The real estate bubble burst for us!

Today we cancelled our first contract for purchasing a Condo Conversion in Pompano Beach, Florida. The entire buzz about the real estate bubble has made us scared of plunging into the market. The numbers for this particular unit are not too bad but they have a negative cash flow of $647.00 monthly. It is rented until May 2006 but there are no guarantees that the renter will stay after our closing. We have an LOC that is -1/4% below Prime rate which will allow us to purchase the unit for cash. After all is said and done with a 15% increase in the unit selling price, the net amount earned would be $19,033.00 after 2 years. The questioned that kept coming back to us is why we want to add the stress for 2 years for that little amount of money. We live in a beautiful home see below on this blog, The home was bought in 1991 and it does need some TLC. It was completely renovated in 1990 by the previous owner, but it does need a little of painting, one new Air conditioner for one of the zones, a new roof, and a little of landscaping, and remodel the kitchen cabinets, and bathroom cabinets. The home is paid for so is the stress worth it or remodeling the home that has appreciated 3 times it value is a better place to put the money from the LOC. Sure would love to hear from your readers. We really feel that we are chickens and should plunge into the abyss. One thing is for sure; we both wish we had a much better understanding of LOC and interest payment only loans before now. People like us with income streams from Pensions and large amounts of equity in our homes should have been buying real estate for rent and flip them after two years. It sure would have made some money on that equity sitting with your home not being used. Se la Vie, may be the next wave……keep on the look out!!!