If the markets fall below the 2002 price (which I think they will, in a lot of areas) they will be considered shrewd investors.
you might be right, you might be wrong. The area in question is not experiencing a large dramatic sell off like San Diego or Miami is currently experiencing...
Do you know what they did with their profits since they sold? If they bought gold, they are up over 100% since then. There are other things that would have bought them 100% gain too -- so I think it is really hard to call them schmucks.
They said they `saved it` and I have absolutely no idea what they did with the money. ... and that is not necessarily important because everyone needs shelter/home... so the home ultimately should not be viewed as an investment, but these people did just that by thinking they could cash in and make a landlord richer and this is mostly why I consider them schmucks...
They thought they sold at the top, but missed about 60-70% upside... since last summer, the values already diminished 10%+/-, so another 40-50% will get down to their original sale price... their home basically almost doubled in value since they sold it... and if they held onto the property for the duration, they would have even more equity built in from lowering the mortgage and they also lost significant tax advantages... after tax, their lost opportunity is mind numbing...
I bought a lot of gold in 2005 and that gold is up over 65%. That's better than most housing. Gold that I bought earlier than that is up even more.
thats nice, but that is not the point... if this banter was investing in metals, you would have been much better off buying the junior miners instead of the actual metal and your returns would be well into the 100s, or even 1000 percent. That is probably still the case, since the jr miners without hedges are leveraged nicely.
So far, I think people who bought in 2005 thinking they would get a higher price selling are schmucks....
I concur, but this thread is about how to manage our investments, money and financial position in an economic collapse, which according to the CNN article an inevitable event...despite the knowledge that real estate will conceivably deflate, I still bought 2 properties in 05 and 2 more in 06, and I am excercising an option on 5 acres of highway retail that had a negotiated price from 04.... the prices I pay for these pieces does not alone dictate the actual value.
Those who do not weigh risk and rewards properly will get slaughtered and will make huge opportunities for those who understand the dynamics of the markets.
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