I was wondering if you could give us some numbers regarding housing
prices before the collapse till now. Do you have any numbers for the
median existing house price before collapse vs. post collapse? And then
if we convert those numbers into dollars what would the "real" loss of
wealth be? If your mortgage was denominated in the Argentine currency
(pesos) are you now able to pay off your mortgage in the depreciated
peso? .... or was your mortgage indexed to a new value based on the
Many people in the states think that they'll be paying their mortgage
off in worthless dollars after the US dollar collapses but I don't think
so. I think the banksters will have something to say about that!
Real Estate is one of the safest investments. Always has been.
Then again our market wasn’t as overinflated as yours.
Still, today I’d put my money in real estate if I lived in USA. Prices already went down.
Here the homes kept their value in the solid areas, maybe dropped 10% or so in some cases.
What I mean is that a house that used to cost 100.000 USD, or 100.000 Pesos , now still costs 100.000 USD, 380.000 pesos.
This varied depending on location as always, the nicer, most expensive places keeping their price in USD.
Example, A house that got sold recently in a nice place, sold for 220.000 USD in 2009, and that house would have sold for 240.000 USD, maybe 250.000.
It was sold for 220.000 USD but sold in just a couple months with several potential buyers visitng each week. It could have sold for 240.000 but the client was in a hurry and wanted to sell fast.
If something very bad happens, I can see this happening in other places as well.
A nice house in USA that costs 280.000 USD before a financial collapse, maybe would still cost 200.000 Euros or so after.
For real estate in worse places, or bad investments like buying in a neighborhood that went south, prices went down but rarely loosing more than 30% of their value.
Once property reaches 40% of their value or so, enough speculators start buying and stop the decline. This has proven to be true in several cases in many countries so it’s a good number to go by.
Here the debt was “pesified” and indeed, they ended up paying 1/3 of what they should have.
The person that saved money ended up loosing a large portion of his savings while the person with the poor financial planning, the one that had debt, was forgiven a fair % of such debt.
Debt during a crisis is a risky gamble, but some people did benefit from it.
Bankers already make their profit keeping the savers accounts and getting their own debts forgiven, they can afford to benefit the people that get into debt. They are after all, the ones that keep the financial machinery going, keeping them rich.