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RE: Leo Talk 5/7/21 - Come Join Our Chat (Part 1)

I rent. Buying is a bad idea for a few reasons in my opinion.

  • we are in a bubble with housing. It might go higher but will end up having a big pullback.

  • technology is going to change the future cost to build. People getting into 30 years mortgages might have an asset that costs a heap load more than what future building might cost.

  • we are seeing a popping of the artificial urban real estate bubble. This could have huge impacts on prices as people are freer to live where they want and still find sustenance.

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I think the popping is generally only happening on the retail sector right now and I don't think the urban area will be touched for a while. It will be whenever the mortgage crisis takes place and the fed wants the market to go down.

But I do think it will go down eventually.

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Urban areas are already seeing a great deal of exodus and prices in major cities are collapsing.

We will see how it all turns out but I will not be surprised if we see cities as undesirable in 10 years.

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I think this will primarily depend on whether or not the work from home takes off. I think it will but if the going back to work crowd works out, then the cities will still be filled.

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That is true and certainly an area of uncertainty. However look at who is in cities. Companies such as banks and insurance companies occupy a lot of real estate in cities. These are two areas that are under attack in my opinion.

Even the other discussion about lawyers, they occupy a lot of city space in the US. If they are seriously reduced, that will free up a lot of space.

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Right now its the small offices that are in demand. As things go virtual I expect it to go down as well. But the problem is if prices will go down or will the reach buy up everything or are we forced to rent from the rich?

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They do that with market cycles anyway. Who do you think buys all the stuff from the banks when the real estate market crashes and people are foreclosed upon?

The game is still the same. This way, the transfer of wealth is at least not taking place.

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Even the other discussion about lawyers, they occupy a lot of city space in the US. If they are seriously reduced, that will free up a lot of space.

This is true even in India and there are hell lot of lawyers here lol but still the amount of pending cases is huge , like literally , very very huge .

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That is true , the cities in India is filled up and there is literally no more space for new buildings . The WFH culture can help Indian cities to decongest a bit .

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I also like to have "Mobility" by renting. If I decided to get the hell out of the country next week, it wouldn't be a lot of trouble because I don't have a large portion of my money "stuck" in a house right now.

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Same here. Being tied to a property does take away some of that freedom. It takes time to liquidate plus the expenses involved eat up a bit of the sale.

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Many learned that the hard way in the last economic collapse. They could not relocate easily in search of jobs since they were tied to a geographic area with the house.

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During your service years , did you work overseas ?

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Yes. Quite a bit actually.

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Exactly , the concept of "stay at one place" is becoming obsolete nowadays , atleast in my opinion .

I would rather spend money on something else than house .

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I rent because I live in an expensive city and I want to move to another city eventually, but I would like to buy/build my own house in the near future

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Building is also an option... I don't really want to do that but my dad is crazy about it. He has built 3 houses in his lifetime and I don't doubt he will build a 4th one one day

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Lol , for investment purpose or he just likes it ?

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He just really loves it!

He loves doing the calculations, drawings all that stuff

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That's good to hear hehe . Gotto have some passion in something right ?

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Make sure you go the 3D printed route so its cheaper. You just got to buy the land I guess.

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I'll obviously opt for the most cost effective method :)

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I would like to buy/build my own house in the near future

That's good to hear but where do you feel comfortable building you house ? Outskirts or in the city ( provided you get the land in the city lol )

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in a nice suburb not far from the city would be ideal :) not a fan of long commutes :P

Exactly :) That's ideal .

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People getting into 30 years mortgages might have an asset that costs a heap load more than what future building might cost.

Totally agree with you on this one . That is why I hesitate a lot on taking long-term loans especially housing loans .

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