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I found it to be a particularly interesting headline because I thought such things were normal. When I bought my home in 2004 it was not only zero down but on

I found it to be a particularly interesting headline because I thought such things were normal. When I bought my home in 2004 it was not only zero down but on a 7/1 interest only arm at just 1 point above the basis rate with a maximum increase over the life of just 4 points. As a bonus I got $50K out to pay off the boat. Needless to say when the housing market crashed I wasn't freaked out because I had effectively nothing to loose. Sometimes not having any money invested, especially for the first decade or so can be a relief if one must consider a strategic default of the mortage.

refurb 10y ago
When I bought my home in 2004 I think the "2004" in your reply is key. Crazy things were happening back then and as you called out, the housing market crashed. I think what freaks people out is that only ~8 years out from the crash, you can already see lending standards getting more relaxed. Didn't we learn anything last time? Not to mention the number of people I've talked to that said "housing always goes up, it's a great investment!". In less than a decade people have gone from "housing sucks" to "it will never go down". Amazing.
- patcheudor 10y ago
  Yeah, in my case I was far from a sub prime borrower. When everyone's rates adjusted up in the 2007-2009 timeframe mine went down. I was using a responsible mortgage tool. The problem was, people without an 850 credit rating were getting these same loans without great terms upon adjustment.
- freyir 10y ago
  > Not to mention the number of people I've talked to that said "housing always goes up, it's a great investment!". "One inflation-adjusted value index between 1928 and 2012 placed the annual rate of appreciation for real estate prices at just 0.2%." [1] Overall, real estate has historically been a bad investment. That said, it does seem like there have been obvious indicators when an particular area is becoming a more desirable place to live, and when home prices are likely to go up significantly in the future. Although I imagine people have been hard at work modeling and forecasting this, and current prices will better reflect future appreciation (if this hasn't already happened). [1] http://www.investopedia.com/ask/answers/052015/which-has-performed-better-historically-stock-market-or-real-estate.asp http://www.investopedia.com/ask/answers/052015/which-has-per...
  - refurb 10y ago
    Housing looks like a bad investment overall, but housing is local. I have no doubt you can make good money off of a house in a "up and coming" city. The challenge is, how do you identify an "up and coming" city? Is it the same way you identify and "up and coming" stock? It's all just attempting to time the market.
liveoneggs 10y ago
I also bought a house around 2004 with $0 down and actually received a $5000 check when I closed!

refurb 10y ago

When I bought my home in 2004 I think the "2004" in your reply is key. Crazy things were happening back then and as you called out, the housing market crashed. I think what freaks people out is that only ~8 years out from the crash, you can already see lending standards getting more relaxed. Didn't we learn anything last time? Not to mention the number of people I've talked to that said "housing always goes up, it's a great investment!". In less than a decade people have gone from "housing sucks" to "it will never go down". Amazing.

patcheudor 10y ago
Yeah, in my case I was far from a sub prime borrower. When everyone's rates adjusted up in the 2007-2009 timeframe mine went down. I was using a responsible mortgage tool. The problem was, people without an 850 credit rating were getting these same loans without great terms upon adjustment.
freyir 10y ago
> Not to mention the number of people I've talked to that said "housing always goes up, it's a great investment!". "One inflation-adjusted value index between 1928 and 2012 placed the annual rate of appreciation for real estate prices at just 0.2%." [1] Overall, real estate has historically been a bad investment. That said, it does seem like there have been obvious indicators when an particular area is becoming a more desirable place to live, and when home prices are likely to go up significantly in the future. Although I imagine people have been hard at work modeling and forecasting this, and current prices will better reflect future appreciation (if this hasn't already happened). [1] http://www.investopedia.com/ask/answers/052015/which-has-performed-better-historically-stock-market-or-real-estate.asp http://www.investopedia.com/ask/answers/052015/which-has-per...
- refurb 10y ago
  Housing looks like a bad investment overall, but housing is local. I have no doubt you can make good money off of a house in a "up and coming" city. The challenge is, how do you identify an "up and coming" city? Is it the same way you identify and "up and coming" stock? It's all just attempting to time the market.

liveoneggs 10y ago

I also bought a house around 2004 with $0 down and actually received a $5000 check when I closed!