Lexington is fast becoming an elitist community (Boston, Framingham: rent, mortgage)
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No confusion-I was answering the ops question and commenting on your quote as well
Quote:
Originally Posted by Bruins_Fan
Odinboy,
I think you're confusing me with the OP. First off, I never said I was looking to live in Lexington. I'm a North Shore guy, and other than maybe living in the city itself someday, have zero interest in ever living anywhere out that way. I much prefer oceanside towns, like where I live.
I never said anything to the contrary. I said the market is the market...whatever. That said, I don't have to buy those houses (and won't)...they are overpriced in MY view. Period.
I agree. Let someone else buy it.
I fully realize that the RE market is all local (as my old school RE broker father used to say..."location, location, location"), but it doesn't change the fact that the home prices here are still insane compared to the overall US market.
I think that if this trend continues, more and more young adults will leave the area. Not a good thing, IMHO. If I wasn't so rooted here with kids, our own business, etc. , I'd leave. The prices really don't make much sense to me.
Not unless we go back to the lending 'standards' of 2002-2007 -- 'Stated / No Doc Income mortgages, zero down etc... 'young adults' typically do not prioritize saving for a home as they do buying $50,000 cars (plus the insurance & excise taxes associated), designer clothes etc.. The problem that I see here on this thread is that the OP cannot afford these said towns (Lexington, Needham, Wellesley).. Also, lenders now want close to 20% down if you don't have a 700 + credit score. That can be a problem for people who are making in the six figures (which really isn't that difficult to do in this area) but can't or choose not to save any money...
From what I have seen in Wellesley (not familiar with Lexington)the majority of these young families are certaintly not doctors and lawyers. First of all, if you are going to make good money in these professions it takes time. Second of all, I know from personal experience that doctors face a quadruple whammy in this state: high malpractice rates, non-competitive salaries relative to high cost of living, high cost of living, and the lowest insurance reimbursement rates in the entire country. So if you want to be rich this is probably not the profession to do it in. There are of course some exceptions like dual-income doctors, specialists, and ones also with old money to start.
Most of young ones moving in are over-paid finance people. They make more in bonuses than salary. Many of the young ones also get handed, as some mentioned, a large downpayment from parents. As Mike mentioned it makes sense financially that someone with good financing and no contingency gets the house even if that often means a builder. It is a tough market out there now in regard to financing and it is survival of the fittest. I am not disagreeing with that as we were one of those strong "buyers" who were able to buy one of those over-priced tear-downs.
However, I do feel bad for the underdog. It is nice to have a mix of people in the town. Not everyone is fortunate enough to have jobs that make that kind of money or get inheritances. I feel very blessed but I can tell you not many people feel that way and often feel a sense of entitlement. Now some will say these people "earned it" but have they really contributed to society or actually worked for it?
I also see a lot of older parents with young children moving into these tear-downs at least in my neighborhood. They tend to be very educated and have put-off children for years and have been able to save some money.
From what I have seen in Wellesley (not familiar with Lexington)the majority of these young families are certaintly not doctors and lawyers. First of all, if you are going to make good money in these professions it takes time. Second of all, I know from personal experience that doctors face a quadruple whammy in this state: high malpractice rates, non-competitive salaries relative to high cost of living, high cost of living, and the lowest insurance reimbursement rates in the entire country. So if you want to be rich this is probably not the profession to do it in. There are of course some exceptions like dual-income doctors, specialists, and ones also with old money to start.
Most of young ones moving in are over-paid finance people. They make more in bonuses than salary. Many of the young ones also get handed, as some mentioned, a large downpayment from parents. As Mike mentioned it makes sense financially that someone with good financing and no contingency gets the house even if that often means a builder. It is a tough market out there now in regard to financing and it is survival of the fittest. I am not disagreeing with that as we were one of those strong "buyers" who were able to buy one of those over-priced tear-downs.
However, I do feel bad for the underdog. It is nice to have a mix of people in the town. Not everyone is fortunate enough to have jobs that make that kind of money or get inheritances. I feel very blessed but I can tell you not many people feel that way and often feel a sense of entitlement. Now some will say these people "earned it" but have they really contributed to society or actually worked for it?
I also see a lot of older parents with young children moving into these tear-downs at least in my neighborhood. They tend to be very educated and have put-off children for years and have been able to save some money.
I agree. I would prefer that every town have a mix of housing so that a mix of incomes can afford to live in these towns. The rampant tear downs have certainly made it harder for people to afford the cost of entry into many towns like Wellesley, Needham, Newton, etc. because many of the smaller less expensive (relatively speaking) houses are gone. When a more affordable home does go up for sale you have the difficult task of competing against builders who's offers have virtually no contingencies.
One thing you can do in these situations is to write a letter to accompany your offer. A lot of these homeowners have lived in the house for many years, raised their kids in the house, etc. A letter saying that you're going to raise your kids in the house and create new memories in the house can sometimes tug at the heart strings and get you the house. It doesn't work every time but it never hurts to try.
I agree. I would prefer that every town have a mix of housing so that a mix of incomes can afford to live in these towns. The rampant tear downs have certainly made it harder for people to afford the cost of entry into many towns like Wellesley, Needham, Newton, etc. because many of the smaller less expensive (relatively speaking) houses are gone. When a more affordable home does go up for sale you have the difficult task of competing against builders who's offers have virtually no contingencies.
This may be what you prefer, but your (or my) preferences rarely hold up against the almighty dollar.
As towns become more desirable, it becomes more expensive just to stay in that town, as desirability usually results in a sharp rise in property taxes, as your modest home gets judged based on what could be there, instead of what is actually there. So what happens in this desirable but mixed town results in 1500 square foot ranch homes being asked to pay $10,000 in property tax yearly. It's not sustainable. So they all end up selling, even if they would rather stay.
Or you could try a California-style property tax cap for existing homeowners, but new buyers know they're going to get soaked by current-rate property tax - people who could afford the mortgage know that they can't afford the mortgage + property tax once the home changes hands. So again, the only people who will buy the smaller home are people planning to "upgrade" it by tearing it down.
Quote:
Originally Posted by MikePRU
One thing you can do in these situations is to write a letter to accompany your offer. A lot of these homeowners have lived in the house for many years, raised their kids in the house, etc. A letter saying that you're going to raise your kids in the house and create new memories in the house can sometimes tug at the heart strings and get you the house. It doesn't work every time but it never hurts to try.
Better be a little more proactive than "writing a letter." You better haul your butt over there, meet the seller, and sit down and talk to them about your plans. If necessary ask your realtor to facilitate the meeting, but don't leave this to a letter.
This may be what you prefer, but your (or my) preferences rarely hold up against the almighty dollar.
This is why I used the word prefer.
Quote:
Originally Posted by JacksonPanther
Better be a little more proactive than "writing a letter." You better haul your butt over there, meet the seller, and sit down and talk to them about your plans. If necessary ask your realtor to facilitate the meeting, but don't leave this to a letter.
Many people hire a real estate agent just to avoid this scenario. I know if I were a seller (and I very recently was) I would have no desire what so ever to meet face-to-face with a perspective buyer. Most sellers I've worked with would react in sheer horror if I even suggested such a thing.
Also, I can't tell you how many times I've seen real estate deals blow up because of a face-to-face meeting. Putting buyer and seller in the same room together before the deal is done is rarely a good idea in my experience. Emotions run high, the wrong thing is said and everything goes to pot.
I worked with a buyer not too long ago who insisted on speaking directly and negotiating directly with each and every seller we dealt with. Turns out he was a con man and was trying to blow up these deals so that his cover wouldn't be blown (long story).
Some great points in this thread by MikePUR & JaksonPanther. I recently purchased a small 1950s ranch in Arlington near the Lexington line that I'm using as a rental property for a famly member, and I found myself in a small bidding war with a builder. It drove the cost of the property up about $15k for me. The property has a large lot & the builder was going to pop in an $850k home,
I found out that the builder & I arrived at the same price & the property owner went with me because I was not going to tear down the house. So.....you just never know.
Last edited by Brave Stranger; 07-16-2012 at 04:58 PM..
Unfortunately, towns can't resist the allure of extra property taxes from these McMansions. I've found that many builders are local boys who are chummy with town officials. In one case, a builder was childhood friends with a selectman. We got into a bidding war with a builder and lost out despite a full cash offer with no contingencies. The builder offered significantly less than us for the house up front but promised a small percentage of the profits. We didn't get it since it was 25% less and I can't imagine they would make out that much better with the several percentage points of the profit. The selling agent was a former builder who is buddies with the builder so we guessed something strange would happen. The sellers apparently didn't care all that much since it was their parents' house. The real heartbreaker was when we drove by months later and saw all the original woodwork and doors shattered into pieces and dumped out front along with the rest of the house.
A more recent surprise was a cute Arts and Crafts bungalow that sold for almost $600k last fall. We drove by and a McMansion was being put up. It was a 2000 sq. ft. house with original details, but I guess it wasn't modern/big enough. I'm surprised it received permits here in Concord, but I'm guessing there was some old boys' network at work again.
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