are houses going for more than the precrash prices? (Hingham: real estate, renting)

[SpringMom3]

it seems like houses are selling for over 2006 prices. people are putting their houses on the market for way over what they bought them at in 05/06/07 and the houses are selling for way above asking prices... why is this?

[Dan1974]

-6.5% vs 3.5% rates on the 30 years fixed mortgage loan
-FHA underwriting virtually all loans, so banks will loan 95% LTV. Why shouldn't they?
-Banks are flush with cash from the fed (TARP & Quantitative easing)

All that put together, the average joe have roughly 30% more buying power than back in 2006.

As for what will the consequence be for such reckless monetary policy, well, just wait and see. But don't buy at these prices, that is my advice to you.

[Beachcomber4]

I was with friends today. One sold their south end condo for 30k over asking last week. Supposedly, the price was high to begin with. Another friend is a real estate agent in Hingham. Houses are being sold before they even go to market. She can't find enough listings to keep up with demand.

[SpringMom3]

Originally Posted by Dan1974

-6.5% vs 3.5% rates on the 30 years fixed mortgage loan
-FHA underwriting virtually all loans, so banks will loan 95% LTV. Why shouldn't they?
-Banks are flush with cash from the fed (TARP & Quantitative easing)

All that put together, the average joe have roughly 30% more buying power than back in 2006.

As for what will the consequence be for such reckless monetary policy, well, just wait and see. But don't buy at these prices, that is my advice to you.

thanks Dan, great explanation. What's your thought on all this? what would you wait till? prices come down/interest rates go up? or what are you thinking?

we are flexible right now. we are renting in cambridge but do need to move to a good school system town for our older child (3 yrs old) to enter school in 2 yrs. but we can do that renting or even stay in cambridge for a bit.

so what's your thought about the market? & prices?

[SpringMom3]

Originally Posted by Beachcomber4

I was with friends today. One sold their south end condo for 30k over asking last week. Supposedly, the price was high to begin with. Another friend is a real estate agent in Hingham. Houses are being sold before they even go to market. She can't find enough listings to keep up with demand.

right, this is exactly what i keep seeing. everywhere.

[Dan1974]

Originally Posted by SpringMom3

so what's your thought about the market? & prices?

Yeah, sounds like us. Renting with a 3 and 1 yo, and wondering.

The sad truth is, you can't think your way out of this when you have a country drifting towards a wellfare state and a government who slowly inserts itself in every aspect of our lives.

I'll give you a simple example. I was considering buying whole life insurance for the tax benefit. Mostly wealthy people usually buy whole life Vs term, because it is a great tool to pass on wealth to your kids tax free. But am I going to go through and sacrifice to pay the high monthly premium with Democrats controlling the country? There has been talk already to "address" whole life insurance tax credit because mostly "evil rich people" benefit from it, even if its available to any hard working american who wish to save for their kids instead of buying that new flat screen TV on credit. So in essence, I am effraid that putting this money away for my kid will end up paying for someone elses TV in the future as the governemnt will come in and steal this money from me. So I am not going to buy whole life insurance because I am absolutely convinced that limousine liberals will end this at some point down the road.

You can do everything right, make all the right moves and decisions, but with the switch from a capitalist society to a wellfare state and socialist government, you now have to deal with their decisions everyday.

I wish I could tell you that when the fed will raise interest rates, that everything will be ok. But what will the democrat do when every hobos in town wont be able to afford a jumbo loan on your dime? Then you will have to worry about that, whatever this will be, because you better believe that they will do something.

Welcome to Canada! I left because I was dreaming of self-reliance and success, and instead I loss 120k$ with my first house and am being taxed into failure while EBT recipients cash in their money to buy smokes and liquor. And the only political alternative to self-contained ivy leaguer elitist believe that Fred Flinstone did have a dino pet.

What I plan to do? Buy the cheapest house that my wife will be willing to live in, in a second tier town, and hope for the best.

Amen.

[pennyone]

"Welcome to Canada! I left because I was dreaming of self-reliance and success, and instead I loss 120k$ with my first house and am being taxed into failure while EBT recipients cash in their money to buy smokes and liquor. And the only political alternative to self-contained ivy leaguer elitist believe that Fred Flinstone did have a dino pet."....

gee, if you are that unhappy, then maybe the generally liberal Northeast is not a place for you. Definitely do not buy a house here if you might move. Try Texas or Arkansas maybe? You also don't need to live in the US....just a suggestion and no sense in being miserable.

[MikePRU]

Anyway...getting this back on track.

Some towns around here didn't have a "crash" and now prices are sky rocketing in these towns. So, values are definitely above 2005-2006 levels in these locations.

[luvmyhoss]

In my area north shore prices are recovering but nowhere near precrash prices.
Beware, listings are selling quickly, but the economy has not recovered. So
this phenomenon is not real.

[City Guy997S]

Originally Posted by Dan1974

Yeah, sounds like us. Renting with a 3 and 1 yo, and wondering.

The sad truth is, you can't think your way out of this when you have a country drifting towards a wellfare state and a government who slowly inserts itself in every aspect of our lives.

I'll give you a simple example. I was considering buying whole life insurance for the tax benefit. Mostly wealthy people usually buy whole life Vs term, because it is a great tool to pass on wealth to your kids tax free. But am I going to go through and sacrifice to pay the high monthly premium with Democrats controlling the country? There has been talk already to "address" whole life insurance tax credit because mostly "evil rich people" benefit from it, even if its available to any hard working american who wish to save for their kids instead of buying that new flat screen TV on credit. So in essence, I am effraid that putting this money away for my kid will end up paying for someone elses TV in the future as the governemnt will come in and steal this money from me. So I am not going to buy whole life insurance because I am absolutely convinced that limousine liberals will end this at some point down the road.

You can do everything right, make all the right moves and decisions, but with the switch from a capitalist society to a wellfare state and socialist government, you now have to deal with their decisions everyday.

I wish I could tell you that when the fed will raise interest rates, that everything will be ok. But what will the democrat do when every hobos in town wont be able to afford a jumbo loan on your dime? Then you will have to worry about that, whatever this will be, because you better believe that they will do something.

Welcome to Canada! I left because I was dreaming of self-reliance and success, and instead I loss 120k$ with my first house and am being taxed into failure while EBT recipients cash in their money to buy smokes and liquor. And the only political alternative to self-contained ivy leaguer elitist believe that Fred Flinstone did have a dino pet.

What I plan to do? Buy the cheapest house that my wife will be willing to live in, in a second tier town, and hope for the best.

Amen.

Dan

I have recently had a discussion on similar levels with a neighbor (regarding saving for retirement not home buying). Don't let "it could happen" due to the politicians, the economy etc prevent you from moving forward. Those things are out of your control and you can't deny the time value of money whether invested in a home or life insurance. If you don't invest, you could be left on the sidelines 20 years from now because of the "politicians, economy, etc."
My conversation with my neighbor regarding retirement started when he told me he just started an IRA at age 51! He was aggravated that he had to put 2K away and the govt. was probably going to take it anyway......