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Old 03-12-2012, 07:23 PM
cm4
 
90 posts, read 120,124 times
Reputation: 34
And the cost of a new roof, a new A/C, a new fence, dozens of DIY projects... all the joys of home ownership!!!
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Old 03-12-2012, 09:11 PM
 
Location: SW Austin
206 posts, read 173,208 times
Reputation: 64
Cm4 youre a prime example,of someone who understands real estate. You never traded up chasing green pastures and as a result you never lost money to realtors and you watched your investment grow. Too many people feel compelled to trade up as much as possible and blow all their equity every 7 years in the process. If people would stay put and throw off the yolk of mortgage debt the better they would be. Communities are created organically and are not some mythic domain of more expensive neighborhoods.
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Old 03-12-2012, 09:49 PM
yam
 
220 posts, read 467,566 times
Reputation: 126
You can simplify the model by breaking your home investment into two pieces. You buy a house and a lot. The house itself always depreciates as it ages (not including remodeling improvements, inflation effects, etc). Your lot increases in value if you are lucky or bought wisely.

Thus a new megahouse in the exurbs is almost guaranteed to be a poor investment - all the value is in the house, which depreciates, and almost none of the value is in the lot. Or in different terms, there will be a newer and nicer subdivision built just down the street in a few years and your house will seem dated by comparison, and you'll still be living on a tiny lot far from town.

By counter example, unimproved central austin properties have almost all the value in the lot. Pay half a mil for the lot, get a rickety sixty year old 2/1 bungalow with a bad foundation for free!
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Old 03-12-2012, 10:15 PM
 
Location: SW Austin
206 posts, read 173,208 times
Reputation: 64
Real estate is still overpriced. The boomers insist we fund their retirement by buying their real estate from them. They dont want the young crowd to create their iwn neighborhoods. Thats why up and coming areas are suppressed
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Old 03-12-2012, 11:35 PM
 
Location: Austin
773 posts, read 542,887 times
Reputation: 911
Quote:
Originally Posted by yam View Post
Thus a new megahouse in the exurbs is almost guaranteed to be a poor investment - all the value is in the house, which depreciates, and almost none of the value is in the lot. Or in different terms, there will be a newer and nicer subdivision built just down the street in a few years and your house will seem dated by comparison, and you'll still be living on a tiny lot far from town.
I've lived in Austin long enough to see this happen with various areas of the city. It's more obvious when you're in a medium-sized town, such as the town where my parents live. There's an obvious "whack-a-mole" type of neighborhood hopping that goes on as one exurb goes out of fashion and another crops up. People spend their entire lives there keeping up with the Joneses and their brand new, big fat mortgage.

The big question, I guess, is this: Which outliers in the Austin metroplex will likely retain their value, given that fuel costs are soaring even as expansion continues even further out? Can any home buyer really be sure?
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Old 03-13-2012, 03:11 AM
 
Location: SW Austin
206 posts, read 173,208 times
Reputation: 64
Areas close to major retail should retain value. Close to downtown should do well. The lower cost of ownership should translate into bigger house budgets. Believe it or not east riverside should do very well in the longrun with the new neighborhoods from the 170s that major builders are starting. The first ones in will get sideways looks from their contemporarys but that area could turn out like something between east 7th and south congress eventually. The land between the airport and downtown is worth more than the provincual people in this town realize. We just need to put on our big boy pants and treat it the same way as dallas houston and san antonio have.
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Old 03-13-2012, 07:28 AM
 
Location: Southwest Austin
4,888 posts, read 9,381,477 times
Reputation: 3332
Quote:
Originally Posted by suit-n-tie white guy View Post
Real estate is still overpriced. ...
Please provide the data to back this assertion, or clarify that it's just your uninformed opinion. What metrics do you personally look at when assessing the real estate market in Austin, and what are those metrics telling you?

Steve
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Old 03-13-2012, 08:03 AM
 
Location: Austin, TX
8,615 posts, read 17,313,614 times
Reputation: 3451
Quote:
Real estate is still overpriced.
Don't buy, then, and if enough people agree with you, then prices will come down.
Quote:
The boomers insist we fund their retirement by buying their real estate from them.
Buy from a non-boomer. Build your own. Who is 'insisting' you buy anything in particular? Recommending is one thing, but 'insisting'?


Quote:
They dont want the young crowd to create their iwn neighborhoods. Thats why up and coming areas are suppressed
'They' (the boomers?) are 'suppressing' up and coming areas? How so? How do you define an up and coming area? I would assume that up and coming areas (UACtm) are increasing in value, by definition, and therefore are not being suppressed.

Anyway, this sounds all conspiracy theory. The inequity in value in different areas is self-created (market-created). You obviously don't want to pay for an expensive area, but would like to live there - you just want the prices lower. The prices are high because lots of people want to live there and will pay the higher prices. You are not just paying for the lot or the house or a combination of the two. You are paying for your neighbors, schools, commute, etc. For better or worse, people want to live near people like them.
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Old 03-13-2012, 08:09 AM
 
Location: Austin, TX
455 posts, read 589,640 times
Reputation: 318
Quote:
Real estate is still overpriced. The boomers insist we fund their retirement by buying their real estate from them.
Second on the 'slow down with the conspiracy theories.' This is grossly oversimplified and sounds like a square peg of a worldview forced into a round hole of an explanation. I don't care if the guy I'm buying a house from is funding his retirement, his bagel shop, or the drug trade. If he has a house I want in a place I want at a price I want, I'm going to buy it from him, and he has a general idea that I might.
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Old 03-13-2012, 03:44 PM
 
Location: The People's Republic of Austin
3,747 posts, read 1,866,609 times
Reputation: 1899
Quote:
Originally Posted by suit-n-tie white guy View Post
Are they ever going to stop building?
I can understand this emotion. Heck, there's a part of me that wishes Austin was the size it was when I moved here in '85. That way there'd be about 400,000 less of you yahoos in my way.

But before anyone assigns blame, look in the mirror. Before you rail against "developers", recognize who built your house. No matter when you arrived here, there could have always been someone that wanted the place frozen the day after they got here, and left you out. Sorta like the laugh I always got in the Nineties about cars with an SOS sticker, yet from a dealership somewhere else. "I'm on board - pull up the gang plank!". No matter when you moved here, do you really think you will be the last person on the planet who realizes Austin is a pretty good place to live?

So the challenge to all of us is how do we meet the demand for living in a place we all love, without destroying it? You can't live here without being environmentally sensitive - but only some of us are fanatical about it.
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