Which market will crash first? housing market or the comic market?

[tth2]

One problem here in NYC is rents have been going up to offset the attractiveness of renting vs. buying. A friend of mine had his rent jacked up to $5600 a month from like $3200 when the landlord decided he was charging too little. He wound up going to a somewhat less nice area and is paying $4000+. 2 years ago I was more inclined to sell and bank the money and rent when it seemed like there were a lot of decent $2500 rentals, but those are gone and $4000 is the norm.*

When that happens, then the "buy" signal is flashing. Looking at housing prices in terms of rental yield is definitely one important method in assessing whether it's time to buy.

 

I'd be curious what rental yields in Ground Zeros like Florida are running. If rents are still declining faster than prices, it's still not time to buy. But if rents are firming up and getting into the 4-5% rent yield range, it may be time to start thinking about buying there.

[rjpb]

Manhattan is it's own housing universe. Median values are 788K, but I read recently that the median household income of current home buyers there is something over 300K - so I guess they can afford it. Those who make closer to the median household income (45K including everyone - not just current buyers) - have rent controlled or stabilized apartments or else they have to move to the Bronx.

 

Until the recent gyrations of the financial markets - Manhattan and to some extent the rest of NYC and close commute suburbs were immune to the housing downturn that's effected most of the rest of the country, but that is likely to change, as Wall Street faces layoffs. Outside the easy commute areas - prices have already dropped around 10% in the last year. Also high end Manhattan properties appeal to foreign buyers who, thanks to the sliding dollar, don't see NYC prices as having risen that dramatically - so that will probably soften the impact to some degree.

 

The fact is that nationwide, and especially on the coasts, housing values have increased dramatically over the 40 year norm in relation to incomes, and for no other reason than cheap easy credit and rampant speculation. Those days are over, and whether it's through price stagnation ( allowing inflation to catch up) or through an actual drop - home values still have a way to go before they fall to their historic relationship to household income.

[CycleGirl]

What a great thread! My jaw simply had to drop on the floor a few times when I read about the prices people pay in other markets, especially New York!

 

Our home cost us $155k about 12 years ago. It's 1800 square feet with 4 bedrooms. Our house payment is about $1k per month. We live in a fairly small town in Oregon. Growth has been steady since we came here. Housing prices have risen and I would estimate that our home is worth something like $240k by now. Our equity has grown about 3.5 times our initial down payment.

 

I would say that our experience is pretty typical. We've slowly, but surely, enjoyed an increase in wealth due to owning our home even in a market that has never been "hot." There is no question that home ownership, at least for us, was one of our best financial decisions.

 

 

[the blob]

I'd be curious what rental yields in Ground Zeros like Florida are running. If rents are still declining faster than prices, it's still not time to buy. But if rents are firming up and getting into the 4-5% rent yield range, it may be time to start thinking about buying there.

-------------------------------

 

I can't imagine this being the case because if you can rent a place for what it costs to buy, then why are all these future renters (current "owners") about to lose their homes! if these people can't afford a $1,200 mortgage payment they won't be able to afford a $1,200 rent. Sounds like there are a lot of people living in $1,200/mo places who can only afford $700/mo.

 

Anyway, to anyone who thinks this is all terribly OT, remember, you need a place to store your comics and there's no place like home!

[the blob]

Then again, at these prices, other than fear of hurricans, one has to wonder why Euros, Canadians and Asians aren't buying up thousands of Florida homes in distress with devalued dollars and propping up the market. Isn't it every Canadian's dream to have a vacation home in Florida? Sure sounds more substantial than buying Barks funny books!

[tth2]

Then again, at these prices, other than fear of hurricans, one has to wonder why Euros, Canadians and Asians aren't buying up thousands of Florida homes in distress with devalued dollars and propping up the market. Isn't it every Canadian's dream to have a vacation home in Florida? Sure sounds more substantial than buying Barks funny books!

Maybe they are buying, and if it weren't for them, prices would've dropped by 75%!

[JiveTurkeyMoFo]

Then again, at these prices, other than fear of hurricans, one has to wonder why Euros, Canadians and Asians aren't buying up thousands of Florida homes in distress with devalued dollars and propping up the market. Isn't it every Canadian's dream to have a vacation home in Florida? Sure sounds more substantial than buying Barks funny books!

 

Florida is so overbuilt, every Canadian could buy a home and we'd still have a housing slump.

 

Seriously, there are literally hundreds of new subdivisions with thousands of new townhomes, Condos, and single family houses dotted all along just Central Florida. Add in South Florida (where the Boom REALLY exploded) and the panhandle (tons of Condos) and you have enough supply to last for 5-7 years at the current pace of sales.

 

 

[innocuous]

Comics will not crash. But, I believe we are looking at a long term period of flat pricing, especially in the mid to low grade area. High grade will climb, but mostly in the early SA and GA area. The common 9.4 and 9.6 from the BA just won't command the escalating multiples.

 

Of course, all this is a guess.

 

As for housing, it is about to crash. In my little community, Thousand Oaks, CA, the two largest employers announced fairly large layoffs in the past month, Countrywide (yes, the mortgage lender) and Amgen. Right now, there aren't a lot of local jobs for mortgage professionals or scientists. So, the doubling of my home value in the past 5 years (when I bought) I believe will come back considerably.

[AussieRuss]

Renting, on the other hand is like flushing your money down the toilet if it goes on for year after year

 

I agree with you when talking about the long term.

 

My parents are in their mid 60's and sold about 3 years ago. they realised about $550,000 for the house and have rented for the last 3 years.

 

They were getting about 7% on the $550k which gave them an income of about 38k per year in intrest.

 

The house that they rented cost $10,800 per annum so they were left with a gain of around $27k per year.

 

Multiply this by 3 years and consider that the area that they live in was in a no / low growth stage & they now have an extra $80k towards the new house that they had built for them.

 

For them renting over a 3 year period was far from dead money.

 

Ohhh... the landlord was happy to have stable income for 3 years so it would appear that everyone won in this siuation.

 

Russ...

[WiseGuyX]

I love these crash threads.

 

I bought a condo in Phoenix for 600k and sold it for 3 million. I bought a hulk 181 for 120 bucks in 1990 and sold if for a new car. Both markets are so hot that if you blink you are too late. Instead of wasting your time on this forum you should be buying comics and real estate in Lvegas or Phoenix.

 

There are always clues to a comic crash coming.

 

I would have to agree.

 

There is some serious money to be made right now. I feel sorry for people in this issue but at the same time I don't. You all know the story: people on both sides; the lenders and Borrowers was making questionable loans. Borrowers was lieing about their personal finanices as well as signing adjustable morgages. The lenders was selling their selves to the devil in order to get the contract. Also, don't forget the auto loans...buying a new car is a rich mans game period. Anyhow, this created a huge Subprime issue or B paper. My wife and I bought a much bigger and newer house during this time but owe zero on it. We saved our money for years and sold our old house during the housing boom. The sell of our old house neted us almost double what we paid for it just 2 years earlier.

 

As for the comic world and effect on it by the market. I believe the sectors like the housing market will crash before the comic market. People will try to hang on to their books for as long as they can before selling. This will trigger a good buyers market in my opinion. So people in a good finnacial postion, could step in and make a nice chunk of change or finnish a collection etc for a far price. If it was me on the other hand, I would seriously consider the market first. There is tons of good companies with stock beating down for no reason. Either way you go, keep in mind they say we may have not seen the full housing market bust. This could take up to two years as people slowly get into a postion were they can't aford their house and car payments. So we may or may have not seen the botton just yet.

 

 

Signs of a comic crash: I can't help but think we already saw our first major sign with modern books. It's just my opinion but it struck me as odd the amount of money people was throwing at moderns. You saw/see people shelling out 500.00 on a two year old raw book. You could buy a raw Hulk 181 for that or less. Now granted that would equal out to a 3.0 - 8.0 book but which is going to retain it's value or add to it over time? The other thing that struck me as strange was the variants. It exploded just like the 90's. When variants got to be a huge issue, it seemed like they simply changed the name to reprints. There was times a book was reprinted before Dimond sold out of the first print?

 

 

My last BS thought is about the target age group of modern comics in comparison to home buyers. We all know modern books is wrote more for your 30 year olds. We also know it's the 30 yr olds with more despossible income to aford older more exspensive key books. I just can't help but think at the same time, It's the same age group envolved in the sub-prime loan issue. This group seems to be 30 yr olkd first time home buyers. If that is the case, you could see a huge halt in sells in regards to both moderns and older comics. This could be worse than the 1990's comic crash. And who knows, maybe the best buyers market?

 

Just make sure you priortise before you load up on anything. The credit world has noticed a new trend were people are choosing credit card payments over their house payments! Our famillies...our children need and deserve a roof over their heads instead of paper books, video games, and over priced video games.

 

Ray

 

 

 

 

[CHAMELEOONCOMICS-migration]

Guess the answer to this thread is obvious now.

 

Viva le Comics!!!!

[DrWatson]

Wow, you sure are catching on fast bumping old threads and all. I wish some of the other members that have been here way longer than you would learn how to use that search feature. (thumbs u

[piper]

This is an interesting thread! I'm sorry I didn't catch this the first time around.

 

The Canadian market has not experienced the same downward trend that is currently underway in the US. I only wish I could buy a 2,000 SQFT home for $250k.

 

 

[mica]

Wow, you sure are catching on fast bumping old threads and all. I wish some of the other members that have been here way longer than you would learn how to use that search feature. (thumbs u

There's a thread around here about how difficult it is to use the search feature. If I could find it I'd bump it.

[Flaming_Telepath]

Guess the answer to this thread is obvious now.

 

Viva le Comics!!!!

 

Hey, Thomas/Luke/Goon/EC7!

 

How's those Green Rivers coming along?

[MutantKeys]

[DrWatson]

Guess the answer to this thread is obvious now.

 

Viva le Comics!!!!

 

Hey, Thomas/Luke/Goon/EC7!

 

How's those Green Rivers coming along?

Interesting. I hadn't thought of that angle. I was traveling down another path.

[nik]

Guess the answer to this thread is obvious now.

 

Viva le Comics!!!!

 

Hey, Thomas/Luke/Goon/EC7!

 

How's those Green Rivers coming along?

 

[delekkerste]

Really interesting to re-read this thread and see how dramatically the view of the real estate market changed between 2005 and 2007. Wonder if we'll be looking back in 2010 and saying the same things about the comic market.

[DrWatson]

Everything is just a cycle of ups and downs.