Author Topic: How is 2017 different than 10 years ago?  (Read 1237 times)

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How is 2017 different than 10 years ago?
« on: January 20, 2017, 08:37:29 AM »
I wasn't involved in the housing market during the bubble of the last 2000's so I am looking for some perspective on those years.

From what I can tell, housing prices in most markets have fully recovered to 07-08 levels. Without understanding all the context of the housing crash, that makes me nervous.

Are prices inflated excessively in the same way they were then?
What is similar and what is differed?
Are these prices more stable? How come?

I am looking to invest more in real estate in the coming months (already own one property), but I am a bit shy because of where prices are.

Thanks for your expertise.


waltworks

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Re: How is 2017 different than 10 years ago?
« Reply #1 on: January 20, 2017, 01:24:30 PM »
In inflation adjusted terms, we are not yet at 2007 levels, or really even that close.

http://www.calculatedriskblog.com/2016/02/real-prices-and-price-to-rent-ratio-in.html

Note the significant difference between nominal and real values.

If a property makes sense financially (ie 1%/50% rule sort of calculations) then you should be fine.

If you are counting on appreciation of some sort, I would certainly not buy anything right now unless you know something I don't. Then again I'd never buy any real estate relying on appreciation.

-W


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Re: How is 2017 different than 10 years ago?
« Reply #2 on: January 20, 2017, 02:04:23 PM »
In inflation adjusted terms, we are not yet at 2007 levels, or really even that close.

http://www.calculatedriskblog.com/2016/02/real-prices-and-price-to-rent-ratio-in.html

Note the significant difference between nominal and real values.

If a property makes sense financially (ie 1%/50% rule sort of calculations) then you should be fine.

If you are counting on appreciation of some sort, I would certainly not buy anything right now unless you know something I don't. Then again I'd never buy any real estate relying on appreciation.

-W

Very helpful information Waltworks.

I had clearly overlooked inflation adjusted numbers.