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Thursday, April 21, 2005
Speculative Bubble in Key West Real Estate Due to Pop
You know, an assurance from a realtor about the housing market is about the same as a stockbroker's view on purchasing stocks...pretty much biased. Seems that Key West may have hit an air pocket on it's jetlike rise to the hyper-inflated prices of today. For sale signs seem more prevelant than ever, mostly fueled by easy credit from the bank. Everyone in town is a speculator, if they want to be. Reminds me of the old saying: If your doorman is giving you stock advice, it's time to sell. To verify this in today's terms, a local masseuse shared with me that she is contemplating buying a "hotel-minium". Basically, she'll be buying a room of a small motel for around $500,000. She won't live in it...it's just as an investment. She rationalized to me, that in a year, between the appreciation and interest rates, she'll be able to refinance and be able to afford the payments. I didn't even bother explaining that interest rates are rising and what that would mean. Why burst her bubble? Maybe I'm wrong. Maybe I'm early. Either way, it's her roll of the dice.
Posted by Cayo Dave at 4:43 PM