Supply Of Under $25k City Properties Dwindling? (Pittsburgh, Erie: insurance, crime rates)

[I_Like_Spam]

Originally Posted by h_curtis

Are you off your rocker? Really? What drugs are you on? You BLAME? BLAME! Are you kidding me? What the heck do you mean "BLAME"? Sorry there buddy, but no one BLAMES a home investor, flipper or someone that guess what? FIXES UP a home that was in horrible repair and then sells it as a home someone can actually live in. Do you think the neighbors are HAPPY that someone took a pos home and made it nice for someone to live in? BLAME? Wow, you are really twisted in how you think. I wouldn't even know where to begin, but as someone that has bought and sold several homes NO neighbor of mine was unhappy that I bought and sold the homes. They were THANKFUL! WOW, get a life bud!

When I bought my house in L'ville, I was pleased to hear that that the guy who sold it to me was fixing up the house next door, with the intent of selling it.

Its one of the factors I used to buy here in the first place.

[Kippy]

While I understand the appeal of not having a mortgage, if you are not able to save enough for a down payment, how are you going to save enough to buy a house with cash?

A 30-year mortgage with a 5% APR on a loan amount of $25,000 results in a monthly payment of $135. Most people, even of modest means, are able to afford more than this.

If your rent is prohibiting you from growing your savings, then you really only have two choices -- find a way to increase your income or find a cheaper place to rent.

[HarryRSpooner]

Originally Posted by Kippy

While I understand the appeal of not having a mortgage, if you are not able to save enough for a down payment, how are you going to save enough to buy a house with cash?

A 30-year mortgage with a 5% APR on a loan amount of $25,000 results in a monthly payment of $135. Most people, even of modest means, are able to afford more than this.

If your rent is prohibiting you from growing your savings, then you really only have two choices -- find a way to increase your income or find a cheaper place to rent.

Agreed and very well put. From my understanding it isn't always so easy to find mortgages at $25,000.00. At least the big banks don't roll that way. But I bet if financing for say the sub50k houses were more readily available then those houses wouldn't stay priced so modestly. It's probably an amazing opportunity for someone with the capital to set up a small bank or credit union. Figure, a fund of $10million divvying up loans at no greater than $50,000.00 could easily accommodate 200 or more loans. At this point on Zillow there are only 162 or so properties under 50k. I'm sure there is more inventory not currently for sale. But drying up the lower priced properties by making capital more accessible could lead to more revitalization. Now to raise a measly,10mil

[Hemlock140]

I find this thread to be amazing. Our first house, in California cost $50,000 in 1978, currently is worth $600,000 despite being 75 years old and only 1,100 sf.

Where we live now east of Seattle the median price is $550,000, and the lowest priced fixer foreclosure would be over $300,000.

You still have homes under $100,000 and are complaining?

[HarryRSpooner]

Originally Posted by Hemlock140

I find this thread to be amazing. Our first house, in California cost $50,000 in 1978, currently is worth $600,000 despite being 75 years old and only 1,100 sf.

Where we live now east of Seattle the median price is $550,000, and the lowest priced fixer foreclosure would be over $300,000.

You still have homes under $100,000 and are complaining?

Yes. Relative to comparative income levels and purchasing power parity. Yes. I know properties under $50,000.00 that are inhabitable can be a total bargain. But it's still a shock to see a house jump from $10,000.00 to $15,000.00 to $20,000.00 in the space of say 5 years.

[gg]

Originally Posted by I_Like_Spam

When I bought my house in L'ville, I was pleased to hear that that the guy who sold it to me was fixing up the house next door, with the intent of selling it.

Its one of the factors I used to buy here in the first place.

Who wouldn't be? Oh the guy that runs around here and complains he can't afford a home. I have NEVER read posts so self centered. Goodness! Oh, sorry scr, that some people are fixing homes up and making neighborhoods better. Poor baby! Geez.

[zman63]

Originally Posted by SteelCityRising

I've most certainly noticed this myself. I blame investors, "flippers", and career landlords for turning what should be a home into a commodity. All I've wanted is what has been fortunate enough to have happened for PreservationPioneer, who was able to move here, pay roughly $10,000 cash for a tiny yet liveable rowhouse in Stowe Township, and make it cozier and more "homey" over the years. He's recently sold that to someone (hopefully not to an investor or absentee landlord).

The housing prices in Homewood especially shock me. I suppose it can't truly be the worst neighborhood in the city if prices here are higher overall than they are in places like Beltzhoover or Fineview in many cases. Each and every time a small liveable house here on Polish Hill gets listed it flies off the market. Developers are only bringing top-shelf living quarters to the market these days (i.e. Summerset at Frick Park, Bakery Square 2.0, Highland Building, Lot 24, etc.), leaving those of us with Target---not Saks Fifth Avenue---budgets feeling squeezed.

The problem for those of us with more moderate incomes is that we're relegated to overpaying for rent due to the tight rental market here, which makes it progressively more difficult to save for closing costs and a down payment on homes that are consistently rising in price with each passing year while salaries aren't rising commensurate with this rising cost-of-living. Eventually I may just end up moving to Youngstown, OH to find a livable home at an affordable price point.

I agree with you on the rental prices and stagnant wages. They are going to push people out. Pittsburgh may have its own mini housing bubble that bursts.

With all of that said, if you want to move, here is what I suggest. Youngstown has some nice suburbs (Poland, Boardman, Canfield), but what about the northern panhandle of West Virginia (Hancock, Brooke Counties)? I think for value you cannot beat it. To me it is one of the best kept secrets in the tri state area. Giant Eagle doesn't have a monopoly (Kroger and Sparkle marts). You can buy beer and wine in the local sheets. If you use tobacco, cigarettes are 2 dollars or more cheaper per pack. The roads are smooth and there is no trash on the sides of the roads. Also, there is a park and ride 15 miles from the WV border in north fayette that heads into downtown. 35 to 40 minute drive by car. Route 22 west is probably the nicest and least congested highway in and out of Allegheny county. You can live like a king making 35-50k a year in WV and commuting into the city.

Finally, property taxes on a 130K home in Weirton, WV area is $472 a year. Even Beaver, butler, wash and westmoreland counties aren't that low.

[ferraris]

Yes, the supply of under $25K homes is definitely dwindling. I don't think it's specific to the under $25K category though, it's just that prices in general are going up.

With regard to the flippers, I don't dislike them really, and I think "blame" has a negative connotation, but I have heard other people echo SCR's sentiments about them. The issue some people have is that they flip to maximize profit (of course), which means they can go very high end, beyond what is necessary to have a habitable house. Say you have a home that sold for $50K but needs some work. A flipper might do a very high end gut job mega-flip and turn it into a $100 or even $150K home over the course of a few months. Someone like SCR might put in $10K over the course of a few years, resulting in a perfectly habitable home, but one that is only worth only $55-60K.

Flippers aren't necessary for what SCR envisions for most neighborhoods. They effect change too quickly and they go beyond what is necessary. I can't speak for him of course, but that is what I have come away with from his posts over the years. As a recent home shopper I agree with him to an extent, but as a recent home owner, I don't mind the flippers in my neighborhood.

[PreservationPioneer]

Originally Posted by zman63

I agree with you on the rental prices and stagnant wages. They are going to push people out. Pittsburgh may have its own mini housing bubble that bursts.

With all of that said, if you want to move, here is what I suggest. Youngstown has some nice suburbs (Poland, Boardman, Canfield), but what about the northern panhandle of West Virginia (Hancock, Brooke Counties)? I think for value you cannot beat it. To me it is one of the best kept secrets in the tri state area. Giant Eagle doesn't have a monopoly (Kroger and Sparkle marts). You can buy beer and wine in the local sheets. If you use tobacco, cigarettes are 2 dollars or more cheaper per pack. The roads are smooth and there is no trash on the sides of the roads. Also, there is a park and ride 15 miles from the WV border in north fayette that heads into downtown. 35 to 40 minute drive by car. Route 22 west is probably the nicest and least congested highway in and out of Allegheny county. You can live like a king making 35-50k a year in WV and commuting into the city.

Finally, property taxes on a 130K home in Weirton, WV area is $472 a year. Even Beaver, butler, wash and westmoreland counties aren't that low.

I would go with Erie. It has one of the lowest crime rates of any city in PA, has a lot of big city amenities, walkable downtown and neighborhoods, sub $20k historic cottages, and PRESQUE ISLE.

[PreservationPioneer]

Even when I was looking for sub $20k houses back in 2008-2009, there was very little on the market that was liveable, unless it was a foreclosure, short sale, or in a very bad area. I did see a lot of properties that had awful basement bathrooms, water damage, bad roofs, needed major structural repairs, or had other issues like trees growing too close to the house or abandoned outbuildings that needed to be torn down. There was always an expensive catch that made the investment much more than the list price.

I think it's worth noting that if you want a cheap house, you need to make lowball offers. The house I bought for 11k in 2009 was originally listed for 28k. If you want a 15k house, look at 25k houses that have been on the market for a while.

Also, those 2 bedroom brick row houses are usually cheap. There are usually some on the market in Rankin, Hazelwood, etc. for under $20k. They are cheap to repair and maintain.