In this issue
April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review June 27, 2005 / 20 Sivan, 5765

Housing envy is booming

By Tom Purcell

Printer Friendly Version
Email this article

http://www.JewishWorldReview.com | I envy my friends in Washington, D.C.

Four years ago, one of them paid $165,000 for a half duplex near Old Town, Alexandria. She encouraged me to buy a place just like hers right down the street, but I hesitated. I wasn't sure if I was going to stay in the area. I thought the price was a little high.

But what do I know about anything.

I had no idea that just a few years later, interest rates would rocket downward. I had no idea the Federal Reserve would pump an unimaginable amount of dough into the economy, or that aggressive mortgage firms would use interest-only gimmicks and other tricks to qualify anyone for a massive loan.

That duplex that I could have bought for $165,000 is now selling for $465,000, and I'm out a cool $300,000 for not buying when I could have.

That's why I read with great interest a recent article in the Washington Post. Housing envy has become the newest psychological phenomenon to strike America's high-growth metro areas.

You see, there are people working side by side, making the same income, but the one who bought a home four years ago is worth, on paper anyhow, $300,000 more than the one still renting. And the one still renting now has to pay a king's ransom to buy the same house.

I often fall into daydreams about what I would have done with all that dough. I could have sold the Old Town duplex and paid cash for a six-unit apartment building in the Pittsburgh suburb where I now live.

I could have moved into one of the units and rented out the others. After all my costs — taxes, insurance, etc. — I would have had a positive cash flow of $2,000 a month or more. I could have retired my corporate clients for a year or two, and spent all my time completing the books I've been struggling to write.

But all has been lost.

Because I missed the housing boom in Washington, I am forced to attain wealth the old-fashioned way. I have to earn it.

Scared off by the insanity of the Washington real estate market, I fled back to Pittsburgh. With job growth and population growth flat, there isn't much of a boom in Pittsburgh. Property is very affordable.

I bought a modest property, my second, because it will make a nice rental. I'll live there a spell, then rent it and buy another. Gradually, slowly, painfully, I'll grow a nice little nest egg for my retirement years.

And as I struggle to build wealth, I am filled with envy — envy for those who made boatloads of dough by doing absolutely nothing except buying homes in high-growth metro areas before the insanity kicked into high gear.

Donate to JWR

The envious part of me would delight in seeing their bubbles burst. It happened before in Washington. In the mid-1980's, the last time the market soared there, people got caught up in the frenzy and speculators snapped up condos as investments.

In 1999, while looking for a place to rent, I met an older fellow who had bought five condos in the mid-1980's. He had paid $115,000 each for his condos then expecting their values to soar over the next decade. But they didn't soar.

When we talked in 1999, he told me the units he paid $115,000 for were worth $90,000. After years of managing his five properties, his investments produced a negative debt of more than $100,000.

Of course, he told me his story a little over five years ago before the current boom kicked into high gear. Right now those same condos are probably selling for $250,000 or more. After being flat for years, their "value" has doubled in the past two years.

His story makes me wonder if today's buyers will experience a similar fate when interest rates go up, money availability tightens and the loan gimmicks disappear.

Who knows, maybe the day will come when such folks envy fellows like me.

Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

Comment on JWR Contributor Tom Purcell's column, by clicking here. To visit his web site, click here.


© 2005, Tom Purcell