Posted by rr smith on February 10, 2002 at 12:06:06:
More buyers (AND MORE SELLERS) will lead to a more efficient market overall, no matter what “commodity” is being exchanged (wheat, currency futures, homes, etc). You have stumbled onto one of the best agruments for middlemen, i.e. they make for a more efficient market and help REDUCE RISK by those who do not want to assume risk. Higher risk in investing almost always leads to higher gross returns (or demands higher returns to attract investors).
Creative financing causing higher prices? - Posted by Tim Savage
Posted by Tim Savage on February 10, 2002 at 09:46:33:
It seems to me that many deals that are stuctured to buy at an inflated price can cause prices in general to raise. Take the example of the condo I almost bought. It was offered for $137,000. The person who bought it paid $155,000 according to the documents. I’m sure they did some creative financing.
What happens when other owners do comps and think “see that one sold for $155,000, mine must be worth that much too” and so forth. They ask $155,000, someone does creative financing and puts down $175,000, etc.