Quote:
Originally Posted by tabs
That is the past dynamic...From the 70's through the 00's housing proved to be a piggy bank for home owners. A real gud investment. Prior to the 70's housing was an overhead expense a place to live. With modest appreciation. You have to understand we was in an INFLATIONARY ENVIRONMENT. Today it is quite the opposite, it is a deflationary environment even though they try as they might to resuscitate inflation with massive debasement of the currency. This alone shows how massive the forces of deflation are.
In 2012 RE was crumbling...in September the FED embarked upon QE3 a tenet of which was to BUY 45B a MONTH in Mortgage backed securities. By doing that it relieved the pressure on banks to liquidate their massive inventory of foreclosed homes. Thus shortening the supply of homes on the market which stabilized RE prices and allowed them to recover. The FED eventually bought around a Trillion USD of mortgage backed securities. Which they is still sitting on.
without the requisite inflationary forces in the market RE will return to being a overhead expense with modest appreciation.
Your take is a gud example of a mindset that is based upon past experiences which are no longer operable. You expect past experience to continue on as if nothing has happened in the meantime which has changed the dynamic. 2008 changed the dynamic.
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Not in my town. Values are still climbing at an alarming rate. That said it's all about location and a quality house.