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KimchiNinja
Joined: 01 May 2012
Location: Gangnam
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 Posted: Tue Mar 19, 2013 6:55 pm Post subject: |
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| liveinkorea316 wrote: |
| House owners tend to be one of the most selfish and wealthy segments of society. You don't deserve the price on your house to rise at all. Your rise is a direct cost to the young person who must buy it from you. Your need for housing gains is therefore just a selfish thing |
...this conversation is becoming a bit absurd.
As an investor I certainly invest with the desired outcome being some chump later paying more for the asset than I did. Investors are selfish, that's true. It's not charity work. It's making an investment return work. 
Last edited by KimchiNinja on Tue Mar 19, 2013 6:57 pm; edited 1 time in total |
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atwood
Joined: 26 Dec 2009
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| Posted: Tue Mar 19, 2013 6:56 pm Post subject: |
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| slothrop wrote: |
| atwood wrote: |
There are plenty of middle class homeowners who own their homes free and clear and pay their credit card bills. |
sure, but there are more than a few who took out mortages designed to only pay the interest on each month, never making a dent in the principal. unlike in the US, where mortgages are drawn up in terms of paying them off eventually, even if it takes 30 years, for a long time in korea, people thought in terms of 'take out as big a mortage as you can manage paying ONLY the interest on', as property values CAN NOT go down EVER.
and i can't even guess how many second or third homes 'owned free and clear' are only that way because the owners took large chonsae deposits to pay them off. it's a house of cards. |
They speculate; quite a few Koreans like to gamble. Real estate in all its shapes and forms was seen as a good gamble, which historically has been true.
But a house of cards? These people will lose their investments, but won't they still have their jobs? Apartment construction is and will slow down, but is that enough to pull the whole economy down with it? The government will continue to pump money into the economy via infrastructure and hopefully some energy production projects. |
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slothrop
Joined: 03 Feb 2003
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| Posted: Tue Mar 19, 2013 7:33 pm Post subject: |
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edit
Last edited by slothrop on Sun Apr 07, 2013 3:57 am; edited 1 time in total |
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atwood
Joined: 26 Dec 2009
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| Posted: Tue Mar 19, 2013 8:27 pm Post subject: |
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| slothrop wrote: |
yeah, probably what'll happen is the government will pump so much money into the economy that food and energy prices will skyrocket, salaries will rise for the upper class, stagnate for the lower and middle class, and apartment prices will rise once again as the government buys up bankrupt developments to house the elderly. maybe they can make a program where people get a free apartment in the countyside upon retirement since their pensions won't be worth squat.
i'd bet someone who retired 15 years aqo with a pension payout of 500,000 a month for the rest of their life thought they'd be fine. now they are in poverty. |
Inflation in Korea is definitely a big concern. And the lower and middle classes are getting it in the neck. Everyone's going to be eating Chinese kimchi because it's all they can afford. |
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slothrop
Joined: 03 Feb 2003
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| Posted: Tue Mar 19, 2013 8:36 pm Post subject: |
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edit
Last edited by slothrop on Sun Apr 07, 2013 3:58 am; edited 1 time in total |
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bigverne
Joined: 12 May 2004
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| Posted: Tue Mar 19, 2013 9:57 pm Post subject: |
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| Quote: |
| Why shouldn't someone profit from their investment? |
The word you're looking for is 'speculation.' |
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KimchiNinja
Joined: 01 May 2012
Location: Gangnam
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| Posted: Tue Mar 19, 2013 10:52 pm Post subject: |
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Meh I dunno about word differences; investment/speculation, same same.
Bonds get called "an investment" but they are speculation too, speculation the US govt won't default or Ford won't bankrupt. Really only derivatives can be totally non-speculation if you are using them for hedging purposes. But any long or short investment seems like an investment and a speculation.
I guess people use the word "speculation" for when idiots or reckless people make investment decisions. |
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atwood
Joined: 26 Dec 2009
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| Posted: Wed Mar 20, 2013 12:14 am Post subject: |
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| KimchiNinja wrote: |
Meh I dunno about word differences; investment/speculation, same same.
Bonds get called "an investment" but they are speculation too, speculation the US govt won't default or Ford won't bankrupt. Really only derivatives can be totally non-speculation if you are using them for hedging purposes. But any long or short investment seems like an investment and a speculation.
I guess people use the word "speculation" for when idiots or reckless people make investment decisions. |
I think people can make unwise investment decisions without being speculators. Speculators are trying to make a big profit quick--day trading, condo flipping, etc. Investors are usually in it for the long haul and expect to be fairly rewarded for the use of their capital. |
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Swampfox10mm
Joined: 24 Mar 2011
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| Posted: Wed Mar 20, 2013 4:44 pm Post subject: |
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Just back into this thread after a few days away...
Have been busy cleaning-out junk before the move. Also bought a few better things -- anyone notice some of the deals on craigslist lately? Sure seems to be a lot of people jumping ship and selling good stuff for cheap. Normally this happens in late Feb but it has continued.
We looked into the auctions. At the prices we were paying (not over 300k) there wasn't much that was in such great condition, or was iffy in terms of being a place we would care to live and raise a family. If a good deal does come up, people who can pay cash in full, and know a lot more/have connections are snatching-up the real deals as quick as greased-lightning. It seemed mostly junk was left that had issues.
In terms of just general searching, deals can be found where people have debt problems. The place we got had some nice additions to the interior-- they obviously planned to live there many years, but lost their business.
I also see the housing market dropping over several years. With fewer babies, it will likely happen. Then again, we might lose large chunks of the city in a war.....that is bothering me more than losing some money in the next 10 years. The North having a nuke and reaching missile capability in 5 years or less will be game-changer, if you know anything about the USA and being threatened. Been here a decade and am stressed daily by this now. Wife won't leave so and my job is good, so am still here.
If you are wanting to buy, take your time and look around.... See lots of places. Deals are out there. Luckily, ours is in a range and subway location that probably wouldn't get hit much. Schools are decent and the area is planning new developments. With that, more shops will come, etc.
Oh, and not sure I mentioned that having a child entering school can have a huge influence on when and where you buy. Some things start to become more important than others. |
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12ax7
Joined: 07 Nov 2009
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| Posted: Sat Mar 23, 2013 7:58 pm Post subject: |
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| slothrop wrote: |
what do you guys think about these "lotteries" where people win the right to buy an apartment before construction even starts? there are a few large developments near where i live that have stopped builiding and gone bankrupt. but there is one that finished and it's value has, supposedly, shot up like 30% in the past 2 years.
i've heard from a real estate agent(not looking to buy, just chatting while looking for a rental) that these days the larger 40 and 60 pyoung apt.s don't sell, and that families(these days getting smaller) generally want 30 pyoung to keep maintenance and energy costs low. was also told the "new hot investment" is buying one room studio apartments to rent to the 20's crowd that's still single yet doesn't want to live with their parents. thoughts? |
Although it may be true in Seoul, it is not so in the provinces. |
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No_hite_pls
Joined: 05 Mar 2007
Location: Don't hate me because I'm right
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| Posted: Sat Mar 23, 2013 9:51 pm Post subject: |
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| Quote: |
| In Korea, households on average spend 16% of their net disposable income on keeping a roof over their heads, the lowest level in the OECD, where the average is 22%. |
http://www.oecdbetterlifeindex.org/countries/korea/
How can there be a housing bubble when Koreans spend the lowest percentage of their net disposable income on housing in OCED? |
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methdxman
Joined: 14 Sep 2010
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| Posted: Sat Mar 23, 2013 11:08 pm Post subject: |
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I'm paying about 1.8 million on 15 million down on a big 2 bedroom in Yeoksam. I'm off lease now so can bounce at any time.
Any recs? |
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slothrop
Joined: 03 Feb 2003
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| Posted: Sat Mar 23, 2013 11:21 pm Post subject: |
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edit
Last edited by slothrop on Sun Apr 07, 2013 3:58 am; edited 1 time in total |
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Malislamusrex
Joined: 01 Feb 2010
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| Posted: Sat Mar 23, 2013 11:29 pm Post subject: |
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double post.
Last edited by Malislamusrex on Sat Mar 23, 2013 11:34 pm; edited 1 time in total |
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Malislamusrex
Joined: 01 Feb 2010
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| Posted: Sat Mar 23, 2013 11:30 pm Post subject: |
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The idea of buying a house is insane as an investment. You can put 100 million in a bank and make a minimum of 3.75% a year for 10 year. That's a minimum of 40 million (even with a low exchange rate and compound interest I'd expect higher than 45).
If you put the same amount in a property for 10 years for a house worth 200 million you would pay 175 million on top of your 100 million deposit for something that looks like costing 180 million.
at the end of the day if you put your money in a bank you can make 40 million. If you buy a house the chances of losing 90 million are pretty high. |
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