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I'll agree with the thoughts of others who posted above. I don't know if the "bubble" will burst here, but if it does, it will affect the farther-out, less desirable towns more than the close-in ones (close to RTP, downtown Raleigh, etc.) with the perceived best schools. That is exactly what happened in 2008 in Northern Virginia when the economy declined across the nation. We had been experencing an extreme run-up of home prices with limited supply, and people were moving farther and farther out to even just buy a house they weren't being outbid on. When the economy went south, the close-in, desirable suburbs like Arlington, Bethesda, McLean lost some value but not nearly as much as they had gained in the prior 8 years. On the other hand, places out in Prince William County and Loudoun County lost much more.
I am curious, though where Waterboy owned his townhouse that has not yet appreciated to above the 2006 prices. Most of Northern Virginia has continued to grow and prices have been steadily increased. My little ranch house in Vienna that was worth about $650K at its peak would definitely be worth that today (had it not been knocked down and turned into a 6 bedroom McMansion, but that's a story for another day).
The potential problem I see with this area compared to Northern Virginia, though, is that it's not nearly as built out. Northern Virginia has practically run out of land so it needs to keep pushing farther and farther out, which of course keeps home prices high, particularly the closer in you get. Here in the Triangle, there is so much more land for building that as the area continues to make the transition from rural to suburban/urban, there will be more housing available, so unless the growth rate continues to go up as it has in the past few years, a bad economy could hit current homeowners, particularly farther out (F-V, Holly Springs, Clayton, etc.) pretty hard.
I lived in a tiny (1,200 sq. ft.) townhouse in Leesburg. Based on my calculations it increased 68% from the time we bought to the time we sold 26 months later. The people that brought from us forclosed 1 year later (had a terrible loan with a bridge loan as well), the bank owned it for 14 months and then it was purchased from the bank for less than half of what we sold it for 2 years earlier. So it has gained back a decent amount of value, but still sits about 15-20% less than what we sold it for in 2006.
I get it's lessburg and it's 35 miles from DC, but that's pretty astonishing none the less. Of course Arlington and Bethesda lost less value and have gained it back and more since 2006.
I'd have to say that the homes being compared in that example are not an apples to apples comparison. Home values around here have not seen ~70% appreciation in just the last few years.
Yeah, I agree with that. My sister paid $250K for her house in Apex 9 years ago, she'd probably get $300K now. In the example OP gave there's too many factors not known about that sale, like any upgrades that were installed, etc etc
Yeah, I agree with that. My sister paid $250K for her house in Apex 9 years ago, she'd probably get $300K now. In the example OP gave there's too many factors not known about that sale, like any upgrades that were installed, etc etc
About the time your sister bought her house, prices were on the decline due to the bottom dropping out of the market. Not a huge decline in that price bracket, but there was a decline. Especially if she still paid close to top dollar at the time she bought it.
I bought a townhouse in 2007 that dropped in value by 2008 and it took until around 2015 before it was back up around what I paid for it. Sold it last year for about 25k more than I paid for it in 2007.
So, yeah... part of that is the market. I think that anyone buying a house here since about 2012 could turn a decent profit selling it now if it's updated and if it's in the sub 500k price bracket.
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Originally Posted by Waterboy526
I lived in a tiny (1,200 sq. ft.) townhouse in Leesburg. Based on my calculations it increased 68% from the time we bought to the time we sold 26 months later. The people that brought from us forclosed 1 year later (had a terrible loan with a bridge loan as well), the bank owned it for 14 months and then it was purchased from the bank for less than half of what we sold it for 2 years earlier. So it has gained back a decent amount of value, but still sits about 15-20% less than what we sold it for in 2006.
I get it's lessburg and it's 35 miles from DC, but that's pretty astonishing none the less. Of course Arlington and Bethesda lost less value and have gained it back and more since 2006.
Yeah, so glad we got out when we did. Set us up for our 2nd and now 3rd houses which have all gained handsomely in value. I'd like to think it was all calculated on my part, but luck has had a lot to do with it .
My in-laws bought a home in coastal eastern FL in 1992 for $175,000. In 2005 or 2006 they sold it for $655,000. Bank foreclosed on it in 2008 or 2009 and it was resold for $155,000. I don't think their timing could've been any better.
I agree that todays home prices are much more reserved than they were in 2005-2006 time frame. I think you're seeing a combination of factors in this area one of which is the job growth and influx of new residents. I have no idea what the buying qualifications are of those older but from casual conversation with early-millennials (mid-30's) in our social circle we are seeing extreme reservation in keeping DTI low. No CC debt, no car loans, no student loan debt, high down payments with ability to pay for the home in cash if desired, etc. Several have delayed buying a home and instead travel the country in an RV or similar while working remote and saving the vast majority of their pay checks. Also when they do buy it's a smaller home than the last group of buyers went for - lots of 1500-2500 sq ft places, not larger homes with higher upkeep/tax costs.
There is also a much bigger emphasis on saving for retirement and retiring early than the previous generation it seems.
We moved to Raleigh and bought a house primarily because of the economy. You have several large "legs" holding the chair up so to speak. Higher education, medical/biotech, IT, all with the corresponding higher paid jobs over manufacturing plant.
I'd have to say that the homes being compared in that example are not an apples to apples comparison. Home values around here have not seen ~70% appreciation in just the last few years.
I totally agree. Either there's a lot of misinformation, inappropriate comparisons, hyperbole or a combination thereof. Home prices have not increased across the board like that. While there may be the special circumstance or the lucky homeowner who bought at a fire sale price during the bottom of the recession crash, most homeowners have enjoyed moderate growth in values of their homes over the last several years. The Triangle has never been a boom and bust sort of RE market that has huge peaks and valleys moving through time a frenetic pace.
We sold our home in Holly Springs in Feb 2015 for $209,000. This was a few months before the market craziness hit!! Neighbors just listed their home (same subdivision - smaller home) for $269,000!!!
It has a few more upgrades than ours did but still!! Less Square feet!! It's crazy....
We are pretty conflicted regarding the move.Over the past few months the market here in the Collin County area in TX has held steady.If we were to do the move we would walk away with a significant profit from the sale of our house.What is the market currently doing in the Raleigh metro and what are your predictions for 2018?
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