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I purchased my condo in 2002. In Hayward, price was 250k. I moved to Hayward b/c I'd been priced out of the other places I wanted to live. I moved in 2005 and rented my place out b/c I married. Kept the condo thinking that if I ever wanted to move back to the Bay I would not be able to afford to buy. Places were selling for ~350 at that time. I just looked and there are 2 similar units listed in my development for 220 and 218. I can't believe that things are selling for less than they were 6 almost 7 years ago. Meanwhile the HOA fees have gone up every year.
I'm one that put 20% down so I've already got a paper loss for a good 30k. Can someone explain what is going on. I can see $$ coming down from the height of the market... but 7 years ago we weren't at the top. We were 1 maybe 2 years into the rise. What's happening to the tax base or how do people like me?
I purchased my condo in 2002. In Hayward, price was 250k. I moved to Hayward b/c I'd been priced out of the other places I wanted to live. I moved in 2005 and rented my place out b/c I married. Kept the condo thinking that if I ever wanted to move back to the Bay I would not be able to afford to buy. Places were selling for ~350 at that time. I just looked and there are 2 similar units listed in my development for 220 and 218. I can't believe that things are selling for less than they were 6 almost 7 years ago. Meanwhile the HOA fees have gone up every year.
I'm one that put 20% down so I've already got a paper loss for a good 30k. Can someone explain what is going on. I can see $$ coming down from the height of the market... but 7 years ago we weren't at the top. We were 1 maybe 2 years into the rise. What's happening to the tax base or how do people like me?
I'm not sure what more explanation than we had a really really big real estate bubble that popped. Watch the news, and we have it in SPADES.
Some places have gone down -- way down. My zip has been hit very hard by many foreclosures. At one time I looked online at real estate listings and discovered that in my zip code 945 homes were on the market.... 854 were foreclosures. So our house prices have really suffered. For instance, a house down the street from me is nearly the same square footage and built around the same time is selling for 74,900. I bought my house for 72,000.... in 1987.
So depending on how severe foreclosures are in your zip code that will affect the bottom line prices in your area.
Here's a chart from Data Quick that has median prices on a year to year basis. Hayward is down 30some percent from last year , and in 2007 down around 12%, so you're looking at a nearly 50% loss in value. But you're not alone.
People are having their properties reassessed for taxes, and yeah -- the whole state is running in the red because of it.
I wish I could give you better news... I assume you don't live here anymore? Have you rented your place out?
I've rented it out. I now live in Charlotte. As luck would have it, my husband has a job offer in the Bay Area and I may be able to come home.
I've seen it on the news and I knew there were problems. I guess I just had NO idea how bad it had gotten. Charlotte has been realtively immune -- so far. I hear people talking about folks buying more than they could afford or flippers as if that's what caused this mess. That's always irritated me. It irritates me even more so now. I bought my place to live in. Not to make huges $$ or flip. I didn't expect that I would Loose $$. If you're almost back to 1987 pricing and you have to move.... Geeze. Who is safe.
I've rented it out. I now live in Charlotte. As luck would have it, my husband has a job offer in the Bay Area and I may be able to come home.
I've seen it on the news and I knew there were problems. I guess I just had NO idea how bad it had gotten. Charlotte has been realtively immune -- so far. I hear people talking about folks buying more than they could afford or flippers as if that's what caused this mess. That's always irritated me. It irritates me even more so now. I bought my place to live in. Not to make huges $$ or flip. I didn't expect that I would Loose $$. If you're almost back to 1987 pricing and you have to move.... Geeze. Who is safe.
Who is safe? The old timers who came here before the California economy started to go crazy. Let's say they paid $15,000 for their house in Cupertino forty years ago. They're sitting on a mountain of equity, and it probably makes no difference to them that it has eroded 15% or so recently. Or let's say they sold it in 2004 or 2005 for a million or so and moved into a $600K condo so they wouldn't have to maintain it, and now it's worth $500K. What do they care? They paid for it with funny money, and what does it matter if a bit of the funny money is gone now?
I guess my folks should have bought a place for me back in 1970 when they bought their home.
Forget the banks... homeowners need a bailout
Quote:
Originally Posted by sonarrat
Who is safe? The old timers who came here before the California economy started to go crazy. Let's say they paid $15,000 for their house in Cupertino forty years ago. They're sitting on a mountain of equity, and it probably makes no difference to them that it has eroded 15% or so recently. Or let's say they sold it in 2004 or 2005 for a million or so and moved into a $600K condo so they wouldn't have to maintain it, and now it's worth $500K. What do they care? They paid for it with funny money, and what does it matter if a bit of the funny money is gone now?
Buying condos/houses anywhere is a dubious investment for most, even if held for many yrs, esp after calc'g taxes, improvements, real estate commissions, etc
Know many <40yo single financiers who earn >>$1MM/yr who have rented condos in NYC or SF or LA for yrs, rather than buying something b/c most scoff at the investment value of real estate
Buying houses makes sense for families who need a house in a desirable suburb near desirable schools; have no plans of moving for at least 10yrs....and are fine w/home holding its value, but not proving to be a great investment
Besides, a major quake in CA (or terror event in NYC) can easily change the pricing dynamics of real estate, esp older, seismically-dubious houses on unstable land....silly to put much of one's net worth into an asset that may easily crumble in a major quake
Buying condos/houses anywhere is a dubious investment for most, even if held for many yrs, esp after calc'g taxes, improvements, real estate commissions, etc
Know many <40yo single financiers who earn >>$1MM/yr who have rented condos in NYC or SF or LA for yrs, rather than buying something b/c most scoff at the investment value of real estate
Buying houses makes sense for families who need a house in a desirable suburb near desirable schools; have no plans of moving for at least 10yrs....and are fine w/home holding its value, but not proving to be a great investment
Besides, a major quake in CA (or terror event in NYC) can easily change the pricing dynamics of real estate, esp older, seismically-dubious houses on unstable land....silly to put much of one's net worth into an asset that may easily crumble in a major quake
BUT -- you aren't taking into account the fact that by NOT using my house like an ATM has definite advantages that I couldn't get by renting. There is no where in the Bay Area where I can rent a single family home in good condition for 650.00 a month. And because I kept my house payment low, but our income went up and up thanks to opening our own business -- I get some tax advantages at the end of the year AND get to stuff all I can away into savings.
Yeah -- I'm ticked that people went crazy and our economy imploded. But I've lived through a few recessions (although this one is tougher than usual) and I know that in a few years, things will be chugging away again, all this hardship a mere memory. That's the beauty of living under your means and putting away cash.
My time line is not one where I HAVE to sell and get out right now... I'm around five years away.... since my investments have to recover and Brent isn't ready for the rocking chair yet. In five years, I don't expect my house to be back at 500K, but I should be able to clear 250K out of it.
And while I'm not happy with what has gone on around here, I will never say I regret buying a home. It was the best thing we did. Having a home has allowed us to save some real wealth wiht little pain.
To the OP, you can appeal your current R/E tax valuation with your county assessor. It's easy to do, and it does NOT require professional help, especially with the internet available. Find recent closing sale prices for some comparable units, (at least 3), average them out, or if one is an outlier, like a larger unit or something, you can discount the highest price, and suggest to the assessor on your appeal form the value for your unit. If it seems reasonable in relation to the comparables you've listed, they'll probably just accept what you suggest.
So, if your current valuation is $281k for tax purposes and you get it reduced to $220k, you will save $600-700 per year. That will last for 3-5 years until the market turns around and then you will be bumped up back to your original Prop 13 valuation escalator which will be $298k to $310k. So you will save some real money for a few years, but it won't last.
Now, if someone has a suggestion for what to do with the board increasing our fees each year. ;-)
Also, for the PP. I didn't buy the condo as an investment. I bought it as a place to live. I didn't expect to get married and move out of state 2 years later. That's why I kept the place. In case I ever moved back.
Quote:
Originally Posted by kettlepot
To the OP, you can appeal your current R/E tax valuation with your county assessor. It's easy to do, and it does NOT require professional help, especially with the internet available. Find recent closing sale prices for some comparable units, (at least 3), average them out, or if one is an outlier, like a larger unit or something, you can discount the highest price, and suggest to the assessor on your appeal form the value for your unit. If it seems reasonable in relation to the comparables you've listed, they'll probably just accept what you suggest.
So, if your current valuation is $281k for tax purposes and you get it reduced to $220k, you will save $600-700 per year. That will last for 3-5 years until the market turns around and then you will be bumped up back to your original Prop 13 valuation escalator which will be $298k to $310k. So you will save some real money for a few years, but it won't last.
Now, if someone has a suggestion for what to do with the board increasing our fees each year. ;-)
Also, for the PP. I didn't buy the condo as an investment. I bought it as a place to live. I didn't expect to get married and move out of state 2 years later. That's why I kept the place. In case I ever moved back.
While it's hard to do long distance, you need to keep track of what the board is doing and make your feelings known clearly. We are a janitorial company that works exclusively in condo complexes and I deal with HOAs and property managers. A good management company with a strong handed manager is necessary, because some of the boards go crazy with things that cost tons of money in order to "protect their investment". A good manager might stop them from making huge mistakes that will cost them money.
And your board is also a consideration. They need to keep a tight rein on the manager. Years ago, we lost a property after an HOA was embezzled from via fraudulent invoices. The board okayed the payments and lost a ton of cash -- and the property manager disappeared, after the checks to these non-existent companies cleared. The HOA fired the management company and everyone the management company hired. Can't blame them.
But keep in mind -- just like you want to get a raise yearly, so do the people that work in your condo complex. Their costs are going up, too.
And water, which in condos is rarely metered, is at a premium with the drought... but since there is no responsibility to conserve water, your HOA may get hit with massive EBMUD fines. And PG&E is asking the PUC for another rate increase.
So -- there are LOTS of reasons costs go up yearly...
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