House flippers in US
visual...@yahoo.com
A group of three guys thought they hit the jackpot when they bought a
run down home for a low cost. They talked about becoming millionaire
real estate flippers even while they worked on the project. With the
house complete, they planned for a 50K profit and put it on the market
for 350K expecting a quick sell.
Weeks go buy, but no sale. They slash prices. More weeks go by,
still no sale. Slash prices more aggressively. Each month meanwhile
they have to make morgage payments to the bank. More and more weeks
go by. Finally they begin to panic.
The show ends with them not having made the sale. So much for easy
money.
In another show, a couple with a new baby build a home costing 500K+
on a hill which they took a morgage on. This was at the time of the
real estate boom in 2007. The house once done looked like crap to
me. She worked as a nurse, he was struggling to get a small architect
firm started. It struck me that the family was going to end up dead
broke and the poor kid was going to end up for adoption.
phil scott
and this mess has not even gotten rollng yet... I saw it coming in
2000 as work was going offshore... the outcome was predictable... I
was wringing my hands as everyone else was seeing their ppty rise in
value and flippers were doing 2 or 3 at time and driving new cars.
meantime I was recovering from my years in corp america...finally
getting on my feet again... didnt buy a house though because they had
gotten so high. and a house would tie me to the local
business,,couldnt take jobs more than an hour away.. .. it all seemed
bogus to me... so i waited it out living in a motor home, with my
motorcycle on the back,,,
its not so bad... no rent, no ppty taxes,,,no mortgage.. I park near
my job sites and ride the bike,,,it gets 50 mpg.. I eat very well and
get a lot of rest...
propane for the frig costs me 30 dollars a month... wireless
broadband for going on line costs me 50 dolars a month... I make
pretty good money... its still not overrly easy for me... i drive the
motor home sparingly... cost about 250 dollars a month for gas.... I
built a hydraulic lift on the back for carrying the bike... that
works well.
I have no idea how most folks with kids, house payments, taxes, cars
with long commutes etc are making it.....santa barbara has opened 9
parking lots so people often entire families can sleep in their cars.
motor homes or tents and take minimum wage jobs or welfare to stay
afloat...
I think this mess will get 3x worse in the next 12 months ...and a lot
worse over the next few years.... many cities are gong bankrupt...no
way to pay the police and firemen nor their 150,000 dollar a year
retirements at age 51... about 50% of those will be retiring over the
next few years... no way in hell to fund that... or pay replacements.
I tell my clients to incorporate, stand clear of the debt,,and prepair
for bad news about the banks one of these monday mornings and all
projects cancelled.
Phil scott. age 67, and still hussling.
Stray Dog
on some kind of transaction but they don't know what
kinds of _games_ are being played in the background, and they don't
know that "business cycles" include downsides as well as upsides.
I just finished reading a book, "The Robber Barrons" by Josephson,
copyright 1934, dealing with all the crap going on 1861-1901
(Rockefeller, monopolies, JP Morgan, all the really big shits that
really did rip off each other and anyone else that they didn't like
using the force of monopolies, monetary clout, intimidation, spreading
rumors, buying each other out on ten cents on the dollar). You guys
need to realize all these games were being played 100-150 years ago,
too.
///////// comments below, unmodified ////////
comp...@hotmail.com
That's impossible. Everyone says you can't lose money in real estate.
Greg Goss
1982 - 1992: Bought $48K, did $10K of upgrades, sold $32K
2003: Bought $112K, did $17K of upgrades, sold $129K. Lost when you
include realtor.
2004: Bought $189K, sold $168K. Our Toronto "excursion" was a
disaster all round.
I realize that Compton was just being sarcastic, but I wanted to hang
this comment onto the conversation anyhow.
--
Tomorrow is today already.
Greg Goss, 1989-01-27
BobR
>
> - Show quoted text -
The only people who make statements like that are the ones who
steadfastly refuse to learn from the mistakes of the past or they are
trying to pull a con job on someone.
Stray Dog
Have you been talking to a slick, fast-talking sub-prime saleguy
who has a story too good to be true? And, unrealistic assumptions?
nospamplease
>
> compto...@hotmail.com wrote:
>> On Jun 22, 9:44�pm, visualseep...@yahoo.com wrote:
>>> Watched a tv show on house flippers.
>>>
>
> Have you been talking to a slick, fast-talking sub-prime saleguy
> who has a story too good to be true? And, unrealistic assumptions?
>
>
it took so long to blow up this time. The guy who
sells the credit doesn't have a stake, other than
his commission. He'll say anything and lend to
anyone. The guys who package this crap up put some
lipstick on it, and pay someone to rate it. The
rating agency doesn't get any work coming their
way unless they say nice things about garbage.
The government sponsors this process by allowing
homeowners to deduct their mortgage payments, and
backing the credit insuring agencies. The tax
deduction forces homeowners to remain
over-leveraged and discourages them from ever
becoming solvent. The middlemen get rich, the
suckers at either end eventually get burned.
Except taxpayers also get to bailout the
gunslinging merchant banks and loan insurers. It's
the wild west. In countries without the tax
deduction and commissioned sales, there are soft
corrections not bursting estate bubbles (Canada
etc). Anyone who proposes cleaning up this system
will be labeled a crazy communist. Thousands of
lobbyists will line up to support the rich
middlemen and the merchant bankers, and line
politicians' pockets. The system works great for
those guys. Voters elect the biggest liar, with
the most financial backing. The system doesn't
work so good for voters. Darwin would be proud.
comp...@hotmail.com
Nope, coworkers, who feel I should do as they have and purchase an
over valued house.
Greg Goss
>They way the US credit system works, I'm surprised
>it took so long to blow up this time.
[...]
>The
>rating agency doesn't get any work coming their
>way unless they say nice things about garbage.
I can't understand why the raters haven't been sued out of existence
yet.
Stray Dog
If THEY bought more than a year ago, then they bought an
overpriceed (not overvalued) house. In the next 6 -12 months,
houses are likely to be underpriced. And, by quite a bit. Now
is the time to be laying plans.
nospamplease
> nospamplease <nospam...@nospamplease.org> wrote:
>
>
>> They way the US credit system works, I'm surprised
>> it took so long to blow up this time.
> [...]
>> The
>> rating agency doesn't get any work coming their
>> way unless they say nice things about garbage.
>
> I can't understand why the raters haven't been sued out of existence
> yet.
>
No kidding. It ain't over. I have a feeling the
fat lady won't be singing for a few years yet.
I heard today that several states are suing
Countrywide Financial. I guess that really means
they're going after Bank of America. They'd better
hurry while BoA still has some equity left.
Greg Goss
India and the geeks? What's the point of the wild cross-posting?
Stray Dog <strayd...@gmail.com> wrote:
>If THEY bought more than a year ago, then they bought an
>overpriceed (not overvalued) house. In the next 6 -12 months,
>houses are likely to be underpriced. And, by quite a bit. Now
>is the time to be laying plans.
Hope so on your timing advice. I've got a fairly large chunk of money
sunk into a housing development that won't be dropping lots onto the
market till late 2010 at the earliest -- another year or two after
your trough of the curve.