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My point is that there is only so much land that can
be developed on the island (limited availability of land)
and that it is a desirable place to live. From living here
for the past year, I have walked around the neighborhood
and have seen many, purchased but empty, lots on the south
side. If the lot is not released, I assume it is not for sale so
it is not available. Sure, it is probably a marketing ploy by the
DI company to maintain prices. Of course, this may change
depending on what happens to the southern portion owned by SPA.
Do I think home prices will drop more on DI? Yes, probably.
Do I think lot prices may drop? Probably. But, I think prices
will be supported for the reasons I mentioned above. I
certainly do not see 180 active lots for sale on the south side.
Just curious, can you point me to a reference?
At some point, you have to pull the trigger. Let's say
you want to build new. Lots start in the mid 100s right now.
Let's say it drops 50% in the next 2-3 years and you save
75k. Do you think interest rates are going to stay at historic
lows (5%) for the next 2-3 years given all the govt cash printing
and bailouts? I doubt it, but I could be wrong. You can lose that
75k easy with an increase of 1-2% on mortgage rates if you are
in it for the long term. Same thing applies to existing homes.
I don't need to belabor my point and don't feel like arguing.
I just presented my impressions - Can I be wrong? Sure.
My point is that there is only so much land that can
be developed on the island (limited availability of land)
and that it is a desirable place to live. From living here
for the past year, I have walked around the neighborhood
and have seen many, purchased but empty, lots on the south
side. If the lot is not released, I assume it is not for sale so
it is not available. Sure, it is probably a marketing ploy by the
DI company to maintain prices. Of course, this may change
depending on what happens to the southern portion owned by SPA.
Do I think home prices will drop more on DI? Yes, probably.
Do I think lot prices may drop? Probably. But, I think prices
will be supported for the reasons I mentioned above. I
certainly do not see 180 active lots for sale on the south side.
Just curious, can you point me to a reference?
At some point, you have to pull the trigger. Let's say
you want to build new. Lots start in the mid 100s right now.
Let's say it drops 50% in the next 2-3 years and you save
75k. Do you think interest rates are going to stay at historic
lows (5%) for the next 2-3 years given all the govt cash printing
and bailouts? I doubt it, but I could be wrong. You can lose that
75k easy with an increase of 1-2% on mortgage rates if you are
in it for the long term. Same thing applies to existing homes.
I don't need to belabor my point and don't feel like arguing.
I just presented my impressions - Can I be wrong? Sure.
I wouldn't worry too much about interest rates rising in the near future because for every 1 percentage point increase in rates, prices will decline on average by 10%.
Today, either you pay cash for the land or come up with a substantial DP of 40% - 50% and hope a bank will lend you the balance albeit at a subtantial rate premium.
We've really discovered in the last 4-5 years that homes and raw land are not long term investments - they are places to live, today or in the future.
I
We've really discovered in the last 4-5 years that homes and raw land are not long term investments - they are places to live, today or in the future.
It seems every time there is a real estate crash we have to relearn this. That's why trying to 'play' the real estate market usually doesn't work.
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