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I'm just trying to get a feel for the different markets. RE Agents - I have 2 questions. Let's say you're personally in the market to buy a home. You have the flexibility to purchase it anytime within the next 2 years. When would you buy your home (now, in 3 mos, 6 mos, 1 yr, etc) knowing that there is still weakness in home prices and sales?
Second Question - you want to buy an investment property to hold for 5 years and sell. When would you buy it?
I'm buying a home to move into right now. I'll live there a year and fix it up, then either sell or convert to a rental. So I guess I'm doing both.
Thanks everyone... please feel free for anyone else to add info. Again, I was just trying to get a feel for other people's perceptions throughout the country. As for me, if I was in the market (NE Florida), I'd probably wait 1-2 months to buy a primary home and probably 3-6 months to buy an investment property.
I'll close on my most recent investment purchase on Thursday. I don't flip properties. I hold on to them for several years, so it really doesn't matter when I buy. I bought two homes in 2006, when it was a sellers market. Over the long run real estate is one of the best investment vehicles there is.
I'm buying right now (under contract, primary residence) and shortly after will buy as many investment properties as look good. Charlotte's market presents some of the best investment opp. in the country because of the economy.
According to microeconomic data we havn't seen the worse as far as the credit crunch. We will not see the peak of foreclosures intil november or december of this year. With this being the case you will not see the credit markets improve intil at least the 4th quarter of 2008. Therefore, in the declining markets you will see prices falling intil at least the first quarter of 2009 but all markets in this country are not as week as the coasts. In fact some markets with strong job growth that missed the boom are seeing modest increases in value even with all this turmoil. Now in my opinion you will see better deals and more options prior to the stabalization of the credit market and a purchase in mid 2008 should not see much more of a hit to value even in the declining markets (unless you are in one of the way over priced markets like sacramento california or sarasota county florida). A purchase in mid 2008 would most likely give you the best of both worlds a great price and little down side potential there by making it a great time to buy.
Personally closing at the end of the month on a rental condo. If you find a good one, make a move. Guaranteed, I did my homework and have a rental market. DO NOT wait until everything clears up. If you have good finances and especially cash, you can do it anytime.
You mentioned the tight underwriting constraints, and I've heard it all over the media on how much tougher it is to secure a home loan, but will it be really that difficult to get a loan? And what do they mean when they say they no longer allow "stated incomes" in when getting a loan?
I'm been looking around for my first home in OC, and although I haven't been preapproved yet, I've been viewing homes in the 250-360k price range,..now I'm scared I may be biting off more then I can chew. My annual income is about 60k with no debt, not much of a down payment, and a 750+ credit score. Is it unrealistic for me to buy in this price range?
Homeseeker, I think you should ask this question on the mortgage forum, as they can probably answer better... and it will be impacted by where you are because you will have taxes and insurance that I cannot help you calculate... but when I do a quick calculation, if you did a loan of 300k, before taxes and insurances you would be in the 36% ratio. I like to see my clients under the 36% ratio with taxes and insurance, UNLESS they know something I don't know...
You can still get 100% financing it is out there... with a credit score like yours.
Stated income is for individuals (like most real estate agents) who cannot produce a pay stub to "prove" our income. We have to "state" our income and show a tax form from last year (or more).
Save a little money, that will help you. No debt, nice annual income, you should be able to get a little nest egg going...
A 300K mortgage on 60K salary? Lets do the numbers..
Rough monthly take home pay (minus some 401k, benefits, flex spending, taxes) is around say 3K?
If you take your monthly mortgage payment with say property taxes at 3500/yr, your looking at a mortgage/prop tax monthly bill of $2400
That leaves you roughly 600/month (not including food, clothes, utilities, spending $, emergency fund, 529 plan, IRA, etc., etc...)
To put it bluntly, unless you're going to live day to day like a homeless person, are you nuts??? You are setting yourself up to be so house rich, cash poor its rediculous...How anyone could even suggest this is beyond me? Shelly, you need to get a new calculator. Yours is stuck in 2004-2005. We're not in the bubble anymore. People need to tighten their belts nowadays...This is exactly what got people into this mess the first time... That percentage is WAY too high.
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Peak of resetting subprime ARMs is in May
