OT - Dow plunges 1,175 - worst point decline in history

[HenryA]

Originally Posted by Ken Robb

How else would we provide housing?

It’s just hiding behind the unicorns farting rainbows.

[verticaldoug]

Originally Posted by Ken Robb

This is a good plan as long as a landlord plans to keep the property. The catch is when it's time to sell the value of the property is largely based on scheduled/realized rents so two identical buildings will be valued very differently if one has rents that are higher than the other. Some areas have percentage limits on rent increases so if a landlord doesn't increase his rents for several years he may never be able to catch up to market rates. IRS rules on depreciation encourage landlords to sell/exchange their properties every few years to regain higher depreciation rates. It's a complicated subject and the rules vary quite a bit from one state or community to another.

I must add that single family and or condominium residences' market values are not as closely tied to their rental income as apartment buildings because they may be bought by folks who want to live in them who don't care what they may have been rented for.

If you look at LA, it is qute complicated. Normally, rent stabilized apartments in LA can have rent increases from 3-8% annually. However, in 2020, Mayor Garcetti put an emergency ban prohibiting rent increase which expires in May 2023.

If a tenant vacates, you can charge whatever you want for the new tenant. What should the landlord's strategy be?

for apartments older than 15 years old, and not subject to other rent controls, you can raise rent inflation + 5%. So 8.6% this year is the max.

For apartments newer than 2007 (under 15 years) you can raise the price what you want, but during the emergency, I think there is a special anti-price gouging restriction which limits price increases to 10%. This should apply to all apartments in LA.

Previously, I posted the articles on Starwood and Blackstone. The large landlords with 100,000s of units, can have an oversized effect on prices in any city where they exist. They will be viewed as a benchmark and if their modus operandi is just to just max out rent increase, it can be a real negative.

The corollary was what you say with the Housing Algorithms buying homes in 2020 or Carvana buying used cars with an algorithm. They can temporarily skew the market.

You also have to think of it in terms of interest rates for financing. If I was building a multi-family residential, I take out a construction loan, and then once I get the place built and rent stabilized, I want to refinance and take capital out. That calculation has been severely impaired here with higher rates.

You also have to think about possibly selling your multi-family, but the cap-rates buyers are will to pay now has also changed.

In the UK, many people buy-to-let apartments. If they were financing on float rate loans (more popular in the UK, than the US, you are hurting. )

A lot of home owners and buy-to-let landlords are hyperventilating over floating rate increases this past year.

[skitlets]

Originally Posted by HenryA

It’s just hiding behind the unicorns farting rainbows.

Just like dreams of homeownership for millions of Americans.

[HenryA]

Originally Posted by skitlets

Just like dreams of homeownership for millions of Americans.

Dreams of home ownership are important, one of the most important for a functioning middle class. The American Dream.

The near ceaseless pumping of the residential construction, mortgage and commodified financial industry is largely to blame. Instead of reckless policies we need some stability with moderate interest rates and low inflation.

[skitlets]

Originally Posted by HenryA

Dreams of home ownership are important, one of the most important for a functioning middle class. The American Dream.

The near ceaseless pumping of the residential construction, mortgage and commodified financial industry is largely to blame. Instead of reckless policies we need some stability with moderate interest rates and low inflation.

Where profit is to be made, more profits will be squeezed.

[fiamme red]

Originally Posted by fiamme red

A good time to buy Tesla stock? I was talking to an investor friend in the gym a few days ago, and he said that was was going to buy as soon it dipped below 110.

Kicking myself now for not buying TSLA when it was at 110 a few weeks ago.

[C40_guy]

Originally Posted by fiamme red

Kicking myself now for not buying TSLA when it was at 110 a few weeks ago.

I would trust TSLA about as much as I'd trust a unicorn fart.

[reuben]

Originally Posted by C40_guy

I would trust TSLA about as much as I'd trust a unicorn fart.

Unicorns never fart, but sometimes they stand next to ogres that do.

[echelon_john]

Makes buying it at $170 in December a lot more palatable.

And it’s a good indicator for chips and the supporting tech. Nvidia is having a good run as well.

Originally Posted by fiamme red

Kicking myself now for not buying TSLA when it was at 110 a few weeks ago.

[woolly]

Originally Posted by reuben

Unicorns never fart, but sometimes they stand next to ogres that do.

Huh, I thought unicorn farts were how cotton candy was produced. Learn something new every day. . .

[HenryA]

Originally Posted by woolly

Huh, I thought unicorn farts were how cotton candy was produced. Learn something new every day. . .

Unicorn farts don't smell, they just come out as rainbows.

[Tony T]

DOW closes at all time high of 37,090

[ridethecliche]

Originally Posted by Tony T

DOW closes at all time high of 37,090

I picked a great time to sell all my ish and sit on cash instead about a month ago...
It was a trading account, not a retirement one... but damn still.

Shoulda done the hodl thing.

[vertr]

Originally Posted by Tony T

DOW closes at all time high of 37,090

I saw the thread title and almost had a heart attack. I'm glad the news is the opposite as 2018.

[saab2000]

Originally Posted by ridethecliche

I picked a great time to sell all my ish and sit on cash instead about a month ago...
It was a trading account, not a retirement one... but damn still.

Shoulda done the hodl thing.

Don’t try to time markets. Especially stock markets if invested for long term gain.

I’ve been known to ‘buy dips” but I never sell peaks.

Ride the waves and keep on keeping on is the best advice most people will give. Prosperity through the S&P 500 is a marathon, not a sprint.