patrick.net

6% or so, IIRC.

robertoaribas says

funny reading all the comments on this article!

Oh, no matter how good I think the OP might be on ZH, some comment pops up to give me a spit-take.

Informative:

SO the returns of the security is based on the rents being charged?

You can't really assign a rating because you don't actually know what the rent will be. At least a mortgage had a long contract that was supposed to be worth what the payments added up to be.

The REO to Rent strategy can easily backfire when the ghetto renters move in and trash every property, along with the increased crime rates that will send asking rent downhill. What once was a $2500 a month rental can become a $500 a month rental very fast. Especially in Phoenix and Tampa. Good neighborhoods six years ago are complete ghetto now.

Funny:

And the next question is, which dufuss dumb ass pension fund manager is going to buy this shit before the company he works for fires it's workers, who also happen to be the tenants of the properties he now owns?

So, do you think that we will end up with a repeat of the subprime crisis? Pension funds stuffed full of junk? Should I be asking WHEN rather than IF? Sure, the MBSs are not rated for NOW, but will they stay that way? Correct me if I am wrong, but I don't know of a single piece of legislation or regulatory oversight that changed as a result of the last meltdown. There is nothing stopping it from happening again, other than the same players waiting for the market to get amnesia and allow itself to be duped all over again.

Are the prime jumbo MBSs the segue into packaging up subprime NINJA junk? Feed the investors true prime investment-grade stuff for a while until they stop paying attention, then start stuffing the top tranches with trash?

Or am I being too cynical and everyone learned their lesson and the sub-prime NINJA bombs won't come back after all?

I apologize for the game of 20 questions, but since a house purchase in the Silicon Valley is out of the question as far as I am concerned, I'd like to stuff my down payment somewhere more lucrative than cash for the next few years. The way I see it, if there's another housing implosion, all these RE investment funds are going with it. It's easier to liquidate these investments than a primary residence though. Of course, as you have said many times SFace, when the cautious retail types start entering, it's time to dump. I'm a cautious guy in the retail category, so does the fact that I am actually considering this mean that the investors are within a year of dumping?

Interesting. I can't see 20%+ down payments being bullish for housing nationally, but I can understand that a lot of people in the SFBA may well be sitting on that type of cash. Hell, my wife and I are and we are barely 30 years old. Sounds like the smarter option is to just leave.

That Cypress Bank Tax made the safe, secure bank accounts look a little less secure, and even the less informed investment crowd is taking a look atbuying real estate again.

LASVEGASWINNER says

That Cypress Bank Tax made the safe, secure bank accounts look a little less secure, and even the less informed investment crowd is taking a look atbuying real estate again.

There's some broken javascript on top of your website.

bmwman91 says

There is nothing stopping it from happening again, other than the same players waiting for the market to get amnesia and allow itself to be duped all over again.

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