“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 greaterfool.ca 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.