On 18 Oct 2014
American Housing Survey finds 1 in 3 homes is a rental,
That isn't the point. I thought the stock market was going down so I sold my stocks. I thought real estate was going up so I bought real estate.
What kind of ridiculous prick spends years telling people real estate would crash while simultaneously holding an asset that he could lose a large sum of money on?
Why haven't you sold all your cars yet? Their value as used cars are certainly going down in the next few years.
Why haven't you divorced your wife yet? Her sexual appeal will certainly be going down in the next few years.
People hold onto their houses in a down market for numerous reasons:
1. The capital gain tax liability is so huge on top of the regular transaction cost that it makes no sense to go through the round trip;
2. Homestead protection against law suits. Cash can not be thus protected;
3. The house/building generate enough rent to off-set down turn;
4. Kids going to school in the local area, where there is either no rental or rental price is high;
5. Rebuying a similar house would require mortgage (again), and there is no guarantee of low interest rate at the next market trough . . . in fact, probably not there.
Just to list a few. How long have you owned real estate anyway? Why did you not sell all your holdings in 1999 and 1991?