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You can also customize you condo! Pick from 3 different types of cabinets, pay extra for home theater wiring! When you buy pre-sale you get a deal, and customize your unit. Build equity before the building is even done!
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Jan 29, 2015 02:44
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People buy sight-unseen to speculate. They plan to sell their $40k down-payment for $60k in a year or two. They have no actual intention on buying or living in the unit.
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Jan 29, 2015 02:48
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xerxus posted:Fear that prices would sky rocket when they can finally pay the rest of the cost? Stupidity Though the stupidity comes from a couple factors like unwillingness to do any kind of research, lack of willpower to live within your means, no understanding of personal finances, little to no planning for the future, and a complete lack of alternatives due to lovely city management.
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Jan 29, 2015 02:48
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cowofwar posted:People buy sight-unseen to speculate. They plan to sell their $40k down-payment for $60k in a year or two. They have no actual intention on buying or living in the unit. This also happens with build slots for business jets.
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Jan 29, 2015 02:54
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I own an 1,100 sqft 3br house in the city, which was built in 1914. I have a wife and baby, and everyone keeps asking me when we're moving to the burbs for a bigger house. Do people not understand that human children are smaller than human adults?
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Jan 29, 2015 03:44
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Sassafras fucked around with this message at 23:04 on Feb 2, 2015 |
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Jan 29, 2015 04:06
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Furnaceface posted:Stupidity The other bit of stupidity is how the pre-sale price is equal or at many times much greater than a existing condo.
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Jan 29, 2015 04:22
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etalian posted:The other bit of stupidity is how the pre-sale price is equal or at many times much greater than a existing condo. People are AMAZINGLY stupid on this specific issue. The developer will say "When these hit the market they will be priced at 380k but if you buy in the pre-sale it will only be 350k!!!" and people jump on it, thinking they're saying 30k. The building gets finished, the units are LISTED at 380, and end up selling for, you guessed it, 350k or so. Sometimes far less. But of course the developer puts the idea in peoples heads that not only will the units be more expensive after construction, but they'll all be sold out. I should sell cans of corn this way. "The corn has only just been planted, harvest is still months away but if you buy now you can secure your can of corn for only $10, after harvesting and canning the corn will be $15 and it might all go in the pre-sale, if you want corn buy now!!!" and then set up a system of government backed debt for people to buy corn and have generations of people who lose their collective poo poo if corn prices aren't always going up. Do you know how many billions this country has tied up in corn loans? Do you know how many jobs the corn industry and associated financial services generate?? We need to make sure the price of corn keeps growing well above inflation, make it a matter of government policy. Baronjutter fucked around with this message at 04:36 on Jan 29, 2015 |
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Jan 29, 2015 04:32
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Baronjutter posted:People are AMAZINGLY stupid on this specific issue. The developer will say "When these hit the market they will be priced at 380k but if you buy in the pre-sale it will only be 350k!!!" and people jump on it, thinking they're saying 30k. The building gets finished, the units are LISTED at 380, and end up selling for, you guessed it, 350k or so. Sometimes far less. I liked this analogy: https://www.youtube.com/watch?v=o3IrWk0hy6Q etalian fucked around with this message at 04:40 on Jan 29, 2015 |
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Jan 29, 2015 04:36
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Congratulations this thread just discovered derivatives. Too bad there's no OTC market for condo pre sales. loving 
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Jan 29, 2015 04:39
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Also the other things that owns about a pre-sale is you basically locked up $40,000 to $50000 in deposit money that isn't earning you one cent during the 3-4 year construction period.
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Jan 29, 2015 04:41
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Baronjutter posted:"The corn has only just been planted, harvest is still months away but if you buy now you can secure your can of corn for only $10, after harvesting and canning the corn will be $15 and it might all go in the pre-sale, if you want corn buy now!!!" Well now that you mention it.... It's not like they're making any more farm land... Sounds like a great investment. I better get in on the ground floor here. Put me down for a couple cases. This is going to make me so rich, flipping corn! There's no capital gains tax on canned corn if I keep it for 6 months right?
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Jan 29, 2015 04:48
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Baronjutter posted:People are AMAZINGLY stupid on this specific issue. The developer will say "When these hit the market they will be priced at 380k but if you buy in the pre-sale it will only be 350k!!!" and people jump on it, thinking they're saying 30k. The building gets finished, the units are LISTED at 380, and end up selling for, you guessed it, 350k or so. Sometimes far less. But of course the developer puts the idea in peoples heads that not only will the units be more expensive after construction, but they'll all be sold out. This is really popular in China because people usually only have to put a small portion of the money down to buy, and they can immediately start shopping for offers on the apartment. It's basically high leverage and call options combined with very low liquidity and unsophisticated buyers.
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Jan 29, 2015 04:58
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on the left posted:This is really popular in China because people usually only have to put a small portion of the money down to buy, and they can immediately start shopping for offers on the apartment. It's basically high leverage and call options combined with very low liquidity and unsophisticated buyers. Don't kid yourself, this was happening in Vancouver and Toronto too. The government finally stepped in and sent the CRA around to look at the assignments. (And now condos aren't being sold out.)
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Jan 29, 2015 05:23
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Cultural Imperial posted:Congratulations this thread just discovered derivatives. basically condo derivatives for stupid greedy morons
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Jan 29, 2015 05:57
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ocrumsprug posted:Don't kid yourself, this was happening in Vancouver and Toronto too. The government finally stepped in and sent the CRA around to look at the assignments. (And now condos aren't being sold out.) In the US, banks would blacklist condos that looked financially risky, and when that happened, the projects would completely disintegrate. Miami had some huge portion of unfinished condo buildings that were ineligible for bank loans at one point, it was a bloodbath.
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Jan 29, 2015 06:33
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on the left posted:In the US, banks would blacklist condos that looked financially risky, and when that happened, the projects would completely disintegrate. Miami had some huge portion of unfinished condo buildings that were ineligible for bank loans at one point, it was a bloodbath. After the bubble the other issues is banks wouldn't want to give loans for complexes that had a massive numbers of new vacancies due to short sales and foreclosures too.
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Jan 29, 2015 06:43
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on the left posted:In the US, banks would blacklist condos that looked financially risky, and when that happened, the projects would completely disintegrate. Miami had some huge portion of unfinished condo buildings that were ineligible for bank loans at one point, it was a bloodbath. http://www.torontorealtyblog.com/ It is written by the fellow that has been in a couple of the youtube videos listed on the last couple of pages. http://www.torontorealtyblog.com/archives/problems-at-the-printing-factory-lofts/10523
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Jan 29, 2015 07:10
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etalian posted:Also the other things that owns about a pre-sale is you basically locked up $40,000 to $50000 in deposit money that isn't earning you one cent during the 3-4 year construction period. fails to grasp compound interest and hidden real estate transaction fees for comparable returns of $27k vs $25k-$15k = $10k
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Jan 29, 2015 07:57
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cowofwar posted:Why would you ever invest in the stock market for a pathetic 3% return when you can buy a $300k house and sell it for $325k three years later? That's $25k of sweet sweet profit.
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Jan 29, 2015 08:07
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Baronjutter posted:People are AMAZINGLY stupid on this specific issue. The developer will say "When these hit the market they will be priced at 380k but if you buy in the pre-sale it will only be 350k!!!" and people jump on it, thinking they're saying 30k. The building gets finished, the units are LISTED at 380, and end up selling for, you guessed it, 350k or so. Sometimes far less. But of course the developer puts the idea in peoples heads that not only will the units be more expensive after construction, but they'll all be sold out. yeah this is basically a future and corn futures actually is something that can be traded
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Jan 29, 2015 14:24
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peter banana posted:yeah this is basically a future and corn futures actually is something that can be traded Deregulation of futures, especially oil futures, in the US contributed heavily to the insane economic collapse of 2008
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Jan 29, 2015 14:31
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Ceciltron posted:Deregulation of futures, especially oil futures, in the US contributed heavily to the insane economic collapse of 2008 It did? Do elaborate.
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Jan 29, 2015 15:26
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I think ceciltron is making reference to the repeal of the glass stegall act by Clinton. But that didn't really have much to do with oil. I'd like to know what oil has to do with 2008.
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Jan 29, 2015 15:49
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I remember copper futures being a big deal in the liquidity crunch.
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Jan 29, 2015 16:19
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Cultural Imperial posted:I think ceciltron is making reference to the repeal of the glass stegall act by Clinton. But that didn't really have much to do with oil. I'd like to know what oil has to do with 2008. Well, I remember in Matt Taibbi's Griftopia he spent a chapter talking about he ratcheting up of commodities pricing by speculators. It put gas prices out of reach for many people who were struggling already, to the point where if someone was working a low wage job, it was a better decision to lose their job instead of driving to it everyday.
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Jan 29, 2015 17:01
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Remember what else was crazy expensive? Rice. Philipino families were busting into Costco and buying as much rice as they could carry. And then the bottom fell out. The economist also got caught up and had a big feature about the "end of cheap food???". My point is, it's just mania. Extremely destructive, totally debased, pure mania. Totally bereft of rationality.
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Jan 29, 2015 17:15
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Grand Theft Autobot posted:I own an 1,100 sqft 3br house in the city, which was built in 1914. I have a wife and baby, and everyone keeps asking me when we're moving to the burbs for a bigger house. That's pretty cozy for a family with a baby (I have two kids and lived in a similarly sized place previously). Wait until you get a toy collection and they start walking.
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Jan 29, 2015 17:28
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peter banana posted:Well, I remember in Matt Taibbi's Griftopia he spent a chapter talking about he ratcheting up of commodities pricing by speculators. It put gas prices out of reach for many people who were struggling already, to the point where if someone was working a low wage job, it was a better decision to lose their job instead of driving to it everyday.
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Jan 29, 2015 17:43
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Yup, the commodity bubble around '08 was spectacular. At one point a single person or fund had purchased 80% of the worlds cocoa reserves for example, and was hoarding them to drive up the value, this is also why most chocolate quality took a massive nose-dive from which it has yet to recover. It turns out that turning everything into a financial instrument is a good way to bring your civilization to the brink of implosion. It wasn't mania, it was cold calculated greed.
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Jan 29, 2015 18:04
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Baronjutter posted:People are AMAZINGLY stupid on this specific issue. The developer will say "When these hit the market they will be priced at 380k but if you buy in the pre-sale it will only be 350k!!!" and people jump on it, thinking they're saying 30k. The building gets finished, the units are LISTED at 380, and end up selling for, you guessed it, 350k or so. Sometimes far less. But of course the developer puts the idea in peoples heads that not only will the units be more expensive after construction, but they'll all be sold out. The developer will also do anything, anything to preserve listed sale price. There was a development up near Finch station that I pass by every day (The Palm) that provided a great example of this in action. They never changed the advertised sale price, but once it was clear they wouldn't sell out before construction began, they started offering 'freebies'. They offered better counter tops, then better flooring, then bathrooms, then better appliances, then you got home theaters, etc. Eventually, the signage posted offered 1 year of free condo fees and the developer would pay your transaction costs. The price never budged, but if you added up all the discounts, they probably knocked 30k-50k off the actual 'cost' to try to get them sold. Way too much about the 'value' of a property is based on it's price, and nothing else (bank loans, mortgages, speculators) and until that get sfixed, we are in for a bigger and bigger bubble.
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Jan 29, 2015 18:10
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Cultural Imperial posted:Remember what else was crazy expensive? Rice. Philipino families were busting into Costco and buying as much rice as they could carry. This is the problem with futures. They were invented and adopted for very good and mostly altruistic reasons, but the sole purpose of them these days is to create bubbles/money.
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Jan 29, 2015 18:30
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CADUSD: 0.78927 and falling. Strong Stable Economy! 
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Jan 29, 2015 18:39
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Saltin posted:This is the problem with futures. They were invented and adopted for very good and mostly altruistic reasons, but the sole purpose of them these days is to create bubbles/money. This is pretty hyperbolic... There are two sides to every futures contract, so for every speculator there is a hedger.
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Jan 29, 2015 18:46
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mike- posted:This is pretty hyperbolic... There are two sides to every futures contract, so for every speculator there is a hedger. Or two speculators, or two hedgers
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Jan 29, 2015 18:57
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mike- posted:This is pretty hyperbolic... There are two sides to every futures contract, so for every speculator there is a hedger. Futures and derivatives are meant to price in risk so that it was quantifiable. It is pretty clear that it is being used, in some cases like fuel and agriculture, to create that risk for profit.
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Jan 29, 2015 18:59
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I disagree about that statement about derivatives being evil. Seriously, blame Clinton for repealing glass stegall. Worst loving decision ever made
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Jan 29, 2015 19:00
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mike- posted:This is pretty hyperbolic... There are two sides to every futures contract, so for every speculator there is a hedger. You know whats hyperbolic? those commodity price charts from all that speculation that has no relevance to the real economy at all!
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Jan 29, 2015 19:03
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Kalenn Istarion posted:Or two speculators, or two hedgers Can you provide an example of a futures contract with speculators on each side?
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Jan 29, 2015 19:12
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mike- posted:Can you provide an example of a futures contract with speculators on each side? You're joking right Like Literally every available contract can be bought or sold openly and there's tracking of net spec positions. The tone of the market is often measured by looking at how the net spec buy on a contract has changed. Market participants are required to register as a hedger or speculator, so it's pretty easy to know who's buying what. This isn't visible to external parties on any given contract but that doesn't matter.
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Jan 29, 2015 19:17
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