Dear @HillaryClinton I Benefited From The Housing Slide

And I’m not afraid to say it.

I’ve made it quite clear here that I’m beyond “not a fan of TrumpReally beyond not a fan. Publically, I won’t vote for him. (Whether that breaks down in the privacy of the voting booth because #NeverHillary I can’t and won’t say.)

I’m largely to the point now of watching this cycle as a near-outside observer. So write now I’m going to observe that I’m somewhat confused by the current trajectory of the Democrat’s attacks.

Riots are easy so we’ll just get those out of the way really quickly:

More complex to me is the current assault on some of Trump’s comments re: the housing market. Even as much as I dislike Trump, I have to wonder: isn’t his defense kinda expected? Sure you might pick up some fringe votes on from the socialists Sanders Supporters who think economic bubbles can be fixed with more Command and Control. And probably from a few people who got severely dinged by the housing collapse, but they were likely voting democrat anyway.

What Clinton fails to realize is that every bubble creates losers, winners, and some pushes. Is she really going to alienate all the latter two just to make a plea to the former?

I know her response will be “all the winners were big business people.”  Well no actually. Let me introduce you to a winner who wasn’t a big business person: me.

Statistically I “won” twice. My 401(k) didn’t start until Oct. of 2008. All things considered, not an awful time to start investing. On the housing front, things worked out even better to an extent. My wife and I bought our first house in the Summer of 2012. The housing market was showing signs of recovery in this area, but the recovery was somewhat bimodal, that is to say it was largely taking place in heavily renovated starter homes and higher end more recent (post-1990) construction. My wife and I were reasonably flexible in our “must have” list allowing us to target a still depressed market: the middle homes. As such we were able to skip the “starter house” and get a 2 story renovated home in a well sought after location, for what amounts to a steal. (The renovations the estate did were all wrong for the market. Given the slump, buyers were demanding, what my wife and I consider remarkably stupid upgrades, granite countertops, expensive tile, etc. These renovations were higher end laminate counters and vinyl tile. Perfect for us as they will be decent looking and functional until we save up to put our own touches on it.)

How well did we do? Very well. We paid 216k and due to the mortgage slump locked in at a 3.5% interest rate. Our mortgage cost (excluding escrow) is only $200 more than the rent was on our 900sqft townhome! Less than a year later similar homes (with different upgrades) sold for $279k and 300k. Taking into account the differences, I estimate that in that time our home value sits around $250k-ish. More if we made some cosmetic changes (like the counters.)

Was I playing the market? No. Did time work out perfectly for us? Yes. Was I hoping the market stayed depressed in the lead up to my entry in both the 401(k) and housing cases. YES. If you’re a buyer, wouldn’t you want a buyers market to continue or get better during your buying period?

Did it hurt other people? Of course. Some of them I know personally (people who bought at the height of the bubble and took huge losses. Some recovered, others have had a harder time.) Do I feel bad for them? Yes. Do I feel guilty or personally responsible in any way? Nope.

And why should I? Maybe next time I’ll be on the losing end of the bubble busting. I doubt anyone will feel guilty for betting the right way on that one.

One comment on “Dear @HillaryClinton I Benefited From The Housing Slide

Leave a Reply

Your email address will not be published. Required fields are marked *