Real Estate > Business & Investing

Posted: 8/20/2007 6:26:22 PM EDT

Anything that has to do with real estate is getting hammered right now because of the sub prime failures; however, I believe the real estate market will recover within a few years, just like it did in the early 90s.

I plan to start buying REITs and ETFs that invest in real estate after the decline stops and a stable base forms.

I figure we should see a bottom sometime prior to Jan 2009 after looking at the ARM reset chart. Is anyone else thinking of doing this and if so what are your thoughts about when and what to start buying?

High quality mortgage lenders would probably also be a good buy since they will have a lot less competition soon.

Posted: 8/21/2007 5:50:39 PM EDT

[#1]

Missing From All the Credit Crisis Coverage: A Realistic Assessment of Where Home Prices Are Headed
usmarket.seekingalpha.com/article/45172

People are panicking in these markets because prices have fallen 2-5% this year. What if we lop 30% off home prices? People dismiss that as ridiculous, but it would only take the market in Washington, DC, back to where it was in December 2003. How about 40%, which would take Los Angeles back to July 2003? Or 50%, which would take Miami back to August 2002. Fifty percent may be a stretch, but 10%, 20% or even 30% strikes me as entirely probable.

Getting the Real Estate Crisis Right
usmarket.seekingalpha.com/article/45174

Essentially the price of a house comes out to just about what people can pay, monthly. The NY Times did a great story 3 or 4 years ago that showed that real estate prices corresponded almost exactly to median income per month, with housing prices moving up as interest rates moved down to set that monthly payment for a house, which is what people can afford and then buy.

U.S. Foreclosures Surge
usmarket.seekingalpha.com/article/45189

The number of U.S. homes in foreclosure jumped 9% from June to July, having climbed almost 93% since the same time last year. Data released Tuesday by RealtyTrac showed that Americans were filing one foreclosure for every 693 households last month. A total of 43 states had an increase in foreclosures since July 2006, but nearly half of them came from just California, Florida, Michigan, Ohio, and Georgia. Nevada had the highest foreclosure rate, filing one per every 199 household. Detroit, filing a foreclosure for every 99 homes, topped the list of metropolitan areas.

Housing Bubble and Real Estate Market Tracker
usmarket.seekingalpha.com/article/45100

“All of the old-timers knew that subprime mortgages were what we called neutron loans — they killed the people and left the houses. The deals made in 2005 and 2006 were going to run into trouble because the credit pendulum at the time was stuck at easy."- Louis S. Barnes, a partner at the Boulder West mortgage banking firm in Colorado, on the fact that there were signs of trouble in the subprime market long before the current crisis. Few were looking for them. (NY Times, Aug. 19th)

ar-jedi

ps, courtesy of The Onion...

Posted: 8/21/2007 6:20:50 PM EDT

[#2]

They are seeing a similar housing bubble in Europe. I was in Portugal a few weeks ago and noticed the housing prices were higher than many areas in the US, even though incomes are much lower there. I asked how they afford such high prices and was told they have 70 year mortgages now!

I'm thinking of investing in real estate after prices move much lower.

Posted: 8/25/2007 4:34:35 PM EDT

[#3]

Until everyone stops talking about housing being a good investment it won't be a good investment.

The biggest bubble in history won't get solved in 6 months.
My guess, 2017, maybe later.
It's going to be ugly.

Posted: 8/26/2007 10:54:09 AM EDT

[#4]

If you are planning on buying REIT shares then look into buying them now. The managers of those funds get paid to plan and trade so you don't have to. I have Cohen&Steers both US and foreign. I bought them mostly because I like the steady income stream but they can go up in NAV as well. I'm not really sure what they have done recently and I don't care because I am a LOOOOONG term investor. SS

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