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Old 06-02-2015, 07:58 PM
 
20,836 posts, read 39,041,284 times
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For those bubbling with enthusiasm for this topic, here's an article that goes into some details on what is a bubble.

Excerpt: "a bubble is a kind of social epidemic—a period of feedback, where price increases generate enthusiasm among investors, who then bid up prices more, and then it feeds back again and again until prices get too high. During that period, people are motivated by envy of others who made money doing it, regret in not having participated and the gambler’s excitement. Stories develop that justify the bubble, they become current and then people think they’re right because everyone’s confirming the stories. So, that happens. Eventually prices get too high and the bubble bursts."


IMO, if the mortgage industry maintains proper lending standards, there will not be a bubble. However, if we go back to liar loans and all the other scandalous tactics then a bubble is a certainly. We're surely in a boom; it remains to be seem if we escalate into a bubble.
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Last edited by Mike from back east; 06-02-2015 at 08:12 PM..
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Old 06-03-2015, 08:08 AM
 
Location: In The Thin Air
12,244 posts, read 8,029,930 times
Reputation: 8893
Quote:
Originally Posted by Mike from back east View Post
For those bubbling with enthusiasm for this topic, here's an article that goes into some details on what is a bubble.

Excerpt: "a bubble is a kind of social epidemic—a period of feedback, where price increases generate enthusiasm among investors, who then bid up prices more, and then it feeds back again and again until prices get too high. During that period, people are motivated by envy of others who made money doing it, regret in not having participated and the gambler’s excitement. Stories develop that justify the bubble, they become current and then people think they’re right because everyone’s confirming the stories. So, that happens. Eventually prices get too high and the bubble bursts."


IMO, if the mortgage industry maintains proper lending standards, there will not be a bubble. However, if we go back to liar loans and all the other scandalous tactics then a bubble is a certainly. We're surely in a boom; it remains to be seem if we escalate into a bubble.
I completely agree. The last bubble they were offering interest only loans so people could get into places they wouldn't normally be able to afford. This was a huge problem in California. Borrowers would only pay the minimum on the loans and when the bubble burst they were upside down by a lot.
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Old 06-03-2015, 08:14 AM
 
Location: Denver, CO
2,391 posts, read 1,796,828 times
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Quote:
Originally Posted by Timmyy View Post
I completely agree. The last bubble they were offering interest only loans so people could get into places they wouldn't normally be able to afford. This was a huge problem in California. Borrowers would only pay the minimum on the loans and when the bubble burst they were upside down by a lot.
I still think a lot of people are overpaying for homes here. This is based on my experience so far with house shopping. Every reasonably priced option I come across ends up selling for $10-20k+ more than asking price, at least according to my realtor and people I've talked to about it. A lot of these places need a lot of work as well. I'm just not sure people will be able to re-coup these costs.
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Old 06-03-2015, 10:01 AM
 
Location: In The Thin Air
12,244 posts, read 8,029,930 times
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Quote:
Originally Posted by Lafleur View Post
I still think a lot of people are overpaying for homes here. This is based on my experience so far with house shopping. Every reasonably priced option I come across ends up selling for $10-20k+ more than asking price, at least according to my realtor and people I've talked to about it. A lot of these places need a lot of work as well. I'm just not sure people will be able to re-coup these costs.
I also agree with that for some of the metro area but there is still a ton of people flooding the state and I don't think that will stop any time soon.

All I have to say is good luck in your search. I know it is tough out there and I feel very lucky to have my house. We are having it appraised this afternoon for a refi to pull cash out. I can't wait to see what they think it is worth. No more debt except a mortgage and possibly a new deck and cover.
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Old 06-03-2015, 04:30 PM
 
Location: Washington Park, Denver
6,902 posts, read 6,492,373 times
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Quote:
Originally Posted by Lafleur View Post
I still think a lot of people are overpaying for homes here. This is based on my experience so far with house shopping. Every reasonably priced option I come across ends up selling for $10-20k+ more than asking price, at least according to my realtor and people I've talked to about it. A lot of these places need a lot of work as well. I'm just not sure people will be able to re-coup these costs.

My dad's best friend was recently telling me how overpriced he thought Wash Park was when he moved here in 1980. It's all relative.
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Old 06-03-2015, 04:55 PM
 
Location: Denver, CO
2,391 posts, read 1,796,828 times
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Quote:
Originally Posted by SkyDog77 View Post
My dad's best friend was recently telling me how overpriced he thought Wash Park was when he moved here in 1980. It's all relative.
That's not quite the same thing. Wash Park has always been a fairly exclusive neighborhood. Any house surrounding one of the city's premier parks is going to go for $$$. You can also tell just by looking at the homes there. I'm talking about homes that need a lot of work and not in prime locations. For example, the town home I just put an offer down on last weekend that needed a ton of remodeling inside and was located in East Denver not particularly close to anything you can consider "prime". My offer of $170,000 was outbid by what my realtor suspected was a good $10-$15k over that.
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Old 06-03-2015, 06:47 PM
 
451 posts, read 381,195 times
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My daughter and her husband (newlyweds) gave up on buying a house this year because they were scared away by the bidding wars. They decided to rent for another year and I don't blame them. They'll wait until next spring and see what happens... No harm in that. Their landlord didn't even raise the rent. It will put them in a better position in the long run.
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Old 06-03-2015, 07:47 PM
 
Location: The Berk in Denver, CO USA
13,942 posts, read 20,184,988 times
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Default Better timig

Quote:
Originally Posted by JWEvergreen View Post
wait until next spring and see what happens... No harm in that.
Not the best move.
The BEST time to BUY is between Nov 22 and Jan 03.
A lot less competition and sellers are more desperate.
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Old 06-03-2015, 08:16 PM
 
2,514 posts, read 3,485,646 times
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Quote:
Originally Posted by Lafleur View Post
Wash Park has always been a fairly exclusive neighborhood.
It certainly is pricey now. When I moved here 20 yrs ago I looked at a couple of houses right on the park. As in across the street from it for about $150K-$170K. They were all dumps. I'm sure they've been torn down and rebuilt as million dollar mansions. As I recall they all had the same basic floorplan. Enter to living room. Bedroom on the right. Kitchen behind living room. Another bedroom behind first on on the right. Maybe a small back room where the coal came in. Sometimes the two bedrooms were in series such that you had to go through one to get to the other. Seemed to be the popular cheap floor plan in the early 1900s. I didn't buy them because the condition was bad and frankly the area wasn't that great. Lots of cheap tiny homes. Who knew that it would turn out like it did? A fixed up one in the area was $200k but there weren't many because house values were flat or losing money in the '80s so no one put money into their homes.

Even 20 yrs ago you could only buy a fixer upper for $150K which is what I did in a nice blue/white collar mix neighborhood with a good builder from the '70s.

A little history on wash park.

“Two-bedroom bungalows closer to the park housed the workers. The corner lots, which were more spacious, were occupied by middle management.”
Merchants flocked to Washington Park. While it may have lacked the moneyed elegance of Capitol Hill, the neighborhood more than compensated with its cozy, tree-lined streets.
Wash Park suffered a steep decline in the 1960s and 1970s. Drugs were rampant. Already affordable housing prices dipped accordingly."


"But as Wash Park increased in value, Nevitt says it resulted “in an ironic value disequilibrium” because high-rise towers, expensive homes and duplexes often clashed with the neighborhood’s predominantly modest style."


Wash Park is upper crust now but it is the first time in its history that it is a pricey neighborhood.

Last edited by mic111; 06-03-2015 at 09:05 PM..
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Old 06-03-2015, 09:05 PM
 
Location: Denver, CO - Capitol Hill
557 posts, read 665,198 times
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Quote:
Originally Posted by davebarnes View Post
Not the best move.
The BEST time to BUY is between Nov 22 and Jan 03.
A lot less competition and sellers are more desperate.
This was my thought as well. Prices are just going to be 10-20% higher this time next year.

Funny you used that date though. Nov 22 is exactly when we closed on our condo a couple of years ago. For below list in a desirable spot, thank you very much.
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