Real Estate: “So the market drops.. big deal. I am in for the long haul.”

“I agree buying today is insane, but the bears forget that there are legions of homeowners who are living mortgage free. So the market drops.. big deal. I am in for the long haul.”


“One thing most bloggers in here seem to overlook. There are masses of homeowners like myself, who like myself have shaved years off the mortgage monster and have only a few years remaining. We have been given a golden opportunity on financing with ultra low rates that probably won’t return for decades..yes, my old man use to tell me how in the early 80′s, 1st and 2nd mortgages were the norm, 11%-12% rates made you feel blessed.
So, I enjoy the remaining years of my mortgage with a locked in, juicy 2.89%…bought before the market lost it’s bearings – prices may have doubled, but I am loving where we live – mortgage free is just a skip away – and though some will hiss that being liquid is having cash – but I say – what if..just a thought, the world goes into a financial crisis (I know, that’s just crazy talk) and the currencies around the world become worthless toilet paper – hard assets will rule. Money won’t keep you warm at night if those digital numbers all of a sudden get wiped out.
I agree buying today is insane, but the blog dogs forget that there are legions of homeowners who are living mortgage free, investing in themselves and have the same long term investment strategy .. so the market drops .. big deal – I am in for the long haul…I came to terms that dedication and commitment will always prevail, and I climbed my own Everest and watching all the rest scramble below me.”

Just Park It at 12 Jul 2012 9:48am

Sure, there are a majority of owners who will sit tight through even a protracted downturn. Bulls forget that bears expect that. Prices are set at margin, and it only takes for a small minority of owners to become anxious sellers for a price crash to occur.
Furthermore, some owners in the same position as ‘Just Park It’ underestimate how much the market price of their
house has come to mean to them. This is one of the perversions of the bubble… regular citizens get distracted by the mania; they change their outlook, their plans; perhaps even at an unconscious level. They anticipate that, if the market drops, they’ll simply shrug and think “big deal”. But then it happens and they notice the unsettling effects. Some will even surprise themselves by rushing to market to attempt to lock in what then remains of their paper gains.
– vreaa



Good point and even better rebuttal.

Mortgage free of close to it, effectively means the banks can’t foreclose on you, aka you own it.

That has nothing to do with the current market. If a mortgage has been paid off, that likely means bought 25+ years ago. Your house may have appreciated 2 – 4 X’s more or less. Ie say bought it for $250,000 and its recent assessment stated $1 Million.

You have built up equity, adjusted for inflation…now what?

The market has been a bubble, and is now imploding. Now its a race to the bottom. If you like your house and wish to live there for several more years,great ….ignore the market….or else you will go crazy thinking about losses ie “could shoulda woulda”...crying over spilled milk if say your homes market price drops from $1 Million to $750,000 in one  month , and human nature is to feel you “lost” $250,000. Remember ,A rising tide raises all ships, an exiting tide lowers them as well.

Or, cash out now and rent……all indications are this could get ugly and prices collapse….then Cash is King and you can snap up bargains as you get back into the market.

Regardless….can’t have it both ways.

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