Ideal ski towns for the future factoring in all issues?

[Hawk]

It does because we live in a capitalistic society. There is only one way to change that. Vote to a more liberal leaning society and evenutally they will take away the money from the rich and give to the poor. But that is going to be a real hard sell in NH.

Also one other thing could be to subsidized housing or Low income state or municipally funded rent control. Another hard sell in NH.

No one said it was fair, its just is the world we live in. Does it make sense? Well yes it does. Things get more expensive. Now the acceleration of cost is supply and demand. That has gone wild and the explanation is very hard to understand. Fully. I am sure there are all knowing on this board that will explain to us.

 

[Edd]

It does because we live in a capitalistic society. There is only one way to change that. Vote to a more liberal leaning society and evenutally they will take away the money from the rich and give to the poor. But that is going to be a real hard sell in NH.

Also one other thing could be to subsidized housing or Low income state or municipally funded rent control. Another hard sell in NH.

No one said it was fair, its just is the world we live in. Does it make sense? Well yes it does. Things get more expensive. Now the acceleration of cost is supply and demand. That has gone wild and the explanation is very hard to understand. Fully. I am sure there are all knowing on this board that will explain to us.

Thanks for this explanation of capitalism but I’m gonna maintain what is simply my opinion if we’re both cool with it and good luck with your future real estate deals.

 

[Hawk]

It's all good Edd. Sounds like you might know someone who can't find an affordable house. The bright side is the housing market seems to be cooling down.

 

[x10003q]

Edd it's simple, realestate has outperformed the markets over the last 50 years. Smart money has gone to realestate. I have many frients that own several realestate holdings that are their retirment plan. Actuctually the pandemic boom flushed some of them out. They couldn't

Except for a few short time frames, the stock market has always outperformed the homeowners' real estate market.

"Or, consider the 47 years between 1975 and 2022. A $100 investment in the average home (as tracked by the Home Price Index from the Federal Housing Finance Agency [FHFA]) in the fourth quarter of 1975 would have grown to about $928 by the first quarter of 2022.6 A similar $100 investment in the S&P 500 at the beginning of 1975 would yield approximately $19,351 in 2022, provided all dividends were reinvested"

Has Real Estate or the Stock Market Performed Better Historically?

The stock market has consistently produced more booms and busts than the housing market, but it has also had better overall returns as well.

www.investopedia.com

 

[mikec142]

Except for a few short time frames, the stock market has always outperformed the homeowners' real estate market.

"Or, consider the 47 years between 1975 and 2022. A $100 investment in the average home (as tracked by the Home Price Index from the Federal Housing Finance Agency [FHFA]) in the fourth quarter of 1975 would have grown to about $928 by the first quarter of 2022.6 A similar $100 investment in the S&P 500 at the beginning of 1975 would yield approximately $19,351 in 2022, provided all dividends were reinvested"

Has Real Estate or the Stock Market Performed Better Historically?

The stock market has consistently produced more booms and busts than the housing market, but it has also had better overall returns as well.

www.investopedia.com

I'm not disagreeing with you, but there are many caveats to this article. For example, taxes are owed on both RE and stock appreciation. You can earn rental income from your RE. You can take tax deductions on your RE. You don't have to pay to maintain your stocks, but you certainly have to pay to maintain your RE. Etc. etc. etc.

Bottom line is it's not just a simple calculation of I paid X in 1975 and it's now worth Y in 2022.

 

[Former Sunday Rivah Rat]

Ultra low rates from 2009-2022 have created sky high prices in RE + stocks. They also cause income/wealth inequality to exacerbate. Ultra low rates are kind of like methadone to an economy addicted to stimmy's + free/easy wealth. Real estate speculation has fueled a bubble along with low inventory. Since rates have gone way up, and most people are payment buyers we will see if there's a correction or crash in risk assets over the next 1-2 years. Stay tuned, houses may get alot more affordable if that happens.

 

[mikec142]

Housing costs may be coming down, but property owners in the more well known ski towns are enjoying a permanent bump in RE values. Said another way, the person who was lucky enough to buy a $500k home in Telluride years ago saw the value of that home to jump to $2mm at the height of the pandemic price jump. While that home may now be valued at $1.8mm, it will never, ever fall to anywhere near the original price of $500k.

PS. Made the numbers up in my head.

 

[mikec142]

Ultra low rates from 2009-2022 have created sky high prices in RE + stocks. They also cause income/wealth inequality to exacerbate. Ultra low rates are kind of like methadone to an economy addicted to stimmy's + free/easy wealth. Real estate speculation has fueled a bubble along with low inventory. Since rates have gone way up, and most people are payment buyers we will see if there's a correction or crash in risk assets over the next 1-2 years. Stay tuned, houses may get alot more affordable if that happens.

It will certainly be interesting. In my suburban NJ town, housing values haven't come down yet. But fewer people are buying/selling because of the high mortgage rates. And many of the people who are buying are doing so in all cash deals to avoid having to take a mortgage.

 

[Former Sunday Rivah Rat]

If this happens imagine all the bargains in resort towns. I wish I had more cash!

The AirBnB Bubble Popping Will Pop The Housing Bubble

Authored by Charles Hugh Smith via OfTwoMinds blog, This is how bubbles collapse: the “vital few” 4% sell at whatever the market will bear, pushing prices down, and the 64% awaken to th…

www.theburningplatform.com

 

[IceEidolon]

Remember that desirable locations have their values propped up by artificial scarcity - if you're buying for location, and most of the property in that location is zoned for single family homes only and with a comfortable minimum lot size, your options are limited and competition drives up prices.

 

[cdskier]

It will certainly be interesting. In my suburban NJ town, housing values haven't come down yet. But fewer people are buying/selling because of the high mortgage rates. And many of the people who are buying are doing so in all cash deals to avoid having to take a mortgage.

The type of property matters as well. My grandmother owned a couple multi-family homes together with her sister. Now that both my grandmother and her sister have passed, the families are selling those properties. The one 4-family house received a ton of offers after 1 showing (and the lowest offer was asking price). So it seems while maybe there are less buyers for single family homes, multi-family rental type properties on the other hand remain a highly sought after commodity.

I'm personally looking forward to the market cooling off a bit. I'll likely be in a position to be looking to buy something at some point next year. So cooling off (at least in NJ) would be pretty beneficial to me!

 

[kbroderick]

Relevant to the original subject, water is probably going to be more of an issue in the future (and already is in some places):

https://www.nytimes.com/interactive...Kaxm5zotTtCbRinxT-eVyX_PSpdomQ&smid=url-share

 

[x10003q]

I'm not disagreeing with you, but there are many caveats to this article. For example, taxes are owed on both RE and stock appreciation. You can earn rental income from your RE. You can take tax deductions on your RE. You don't have to pay to maintain your stocks, but you certainly have to pay to maintain your RE. Etc. etc. etc.

Bottom line is it's not just a simple calculation of I paid X in 1975 and it's now worth Y in 2022.

The reference was a primary residence. The stock market is a better investment than a primary residence. Rental property/commercial RE are completely different.

 

[skef]

Counterpoint (for the really long haul…): https://www.frbsf.org/economic-research/wp-content/uploads/sites/4/wp2017-25.pdf

 

[Hawk]

Except for a few short time frames, the stock market has always outperformed the homeowners' real estate market.

"Or, consider the 47 years between 1975 and 2022. A $100 investment in the average home (as tracked by the Home Price Index from the Federal Housing Finance Agency [FHFA]) in the fourth quarter of 1975 would have grown to about $928 by the first quarter of 2022.6 A similar $100 investment in the S&P 500 at the beginning of 1975 would yield approximately $19,351 in 2022, provided all dividends were reinvested"

Has Real Estate or the Stock Market Performed Better Historically?

The stock market has consistently produced more booms and busts than the housing market, but it has also had better overall returns as well.

www.investopedia.com

So that is also looking at national averages. This discussion was specifically talking about New England. NH in fact. There is no way the market outperformed housing here. Just eyeball the real estate sales. People are making over 100% in some cases. My house I owned was 154% increase in 20 years. Minus inprovements of course but all in It was probably 50%. I mean unless you invested in something like Microsoft, Apple or Amazon, you are not going to get even close.

 

[AdironRider]

Except for a few short time frames, the stock market has always outperformed the homeowners' real estate market.

"Or, consider the 47 years between 1975 and 2022. A $100 investment in the average home (as tracked by the Home Price Index from the Federal Housing Finance Agency [FHFA]) in the fourth quarter of 1975 would have grown to about $928 by the first quarter of 2022.6 A similar $100 investment in the S&P 500 at the beginning of 1975 would yield approximately $19,351 in 2022, provided all dividends were reinvested"

Has Real Estate or the Stock Market Performed Better Historically?

The stock market has consistently produced more booms and busts than the housing market, but it has also had better overall returns as well.

www.investopedia.com

Yeah if you completely discount that the majority of real estate in this country is bought with leverage, which adjusts the calculus pretty significantly.

A very common example. Person buys house in 2015 for the average price at the time of 176k with 5% down FHA. So they invest $8,800 bucks. They then sell in 2023 for the average housing price of 467k. Lets exclude the monthly mortgage payments (opportunity cost - since presumably they would have had to make rent payments also if they didn't buy, which are roughly equivalent to the cost to own since landlords don't lose money typically). Take off 37,360 for closing costs when they sell, and let's assume one major repair of 20k during that time frame as well.

That person made $242,440 tax free (assuming primary residence) on an initial investment of $8,800. Stock market isn't even close and you'd have much higher leverage costs if you tried (if you could even get it), and much higher risk. This is the average mind you, some areas did significantly better.

 

[djd66]

So that is also looking at national averages. This discussion was specifically talking about New England. NH in fact. There is no way the market outperformed housing here. Just eyeball the real estate sales. People are making over 100% in some cases. My house I owned was 154% increase in 20 years. Minus inprovements of course but all in It was probably 50%. I mean unless you invested in something like Microsoft, Apple or Amazon, you are not going to get even close.

S&P 500 in 2003 was 900,… 2023 its 4500. That’s 5x

 

[Hawk]

I am talking personal investment. So if i looked at your 401K over the last 20 years you can say that your % increase on investment was greater than 50%? I know my numbers. I was aggesive and I invested in a wide range and it is no where close to my return on my real estate.

 

[djd66]

I bought my current house in ‘03. When I take into consideration renovations, property taxes and maintenance, my stock market investments have way out performed the realestate. I invest mainly in index funds. Owning however makes much more sense than renting.

 

[Hawk]

OK, Fidelity blows then. I'm firing my fund manager. Will you take over for me? No in all seriousness. You must have done well.

There has been one major correction over the last 20 years and another smaller one in the last 2 years. Those have have knocked down the percenages a bit. My house tripled in value in MA and my condo in VT doubled in value. I can't say my 401 K did.