The Real Estate Market Has Bottomed Out

In the good old days when there was a world wide party going on, when everyone was so optimistic we were buying and paying for things like there was no tomorrow.  We did not bother to look at what we were doing and why we were doing it.  Many of us were jealous of all the professionals in the real estate and mortgage business as well as Wallstreet.  I had a hard time accepting that it would last and in fact I sold my home.   I told everyone I knew this is not going to last.  Home prices are too high relative to rent, why would you want to pay $3,000 a month when you can rent for $1,500 ?  Now things are in reverse, you can now buy for $1,500 a month and rent for $2,000, so why are so many people holding back ?  Same reason irrational ideas of what things should be instead of what they are.  Perhaps the economy will worsen and home prices will drop even more, but more likely than not, prices have bottomed out, we can tell by looking at real estate prices and lending rates.  You can buy, rent out and literally have your investment property paid for by someone else.  The depreciation from the rental protects a little of your income and all the rental income when combined with the associated expenses of ownership.  It is a young person’s world, they are going to be successful by virtue of growing up and buying their first home.  You can work very hard to attain what you want in life, but ultimately it is luck that determines your success.