I agree that going forward is going to be tougher in both capital and RE markets. The US Fed had 3 rate increases this year so far, say there will have one more in Dec, and are signalling 3 for 2019. Either the yield curve is going to invert and bring on the next recession, or the whole yield curve will shift upward. All that cheap debt is going to get significantly more expensive. Households, corporations and government are all so indebted, it is going to have an impact in all markets.I think RE and wall street BOTH have been so manipulated over the last 10 years that neither are very stable given our current situation with rising rates and central banks globally starting to tighten. The economy has been on steroids and any idiot was able to make money.... (including me) The next 5 years will thin the heard.... RE or stocks/bonds.
Thanks JAG. Which end are you referring to? RE bubble? Stock market?...one difference is, in real estate you can buy in at tomorrow’s lower prices today (if you’re lucky). Something you can’t really do with stocks. It’s been easier to do this year than ever before, which tells me the end is getting nearer.
Yes, you can as many, including Pluto above, have articulated it well over time. It is just on a different time frame with stocks than it is with illiquid assets such as RE. A current stock example is CTC.b It's intrinsic value has not changed in the last two months but its market price certainly has, down from $180 to $155. Market perception changes on future cash flows affect both types of investment. I wouldn't buy investment RE today due to mortgage rate increases unless market prices come down to offset perceived rate changes in the next 12 months or so.one difference is, in real estate you can buy in at tomorrow’s lower prices today (if you’re lucky). Something you can’t really do with stocks.
I think both are overdue, at least the numbers seem to indicate it. The problem is, as was so eloquently stated, markets can remain irrational longer than you can remain solvent.Thanks JAG. Which end are you referring to? RE bubble? Stock market?
You can only buy at half the price if there is another identical unit willing to be sold for half the price the same day, week or month. Market prices for a stock vary all day too, sometimes significantly. Market price is what 2 parties are willing to do a transaction for, whether RE or stocks. The only difference is frequency and degree of variation. Not sure why you keep on insisting otherwise but it seems very much being dug in on your own form of reality. We will obviously never remotely agree.In real estate however, a two bedroom in the same building may sell for half of what another unit did on the same day. There is no market price that says this is what a place will sell for. One person may have overpaid, maybe neither did, one just got a better deal, maybe they both overpaid in the long run (that’s where knowledge comes in handy).
To the market, no ... the market may change it's mind to be more of what one thought when buying.... The stock market price, IS the price of the stock today.
You may think the market is undervaluing the stock price, but the market disagrees, your personal opinion doesn’t matter in the stock market ...