patrick.net

Home prices come down to affordability as most are bought with a mortgage or they are bought with cash and then long term rented.

Those bought with cash are intended to earn at least a 7% annual return on investment, so they have to charge enough rent and minimize expenses to realize that.

Housing cost (rent or mortgage/property tax/property insurance/hoa fee/home repairs) should not be more than 38% of household income.

With the 30 yr mortgage rate nearly at 5.9%, and it was 2.8% months ago, that means housing has to drop to late 2019 price levels at least.

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DooDahMan says

t. In other words, the probability that a big one-day rally occurs during a bear market is nearly twice as high as you'd expect on the basis of randomness.

It may be long term investors buying stocks at a desirable price level. They think they are getting value by buying it then and holding onto it for at least 3 to 5 years.

Look at Carnival Cruise this past Friday and see how much the stock went up in early trading. If it goes up that much that means so major investors or "whales" are buying shares.

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ad says

Look at Carnival Cruise this past Friday and see how much the stock went up in early trading. If it goes up that much that means so major investors or "whales" are buying shares.

Soros bought RIVN at 103 plus, Buffett bought SNOW at 251. Whales can be wrong too.

I think the term here is 'Reversion to the Mean' trading.

In other words, when the bear market sell off is huge, creating a huge gap between the price and the 200 day EMA, then, there's a tendency to rally back to re-test the 200 EMA or at least, the middle of the Bollinger bands (in effect), before re-commencing with another sell off.

A picture is worth a 1000 words. Here's the SPY with a 200 day EMA in red & a Bollinger Band which uses the 66 day (approx 3 mos) as its EMA with the standard bands.



So whenever the market seizes to be bullish, i.e. when the below 200 EMA price is a daily phenomena, ala bear market, you can almost see the reversion to mean, counter-rallies, trying to get back to good.

So the question then is to what extent is one an active trader? If one's not glue to the ticker tape w/ all his software tools, then perhaps, it's best to only take trades, once the 200 EMA is re-tested and the price action closes above it.

Rin says

'Reversion to the Mean'

Yes, and the PE is below 20. How far does it drop ? To 15 ? https://www.multpl.com/s-p-500-pe-ratio

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And the annual return for the S&P 500 has been only 6.5% since January 2000. That is based on reinvesting dividends and is the rate before inflation.

Adjusted for inflation, and the annual return is 4% since January 2000. What happened to the S&P 500 returning 11% a year ?

https://dqydj.com/sp-500-return-calculator/

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ad says

Yes, and the PE is below 20. How far does it drop ?

I'm not too sure if the PE, or better yet, the Schiller PE10 (which uses 10 years of trailing earnings to average out the periodic poor quarterly sales), give ambiguous results when used globally.

https://www.topdowncharts.com/post/2020/04/09/10-charts-on-the-pe10-valuation



If you look at ETFs which track Singapore (EWS), Korea (EWY), Poland (EPOL), Norway (ENOR), etc. They seem to also be dealing with their own bear markets.

Rin says

Schiller PE10

Yeah the Shiller PE ratio, which uses the last 10 years of earnings, continues to trend down. https://www.multpl.com/shiller-pe

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At level 4. Won't be at level 5 until the house is paid off. Goal is to be at level 6 by the time I retire.

Level 7 only if I become independently wealthy via some of my patents / innovations / inventions. To date they only exist on paper. None have gained traction, but I still tinker in my spare time.

Eman says

This is making the spread between the borrowing cost and the return you’re getting. You’re essentially operating as a bank.

That's right! I make loans (about wrapped up now though) on lending club too but I was mostly speaking about real estate.

I'm into a lot of things. That's real diversification.

Pay cash for house (with enough elevation that it won't flood). Make house hurricane proof. Add sprinkler system. Drop homeowner's insurance.

DooDahMan says

Does this include backed up toilets / sewers or someone leaving a faucet(s) on or just one of those I forgot it is going to 20 below tonight and I was supposed to keep a trickle of water running so the pipe don't freeze moments ?

I've never had pipe freezing, because they run through my basement, which doesn't freeze. In so far as the other things that you mentioned, those only happen to stupid people.

DooDahMan says

Is homeowners insurance required in Florida?

Only on a Mortgage, and the bank is the one that requires it.

Out of control rising premiums is the main impetus for me deciding to double up my mortgage payment and pay off the remaining 20 years of my scheduled payments, in less than 5 years. I paid it off at the end of 2020, and the first damn thing I did was canceled my Insurance and got the premium back. It renewed through my escrow account about one month before I paid it off.

My Premium was already $3500 when I canceled it, it would probably be well over $4000 by now.
If I were to put 4K in a rainy day fund, I would have 20K within 5 years. That would be plenty to make any hurricane repair with or without sweat equity.
Face it, if my house were to totally blow away, then so would every other house in South Florida. The insurance company would go belly up and Fema would have to step in and pay for it all anyway.

DooDahMan says

Not sure I will live long enough to see such a creation

Hurricanes are about storm surge. A quality built house can sustain a hurricane easily, you just have to spend $$$$ up front. Modern houses should not sustain wind damage unless 120mph plus. Obviously it depends on the builder and what you're willing to spend.

I'm in a tornado prone area and when they hit (not my town) many of the houses stay in-tacked with maybe some roof damage or a broken window from debris. Sure an F-5 tornado or a Cat 5 hurricane could fuck your shit up, but flooding is the biggest concern with hurricanes, not wind until it's Cat 4 plus.

We're used to seeing Weather Channel people standing at the beach acting like they cannot stand up to get ratings and views. EVERYTHING is a business. It's not about informing you. And yes, hurricanes and tornados are dangerous. If you can make money off them you exaggerate the experience of them. Everyone I know in IL goes outside if the tornado sirens go off to check the weather. Always be safe, but rare and extreme events rarely result in death or damage.

As someone who worked in the mortgage bank industry, I recommend just increasing your deductible limit to lower the cost of insurance. Some repairs can be financially devastating such as a tornado, fires or sinkholes.

The nice thing about renting is if you don’t like the neighbors or your situation you can leave.

The bad thing about renting is if you really like your situation the owners can tell you to leave, which is inconvenient.

Getting a good situation with cheap rent is a lucky event, but sometimes you get lucky.

clambo says

The nice thing about renting is if you don’t like the neighbors or your situation you can leave.

The bad thing about renting is if you really like your situation the owners can tell you to leave, which is inconvenient.

Getting a good situation with cheap rent is a lucky event, but sometimes you get lucky.

Do what I'm doing. Buy all the fucking lots around you and know your neighbors. I won't have a neighbor within 200'. Or go legit rural in the middle of a farm field. I like the ease of socializing though in a town (not city) and not having to drive far for a basic think like milk or bread.

Outside of CA, I'd say buying makes the most sense if you're going to anchor there for 10+ years. Easy hedge on inflation. CA appreciation looks amazing on paper, but gets capped with the state income taxes. I think the state is hitting a peak. Foreign investment is one thing. Other states are more attractive. Why would I move to CA and with state taxes alone get taxed 60-70% more than I do in Blue ass IL? Sub 5% versus getting into the 13% bracket in CA is a no brainer. I'll stay in IL.

DooDahMan says

Jan. 6 attack on the Capitol

More precise would be "trespassing on Capitol grounds followed by disproportionate response"

DooDahMan says

not sure why others did not catch on

Willful blindness, Madoff was a respectable upper-class member so not polite to question him.

Bd6r says

DooDahMan says

not sure why others did not catch on

Willful blindness, Madoff was a respectable upper-class member so not polite to question him.

There wasn't a problem until he started ripping off wealthy Jewish people. That's the stark reality.

I'm sure lots of people knew about Madoff, but didn't say anything because they didn't want to wade into the solipsistic delusions of the beguiled celebrities who felt they were entitled to absurdly optimistic returns. I wouldn't count that as some kind of profound prediction. Just like today, you can't really say anything to the bitcoiners, or the the "White Rabbit" crowd who read every week that the QFS is pending with the Iraqui Dinar and the Zimbabwe Dollars etc. etc.

They dangle the exact same carrot that it all is coming 'next week', and when next week arrives, then it is coming again 'next week' when all of these mysterious bond funds are being released.

Apparently, the dinar frauds are perpetrated by the Bush family and their banks, and the gold and precious metal floggers. It's only when the Ponzi schemes collapse under their own weight that the beguiled scream and yell, and as often as not, they are eager to pile into the next web of fraud delusions spun for them by some sociopathic magician.

Some of the sociopaths actually think they are performing a psychologic service for these daft gamblers who NEED to pursue a delusion of the pot of gold at the end of the rainbow. Who knows, maybe they are. The now ancient "Sir Francis Drake" scam has been going on forever, just changing hands when one executive group of con artists are imprisoned, only for a new generation to crop up to feed the subscribers to the fraud.

Deport Hindooo cult back to their hell hole... This is only solution to save West from hindooo mess.

https://ca.news.yahoo.com/newsroom-ready-police-face-growing-232300876.html
Newsroom Ready: Police face growing questions, calls for investigation into false Parliament bomb tip

FarmersWon says

A fake bomb threat resulted in the arrest of 2 Sikh men attending a Sikh Genocide Remembrance Rally.
This raises serious questions. Who provided this false info and was this really about shutting down dissent?

How do you know it's not fake?

Hey, there's nuts and violent people in every group.

DooDahMan says

zzyzzx says

those only happen to stupid people

Or people with children

Same thing, for the most part.

DooDahMan says

Hail damage and home insurance coverage: What you need to know

Homeowners insurance offers protection against hail damage to your home's structure. But insurers in states where hailstorms are common limit the coverage or increase the premium So, if you want protection from such events, make sure that you are being fully covered and check for restrictions on your homeowners' policy before purchasing it.

https://www.insurance.com/coverage/home-hail-damage-insurance-claims

So this is why insurance is so expensive in Oklahoma?

1337irr says

As someone who worked in the mortgage bank industry, I recommend just increasing your deductible limit to lower the cost of insurance. Some repairs can be financially devastating such as a tornado, fires or sinkholes.

I'd agree. If you can't front a high deductible you're likely to be broke. Maybe don't buy/build something so expensive? I always go high deductible and high coverage.

Having made claims from travel to houses, keep cash on hand and you'll be rewarded with a lower monthly payment. No sense in giving it away to an insurance company until you actually need to, which might be never.

Thorp looks great and is sharp AF for 89. I have a friend and a neighbor in that range and they are both infirm and kind of daft.

There are many investors buying places, especially in Florida.
There were unoccupied places and that was the reason.
I think it’s wrong that people have to bid against Wall Street or groups of rich people to buy a place.

HunterTits says

DooDahMan says

Logan Mohtashami: The investor narrative has been blown out of proportion because they’re not the biggest buyers of homes in America.

Fucking bullshit. It is as high as 50% in many markets when you look at mortgage applications for second homes where they check off the box where they say they intend to collect rent on the house. That means they are investor buyers.

If one just looks at the purchases being made by LLCs and Corps like this jackass is referring to, then it seems like it is only 25% of sales are investors.

DooDah's post is in the side of the investors, that's why he is projecting.

I work as a Notary Public in Real Estate. I too see that 50% of transactions are for investors. Every RE agent and Loan Originator I know that has made good money, has done so by buying opportunities and either flipping them or renting. Regular folks miss out on those opportunities m

The Fed Funds rate was 5% to 6% from 1995 to 200, and around 5% in 2007.

The Fed Funds rate was 0.25% from 2009 to 2016 and then peaked at 2.5% in 2019.

It is now 1.75%. I suspect the Federal Reserve will raise it to a maximum of 3% to 4%.

All of this may help adjust housing prices so that homes are affordable.

That means housing cost (rent or mortgage/property tax/property insurance/HOA fee) is not more than 36% of household income for the typical family living.

.....

richwicks says

FarmersWon says

A fake bomb threat resulted in the arrest of 2 Sikh men attending a Sikh Genocide Remembrance Rally.
This raises serious questions. Who provided this false info and was this really about shutting down dissent?

How do you know it's not fake?

Hey, there's nuts and violent people in every group.

Hindoo is known to kill own people and blame Sikhs. This is factual historical fact.
There leaders openly said its OK to kill 40M Bhartis to get rid of 20 M Sikhs.
Hindooo cult treats Bhartis like shit.. $1 a day wage and no toilets or food.

On the current news:
https://ottawa.ctvnews.ca/false-bomb-threat-tippers-should-be-prosecuted-world-sikh-organization-of-canada-1.5946141
Police face growing questions, calls for investigation into false Parliament bomb tip

https://ottawacitizen.com/news/local-news/rcmp-investigating-false-parliament-hill-bomb-tip-against-sikh-men-ottawa-police
RCMP investigating false Parliament Hill bomb tip against Sikh men: Ottawa police

WookieMan says

1337irr says

As someone who worked in the mortgage bank industry, I recommend just increasing your deductible limit to lower the cost of insurance. Some repairs can be financially devastating such as a tornado, fires or sinkholes.

I'd agree. If you can't front a high deductible you're likely to be broke. Maybe don't buy/build something so expensive? I always go high deductible and high coverage.

Having made claims from travel to houses, keep cash on hand and you'll be rewarded with a lower monthly payment. No sense in giving it away to an insurance company until you actually need to, which might be never.

+1

Worked hard and never got laid. Perfect drone.

I mean, who is the jackass that upvoted this drivel.

Fucking attempted coup my ass. The first fucking coup attempt in history where not one “insurrectionist” was armed and the fucking government said “come on in”.

Who the hell are the assholes writing these lies?

The threat to Democracy is too much government meddling in our lives.
Another is allowing foreigners in the USA in large numbers.
The most recent threat was the lawless behavior of governors illegally changing voting procedures to vote (fraud) by mail. This allowed vote fraud on a large scale.
Only a fool believes we should vote by mail.
January 6 was a protest against the vote fraud in November.
How do we know it’s a fraud? It’s true because any mention of it was censored by Facebook, Twitter, etc.

DooDahMan says

On the anniversary of the January 6 attempted coup

This was a public demonstration that meant to get the public's attention. It was no coup, and you know that. If it was, then they would have gone in there with guns and started shooting and set fire to the place. Yes it caused disruption but it was not there to have a takeover of the government. And yes, disruption or disorderly conduct could be attributed to a few of the protesters, including the African American, John Sullivan, who is a left wing activist.

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My father lived to just a week short of 96.
The cartoon above shows an inaccurate description of him.
He did take a nap after lunch.

I recommend to have extra money to pay someone to help you; your kids likely won’t (if you have any).

I’m not a geezer yet but I’m going to be prepared for it.

Don’t let yourself go, my father even had a trainer at age 94.

DooDahMan says

On the anniversary of the January 6 attempted coup

I agree. It is fraud and slander to characterize legitimate unarmed objection to mass election fraud as somehow a coup, especially when the protesters were deliberately let to the Capitol building.

I disallow it.

DooDahMan's comment will all go through moderation again, like I did once before. I am certain that he is not here for any good reason.

LOL at new title. It is a 'Soros' tactic to interject 'threat to democracy' every other sentence to virtue signal and justify destruction of actual democracy.

There's enough firm evidence Jan 6 is a rampant false flag perpetrated by the Dems and radicals, that the 'coup' word repeated over and over with the 'd' word is two bit propaganda.