The Collected Works of Author and Blogger Larry Roberts

Archive for July, 2011

Has fairness been a casualty of the housing bubble? At times it looks that way. The government keeps implementing policies to benefit one group over another not because it is the right thing to do but because it buys them votes. Last year, I wrote about The Policy of Screwing Prudent Renters to Benefit Loan Owners. One housing bubble phenomenon was that the right ones -- prudent people who knew what they could afford -- were kept out, and the wrong ones -- kool aid intoxicated fools -- were let in. That mistake was bad enough, but now our own government is frantically working to repeat this mistake. Rather than doing something corrective, like letting house prices fall, our government is going to extreme lengths to…[READ MORE]

The fear of strategic default is a necessary deterrent to foolish lending. Without it, lenders are emboldened to make all manner of bad loans because they believe they will get paid back. Lenders will make nearly any loan if they believe they will get their money back with interest. It's only when they feel they won't get repaid are they prompted to loan responsibly. Signatory versus asset-backed debt Some have questioned how I can be so against debt, yet I am leveraging up to the max to buy cashflow properties in Las Vegas. Isn't that being hypocritical? No. Not all debt is created equal. The debt I am taking on is backed by a cashflow-producing asset. The income stream is…[READ MORE]

Which Irvine Village is the most desirable for single family homes? Which Irvine Village is the best, and how could this be determined? Well, taking an opinion poll might be interesting, but it wouldn't be backed by anything substantial. To determine what people really believe about desirability, we have to look where people put their money. Money talks. The neighborhoods where people pay the most for real estate determines what is "best." Determining which neighborhood obtains the highest premiums is not easy. We couldn't simple look to the MLS or to past sales and see where the prices are highest because there can be many reasons people pay more in one neighborhood versus another. To accurately measure premium, we needed…[READ MORE]

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