On Mon, 3 May 2021 13:56:52 -0700 (PDT), DerbyDad03
wrote:

On Monday, May 3, 2021 at 2:20:58 PM UTC-4, J. Clarke wrote:
On Mon, 3 May 2021 13:53:59 -0400, knuttle
wrote:

On 5/3/2021 9:34 AM, Ed Pawlowski wrote:
On 5/2/2021 8:32 PM, Clare Snyder wrote:
On Sun, 2 May 2021 17:44:19 -0400, Ed Pawlowski wrote:

On 5/2/2021 4:42 PM, Bill wrote:
On 5/2/2021 3:43 PM, DerbyDad03 wrote:

Their offer was accepted, not just based on the offer price, but also
based on the appraisal clause. Another offer also had an escalation
clause that maxed out at $410K, but the appraisal clause was only
$13K above the appraisal value, $2K less than their offer. That was
close!

I'll assume my previous message has been read. Color my cynical but all
I have to say is "what a coincidence!". That said, I congratulate the
buyers on their new home. The way property is appreciating, it will
surely be a great investment in the long run, and you can live in
it!


I wonder in 3 to 5 years if the house price today will still be a good
investment when interest rates are back up.
I'm betting there will be a lot of people with upside down mortgages
in 5 to 10 years in several areas of the country. Our area is less
likely to see it than many others due to our resiliant economy -
but
%7 would definitely be painfull for MANY buyers - even here.


Exactly. A scenario like: I paid 500k for this house, owe 400k and the
highest offer is 300k.

Live there long enough and you are ok, but if you have to relocate, you

are screwed.
The investment firm we use said stand pat in Pelosi's 2009 down turn. We
listened to him and as far as our investments we are now ahead.

There were people who got all excited when the housing market went to
.... and sold their house when the value went upside down relative to
the mortgage. I could understand if you were relocating where it was
no longer possible to commute from the old house and it was required.
However to sell because you were upside down, and then pay the same
amount as you mortgage for rent, did not seem like a good economic decision.
Who was it that said "buy in a falling market and sell in a rising
one"?

Of course there's also the classic "buy low, sell high". But both
involve knowing what "low" and "high" are and having the luxury of
waiting.

...and there's nothing wrong with selling low and buying low if
what you buy is expected to recover faster/higher than
what you sold.

Reversals often offer opportunities.

Similarly, buying high is perfectly OK if you what you buy is
expected to outperform what you currently own.

Active managers do this all the time.

Buying low and selling high isn't all that hard in real estate but you
have to live somewhere. Buying and selling doesn't matter much. It's
the first time buy that's so difficult, and getting more so.

The problem with the 2008-2012 downturn wasn't so much that people
were upside down but had adjustable mortgages they couldn't refinance
because they were upside down. When the interest rates spiked, they
were screwed. Now the interest rates are so low (artificially low,
thanks to the FED). The ones who will be burned in the next downturn
are those who lent the money.