Housing market's gonna crash

pitdogg2

polrbehr wrote: »

According to Zillow, my house is worth $3400 less than it was a month ago.

Maybe I should cut the grass?

IF you had the right "grass" it could be worth triple the amount it was a month ago.......

just sayin!

polrbehr

pitdogg2 wrote: »

polrbehr wrote: »

According to Zillow, my house is worth $3400 less than it was a month ago.

Maybe I should cut the grass?

IF you had the right "grass" it could be worth triple the amount it was a month ago.......

just sayin!

Well, I thought we were talking about the front yard.

Behind the PVC fence? Well, let's just say that Carl Spackler is an excellent role model...

treitz3

Ours has lost $8,600 in the past 30 days. It will continue to go down too.....and we are in one of the better markets in the country.

Doesn't really matter to us because this is my "forever home".....unless we find a smokin' hot deal on a lakefront property that offers us what this one does (in terms of well kept, SF, upgrades, well built, brick, etc...) and that ain't gonna happen, so I guess this is the home I will end up dying in one day. The wife can do whatever she wants with it once I'm gone. It's too big just for her, even with all of the professional landscaping stuff we have.

Shoot, who am I kidding? It's almost too much for me.

Tom

Jstas

I don't know how much ours lost. Don't care. We were way under market value when we got it because of the disaster it is.

The old house is being rented out and only has 3 more years of collecting rent to where it's collected it's value and paid itself off.

Jstas

Interesting

https://finance.yahoo.com/news/just-cant-wait-nearly-three-210000181.html

VR3

Alot of people fomoing earlier this year no doubt.

treitz3

From the Article wrote:

"I would say my regret is not that I bought a house — it's more that I didn't allow myself the time to pick the right house,” says Kingsman.

Well, it's not like they had this thing called "time" when the market was hot. If you snoozed at all, you wouldn't have had a house at all. You basically took what was left and what was available.....and you overpaid for said property....if you were lucky enough to be the "winner" of the offers flowing in like a tidal wave.

Maybe not in all areas of the country but definitely in desired areas where masses of people across the US were moving too.

From the Article wrote:

Zillow research shows that homeowners end up paying around $750 a month, or over $9,000 a year just for basic repairs and maintenance.

Wow!!! I haven't paid 9K in repairs to our house in the 9 years I have lived here. Now, "upgrades" and changing things to what the wife and I desire to have is another thing but we have multiple thousands left to go to hit that threshold of maintenance. (Lawn care not included in this figure, as I do not consider this "household" maintenance....to me, this is lawn maintenance).

We didn't even hit anywhere NEAR that amount (9K) in our last residence, after 12 years of ownership.

Guess I had better count my blessings. 9K per year in maintenance? Holy Moly....

Tom

VR3

Based on my thousand plus renovations I have done, I would conclude the average person does no maintenance or cleaning during their average 7 years of ownership.

I would actually say alot of the houses I do, we are undoing alot of things people do to their house more than anything.

treitz3

Eh, this can all be "semantics". My version of maintenance (or definition thereof) can be different from yours. In my case, I consider "upgrades" not a part of maintenance.

What I do consider maintenance is what the costs are to maintain what is currently there. I.E., repairing a fridge that no longer has an ice maker that works. Yearly maintenance on the HVAC system to keep it running. Repairing any plumbing or electrical issues that may arise after the purchase of a home. Cutting down a tree that is rotting and has the potential to destroy or damage part of your home.

What I (personally) do not consider maintenance is swapping out a perfectly good range that works with another one that is solely purchased as an upgrade. A cleaning company that comes and washes your windows inside and out, pressure washes the home/hardscapes or a maid service. To me, these are all items that one can do themselves or isn't "needed" in order to maintain a home properly.

For instance, I changed out all of my exterior and interior locksets/doorknobs and the like throughout the property after I moved in. Yes, multiple thousands of dollars were spent.....BUT this wasn't maintenance. It was my desire to change everything out. To me, there is a difference.

Much like changing out your kitchen (twice LOL) or your recent addition. That wasn't "needed" in order to maintain your home. That was by choice in order to improve your lifestyle. Knaw'mean?

Tom

VR3

Right, but I'm talking about maintenance. Nothing surprises me on how people live anymore, nothing!

treitz3

Agreed on THAT one. @aprazer402, you and I would have quite the stories to tell....LOL

What would be comical would be walking into PFB's house after he moves out....I am cracking up just thinkin'bout it.

Tom

VR3

It's probably immaculate 😜

pitdogg2

You never ever buy a house sight unseen like many did! That is ludicrous!
In the past you did a walk through a day or so before your closing to correct stuff the owners were trying to hide or had failed to rectify things they agreed to do or fix.
So many people just threw cash in the air the last 3 yrs and now they're upset it just didn't land in the right spots.
HELLO! Is there anybody in there?

treitz3

Ivan, in some cases, there never was an "open house". When people were fleeing....shall I say without going "there", certain areas of the country.....and move to a state that was open for business? They didn't have the time to fly down and do what was typically considered a "normal" purchase. The house(s) would typically have 10 or 13 offers within the first day, sometimes within the first couple of hours. People would forego the inspection as an incentive for the seller to sell to them over others, with perhaps higher offers. 10-20% over the already severely inflated asking price became the norm.

It was either folks bought a house under these ludicrous conditions or lose out and be responsible for $2,500/mo rent. More, if you required more rooms or needs. At least with a mortgage, over time, they get money back out of it. With rent, you pay more than or close to double the mortgage you would have than if you purchased and you would get nothing out of the deal, except a roof over your head and increased rent when it came time to renew.

With housing prices going down, in some areas considerably, and people buying these houses during this mess, many, many people are going to be underwater for a very long time. Negative equity for 2 decades may be the case for many people, unless a miracle happens or they put a significant amount of money down.

Ironically, now that housing prices are going down, interest rates are going up. These are tough times for people that are currently not in a home they wish to stay in for some time.....unless they can pay cash for something different.

Tom

Jstas

$2500 a month rent for a house is the norm around here. Studio apartments are going for $1000-$1200 a month. The only way you get cheaper is to go to the shadier parts of town or way out in the sticks, away from everything. So you might save a buck on housing costs but you're spending two on commuting costs. Unless you can score a work from home gig.

The $9K a year on maintenance, I guess it depends on how much you do yourself. Also, how large your property is. If you get your lawn done by a service, at ~$40 a pop, that's around $400-$450 a year alone for just mowing. Do it yourself, though, and $50-$100 a year on fuel costs, possibly less if you can get away with a battery powered or electric deal.

I guess it's all relative.

I think the more important thing to take from the article is the buyer's remorse and the fact that many people are already upside down on their mortgages. With the "not inflation" we are experiencing and the "not a recession" we are going through right now, the economic retraction is going to make the job market tighter too. Both things are going to make people want to get out of their situations either by choice or by force.

With the way people bought houses, though, they took on the burden of the things that need to be fixed and the maintenance that needs to be done that was neglected by the previous owner. Maybe that's where the $9K a year comes in to play? But if they went and bought without an inspection, the next buyer won't and they are going to be on the hook for expensive repairs on a house they already can't or don't want to afford and that will kill deals and/or drive prices way down. Either way, this is shades of 2007 all over again where some outside force on the housing market is going to make over-inflated housing costs crash. With so many people paying over asking price, lots were underwater from the jump.

This just feels like a perfect storm.

Additionally, I read a report this morning from Pricewaterhouse Coopers where 51% of American companies were either considering layoffs or have already started. A further 19% haven't considered layoffs but responded that they were a possibility.


Side note, this seems to be the article where they got the $9K a year in maintenance costs. Seems that Zillow is lumping in things like utility costs, homeowners and taxes which would drive the total costs up to $9K-$10K a year average. But, additionally, they include carpet cleaning, gutter cleaning, pressure washing, HVAC maintenance, lawn maintenance and house cleaning. All those are services that you could do yourself for a fraction of what it cost to pay someone. About the only thing I wouldn't do myself is HVAC because I know little about it and have ample opportunity to screw it up bad enough that it costs a boatload more to fix it than if I just cover the cost of a service plan and have a pro do it.

Here's the article: https://www.zillow.com/research/hidden-costs-of-homeownership-16072/

sucks2beme

Nothing about home ownership is hidden. Just people
with their brains in neutral. Not having a home inspection is crazy.
With that said, there isn't a guarantee that the seller will agree to
fix those items found. And believe me, even if they do it may not
be fixed right. But at least they would know going in what was
wrong. Yes, renting costs money, but so does getting out of a home
that doesn't meet your needs. And if you are budgeting that close
to the edge of your means, it's not going to end well.
Better to buy a cheaper home that is out of date and make changes
when you have the money. Tv is full of nonsense where people rip
and tear out a perfectly fine kitchen for their dream one.
And they spend $50k. And the next guy will hate it.
Waiting over time, you'd be amazed by how priorities change.
But that tv induced dream vision seems to be the one too many
go with.

polrbehr

sucks2beme wrote: »

Tv is full of nonsense where people rip
and tear out a perfectly fine kitchen for their dream one.
And they spend $50k. And the next guy will hate it.
Waiting over time, you'd be amazed by how priorities change.
But that tv induced dream vision seems to be the one too many
go with.

Television - the wonderful invention that makes you realize what you don't have, while simultaneously making you want it more than you thought you did before you knew you wanted it.

Emlyn

Realtors are getting sellers to routinely knock $25K off the initial asking price of what was recently a $800K house in my neck of the woods. The appraised value of a place like that is properly still in the $615K range but prices got out of whack with reality in the last couple years.

pitdogg2

My house gained 6K in appraisal value from April to September of this year. Same house, same condition no new upgrades or paint of any sort. Same appraisal guy, same company only the month was different.

VR3

Did you wear something different the second time? 😜

Emlyn

VR3 wrote: »

Right, but I'm talking about maintenance. Nothing surprises me on how people live anymore, nothing!

Not residential related, but the manager of my office building got pretty frustrated to find out a few years ago that some kind hearted staff were leaving food out so the mice wouldn't get hungry over the weekend. Seriously.

VR3

Just imagine those people's house!

sucks2beme

Mice in an office building. Given that a lot of modern cabling
has a soy based jacket, that doesn't end well. I can't tell you
how often this happens. During renovations of the 911 call center,
someone was leaving a door propped open. Mice got under the
raised floor and destroyed thousands of dollars of new cable.

mhardy6647

my dream kitchen...

SIHAB

treitz3 wrote: »

all of the professional landscaping stuff we have.

Shoot, who am I kidding? It's almost too much for me.

Tom

Pics? I love to steal good ideas!

oops. Doc beat me to it.

shawn474

Market is definitely turning but we just sold our house last week for full asking price, no inspection and with no contingencies. Was on the market for 6 days before it sold.

nooshinjohn

shawn474 wrote: »

Market is definitely turning but we just sold our house last week for full asking price, no inspection and with no contingencies. Was on the market for 6 days before it sold.

Out of state, cash buyer perhaps?

GlennDog

nooshinjohn wrote: »

shawn474 wrote: »

Market is definitely turning but we just sold our house last week for full asking price, no inspection and with no contingencies. Was on the market for 6 days before it sold.

Out of state, cash buyer perhaps?

I bet so . . . or a “newer home” that the buyers felt didn’t need an inspection. Chumps

shawn474

nooshinjohn wrote: »

Out of state, cash buyer perhaps?

Not out of state and not cash, but a large down payment apparently.

GlennDog wrote: »

I bet so . . . or a “newer home” that the buyers felt didn’t need an inspection. Chumps

House built early 80's; model home for the neighborhood. Bare bones......We took very good care of it and updated kitchen and bathrooms, floors, etc. Definitely nothing fancy at all and a good starter home, but nothing to write home about. Helped that some of the townhouses in our area were going from similar prices - so the ability to have a .35 acre wooded lot that backs up to state park land that will never be developed is a plus.

aprazer402