NY Housing Article: Any thoughts? (Albany: insurance, refinance, school)

[propain]

Originally Posted by 56 Fighter

The point flew right over your head.

And yes, if you bought a house foe for 320k today, chances are if you were to re-sell it tomorrow you'd get 300k. Broad brushes cannot be put away... we are talking about the real estate market.

Yeah, except you will buy it today at 5% and sell it tomorrow at 8%. Buying a 320K at 5% or 300K at 8%. Guess which choice is more affordable?

[dman72]

Originally Posted by propain

Yeah, except you will buy it today at 5% and sell it tomorrow at 8%. Buying a 320K at 5% or 300K at 8%. Guess which choice is more affordable?

In which case you will not be able to sell for 300K, more likely 260 or 250. What were home prices like the last time mortgage rates were 8%? A brand new colonial friends of mine bought in Centereach was going for 200K in 1998 or 99. A similar house sold for 470K back July 2008. If interest rates hadn't gone down below 6%, do think those houses would have appreciated that much? No, they might have appreciated to 300K or so. So, another 20% on that 470 house puts it around 376K, which guess, what, is still more than most people in Centereach can afford!!

So, the 300K previously talked about after a 20% drop here is IF interest rates stay in the same ballpark. You're talking about 8% rates, which means that the market will go MUCH further down. More likely, you'll just have many more people staying put. You already have banks not giving mortgages to people with decent credit and incomes and these low rates. What happens if rates go up to 8%? Almost everybody on LI will be unable to afford houses without a drastic drop in the market.

Eventually someone has to actually be able to AFFORD the houses, right? You can't sell them to fictional families making 250K a year who are few and far between. The banks are not "making it work" anymore. They are saying "this is what you make, this is what you've saved, this is what you can afford". Which means that the average home on LI pushing 400K is still not affordable to most people looking to buy.

[Burb]

Originally Posted by 56 Fighter

The point flew right over your head.

And yes, if you bought a house foe for 320k today, chances are if you were to re-sell it tomorrow you'd get 300k. Broad brushes cannot be put away... we are talking about the real estate market.

Here in lies our fundamental difference of opinion. You are viewing buying a home today as buying a share of a declining market, failing to recognize the value of assets relative to each other within the market is where you fall short. To use easy numbers, I Conceed houses sold today will decline in value 20% in 1 year. Individual houses will lose between 0% and 40% of their value, flat for the short sales and distressed sellers, 40% for the less savy shopper.

These redundant threads dispense the same treatment and advise to the person buying a house at a great price and interest rate as the guy buying above retail with marginal financing. Yup, rediculous.

[propain]

Originally Posted by dman72

In which case you will not be able to sell for 300K, more likely 260 or 250. What were home prices like the last time mortgage rates were 8%? A brand new colonial friends of mine bought in Centereach was going for 200K in 1998 or 99. A similar house sold for 470K back July 2008. If interest rates hadn't gone down below 6%, do think those houses would have appreciated that much? No, they might have appreciated to 300K or so. So, another 20% on that 470 house puts it around 376K, which guess, what, is still more than most people in Centereach can afford!!

So, the 300K previously talked about after a 20% drop here is IF interest rates stay in the same ballpark. You're talking about 8% rates, which means that the market will go MUCH further down. More likely, you'll just have many more people staying put. You already have banks not giving mortgages to people with decent credit and incomes and these low rates. What happens if rates go up to 8%? Almost everybody on LI will be unable to afford houses without a drastic drop in the market.

Eventually someone has to actually be able to AFFORD the houses, right? You can't sell them to fictional families making 250K a year who are few and far between. The banks are not "making it work" anymore. They are saying "this is what you make, this is what you've saved, this is what you can afford". Which means that the average home on LI pushing 400K is still not affordable to most people looking to buy.

Since when are home prices on LI based on affordability of the majority? That hasn’t been the case for over 30 years. Why do you think this will take place now? You are using the bubble as a reason to correct 30 years of high home prices that have been driving the lower salaries off Long Island for the past 30 years? That is some wishful thinking.


To the rest of your post....


Historically yes, but over time and not as dramatic as you might hope. Between 1985-1988 there was an increase in home value of 65%. The average interest rate was 9%.

2002-2003 we only see an increase of 34% with an average interest rate of 4%.

Higher interest rates don’t always mean a drop in home prices. Over time yes we could see drops but the immediate results it to quell inflation. When home prices start to drop you will see a drop in interest rates again.

Once you hit bottom, no matter what interest rates do on the short term housing will increase approx. 4% a year. If you keep waiting you might price yourself out of the market for 2-5 years before things become affordable for you again.

If you dont think today is a good time to buy, then don’t. But be prepared for small drops is house prices followed by high interest rates. That new trend will linger for at least 2-5 years while we combat the inflation risks of all this government spending.

[dman72]

Originally Posted by propain

Since when are home prices on LI based on affordability of the majority? That hasn’t been the case for over 30 years. Why do you think this will take place now? You are using the bubble as a reason to correct 30 years of high home prices that have been driving the lower salaries off Long Island for the past 30 years? That is some wishful thinking.


To the rest of your post....


Historically yes, but over time and not as dramatic as you might hope. Between 1985-1988 there was an increase in home value of 65%. The average interest rate was 9%.

2002-2003 we only see an increase of 34% with an average interest rate of 4%.

Higher interest rates don’t always mean a drop in home prices. Over time yes we could see drops but the immediate results it to quell inflation. When home prices start to drop you will see a drop in interest rates again.

Once you hit bottom, no matter what interest rates do on the short term housing will increase approx. 4% a year. If you keep waiting you might price yourself out of the market for 2-5 years before things become affordable for you again.

If you dont think today is a good time to buy, then don’t. But be prepared for small drops is house prices followed by high interest rates. That new trend will linger for at least 2-5 years while we combat the inflation risks of all this government spending.

You keep thinking inside your own box. Most houses on LI are not in Roslyn Estates, or in East Hampton on the waterfront. They are in big developments. They are where people who work for a living have to live. While they may on average be have always been certain percentage higher than the average house in the country, that was supported by the increase in salaries that this area commands. That factor is declining every year as more and more companies leave. Do you think that every person from the rest of the country making 150K a year is going to move here to prop up the housing market? It really isn't that attractive.

[propain]

Originally Posted by dman72

You keep thinking inside your own box. Most houses on LI are not in Roslyn Estates, or in East Hampton on the waterfront. They are in big developments. They are where people who work for a living have to live. While they may on average be have always been certain percentage higher than the average house in the country, that was supported by the increase in salaries that this area commands. That factor is declining every year as more and more companies leave. Do you think that every person from the rest of the country making 150K a year is going to move here to prop up the housing market? It really isn't that attractive.

Ill keeping living in my box and you keep hoping to use this bubble to fix 30 years of high home prices on LI.

Just an FYI there are so many affordable homes on LI for every type of income. But just because you make less money than the next guy doesn’t entitle you to bottom out the upper to middle class house markets. Its just not going to happen.

I’ve said it 10000 times already, if you cant afford a home on LI today you wont be able to afford one tomorrow. Sorry, that’s the reality of LI.

[dman72]

Originally Posted by propain

Ill keeping living in my box and you keep hoping to use this bubble to fix 30 years of high home prices on LI.

Just an FYI there are so many affordable homes on LI for every type of income. But just because you make less money than the next guy doesn’t entitle you to bottom out the upper to middle class house markets. Its just not going to happen.

I’ve said it 10000 times already, if you cant afford a home on LI today you wont be able to afford one tomorrow. Sorry, that’s the reality of LI.

And I've already told you my personal situation, and you keep repeating the same mantra about how people can't afford it. Does it make you feel like you're some kind of elite member of society to keep telling people who can afford a house here that they disagree with your view of the market because they can't afford one? It's kinda..stupid.

[propain]

Originally Posted by dman72

And I've already told you my personal situation, and you keep repeating the same mantra about how people can't afford it. Does it make you feel like you're some kind of elite member of society to keep telling people who can afford a house here that they disagree with your view of the market because they can't afford one? It's kinda..stupid.

What’s stupid is your sensitivity and overall aggression toward me when I state an opinion you don’t like.

Im not speaking to you personally when I say "If you cant afford a home". It’s a generalized statement.

Honestly, if you cant handle a debate with me without getting offended and casting insults don’t bother replying to my posts.

[dman72]

Originally Posted by propain

What’s stupid is your sensitivity and overall aggression toward me when I state an opinion you don’t like.

Im not speaking to you when I say "If you cant afford a home". It’s a generalized statement.

Honestly, if you cant handle a debate with me without getting offended and casting insults don’t bother replying to my posts.

The language of everything you post is insulting, dismissive, and aggressive, yet you're taking offense to being insulted. "But just because you make less money than the next guy doesn’t entitle you to bottom out the upper to middle class house markets. Its just not going to happen."

We're talking about obvious economic trends here and you're talking about what people feel entitled to. We're talking about what's GOING to happen here. What people are trying to WILL to happen should be irrelevant. Many times you've stated how the riff raff want to lower prices and how that will hurt neighborhoods. That's doesn't have anything to do with what is actually going on or will go on..it's simply your wishful thinking.

Simply put, you wish for a market that can't be sustained, to be sustained...and we know why.

[propain]

Originally Posted by dman72

You keep thinking inside your own box. Most houses on LI are not in Roslyn Estates, or in East Hampton on the waterfront. They are in big developments. They are where people who work for a living have to live. While they may on average be have always been certain percentage higher than the average house in the country, that was supported by the increase in salaries that this area commands. That factor is declining every year as more and more companies leave. Do you think that every person from the rest of the country making 150K a year is going to move here to prop up the housing market? It really isn't that attractive.

See above bold and ask yourself why I became more aggressive toward you. You people really have a hard time understand the chain of events and who gets aggressive with who first. You dont think your comment to me was dismissive or Condescending?

Originally Posted by dman72

The language of everything you post is insulting, dismissive, and aggressive, yet you're taking offense to being insulted. "But just because you make less money than the next guy doesn’t entitle you to bottom out the upper to middle class house markets. Its just not going to happen."

We're talking about obvious economic trends here and you're talking about what people feel entitled to. We're talking about what's GOING to happen here. What people are trying to WILL to happen should be irrelevant. Many times you've stated how the riff raff want to lower prices and how that will hurt neighborhoods. That's doesn't have anything to do with what is actually going on or will go on..it's simply your wishful thinking.

Simply put, you wish for a market that can't be sustained, to be sustained...and we know why.

The above bold might be harsh but it’s a reality. That reality spun you off into a tissy. Try to control your emotions.

Im talking about economic trends that you refuse to comment on. I’ve post many links and reasons why I think we are stable and now is a good time to buy.

What I find HILARIOUS is your masked attempt to state you have no stake in wishing house prices bottom out even more and how you want to return to 1962 house prices. Its just your opinion right? You have nothing to gain from it?

Please stop acting like you aren’t hoping and wishing house prices will tumble for your own personal gain. Its insulting.

I have stated many time and my many reason why I want home prices to stabilize and go up. Im sorry you find that opinion offensive. Maybe you should just ignore me since you cant seem to control your emotions. I could do without your banter as well.