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Xenophage · 05-20-2005, 10:16 PM

Man oh man the frenzy is at its peak read this shit and tell me its not.

http://www.fortune.com/fortune/inves...061371,00.html

And the appreciation! Surely you?ve heard, because real estate profits are the kind of thing that no one?your neighbor, your boss, yourself?can seem to shut up about. Since 2000 the median sales price of a single-family home has jumped 77% in New York City, 92% in Miami, and 105% in San Diego. "Nationally, all levels of real estate activity are at all-time highs," says economist Mark Zandi

Speculators are creatures who emerge every decade or so to exploit the hot business cycle of the moment?those whose aim is to ride the wave to its highest point and then, with miraculous skill and timing, get out before it crashes on all the greater fools beneath. (They are also, like fishermen, more than willing to exaggerate the size of their catch.) Lately their numbers have been multiplying with every cocktail-party tale of a dentist, florist, or shrink buying "threesies" and "foursies" (three or four properties at a time, in speculatorese) and making a killing.

Many of them acknowledge that they are part of a bubble and that a correction is coming. But they believe it won?t hit their market?or that if it does, they?ll be able to get out in time. Despite all the warnings and a few bleats of self-doubt, most of these people are continuing to behave with all the stark raving urgency of panicked shoppers at an after-Christmas clearance sale.

That amount, the couple say, represents their entire net worth. But that fact doesn?t seem to trouble them much. They plan to sell properties when they need the cash and hold on to the others to fund their retirement. "It?s a risk," concedes Debbie, "but I really feel like it?s a lot less risky than the stock market. Even if it does crash, it?s not like it?s worth nothing?like a stock, where the value can go all the way to zero. I guess it?s much more exciting than it is scary."

Is he worried about talk of a bubble? "Well, I can foresee what will happen," he says. "I know in the near future a lot of people who have interest-only mortgages will get in trouble."

He?s probably right. Interest-only mortgages?which don?t pay down principal, so borrowers make lower payments than with conventional mortgages and thus can afford more expensive houses?used to be considered risky. In 2001 just 1.6% of all new U.S. mortgages were interest-only. But last year a stunning 31% were. If there?s any sign that a downturn could get loads of folks in trouble, that?s it.

In the past year the number of Phoenix homebuyers who identified themselves as investors has more than doubled, to 2,703. They bought 18% of all homes sold in the Phoenix area in 2004, according to Infocom, a local real estate research company. Phoenix builders, fearing that the speculative frenzy would damage their primary business, soon announced the same kind of antispeculation clauses that had proved largely successful in both California and Las Vegas.

By the time those measures were in place in Phoenix last fall, however, the swarm of investors descending on the city was almost too much to stop. At one of the construction sites of big builder Toll Brothers, a van full of investors from Las Vegas pulled up to a sales trailer shortly after the antispeculation measures had gone into effect. According to a Toll Brothers spokesperson, the saleswoman on call was so flustered by the group?s displeasure at being denied an opportunity to invest in such a scalding market that she had to radio headquarters for backup. "They all wanted to buy multiple properties, and they wouldn?t take no for an answer," says the spokesperson. "They were trying to climb in and give her their deposits. She had to lock herself in the trailer."

The houses aren?t exactly throwing off cash: Tahmassebian estimates that he loses $3,500 a month on them, since he doesn?t bother to rent out all 15. "If I?m negative on a few, that?s okay," he says. "I?m in it for the appreciation." In seven months, he estimates, the 15 properties have appreciated from $2 million to $3 million. He?s planning to sell in the next two to three years, but if the market does crash?which he doesn?t expect?it wouldn?t be a disaster, he says: "You just hold on till it comes right back up."

There are a lot of people getting in at the top of the market, and you could hear some horror stories if it doesn?t last."

"I read all the stories about real estate and condos in Miami," he says. "You know, saying, 'Everyone is a speculator,' and 'It's a herd mentality.' I see them all the time now, and I wonder: Am I one of those people?"

Hhahahahah the market will just come back up... tell that to the fucking NASDAQ hahahahahah

The Shit is gonna hit the fan so fucking hard !

05-20-2005, 10:16 PM
Xenophage Registered User Industry Role: Join Date: Oct 2001 Posts: 12,122	REAL ESTATE is ripe for a burst ! Man oh man the frenzy is at its peak read this shit and tell me its not. http://www.fortune.com/fortune/inves...061371,00.html And the appreciation! Surely you?ve heard, because real estate profits are the kind of thing that no one?your neighbor, your boss, yourself?can seem to shut up about. Since 2000 the median sales price of a single-family home has jumped 77% in New York City, 92% in Miami, and 105% in San Diego. "Nationally, all levels of real estate activity are at all-time highs," says economist Mark Zandi Speculators are creatures who emerge every decade or so to exploit the hot business cycle of the moment?those whose aim is to ride the wave to its highest point and then, with miraculous skill and timing, get out before it crashes on all the greater fools beneath. (They are also, like fishermen, more than willing to exaggerate the size of their catch.) Lately their numbers have been multiplying with every cocktail-party tale of a dentist, florist, or shrink buying "threesies" and "foursies" (three or four properties at a time, in speculatorese) and making a killing. Many of them acknowledge that they are part of a bubble and that a correction is coming. But they believe it won?t hit their market?or that if it does, they?ll be able to get out in time. Despite all the warnings and a few bleats of self-doubt, most of these people are continuing to behave with all the stark raving urgency of panicked shoppers at an after-Christmas clearance sale. That amount, the couple say, represents their entire net worth. But that fact doesn?t seem to trouble them much. They plan to sell properties when they need the cash and hold on to the others to fund their retirement. "It?s a risk," concedes Debbie, "but I really feel like it?s a lot less risky than the stock market. Even if it does crash, it?s not like it?s worth nothing?like a stock, where the value can go all the way to zero. I guess it?s much more exciting than it is scary." Is he worried about talk of a bubble? "Well, I can foresee what will happen," he says. "I know in the near future a lot of people who have interest-only mortgages will get in trouble." He?s probably right. Interest-only mortgages?which don?t pay down principal, so borrowers make lower payments than with conventional mortgages and thus can afford more expensive houses?used to be considered risky. In 2001 just 1.6% of all new U.S. mortgages were interest-only. But last year a stunning 31% were. If there?s any sign that a downturn could get loads of folks in trouble, that?s it. In the past year the number of Phoenix homebuyers who identified themselves as investors has more than doubled, to 2,703. They bought 18% of all homes sold in the Phoenix area in 2004, according to Infocom, a local real estate research company. Phoenix builders, fearing that the speculative frenzy would damage their primary business, soon announced the same kind of antispeculation clauses that had proved largely successful in both California and Las Vegas. By the time those measures were in place in Phoenix last fall, however, the swarm of investors descending on the city was almost too much to stop. At one of the construction sites of big builder Toll Brothers, a van full of investors from Las Vegas pulled up to a sales trailer shortly after the antispeculation measures had gone into effect. According to a Toll Brothers spokesperson, the saleswoman on call was so flustered by the group?s displeasure at being denied an opportunity to invest in such a scalding market that she had to radio headquarters for backup. "They all wanted to buy multiple properties, and they wouldn?t take no for an answer," says the spokesperson. "They were trying to climb in and give her their deposits. She had to lock herself in the trailer." The houses aren?t exactly throwing off cash: Tahmassebian estimates that he loses $3,500 a month on them, since he doesn?t bother to rent out all 15. "If I?m negative on a few, that?s okay," he says. "I?m in it for the appreciation." In seven months, he estimates, the 15 properties have appreciated from $2 million to $3 million. He?s planning to sell in the next two to three years, but if the market does crash?which he doesn?t expect?it wouldn?t be a disaster, he says: "You just hold on till it comes right back up." There are a lot of people getting in at the top of the market, and you could hear some horror stories if it doesn?t last." "I read all the stories about real estate and condos in Miami," he says. "You know, saying, 'Everyone is a speculator,' and 'It's a herd mentality.' I see them all the time now, and I wonder: Am I one of those people?" Hhahahahah the market will just come back up... tell that to the fucking NASDAQ hahahahahah The Shit is gonna hit the fan so fucking hard !