LI Housing (Hope: for sale, apartment, foreclosures)

[S.I.B.]

Originally Posted by dman72

It's very simple..loose lending is over, people can't afford current prices, even if they want to..if you can't get the mortgage, you can't buy the house. I don't know how you can call that subjective information, it's facts. The only thing that can change this situation is if the banks start putting through more fake loans....do you think that is going to happen?

this is true, but likely not as relevant to those who already own. I wonder what percentage of LI buyers are first time buyers? If we're to believe all of the Long Island Brain Drain hype, perhaps it's lower than other areas.

[dman72]

Originally Posted by S.I.B.

this is true, but likely not as relevant to those who already own. I wonder what percentage of LI buyers are first time buyers? If we're to believe all of the Long Island Brain Drain hype, perhaps it's lower than other areas.

I don't think it matters whether you currently own or don't...if you want to sell, buy, or refinance, where the market is at effects you. If you saved 50K in 2007 and waited a few extra years to buy, well, you made a very wise decision.

[S.I.B.]

Originally Posted by dman72

I don't think it matters whether you currently own or don't...if you want to sell, buy, or refinance, where the market is at effects you. If you saved 50K in 2007 and waited a few extra years to buy, well, you made a very wise decision.

My point was in response to your comment about people's ability to get loans and lending practices. I don't know the exact numbers, but the average homeowner likely can get a mortgage easier than the average first time buyer...and likely doesn't have to borrow as much.

[dman72]

Originally Posted by S.I.B.

My point was in response to your comment about people's ability to get loans and lending practices. I don't know the exact numbers, but the average homeowner likely can get a mortgage easier than the average first time buyer...and likely doesn't have to borrow as much.

..not if they are underwater in their mortgage or have little equity.

I don't think there's much difference to a bank if you have 75K in equity in a house, or 75K in the bank and you are looking for your first place..actually, they'd probably prefer the cash because who knows what your house is really going to sell at, if at all, so now you have 2 mortgages to pay if your house doesn't sell.

[S.I.B.]

Originally Posted by dman72

..not if they are underwater in their mortgage or have little equity.

again, what percentage of buyers are in this boat?

I don't think there's much difference to a bank if you have 75K in equity in a house, or 75K in the bank and you are looking for your first place..actually, they'd probably prefer the cash because who knows what your house is really going to sell at, if at all, so now you have 2 mortgages to pay if your house doesn't sell.

does the average first time buyer have as much cash on hand as the average homeowner's cash + equity? I have no idea, but I'm thinking the homeowner may have them beat.

[dman72]

Originally Posted by S.I.B.

again, what percentage of buyers are in this boat?


does the average first time buyer have as much cash on hand as the average homeowner's cash + equity? I have no idea, but I'm thinking the homeowner may have them beat.

1st question: many who bought in the last 4 or 5 years

2nd question: I don't know, a heck of a lot of people took out equity loans on inflated home prices. Let's say you bought your house for 400K in 2002, it was deemed to be "worth" 500K in 2006 by the appraiser..you had it paid down to a balance of 250K, then you took 200K in equity out to buy stuff, maybe you "increased" the value of your home to 600K with granite counter tops and pavers.

Now, it's 2009, the bank decides that your house with all it's fancy updates would sell for 450K, yet you've only paid down the mortgage by and equity loan another 25K...your equity is now 25K. Not great.


It really depends on how much: income, total debt vs. cash you have. I can think of some people who have been in their homes for a decade who aren't in good shape in that regard.

[I_Love_LI_but]

Originally Posted by S.I.B.

again, what percentage of buyers are in this boat?


does the average first time buyer have as much cash on hand as the average homeowner's cash + equity? I have no idea, but I'm thinking the homeowner may have them beat.

If the homeowner cannot sell it because 1st time buyers are not moving into the market at enough volume, then I'd say everybody ends up "beat."

[workingclasshero]

Originally Posted by S.I.B.

My point was in response to your comment about people's ability to get loans and lending practices. I don't know the exact numbers, but the average homeowner likely can get a mortgage easier than the average first time buyer...and likely doesn't have to borrow as much.

not always...sometimes its easier as a first time buyer...especially is you still have a mortgage

two examples:

a) you make 75k a year....you QUALIFY for a 200k loan based on the 30% rule...as long as you have 40k as a down payment you should be able to get it as a first time buyer.

b0 you make 75k a year...you qualify for a 200k loan based on the 30% rule....you currently own a home that is worth 275k that you paid 200k for and you have 150k left on you mortgage (50k equity on the loan , but 125k equity for the value of the home))......so you have 150k left on your loan so all you qualify for is 50k mortgage...until you sell the first home.

[S.I.B.]

Originally Posted by dman72

1st question: many who bought in the last 4 or 5 years

obviously. But that doesn't tell us how many people out there who are shopping for homes are in that boat.

2nd question: I don't know, a heck of a lot of people took out equity loans on inflated home prices. Let's say you bought your house for 400K in 2002, it was deemed to be "worth" 500K in 2006 by the appraiser..you had it paid down to a balance of 250K, then you took 200K in equity out to buy stuff, maybe you "increased" the value of your home to 600K with granite counter tops and pavers.

Now, it's 2009, the bank decides that your house with all it's fancy updates would sell for 450K, yet you've only paid down the mortgage by and equity loan another 25K...your equity is now 25K. Not great.

That's a whole lot of doom and gloom. My question is how many people made those choices...and how many of them are part of the current pool of buyers?

It really depends on how much: income, total debt vs. cash you have. I can think of some people who have been in their homes for a decade who aren't in good shape in that regard.

there's obviously many factors impacting all of this...and I'm thinking there is more pain down the road. Prices have dropped, but I feel like the "nice house in a nice area" is still pretty pricey...and I'm curious as to why.

[scottzilla]

I'm not sure how anyone can pay off a 400K house down to 250K in 7 years.
I've been paying mine for 7 years and haven't made a dent.