Originally Posted By wonderingalice ^^Too true, Sport Goofy. My grandparents on my dad's side never owned a home - always rented. But they also never had a credit card - paid cash for everything, or simply didn't buy it.
Originally Posted By jonvn This sort of thing happens every few years. In the 70s, in the 90s, now. When corporations start buying up houses, though, that's when things are going to change here. I can see a good business opportunity for a corporation. They buy up houses, rent them out. Any house for sale in a neighborhood, they just buy. They then collect rent forever. Eventually, home ownership no longer will exist, and we'll all be paying rent to walmart.
Originally Posted By Kar2oonMan >>Eventually, home ownership no longer will exist, and we'll all be paying rent to walmart.<< Except we'll all be working at Walmart, too, and unable to afford the rent! We're doomed, doomed I tell you!!!
Originally Posted By Kar2oonMan Of course, the more I think of it, there's hope: Walmart lets you camp in their parking lots for free. HAHA! Take that, corporate swine! Thought you had us trapped, didn't ya???!!
Originally Posted By Sport Goofy << I can see a good business opportunity for a corporation. They buy up houses, rent them out. Any house for sale in a neighborhood, they just buy. They then collect rent forever. >> Except at the current real estate prices, the return on investment in really isn't there for a landlord to do this in single family homes. That's why you see all the big corporate home builders barfing up multi-family condos all over the place. Cheap condos can be converted to rentals in a housing market crash. Single family homes don't have the same rental value. I just ended a lease with a landlord who was losing about $1,000 a month on me between the cost of here property and the rent I was paying. The rental demand isn't strong enough to command the sorts of monthly rents that are required to cover property values in the market right now. If we see a broad decline of property values by about 30%, the story will change.
Originally Posted By jonvn "Except at the current real estate prices, the return on investment in really isn't there for a landlord to do this in single family homes." A corporation would not have a monthly mortgage to pay out. So they probably would not be losing any money. They would contract out for maintenance, and simply take in the cash. The house would pay for itself in about 5 to 10 years. This is going to happen. Especially as jobs just start to evaporate. Perhaps single family homes will start to get torn down, zoning rules changed, and condos put in their places. That would allow for much more rent per acre of ground than a single family home would. But this is how it's going to go. Maybe in a couple more decades of job loss and walmarting of industry.
Originally Posted By Sport Goofy << A corporation would not have a monthly mortgage to pay out. So they probably would not be losing any money. They would contract out for maintenance, and simply take in the cash. The house would pay for itself in about 5 to 10 years. >> The return on investment is still pretty lousy. I ran the figures on my last home. Instead of selling, I could have rented it out. I had quite a bit of equity in the home, and could have easily made a profit on the rent paid vs. other expenses. I did some calculations and figured that my return on investment for being a landlord was about 3%. Even if I stroked a check to pay off the mortgage and own the home free and clear, the return on investment only got up to about 6%. Those are fairly paltry returns, and not very attractive to corporate investors. I am getting a better return on my investment by taking the cash from my home sale and putting it into a 5% CD than being a landlord. When you look at the kinds of returns that corporations seek, boring real estate deals that only get you 5-6% aren't all that attractive. That's why these sorts of investments are packaged up as REITs and there aren't very many publicly traded companies dealing in this sort of thing.
Originally Posted By jonvn Hey people will be happy to be able to live in the walmart parking lot. The alternative will be the gutter. I can see a walmart type company selling different grades of housing. Parking lot, apartment, duplex, house. All at a low low price, designed to suck every penny from you while providing you with no chance of ever getting ahead. And people will be so stupid from the mess that education is in this country, that they'll be excited by the opportunity.
Originally Posted By jonvn "The return on investment is still pretty lousy." For you, on your one home. You need to think in terms of economies of scale. If you are a major user of say electricity or water, you get breaks on that. If you contract out for certain services like gardening, you get a break on prices for doing it to many homes. Costs for a corporation doing this sort of thing are much lower than for an individual.
Originally Posted By vbdad55 and people wonder why some posters say that no matter what the president does he is demonized. Here is a perfect example. However if you want to demonize him, then you have to include Chuck Schumer and the entire Deomocratic party since he is claiming all the ideas being incorporated came directly from the Democrats. The next time the demonizing issue comes up - please reference back to this thread -- I for one am glad with the actions, and I don't care if it is the Dems of the GOP who came up with it.... it is needed to help the overall economy --
Originally Posted By vbdad55 ^^^^^^^^^^^^ I will read the rest of the thread later - the first 10 posts or so though were an amazing display of hatred for one person blinding any better good that may come from any decision. And people wonder why we are so polarized at the polls.
Originally Posted By vbdad55 yep - that Bush is such an idiot for this step -- please explain this then: "Sen. Charles Schumer, D-N.Y., said he was pleased to hear Bush and Federal Reserve Chairman Ben Bernanke address the escalating crisis in the mortgage market. "The current situation is simply out of hand. It's bad and it's getting worse," he said. He said Bush's proposals - increasing FHA loans, reducing down payment requirements on loans to be insured by the FHA, eliminating tax liabilities for foreclosure victims - were all Democratic proposals." so I guess the Democrats are the idiots for this, and Bush an idiot to listen to them. Could it just be possible that for once the two parties got it right ?
Originally Posted By fkurucz <<Take a look at how much those l'il fixer uppers are going for. Take a look at how much they appreciate compared to where you live now.>> Sorry, but fundamentals do not support that thinking any more. They won't appreciate because NO ONE can afford them anymore.
Originally Posted By fkurucz <<"The return on investment is still pretty lousy.">> Correct. It would be a pathetic ROI, about 2-3%.
Originally Posted By jonvn "NO ONE can afford them anymore." This is what is always said. Eventually you would think it has to be true, but it never seems to come to pass.
Originally Posted By Sport Goofy << This is what is always said. Eventually you would think it has to be true, but it never seems to come to pass. >> Well, the only reason for the recent home price explosion was a proliferation of loans to a segment of the population with no income, no jobs, or assets. The party had to end sometime. I guess the government will step in and give away funny money to these people to maintain the asset inflation bubble, but you can only run the printing presses for so long to defer the problem.
Originally Posted By Dabob2 I didn't weigh in on this at all because, at least in the reports I've seen, all they had were VERY broad outlines, with pretty much no details. Perhaps the details were elsewhere, but I haven't found them. The outlines - let's help people who got in over their heads - sounded good, but also sounded almost as generic as "we need to strengthen America's health care system" or other boilerplate. So I couldn't really say whether I thought Bush's proposal was good or not so good. I really would be interested in seeing some details in Bush's proposals, as well as possible Democratic proposals - unless in fact they're pretty similar (vbdad seems to think they are, although Douglas predictably opined that "it's certainly not as stupid as what many Democrats suggested" without saying which Democrats or offering any details). Details, please.
Originally Posted By vbdad55 ^^^^^^^^^^ It's not that I 'think' they are similar -(I haven't seen any side by side sheets) I read Chuck Schumer's quotes who said that Bush's plans all came from the Deomcrats - I would think he would know
