I just looked into my Crystal ball and guess what I saw??? Your right there is no such thing as Crystal ball but if there was one this is what I think I’d see.
Real estate is never going to be like it was with 10% appreciation per year or more or have the price double like it did every 10- 12 years. Sorry it's just not going to happen.
Here is good example of what I’m taking about in just one aspect of real estate . In the 1970’s , I know I’m dating myself but I’m an old guy, apartment building whether a 2 flat or multi-family property was priced 8 to 10 times net of the building and no one was paying more than that price because everything was based on what the return was based on your investment. Now comes the dreaded “Condo Conversion” and with that everything changed . With condo conversions sellers started pricing them as if they were already converted and that sent prices out of control and pretty much killed the apartment business as we knew it. Almost never in the last 20 years did I see an apartment building pay for itself that’s right it cost you money! The total rents minus expenses weren’t covering the payment. Why in the world do you buy something to lose money? Well if there is any shot you can sell them off as condo's you might be able to make some money. You've heard about getting in early whether it's buying stock for Google or real estate ideas and after a while once everyone ( novices) knows about it that's when the rug is pulled out from everyone.
Here’s what we are seeing today in just Cook County, the latest figures say 35% of owners are upside down on what they owe compared to what they paid. If you check out the latest sales on 2-4 unit building were back to 8 to 10 net. So if you buy today your getting 8 to 10% return on your money. Don’t count on the appreciation just pay it off and you’ll have a nice income for a long time.
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