I’ve been fascinated by the story of Casey Serin, a 24-year-old who dived into real estate investing as the market turned sour. He bought the bulk of his properties in 2005 with “liar loans,” which lets borrowers state their own income to get into more house that they could afford. And with interest-only payments, for at least a few years you can afford your dream house. This housing boom has created new rules that prevent housing from ever going down; by the time you balloon payment begins, you can refinance and cash out a little to get marble countertops or a new car. Unfortunately for many people reading from a DC condo right now, we know this recent housing boom was no different from previous ones.
Casey bought houses at their peak prices, sometimes without even looking at them in person, and found himself unable to get buyers interested. Since he quit his web designer job to be a RE investor, there was no income coming in. He started a blog about his problems, which was immediately successful though it put him on the hook legally since he admits to lying on his loans. The USA Today did a profile on him called 10 mistakes that made flipping a flop.
In one year, the 24-year-old website-designer-turned-real estate-flipper bought eight homes in four states — and in every case but one, he put no money down. At his peak, in April, Serin had $93,000 he’d taken out of the homes as he bought them. By July, he was broke, desperate for one last deal.
Now? Serin has $140,000 in credit card and credit-line debt and five houses in foreclosure. Last month, he started iamfacingforeclosure.com, a blog that’s drawn both notes of condolence and expletive-laced condemnation.
He is sitting on $2.2 million in debt. Only in America will banks lend such a large amount of money to a web designer. But to his credit, if he simply dived in four years earlier, he would be a very wealthy man right now.
I’m not a RE investor but I’m fascinated by this story because I completely missed the boat. I did not buy any properties and got to sit on the sidelines watching other people’s wealth increase. I am a bitter renter. But the fact that my rent payment is less than what many of you Whole Food shoppers pay for food a month does ease the pain.
The fun part of all this, and why I’m writing about Casey, is his brilliant blog. He is a soap opera writer, stirring up the pot and getting everyone in a froth over his idiotic moves and statements. Examples:
- Continual search for “creative” and “sweet” deals even though he has to borrow thousands of dollars a month from friends and family.
- Selling a reliable car and buying a used Jetta with a subwoofer that is in dire condition.
- Following the advice of “gurus” and attending real estate seminars. He recently attended a one-week RE seminar and posted about how the book Getting Things Done might turn things around for him.
- Postings of his discretionary spending which includes visits to Macaroni Grill and Jamba Juice (West Coast equivalent of Smoothie King). The Jamba Juice mentions guarantee at least 100 comments.
- Complete unwillingness to file for bankruptcy (until yesterday).
For the past couple months I know he’s been trolling, but I just can’t look away. I really want to see where this ends up: if his wife will divorce him, if he will go to jail, or if he will land a sweet deal to get him out of the mess. And it’s educational too because I have learned more about RE investing from the hilarious comments section than anywhere else.
I look forward to a housing crash, which would only affect speculators like Casey or buyers who bought more than they could afford. Unless the dollar falls, which is a real possibility for 2007, a housing free-fall would be a most pleasant development to someone like me who is sitting on cash.Tweet Follow @rooshv
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if you want to help along a housing crash, build a wall at the us-mexican border.
Invest in coke, the demand never dries up and you’ll get your pick of floozies.
Cliffs Notes Version: In other words, Casey did the exact OPPOSITE of what you’re supposed to do to be a successful real estate investor. ‘Nuff said.
Lmao….Its all Robert lying Kiyosaki fault for writing that dumb book. It was easy money for alot of people and a ton of folks got rich but nothing last for ever. DCB did you know this guy did a background check on R.K. and found a ton of shit that basically proves this clown was a fraud and that he made millions of writing books and thats how he got rich, not off his properties.
My husband and I have spent the past three years trying to defend why we weren’t buying into one of the most expensive real estate markets at the most expensive time. Everyone we know, from our parents, to collegues, to friends have scratched their heads when we calmly explain that we don’t have the cash for a down payment, nor the gullibility to fall into the trap of an interest-only loan at a low interest rate that we know isn’t sustainable. It’s as if during the past 20 years Americans were brainwashed into believing that owning your own home is more important than being financially stable.
median household incomes are not even in the ballpark of the median home price.
the idea that a house is selling for 500K dollars when the median household income is not even 50K in the state of FLA is so out of control its laughable.
I love the “soft landing” people. The housing market is headed for a “soft landing.”
Not even close.
The housing market is headed for total depression…
I don’t care what Barnanke says. I don’t care what any jackass at the National Assocation of Realtors is saying. They all are living in a fantasy world. Reminds me of when Yahoo was trading at 180. Greenspan use to call it “irrational exuberance.”
This developers are all going to be stuck holding the pots. Its good to see them get stuck. Tying people into these interest only loans and 100% financing mortgages.
A 500K dollar home — goes for about 3500 bucks a month not including insurance and property taxes…
You do the math — doesn’t add up.
surprised this only has five responses
I can’t believe that’s real…gotta be a viral site
Casey Serin’s website is a scheme to market an overpriced, worthless multi level marketing real estate investor school. The name of the school is Nouveau Riche University. He won’t publish comments on his blog with the name of the school. He also won’t let people know that his boss, Chris, is Chris Record who runs a Nouveau Riche MLM website out of Roseville, CA. Look up Noveau Riche and Chris Record. The whole Casey thing is a scam. I hate to say I’m let down in a strange kind of way. I guess I really wanted him to be a nice kid who got in over his head and somehow saved himself. Oh well.
It makes me laugh…everyone who commented today are all renters. And you all are singing the same lame song, thinking that you are so smart because you are saving money… You mean the rent money you throw away to the landlord?
PS. my equity probably buys all of your rent for the next 10 years.
Sorry but i’m not gonna try and keep up with the joneses and buy a half million dollar condo. Sorry thats a waste of money as well and theirs no gurantee that your home will gain substantial equity which most people are finding out about now. Last year the U.S. set a record for the most bankruptcy’s and foreclosure’s in U.S. history. So you go ahead and laugh, i’ll wait till I move out of the DC market to buy something affordable and convenient. I’m making more money putting what you waste in upkeep expenses and insurance on the stock market.
another idiot….play the stock market…thats a safer bet……..
People have made ridiculous mistakes during this real estate market. I look around my neighborhood and see houses that were obviously purchased by people using scam mortgages to finance something they can barely afford.
THAT BEING SAID- owning a home is probably the biggest tax break you will ever get. Home ownership is welfare for the middle class. You shouldn’t bankrupt yourself like this guy, but renting indefinitely (unless you are living below your income level and saving) is not a good strategy. The homeowner will be able to write off a long list of home ownership related costs against his income, which ultimately makes him better off than his renting counterpart.
the equity you built up bro? you are as stupid as you sound.
your mortgage payments for the first 4 years are almost all INTEREST… not to mention the property taxes that your paying — and the home owners insurance your paying.
only plausible benefit that you would get from buying a house at these levels might be the tax write off on your interest.
a renter has been winning over the last 16 months… and will continue to win over the next 12-24.
then its time to buy.
tampa is right. the time to buy will be in 1-2 years. unless you are wedded to the idea of buying that swank condo on 17th and Q. there are some ecological niches which will never implode.
Eugenius represents the mentality that I mentioned. Owning at any cost is seen as superior than renting at a reasonable amount. Just because I’m not building equity in a house I own does not mean I’m throwing my money away. I am getting a place to live, as well as the freedom to avoid repairs and insurance. And who can forget the biggest benefit of all: I’m not tied into a mortgage that I can’t afford and a house I can’t unload.
I would love to buy, but I’m not going to get myself in over my head. Maybe Eugenius had
Lmao…..Fuck a mortgage at half a million for a efficiency overlooking South East. I talked to a professional money guru a while back who said in markets like Boston, DC, NY, LA, San Fran, Hawaii- your better off renting and putting the money on the market because if you have to use a interest only loan to get qualified or pay for the home, you probably can’t afford it anyways and it doesn’t make sense to keep something you’ll have to unload in 4 years if your not gonna build substantial equity.
Cont. from above:
Maybe Eugenius had a nice pot of cash for a down payment, or parents who could give him the money. But for the rest of us who don’t want to get involved in some shady no-money-down scheme it’s a bit tougher to buy in a market this expensive.
Because all those people came out big during the late 90′s and early part of the decade. People really were making big money but not anymore. We probably won’t see anything like that for another 15-20 years….But I’m reading all these stories of people getting foreclosed on because they couldn’t keep up and i’m reading the newspapers and all these houses are getting sold by the banks (foreclosed)..I’ll just save my money and wait till I find something affordable in another part of the country…
Casey has finally been arrested:
How bout just save the cash for a house and buy one. We are so lucky to be living at this time in history as it is so easy to save money toss it in a mutal fund and earn an income. Takes less time to make it in the real world than in a online video game. Too easy.
He’s back. Looks like the arrest was a hoax.
Sounds like he is coming down from his publicity high..
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We’ll have a free party in casey’s modesto house, on new year’s day, 4pm-3am, bring your own beers and food. We’ll give you a free casey tshirt.
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Casey Serin should be executed.