posted on July 11, 2005 06:19:27 AM new
With median home prices higher than most families can actually pay for, will this boom soon come crashing down?
I have read where some housing markets have people paying over 50% of their income for a house. No money for savings or anything else.
Some places have housing so high, most can't even afford it. Does this mean the prices have to come down? I don't see wages going up soon.
posted on July 11, 2005 07:33:05 AM new
I wonder to what extent the prices are keeping interest rates low?
Prices here are astounding. Unimproved acreage when bought in large amounts goes for 50-75,000 /acre. If this ranch wasn't 200+ years old, there's no way anyone could make a living raising livestock on it. I don't see a slump happening in the southwest. I recently spoke with a cousin in Phoenix who is shopping for a bigger house either there or in Tucson. In virtually all of the new subdivisions, it's a minimum 6 month waiting list before your new home is even started. In the nicer, older neighborhoods in Phx, people are paying top dollar for nice older homes just to get the lot. Then they bulldoze the house and rebuild a McMansion that doesn't fit the neighborhood...crazy.
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posted on July 11, 2005 11:43:39 AM new
Interest only mortgages. Scary.
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posted on July 11, 2005 12:43:51 PM new
The one I find interesting is the reverse mortgage they're offering to older folks...great way to stiff your kids if you're of a mind to...
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posted on July 11, 2005 04:33:21 PM new
About a year and a half ago my parents bought the plot they are going to build their house on. Every couple months they get notice from a local realtor letting them know what recent plot and homes in the area have sold for. A plot the same size as theirs (no home, just the plot) just sold for a little under 200K, almost three times what they paid for theirs. At this rate, the steps and I could end up inheriting well : )
Prof - those people doing scrape offs are probably ending up with much better houses than the ones on the waiting lists. Because of the growth of private hire construction inspectors there are now builders that won't sell a house in advance anymore. It was costing too much time and money for builders to make the fixes noted by the inspectors so now they keep them out by only letting buyers choose from already constructed homes. Tell your cousin to stay far away from this type of builder, they are not only substandard, but they know it and don't care.
If he has the funds, tell him to contact custom builders in the area. They are the ones doing the scrape offs and many times they already have them in the works. Since they are not laying down houses as though they were chickens laying eggs you usually end up with a product that isn't just up to code but is actually built right.
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No, I'm saying -- I'm merely -- I'm saying what I'm saying. I don't know why I'm always having people say, are you trying to say -- you know what you can do if you want to know what I'm saying is listen to what I'm saying. What I'm saying is what I said ...
posted on July 11, 2005 04:52:17 PM new
point well taken fenix, I just hate to see beautiful, mature older neighborhoods invaded with these stucco Santa Barbara-Santa Fake monstrosities they're building these days. Personal preference, that's all...I like old, but I realize most folks aren't willing to accept the hassles that come with an older house. My cousin has a nice 5 acre piece in phx he was holding as an investment, it's in a good area. My advice to him is to build on an acre or so and hold the rest. He owns it free and clear and it will make getting a mortgage on a custom house a piece of cake for him. The land is worth way more than any house he could conceivably want.
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posted on July 11, 2005 05:23:06 PM newAre we headed for a housing crash?
I don't think so....this has been the cycle for all the years of my life regarding home buying. There might be some specific areas/locations where the housing market eventually either stops gaining momentum or actually loose value for a while....but I don't think it will ever happen on a large scale that some are worried about.
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Kind of along this line....housing costs going up....
A TV show that I recently ran across and have watched a couple of times, called "Property Ladder", is about investors buying a run down home....fixing it up in order to sell it asap to make a big $$ income. They're making some pretty good money doing this for only 2-3 months of hard home improvement work.
posted on July 11, 2005 05:45:46 PM new
Prof - I can understand that. They are doing the same thing in Denver right now. I think the problem with the older houses is that most of the rooms are so small in them. I'd hate to make a huge investment in a home where I felt claustrophobic but at the same time who wants to live in the house that stands out like a neon sign. The smart builders and owners are building the roomier modern homes but staying true to the traditional style facades.
As for your cousin - sounds like you are giving great advice. If he goes with it, tell him to look into an inspector that specializes in new construction and have him take a look at any current projects prospective builders have going, don't just look at their portfolio of pretty pictures.
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No, I'm saying -- I'm merely -- I'm saying what I'm saying. I don't know why I'm always having people say, are you trying to say -- you know what you can do if you want to know what I'm saying is listen to what I'm saying. What I'm saying is what I said ...
posted on July 12, 2005 02:17:32 AM new
Our daughter and husband bought a house 11 years ago in Huntington Beach for $205,000. They're getting divorced, and it was just appraised at $670,000. Small kitchen, living room, small dining area, four small bedrooms, two baths, 2-car garage, corner lot (small).
Our daughter in Silicon Valley (Bay Area, San Fran.) and husband bought a house 10 years ago for $303K. Now worth about a million. 50 x 100 lot, old house one level, small kitchen, living-dining room, three small bedrooms, no attic or basement, one bath, one-car garage. They could have bought 6 older houses in Northern Utah for $303K back then. There'd be no point in their selling the house now because their profit would only buy a house like theirs, for 'way more! Unbelievable.
posted on July 12, 2005 05:21:15 AM new
I think that's the reason so many Californios leave the state. The money they make on selling their homes will buy so much more in other states.
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posted on July 12, 2005 06:33:34 AM new
The same story in Maryland...even though homes in our area are selling quickly for astronomical prices not many can afford to sell and move anywhere in the D.C., Maryland or Virginia area.
And with escalating value, real estate taxes are also going through the roof!
posted on July 12, 2005 06:59:00 AM new
I agree, many Californian's are taking their CA real estate profits and leaving the state.
My girlfriend's daughter and SIL each owned their own CA home when they married....sold them both...moved here and bought several homes and are renting them out. They RETIRED at age 33 and 35. Now they have a big beautiful home of their own on 10 acres with a path right down to their own private boat dock plus a full view of one of the gorgeous lakes here and they are raising their family together.
I think it's just wonderful they were able to do that....thanks to the people who were more than willing to pay more than the listing price of their homes.
"Whenever the nation is under attack, from within or without, liberals side with the enemy. This is their essence." --Ann Coulter
And why the American Voters chose to RE-elect President Bush to four more years. YES!!!
posted on July 12, 2005 08:23:07 AM new
I think it's great too. It's particularly nice to hear that Californians are moving somewhere else
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posted on July 12, 2005 08:29:03 AM new
The median priced home in California has passed $575,000 dollars. My area is beginning to look like a suburb of San Francisco with Californians moving in. They can buy a mansion and live happily everafter with the equity from their home in California.
posted on July 12, 2005 12:05:04 PM new
Wow, I have to agree with Profe, we don't want more CA transplants up here
I believe that there was a surge of them awhile ago, that made housing prices go up (thats one reason)
We bought this about 2+ years ago. It is, I think above the median price for Seattle.
We had an appraiser come out a month ago (going for an equity loan for some remodel projects) it has gone up $100K in the past year.
We could sell this and go to E. WA and live, but he is still working here in Seattle, well actually he works in Bellevue, and it takes him an hour in traffic to get over there, loves the job, hates the commute.
I'm pretty sure we'll retire in our desert Eastern WA
