I Went To Orlando And All I Got Was A Lousy Condo
BankRate has a write up on using a vacation to pick up a house. "Maybe throwing back a few Mai Tais and, checking out the local real estate market? That's no way to spend a vacation, many will say, but it may not be such a crazy idea."
"'There are people who come down here with the express desire to go on vacation and they go home buying a house,' says Marcus Truett, a second-homes specialist in Orlando. 'But there are downsides to buying like that, like people overextending themselves or believing in a lot of hype.'"
"Using your vacation to house-hunt is just a smart way to multi-task."
This has actually come up before, so it must be some sort of trend. The modern vacation/house hunt includes due diligence, according to the story. "While you're there: Find the nearest Starbucks."
16 Comments:
It's not so unusual--on our last trips to Vegas and Hawaii we were hounded by timeshare salespeople. Those are the true pond scum of "real estate." No equity and 20 year expiration clauses!
Since they sell I guess the general housing bubble should be expected.
People don't do their homework.
-Generic
anon,
I live in a timeshare town. I never knew what they were before. They are the hands down, worst RE deal out there and everybody in town is ashamed to talk about it. The resale on a TS is almost $0.
I know one couple who bought one and they didn't even want it. They just got pressured in such a way that they caved in. Smart, executive type from CA, too. Thanks for commenting.
I love Time Shares.
Next week I am going to Hawaii to stay in a beautiful luxury codo on the beach for a week.
Oh, did I mention, its not mine, the owner does not want to use it this year, so I am renting it for a week for $600.
Timeshares are the new "hot" thing. I've looked at a few in Hawaii and a couple other places because they give you $100+ coupons for dinner, etc. But they just don't pencil out---regardless of the resale or not. It's much cheaper to rent the same place/same area.
I think some people check their brains at the door when they're on vacation. That's why you see so many art, jewelry, etc., stores in tourist towns. For some reason, people will buy things in a relaxed (drunk) mood that they would never consider buying otherwise.
A cousin of mine has bought three. I think she just likes the notion that she "owns" something in tropical places, even though it makes no financial sense. Westin and Marriott also make a big deal out of the fact you can use your 1-2 week(s) anywhere they have timeshares. So it's flexible. Thing is, you can rent anywhere just as easily (and more cheaply). So I don't see any advantage.
Timeshares aren't an "investment" or any kind of financial asset decision. They are a marketing invention by condo developers and hotel managers. And they seem to be successful...at least for the companies selling them.
Time Shares... don't even get me on them. I get a dozen calls a week from them every winter trying to get me to go down to AZ or FL and 'try out' a time share for a week... I tell them I love winter... wouldn't want to miss a single snow flake... btw I live in Minnesota.
Then they call and tell you you've won a 'valuable prize'... like a Mercedes SUV or something... of course the 'or something' might be coupons for dinner like in the other comments... but hey come on down... you might be lucky.
A couple friends of ours bought one about 20 years ago (probably free of it now)... at a golf place in Orlando area somewhere... it was on the edge of town then... probably surrounded by winos and meth whores now. But back then they had no idea of the power associated with the 'dark side' of the Empire of the Mouse.
Plainly, this calls for a haiku:
Time-share in Vegas
Long desert afternoons
Time for playing craps
Also, I hate to be a macro-nag, but I think MZM comes in to play here again.
We used to call the right part of the graph a "shoulder", which was a polite way of saying "HOLY SH**"
Can you explain what that chart means?
This article should make the MZM chart make a little more sense:
http://en.wikipedia.org/wiki/Money_with_zero_maturity
I'm afraid I still don't understand the point you're trying to make with the MZM chart. Please explain for us financial illiterates.
Roughly speaking MZM ("Money of Zero Maturity") is a measure of all the "money" (cash and near-cash equivalents) in the economy. There are a number of "money supply" measurements such as M1, M2, M3 etc - MZM is the most "inclusive".
The money supply has grown continually for as long as the charts are available, but at different rates. For example, pre-1970 the growth rate of M3 was fairly slow. In the 70's it took off, pausing it's *rate of growth* (which correspond to the relatively flat parts of the curve parts) only during recessions.
The point is that in the 90's the *rate of growth* in the money supply MZM took off - around '94 it seems to rotate through about 15 degrees. This corresponds to the Clinton "boom", nut interestingly it did not correspond to a dramatic increas in CPI, as would be expected. This is perhaps due to a few things, such as increased productivity and "global wage arbitrage" ie. getting stuff made in China.
But about 18 months ago the curve flattens out dramatically. If we look at the whole series (which only goes back to 1980, unfortunately) there is no period of transition of *rate of growth* that is so dramatic.
Does this mean something definitive? Beats me. I'm certainly not an economist, but changes of this magnitude haven't been seen before. To me it suggests that all the talk of "gradual" changes in interest rates are a smoke screen for someone, somewhere, standing on the brakes. It suggests a dramatic slow-down in the economy, or at least in the economy's rate of growth. And if you are on a highly "creative" mortgage where you are banking on getting a wage increase that will correspond with the day you have to start paying down principal (ie. are *speculating*) I suspect you may be in for a surprise.
For the last 15 years the economy has been awash in cash - this chart suggests that is changing. Or rather, has changed.
pb.
Sorry, should have looked at the chart again before I commented on it.
The flat spot around 94 transitions into an increasing rate of growth in 95. If memory serves 94 was the "bond shock" caused by the fed being responsible ie. not telegraphing every single move they are going to make about a year in advance.
The flat spot/decline in 2003 corresponds with the "deflation scare" that seems so long ago now...
Thanks for the chart. Interesting.
All eyes are now on the Federal Reserve, which meets on Tuesday. Almost everyone expects a quarter-point hike to 3%, but everybody is wondering if they'll change their language about "measured" increases. If they do drop that language, you can expect a jump in the 10-year treasury note and in mortgage rates as well.
Given that the 10-year treasury is trading around 4.20%, it's obvious that Greenspan's "conundrum" still hasn't corrected itself.
Sorry to hijack this and turn it into a discussion of monetary policy... but...
I am not so sure about what will happen to the 10 year. I suspect that even if they drop the measured language the jump in longer rates might not match the increase at the short end of the curve. The "inverted curve" is said to be the best predictor of a recession, so if conditions continue to decelerate we might see that by late summer.
Once again, apologies... back to our regularly scheduled haikus...
Why not both,
Yuan on the fly
10 year note chase
Homeless
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