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moana posted:Step 2 I feel kind of stupid for not knowing this, but if the rule of thumb is not more than ~1/3rd of one's income total toward debt, what is the other 2/3rd supposed to be used for? Maybe I'm missing something, but with that much extra income every month, shouldn't you pay double toward the mortgage or something?
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May 6, 2009 16:27
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Cheesemaster200 posted:How long did it take tech stocks to rebound after that bubble popped a decade ago? Like I said, just because something took a hit, doesn't mean that said industry is doomed for the next quarter century. We pick ourselves up and get on with it. People still want to own houses, banks still want to make oodles of money with bad mortgages. But a lot of tech stocks never did rebound. The NASDAQ in particular has never come close to its previous peak. E: Words. Kobayashi fucked around with this message at 04:07 on May 12, 2009 |
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May 12, 2009 04:04
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Cheesemaster200 posted:Well I guess I can't argue with that! I don't get what you're trying to say here. It's not that the NASDAQ "never really saw" its previous highs, but rather, 10 years later, it's never even come close. Yes, there was a strong uptick over the past 6-7 years, but after the latest crash, it's much, much closer to its 10 year low than its 10 year high. And yeah, the S&P and the Dow did a lot better, but you specifically mentioned tech stocks, so that's why I brought it up. I don't think the major tulip indexes have ever really recovered, either...
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May 12, 2009 18:06
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Cheesemaster200 posted:What I am trying to get at with all this is that the future of markets is still uncertain. It may go up, it may go down more. Some markets may see highs, others won't. Earlier in the thread people were making accusations that the housing market has to align to a historical curve that adheres closely to inflation adjusted values like it is a law of economics. Well duh, the bog standard disclaimer for pretty much everything is, "past performance may not be indicative of future results." The point people are trying to make is that there is no real, sustained evidence that homes are good investments. Sure we just had a huge bubble, and I guess it's possible it could re-inflate, somehow, but all the evidence suggests that this was a once in a lifetime orgy of free credit and rampant speculation.
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May 12, 2009 19:49
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Cheesemaster200 posted:The evidence does not suggest that, the evidence suggests that the latest bubble was different than what is was for the last 100 or so years before it. It does not inform you of anything about the future housing market. Making any conclusion based only on that graph does not take into effect any other factor other than "what it previously was". What graph are you talking about? Are you seriously arguing that because we can't predict the future with absolute certainty, we cannot make any conclusions at all about the future of the housing market?
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May 12, 2009 20:55
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Cheesemaster200 posted:I am not trying to marginalize the trends of housing, but this isn't a scientific experiment where we can make a conclusion from data points observed previously. The housing market is just too large of a dynamic entity. Yes, in the past it was rather linear, but that was before jumbo loans, ARMs, government subsidy for housing, modern mortgages procurement, and tons of other factors which led to this bubble in the first place, factors which aren't going away I didn't see your edit earlier, but this is just all wrong. Housing prices have hardly been "linear" over time: http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27leon_graph2.html Jumbo loans and ARMs are most certainly going away. Gaaaah, do you even have any idea what's been happening over the past 10 years? 
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May 12, 2009 21:00
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swenblack posted:Of course we can't predict the future with absolute accuracy. I don't mind opposing views on where the market is headed, but most of the information you're using to support your argument is wrong. The last major social change in regards to home buying was right after WWII, after Congress had passed several measures to encourage home ownership, including implicitly backing mortgages up to 30 years. That, coupled with the post-war economic prosperity accounts for the large jump in home prices in the late 40's and early 50's. It was during that time when all your "modern mortgage ideas" originated, not in the last ten years. Yeah, and entities like the FHA were created in the wake of the Great Depression.
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May 12, 2009 22:57
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Tap posted:Alrighty then, thanks for talking me out of it. I'll continue renting until I can make more money. Yeah, look at Step 2 from the OP. General rule is you can safely ballpark around 2.5x your annual salary. A $250k mortgage puts you at 5.0x your annual salary. Right now you either need to double your income, or halve the loans you're looking at.
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May 28, 2009 18:39
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