Mortgage Guy has a great post over at his site. Well worth the read...
"The problem came the past 5 years when if you waited a year or heaven forbid TWO years, you either lost 100k+ in ‘appreciation’ or became priced out ‘forever’."
"What most people didn’t realize is that they were competing with the rest of the masses who were also rushing to buy, buy buy…at whatever costs."
" The lenders were all too willing to ‘help’ people ‘afford’ the ‘American dream’. Don’t make enough…state your income". "Don’t have a downpayment, no problem…you don’t need it. Heck, we will even give you 3-25% at closing to help you pay closing costs and even furnish the place. Have a BK, don’t worry…we won’t hold that aginst you. Want lower payments until you get promoted, make more money, or win the lottery…we have I/O and neg-am. You need to buy TODAY because prices are going up…look how rich everybody else is getting."
"It is at this point that I loved to ask people: “what happens if property doesn’t continue to keep going up?” You would have thought I just gave the Pope ‘the finger’ the way people would look at me. Heaven forbid this guy actually question the appreciation of housing, but he muttered the ‘R’ word at the same time. What do you mean it can make more sense to RENT than to buy?"