real estate going down?

Question

in some places real estate is going down in its down turn. will real estate always go down and stay flat?

doesnt real estate double every 10 years? so if ther average house is 500,000. in 10 years it will be almost a million? so in 5 years it will be 700,000? someone told me real estate ALWAYS has cyles, if it is going down now, it WILL go back up later. they said a real esate cyle is usualy 7 years. from top to bottom back to top, or bottom to top back to bottom. so in 5 years or more, real estate will be going up real high?

and someone said everytimg theres a boom, the next boom will always be higher than the last? so the last boom was in the early 2000's. so by the 2010 or later it will go up higher than the peak in the early 2000's?

if i buy 5 houses below value right now since prices are going down, andi n a buyers market for 500,000. can i look foward to selling them for 700,000 in 5 years from now when its a sellers market?

for california, los angeles

Answer 1

Not always the case so many things cause the fluctuation, just watch the market trends and you shoule be able to tell where everything is ...kr

Good Luck!

Answer 2

Judging from your question-- this is all a bit "new" to you.

"New" being another way to say inexperienced, a novice, fresh meat--, or in other words someone who may have to learn a lesson or two the hard way first.

Buying and selling real estate is kind of like being in your first gun fight or first fist fight. You don't know what to expect.

You don't usually get shot, but it can be just as brutal except you go broke fast if you don't know how to "play" the game with the big boys who know all the "tricks".

I would hire a good Real estate investment councilor if you plan to jump in. Also get a good taro card reader, and then a physic adviser to back up the investment guy.

An Indian medicine man could be handy too.

Then jump in. The sharks are always waiting for fresh meat!

Yes, generally real estate goes up. And yes, generally it has been 10% a year or more in many places. And yes you can make money. Not so however around New Orleans, and other places along the Gulf of Mexico and places prone to floods, fire, land slides, etc..

Many of these investors got wiped out. They never saw it coming. Kind of like a sucker punch, or ankle holster gun nobody checked for.

But if you like risks, lots of stress, dealing with idiot contractors, workers, and code enforcement people, then have fun---, but be very careful.

I'm not kidding. Lots of people are out to get the new guys money before they know how to play the game.

Kind of like playing high stakes Poker.

Fl Guy
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Answer 3

People will not lose "money": they will lose the anticipated equity that they banked on when they bought more than they could realistically afford, through ARMs or worse: "Option" loan products. The buyers who hopped on the gravy train at the beginning made killings. They also took the most risk. The ones who got on later were too late. The market wised up, interest rates went up and consumers began to see the writing on the wall. What will happen in Southern CA, among other things: 1. Government agencies will begin investigating all the loan fraud, taking out some major lending players. As a result of auditing, lenders will be forced to buy back their secondary market loans and lending practices will become more conservative, eliminating a HUGE segment of the homebuying population (They will no longer qualify). 2. Real estate prices will drop because homes cannot sell without qualified buyers. 3. The 68% increase in foreclosures means that there is some stiff competition for home sellers. Election year is coming. Politicians want to make names for themselves. There are also some big human-interest stories in the mass numbers of borrowers who were sold loans that they can no longer afford, due to predatory and fraudulent lending.

Answer 4

Yes, real estate has cycles and probably always will. But CA got very inflated, so might take quite awhile to get back to its peak, if it ever does.

You can't depend on real estate doubling every 10 years. And in any case, averages don't apply to one particular house, or five particular houses - it's very possible for the market as a whole to be up but the value of a particular house to be way down, or vice versa.

So no, you can't depend on it being a sellers market within five years - and you DEFINITELY can't depend on making money on five particular houses.

Answer 5

Real Estate is driven by interest rates.

Here is an excellent report I recommend you take a close look at.

http://www.dynamictraders.com/images/SpecialReports/dt_specialreport_bonds_507.pdf

Terry Smith
http://www.Welcome2Arizona.com

Answer 6

dabble but don't gamble...as the old adage goes..."what goes up comes down."