BoyGenius
Cyber Bully Victim
First off, mark to market is pure 100% fantasy and the dumbest idea in the last 5,000 years. Besides the DH rule. The best property in the universe isn't worth X dollars, right now, this very minute. It's worth what it's worth when it is bought and sold. Everything else is a suggestion based on recent sales and a fair idea of the pool of buyers, but still a guess.
Mark to market is part of how we got in this mess in the first place. Mark to market is a real time heart monitor and stampede creator in a nation that works best on weekly, monthly, quarterly and annual accounting. It CREATES instability where stability is CRUCIAL.
Imagine if milk was valued several times a day. The shelf is kinda bare, up goes the price! The delivery truck blew a tire, up goes the price! Some mom just bought 3 of the last four gallons! There's three people heading for the dairy case and 4 cars just pulled into the parking lot! Quick! PANIC! That gallon is gotta be worth $100 to someone!
Now, the reverse. The snow storm DIDN'T come, an Internet rumor said milk is bad for you, people are on vacation, the three gallon lady found out she is lactose intolerant and the delivery schedule got messed up and an extra milk delivery came; there's milk everywhere! Quick! Panic! Sell that milk for whatever you can get for it!!!!
Secondly, who in the hell could have predicted in '07 that a GOP potus would take these drastic, huge and devastating steps towards socializing the economy? He pulled the rug out from under everyone and everything. He did NOT fix Fanny, he did not fix mark to market, he did not fix oil. He poured gasoline on the whole smouldering mess.
So, the question; better to own or better to rent?
If you've rented the last two years and it's cost $1,000 a month less to your cash flow, including the tax implications, then you have $24,000 more cash had you rented...depending on where you put that money.
If it's in the bank, great.
Under your mattress. Great. Hope you don't get robbed.
Buried in the back yard. Great. It's not your back yard.
If it's in Citibank stock. It's gone.
If it's in gold, great.
If you started a business with it, great. Depending on the business.
It's fine to argue renting is better. We would all be better off now if 8% of new homeowners the last 5-6 years did NOT get their loans. We'd all be better off if W hadn't socialized the economy. We'd be recovering now. We'd all be better off if Obama and Nancy and Harry hadn't just made it far worse.
At some point, housing WILL settle into a fair supply and demand equilibrium and most, especially better properties will recover. If housing falls some more and you've now saved $36,000 because you rented yet my house starts going up $12,000 a year for 3 years, we're even and the question goes right back to the one I asked earlier that you are trying to avoid answering;
What do you do with that money you saved by renting as housing devalued?
I thought I pretty clearly stated a 5% FDIC insured savings account back in the time-frame this thread was started was the place to be. These days it would be in bonds.
http://forums.somd.com/consumer-fin...h-you-owned-your-own-home-19.html#post3619138
And I guess under your explanation of mark to market, when they send you a brokerage statement it should reflect what you paid for your stocks, and what they might sell for next week, not what they're trading at today. Can we do that for car loans too? Living outside of what things are worth in real-time is pure fantasy, you just don't want to come to terms with that. Making statements that your house may go up $12k a year is just as funny as the statements that were made in the opening lines of this thread. It may happen, it may not, but you can't back it up either way, and it's irresponsible to pretend it will, and that's the kind of stuff that kept the housing game going as long as it did.
And I'll reiterate what Somdrenter says: you guys like to use the classic excuse that people advocate renting as being superior to owning, while you all advocate the opposite, the truth is that has never been the case, what's been advocated is you rent until you can buy low and sell high. And to prop up home prices you to try to degrade people into thinking they're lower class citizens if they rent. This rental strategy provides the same quality of life and doesn't take down the economy. Who's going to be successful in San Souci: the guy who paid $70k in 1999, the guy who paid $206k in 2006, or the guy who pays $75k in 2010?
What do you have to say to the people that fell for these self-centered, delusional lines back in October 2007:
Don't be stupid and let this buyer's market opportunity pass you by.
So STOP that renting!!! Renting is for losers! The American dream is to OWN a home, not friggin rent one.
"You are TOTALLY not going to get that kind of deal a year from now."
) and making it a 2 car and putting a bigger master bedroom above it.
