Current Events > The housing market is shit right now.

(+) Yeah! (+)

I'd advise against investing in real estate.

For the buyer or seller is it shit?

Timing the market will never beat time in the market. Land is the second most valuable thing other than your time.

TotallyNotAGirl posted...

Timing the market will never beat time in the market. Land is the second most valuable thing other than your time.

Your health has a say

Cocytus posted...

Your health has a say

Okay true true.

Nah. We just bought a house in February. Mortgage on a 2,000 sqft 4 bedroom is only $300 more a month than the stupid 1,200 sqft 3 bedroom apartment we were in. If interest rates get better, we can always refinance.

Cocytus posted...

For the buyer or seller is it shit?

Buyer. Interest rates are 6 to 7%.

Makes me glad I live with my Parents. An example if a quirk that has.

Full_Pokedex posted...

Makes me glad I live with my Parents. An example if a quirk that has.

oh duncan

Bought a 3700 sqft house a couple years ago with a sub 4% interest rate. Given where the rates are now I feel we won't be refinancing for a while if ever.

Full_Pokedex posted...

Makes me glad I live with my Parents. An example if a quirk that has.

Another quirk is also being completely ignorant about how the real world works.

Pros and cons, I guess.

RchHomieQuanChi posted...

Another quirk is also being completely ignorant about how the real world works.

Pros and cons, I guess.

lol

bsp77 posted...

Nah. We just bought a house in February. Mortgage on a 2,000 sqft 4 bedroom is only $300 more a month than the stupid 1,200 sqft 3 bedroom apartment we were in. If interest rates get better, we can always refinance.

Obviously depends where you are. A 4br in my area would be $2 to 3 million, and the mortgage would probably be 3x my current rent for my 1100 sq ft 2br.

TendoDRM posted...

Obviously depends where you are. A 4br in my area would be $2 to 3 million, and the mortgage would probably be 3x my current rent for my 1100 sq ft 2br.

Of course it depends. Minneapolis/ St Paul suburb for us.

Just saying why the initial post doesn't work for everyone. We also just really wanted a house.

TotallyNotAGirl posted...

Timing the market will never beat time in the market. Land is the second most valuable thing other than your time.

As stated, you definitely overlooked health

And this isn't necessarily true when owning property incurs financial obligations like property taxes, upkeep, mortgage interest, etc.

Timing the housing market can be incredibly important lol

Ideally home ownership should be a lifestyle choice more than an investment choice.

emblem-man posted...

Ideally home ownership should be a lifestyle choice more than an investment choice.

That was our primary reason

Cocytus posted...

For the buyer or seller is it shit?

Problem is if Im selling then Im probably moving as well and would have to deal with the same high prices.

When interest rates are down more buyers are coming in, driving up home prices and competing offers, so it's not so simple sometimes.

What are you talking about? Prices will always go up to infinity!

Idk, its shit in places and neighborhoods where people prefer to live. I think a lot of people arent willing to lower their standards for a starter home.

TimeForAction posted...

Idk, its shit in places and neighborhoods where people prefer to live. I think a lot of people arent willing to lower their standards for a starter home.

Sure wasn't my experience when I was looking whether to buy or build a house.

Could get a "starter" house that was 80-100 years old, ~1200 sq. ft, in need of some repairs and generally a bit worn down due to age (but w/ some renovations for flooring/counters), no garage, townhouse or condo (shared walls), etc....

OR could spend 40-50% more and get a house built within the last few decades, twice the size, full garage and driveway, detached w/ a yard, no fixing up needed, plainly higher quality overall.

The amount "more" you got from buying past the bottom of the price listings was absolutely crazy. Unless you straight up can't afford a mortgage for the next tier up of housing, I have no idea why anyone would choose the "starter" house.

My real estate agent explained that the trend I noticed was true. Starter homes offer the absolute crappiest "return on investment" and outrageous "cost per square foot" because:
a) there aren't many starter homes on the market so competition for them is fiercer
b) starter homes are seen as a "good investment" b/c they can be quickly and easily re-sold so a lot get bought up by house flippers (who can also get the most bang for their buck renovating a run down starter home to sell for more vs. more costly houses)
c) While not having a yard and being smaller reduce building costs somewhat, you still can't escape a lot of basic costs like utilities, foundation, government fees, etc... that any building will incur. Larger homes can "spread out" those base costs over their larger square footage, small starter homes cannot

TL;DR: No, quite the opposite. Starter homes are very hot sellers b/c some people need to take the cheapest thing they can get and investors like to flip them, so people being "unwilling to lower their standards" is not the issue.

It's starting to cool off. My fiancee and I just got a 3 bedroom 1 bathroom 2100 sq foot place with a detached 2 car garage last month.

streamofthesky posted...

Sure wasn't my experience when I was looking whether to buy or build a house.

Could get a "starter" house that was 80-100 years old, ~1200 sq. ft, in need of some repairs and generally a bit worn down due to age (but w/ some renovations for flooring/counters), no garage, townhouse or condo (shared walls), etc....

OR could spend 40-50% more and get a house built within the last few decades, twice the size, full garage and driveway, detached w/ a yard, no fixing up needed, plainly higher quality overall.

The amount "more" you got from buying past the bottom of the price listings was absolutely crazy. Unless you straight up can't afford a mortgage for the next tier up of housing, I have no idea why anyone would choose the "starter" house.

My real estate agent explained that the trend I noticed was true. Starter homes offer the absolute crappiest "return on investment" and outrageous "cost per square foot" because:
a) there aren't many starter homes on the market so competition for them is fiercer
b) starter homes are seen as a "good investment" b/c they can be quickly and easily re-sold so a lot get bought up by house flippers (who can also get the most bang for their buck renovating a run down starter home to sell for more vs. more costly houses)
c) While not having a yard and being smaller reduce building costs somewhat, you still can't escape a lot of basic costs like utilities, foundation, government fees, etc... that any building will incur. Larger homes can "spread out" those base costs over their larger square footage, small starter homes cannot

TL;DR: No, quite the opposite. Starter homes are very hot sellers b/c some people need to take the cheapest thing they can get and investors like to flip them, so people being "unwilling to lower their standards" is not the issue.

I can basically agree with all of this.

At the time that we bought, a "starter" home would have been about 2/3rds the price of the SFH we ultimately bought. At that time, roughly $50k translated to an increase of about $125 to our mortgage so we made the correct decison to forgo the "starter" home altogether. For just under $1000 more, we basically almost doubled the square footage, much newer home in a much better area. It really was a no brainer.

Market is great if your down-sizing rather than up-sizing

Cocytus posted...

For the buyer or seller is it shit?

The real answer is the people who can't even afford to be buyers.

Honestly, I don't even like the term starter home.