Its Friday, so its that time of the week to provide my Three Cents Worth as a post for Curbed. This week, I try not to go insane about the logical patterns of price and sale levels.
To view post: Three Cents Worth: Market Logic and Insanity
Previous posts can be found here.
Tags: Three Cents Worth, 3CW
I’m trying to make “macro” sense out of recent developments. I have bad credit because of a business failure a few years back that I’m still digging out of. My wife has better credit but is still finishing school; hopefully she’ll have a job when she graduates but it won’t be a huge salary-earner even then. However, we do have some steady, tax-free income, and about 50% equity in our house. Since we may have to move so my wife can find work, we’ve been thinking about selling our house, then getting a no-paper loan in my wife’s name to finance a new one (with close to 50% to put down!). Now, however, with sub-prime lenders under fire, I’m wondering whether we’ll be able to get a new loan; if not, we may want to keep our existing house (and loan) and turn it into a rental just to stay in the housing market. Making it even more complicated, I’m also starting to wonder — with both trade and fiscal deficits so high — whether a big economic stumble is in the offing; in that case, is it even a good idea to have all our eggs in one basket (i.e., house)? Or would we be better off selling, renting for a while and putting the money into diversified investments?
I’m not looking for personal financial advice so much as I am for a sense of how all the markets are interrelating, and what kind of impacts that could have on middle-class Americans like us.