with all big run-ups expect a retracement. GOLD Silver and RE will not go to Zero like the potential for stocks but that's why you balance your portfolio.

11% of all homes are vacant in the USA. 28% of all homes are under water.

Remember Sales fall first. Then listings rise. Then prices erode. It has always been that way.

I see little to no sales in my high priced area for 6 months, I've seen a listing increase of over 300%.....next!

Just spoke an agent I know in Florida who says sales are increasing. I asked him from whom, he said Canada & Australia/NZ. Banks are giving out loans to foreigners quite easily he said. He has sold only one home to a US resident in the last 4 months and it was a downsize for retirement.

Here's something to note:

A single family home in Vancouver, Canada last week hit an average of $1.14 million USD. The average family income in that city is $83,300 USD. That’s a multiple of 13.6. The American real estate market collapsed in 2006 when the multiple touched 4.6.

Now many will state the US market was too open to ninja loans and it was for sure but it caved at 4.6x income. All other markets such as Canada, Aus, China and even KL KV loans are upwards of 10x income, share same debt to income ratio of 130-145%.

This evidence all leads to loose lending and RE greed that is absolutely beyond any responsible person or fundanmentals.

I stay firm on 2011 being the transition year for those who are waiting for the correction to occur in KL KV properties. The only way RE will drop in a short cycle say 2012-2013 is if some very bad news come via Global Markets which may occur.

The other option is you will see a governement orchestrated slow melt whereas 2012-2015 could shave of 10% per annum bringing bubbled properties in line otherwise.

You may see the property sector aligning for a soft landing and final correction by 2020.

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Added on February 7, 2011, 12:55 pmCorrect, the is no crystal ball but there is common sense. The key to investing in RE is simply sell on the way upto the top and buy somewhere before the bottom, not when there is blood on the streets either way as that's a play for the insider, someone in the Bilderberg group or Mr. Buffet!

Bubbles are created by these three and you simply need to remove your greed and profits from any run-up known as a bubble.

buying gold at 850 and selling at 1420 along with silver at 12.50 and selling at 28.30 was a good plan. It ran up another 10-15% but then fell off in the retracement. Look at RE to do the same but on a longer scale.







This post has been edited by Onemorething: Feb 7 2011, 12:55 PM

Correct, based on the RE trend right now specific to Malaysia the run up has occured and is peaked for KL KV (key selected areas) based on lack of sales and increased listings. This in a normal market for me would indicate a correction even in a minor runup (which is not the case), when affordability is still within reach (which is extremely high right now) and debt to income is still manageable (which we rank amoung the highest in the world at 145%).

Taking the fundamentals off the table, RE has been on an Emotional ride since 2008 and without the cheap money and momentum we have witnessed would not be where it is today, not unlike the last bubbles globally in AUS, CAN, CHINA and back in HK SING MALAY.

Great RE opps in Mongolia, almost like the UAE but not here.

Quite simply dont look at what your neighbor is doing but what the high enders are doing right now. They all have their houses on the market and listings are up say 300-400% since Sept 2010 with limited to no sales. This is called trying to take profits from a great run-up off the table and/or divest in RE for this period however the time to sell these props was sooooooo last August.

This supply and demand cycle alone can only do one thing to RE!

I have been through this 3 cycles before, know the signs and can only share my experiences.

Expecting Gold and Silver to retrace as it's doing back to 1150 and 18.50 which will be good buys. You can start buying small amounts before this on the way down since again, knowone can time the bottom.

Only my opinion and willing to share!

Yes good point and this is what is new about the RE market after 30 years of credit expansion, for the first time in over 50 years, RE has lost it's way and is less of a safe haven play than ever before for the long term. Look at people in the US who have lost complete faith in RE and the prices continue to plummet. Look at corrections in the UK and EUROPE and how LUST for RE has gone away.

And finally, look at the demographics changing in the RE purchaser, the boomer who has not enough money to retire and their kids who they have funded all the way along with the next gen who see the pain of what the RE market has done to families and have opted to opt out.

These trends are changing our perception of RE back to times when a house was a home, not an ATM!

Yes same happened in US after 9/11 and High Tech Melt down. What did the Fed do, print more money, lower rates, give the economy an injection followed by many more to get them and us around the world to 2008.

This is unprecidented territory and the last 30 years in the USA has been monitized and the ROW fell in line and took up the same trend as to not be left behind on the global landscape.

Studying the MY RE marketplace and trends for the last 20 years shows the last reasonable buying opportunity was around 2004-2005, the drop in 2009 would have been okay but a retracement to this level I expect, 30-40% plus from asking prices.

Again, i'm commenting only on RE that I would invest in based on best location and best future growth and of coarse affordability by myself and any rental trends moving forward. RE outside KL and prime locations in KV may only suffer a small correction of 10% or less if they have only had steady low annual growth since the 2005 period.

One thing to always note, location is KING and by purchasing the wrong property can be devastating. However, if you are buying for personal use and the only props that are affordable are outside in the KV (non prime) locations then at least you can carry the debt load.

Honestly all, you better add 15% to your budget (for affordability calcs) for inflation especially the cost of food, as this element could double in the next few years, appears to be up 20% already.

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Added on February 9, 2011, 9:30 amAs I noted already, investment in RE in non prime areas is a gamble, always will be! It depends on your motivation for investment or for an affordable lifestyle which is for personal use.

For instance, one blogger who purchased in IPOH 5 years ago bought for $189K and lists for $210K and cannot sell it.

If the Props in JB for new developmet is higher than existing you have to ask yourself why? the common answer is those existing JB properties are overpriced!

CJ IMHO is a long term play and a safer one on the front end but again, when prime properties drop and or rents drop with them, the owner or occupied non prime location is always under threat.

Look what has happened in the US/UK and EURO, the trend to home ownership is not for investment but the return of the 1950's where an affordable roof over our heads is all we need. Those in McMansions are seen negatively. To own a second home for investment a thing of the past.

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Added on February 9, 2011, 9:36 amwhere you see one cockroach, might as well be 1000 nearby and that is what you have described here. The lending in this country is no better than the US UK or EUROPE, and the bubble no different and the euphoria which came to an end for these countries as well. US RE is still downtrending, UK back in recession and EURO defaults and ongoing mess.

All eyes on China as the largest RE bubble in Asia!

This post has been edited by Onemorething: Feb 9 2011, 09:36 AM

retracement trend on PM's.

PM's have historically overshot, negative retracement is due!

That is all I'm willing to share! How you read PM's is up to you.

Bottom Line the return has been hugely greater, and ultimately easier due to liquidity than RE!

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Added on February 13, 2011, 9:13 amAlways, or move in with family and double triple up. What else do you think happened in the USA!

Listings Increase, Sales Decrease, Prices Erode....so do rentals!

Top prop's get hit first until some equalibrium occurs between affordability and ownership.

Maybe someone in their wisdom can explain why there are so many new listings in the highest priced areas are on the market right now?

I know, but do you?

This post has been edited by Onemorething: Feb 13 2011, 09:13 AM