Posted by ken in sc on July 22, 2003 at 12:48:16:
The influx of new investors is huge. I personally dont know what their former occupation or investment strategy was. But the answer to your question is: They are paying too much! They cannot make the return they want paying that much and will eventually become disinterested and move on.
Ken
How do you know this? - Posted by JANE
Posted by JANE on July 22, 2003 at 11:20:01:
After reading some of the archives and posts that are current. I’m reading alot of people making statements
that there is soooo many failed dot comers and busted
stock market people that are buying re now and that the
time will past with them and the maket will cleanse again.
I’m curious since we have not seen times like this before
what makes people certain they will leave rei???
thanks for reading my random curiosity!
Jane
Re: How do you know this? - Posted by GL - ON
Posted by GL - ON on July 22, 2003 at 15:07:52:
“I’m curious since we have not seen times like this before
what makes people certain they will leave rei???”
But we have seen times like this before, at least once every 20 years.
The last big boom was in the late 80’s. The 90’s were the best time to buy real estate I ever saw in my life. Now the general public is starting to get wise, and the prices are getting bid up to new highs.
We are just getting near the blowoff stage (last 2 or 3 years of the boom) in some markets. I hear Atlanta, which was a leader in the boom, has already started to slide.
Where I am the boom is just beginning and has another 5 years to run.
It’s easy to time the market if you know what “time” it is. You don’t even need a stopwatch, a calendar will do.
Here is how it works. We are looking at real estate as an investment. You can tell a good investment from a bad investment because a good investment makes money, a bad one loses money.
If you know what you are doing you can analyse any investment and tell whether it is a good one or a bad one.
When there are lots of great investments in the market, that’s the time to buy. It is also the time everyone stays away and all your broke neighbors call you a fool.
When there are no good investments left in the market and all your broke neighbors are getting into the game and telling you to get in before it’s too late, it’s getting to the blowoff stage.
When you have been expecting the boom to crash, it seems, for years and prices have kept going up to ridiculous levels, and everyone is saying it is a whole new paradigm and the old rules don’t apply anymore and the boom is never going to end, then you know the end is only months away.
Remember, the pendulum always swings too far one way, and when you think it is never going to stop, it suddenly swings the other way.