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| TripleNickle, while I can appreciate where you’re coming from, and you make some very valid points, as always, I still maintain land should be viewed and valued no different than a bond of significant duration. A bonds cash surrender value changes instantly with a change in prevailing interest rate of similar bonds. Last I knew, nobody pays extra for perceived blue sky for a bond. It seems that only in approximately that last 20 years that land has uncoupled itself from fairly accurately pricing itself in correlation to bonds, which for its entirety prior to that, pretty much rose and fell in lockstep to the prevailing interest rates at the time. All that being said, it appears to me somewhere along the line in the last 20 years we as a group have decided to toss aside basic economic principles in regard to what we’re willing to pay for land, building in a huge amount of blue sky, (based on nothing more than exuberance and betting on the come), which is and can be a very subjective number, as the basis it was valued at can disappear overnight. An example would be buying a business and paying an extra price for the existing client/customer base that have provided a concrete long term profit margin that can be accurately calculated. Then the day you take over, the customers come in and decide they don’t like the color of your tie, and leave in droves, going elsewhere. Now what are you left with, nothing more than the inventory and what you can rent the building for after your going out of business sale. What I’m saying is paying for blue sky always has, and always will make me nervous, knowing full well it could leave me as fast as it found me. Gotta go, busy day planned, last comment I’m gonna make on this subject, one which had I to do over, guess would have just kept to myself. Clearly too controversial of a subject.
Edited by Boone & Crockett 5/4/2024 07:54
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All you land bulls may not want open this thread; Auction results
