Liberty

If I was in the US I'd definitely be looking into buying a house. In fact, I'd probably have bought one a couple years ago. In Canada, mortgage interest isn't deductible, most people get 5 year fixed rates at most, and our average house costs almost double your average house, so the situation is different..

Someday Roger Lowenstein and Alice Schroeder will write books about this :D

Where I live, there are no water meters for residential customers. Everybody pays the same, so basically those who save are subsidizing those who waste. It's a terrible system. But I still conserve water as much as possible because I find waste inelegant, and I get some psychological benefits from conserving. But most people aren't like that, so I really hope we'll get water meters soon... Even if there's plenty of fresh water around here, running treatment plants is still expensive, and the more efficiently you use water, the longer you can go between building expensive new treatment plants. I really wish gray water systems and small-scale rainwater collection were more widespread. It's crazy to flush your toilet and water your lawn with potable water treated to the same standard as the water you drink... http://en.wikipedia.org/wiki/Greywater

http://www.businessweek.com/news/2014-09-04/appaloosa-s-tepper-says-u-dot-s-dot-bond-rally-ending-as-ecb-cuts-rates

30 years? Sure. 5-10 years? Not so sure. Renting for a few years while waiting for house prices to be at more historical levels could certainly beat buying at the top, even if you don't sell for 30 years. Some might call it market timing, but I don't think so. It's bottoms up, just like not buying companies that you find too expensive. Right now I find houses too expensive where I live (and I don't even live in one of the most expensive areas of Canada). I also wouldn't buy a Honda Accord for $70k, that's not market timing...

But that's assuming that you will have capital gains. If you assume capital losses over the next few years, it might look a lot less attractive.

What's wrong with paying rent if it's properly priced? I'm renting right now, and it's a much better deal than buying.

But if you buy at the top and a $3m house is worth $3m in 20 years (not adjusted for inflation), that's not such a great deal. People who bought in Toronto at the end of the 80s had to wait almost 15 years to break even.

From tom's other thread, I thought this also belonged here: http://www.economist.com/blogs/dailychart/2011/11/global-house-prices

It's happening! Congrats! :D

I don't understand what it has to do with what the article was about. Granted, it was way too prolix, but all its saying is that inflation can have all kinds of effects on all kinds of people, and that the short-hand of "inflation = bad" is too reductive. If it was universally bad, the fact that the dollar has probably lost over 90% of its value over the past 100 years (or whatever) would probably be a catastrophe, yet we're much better off. Also, places with deflation aren't exactly doing better in real terms than places with inflation. What matters is the real economic stuff going on underneath whatever nominal amounts you use to exchange goods and services. You're reading way too much into what I wrote, by the way. I'm not saying inflation is good. I'm saying it's more complicated than that.

But I am saying inflation (too high) is universally bad. In what sense is inflation good? If I understand what you are saying then by his argument Stalin can be considered a great man because there are still russians today who celebrate his reign. Of course they were the people who didn't wind up in the gulags, they benefited from the slave labour. Capitalism breaks down when you have runaway inflation. I mean bribery can be considered good for the civil servants. But really, except for a select few like a tinpot dictator, everyone suffers under bribery and corruption in the long run. Same for inflation. I have no idea what you're talking about. Did you even read the linked article? It's just saying that inflation can be bad, neutral, or good. It depends on what economic actor you are and what it is that becomes more expensive. If your wages inflate faster than the prices of the things you buy, inflation is good for you. And anyone's higher price is someone else's higher revenue. Over the past 100 years, how much less can you buy for a dollar? Yet are people living better or worse? What matters in the end is the value that you produce and get, not how many nominal dollars you get and spend.

http://www.sequoiafund.com/fund-reports.htm

Randomep, the article doesn't say that inflation can't be bad. But everybody likes it when it is their wages that inflate.

Thanks, good read.

"Happy families are all alike; every unhappy family is unhappy in its own way." I think that goes for management too. There are lots of ways to be bad.

Every time there's a bubble, people have a thousand reasons why it'll keep going. All the attention gets focused on these reasons and people lose perspective. A few thousand wealthy foreigners obscure the fact that tens of millions of canadians are the ones primarily owning, buying and selling these houses, and their incomes haven't kept up, their debts are ballooning, and a huge part of the economy is RE, compounding risk. Chinese princelings aren't the ones buying dilapidated 1960s bungalows for a million bucks...

As Churchill said, 'you shape your houses, and then they shape you'. The recent interview with Guy Spier where he describes his system to be patient is a great example of that. If you know yourself to be impatient, you can create an environment where it's easier to be patient (ie. a room with no electronic devices, don't look at stock prices during the day and only submit orders when markets are closed, move to a calmer city, etc). That is an interesting concept. I read about research done on the link between success and self control. It turns out that more succesful people make sure that they put themselves in a enviroment where self control is easier. They do not necessairily have more self control. Basicly, if you want to lose weight, do not buy cookies and do not go to the supermarket if you are hungry. And do not live across a really good bakery. I think Buffett staying in Omaha probably helped him a lot. He stayed away from all kinds of bad influences and from a whole lotta noise and time drainers.

As Churchill said, 'you shape your houses, and then they shape you'. The recent interview with Guy Spier where he describes his system to be patient is a great example of that. If you know yourself to be impatient, you can create an environment where it's easier to be patient (ie. a room with no electronic devices, don't look at stock prices during the day and only submit orders when markets are closed, move to a calmer city, etc).

That's counting the value of their houses, though. Look at their liquid assets and incomes and the picture will be different, I'll bet. I'm sure american investors all seemed a lot richer too at the top of the dot-com bubble, but it wasn't real value. I think it's crazy and circular to use house prices to justify high house prices ("see, people have a high net worth, they can afford these expensive houses. Oh, what's their net worth mostly composed of? Houses, of course....").

Some people will argue the same thing about the internet bubble (think of all the extra fiber that was laid out, etc). Doesn't mean a lot of people won't get creamed. RE bubbles are a plus for those who rent and wait on the sidelines or those who luck out and sell at the top and don't just turn around to buy a similarly expensive house. Not for everybody else. http://i.imgur.com/bTw60eA.png

Can't easily save local copy of the file most times, and a PDF looks fine without their UI around it so they provide no real added value.

Longest i've seen as this one: http://youtu.be/lUMQylUxbsg Just 1 hour, though.

Congrats on the pick, snowball.