What is going on with all of this 400K homes listed at 600K

[avayan]

Originally Posted by Katana49

LOL

Those who forget the past are doomed to repeat it. What you were supposed to learn from your mistake was that sitting on the sidelines because of an obstinate view that houses should only be priced according to a value that YOU decide is right is only causing you to miss out on further rises in the real estate market.

Honestly, I feel for people who were planning on buying a home the past few years but were waiting to come up with a down payment or had other issues preventing them from buying. They're going to have to pay more and get less.

But you seem to think... well I really have a hard time following your logic, or lack thereof. You reap what you sow. You want to keep banging your head against the wall, lamenting these higher prices, 2-3 years from now, you're going to post a new thread whining that you should have bought a house NOW, but you can't bring yourself to buy a $600k house when it's priced at $700k.

But you just explained! We spent the last three to four years working our finances so we were able to afford a 450K home and when we finally make it, now they are 600K! And as you specify, if we now start to save so that we can afford a 600K, clearly it will not be a weekend project, which means that by the time we can afford the 600K, they will be at way much more. The stick in the carrot!


EDIT: Actually, I meant the carrot in the stick, heh heh heh...

[BayTexan]

You will be constantly chasing the market. While you were saving up, house prices went up. What is preventing you from looking at 450K homes (that you can afford) now? I follow the market pretty closely and you can definitely get a nice home for 450K in many areas (granted it may not be brand new construction that was available at that price a few years ago).

You need to reset your expectations or you can keep waiting for the bubble to burst. As others have said, the price of a home is what people are willing to pay for it (not what you think it should be).

Originally Posted by avayan

But you just explained! We spent the last three to four years working our finances so we were able to afford a 450K home and when we finally make it, now they are 600K! And as you specify, if we now start to save so that we can afford a 600K, clearly it will not be a weekend project, which means that by the time we can afford the 600K, they will be at way much more. The stick in the carrot!


EDIT: Actually, I meant the carrot in the stick, heh heh heh...

[avayan]

Originally Posted by Shysister

Totally agree and at this point OP's sentiments are redundant because ultimately he's digging deeper into his own grave by complaining about what he could have got 2 yrs ago vs coming up with a plan on how he can maximize his options in the CURRENT market.


As you stated, even if he sits around and wait for a "burst" you don't know how much the burst is actually going to be. Could be 50K or 100K+ but bottom line you will never get back what "could have been" In the end what it boils down too is as long as you're getting what you feel meet your needs, mission accomplished.


I'm sure everyone miss the days when gas was $1 a gallon but those days are never coming back but does gas go down? Sure it does but the fact of the matter is it will never go back down to being $1 a gallon. So you either pay $2+ or stop driving. It's that simple.

The gasoline example is correct but you are missing an important factor and that is what is my salary today? Chances are it is not what it would have been when gas was $1.00/gallon. So even if gas is at $2, it is still possible that it is "cheaper", if my salary happens to be higher in proportion.

When it comes to properties, prices have gone up about 40% in the last 4 years. Or so I read... Maybe some people's salaries have gone up 40% in 4 years as well??? Don't think that is the norm...

But you are right! My sentiment is redundant and useless as it does not change reality. I have already stated this. Unfortunately, for 450K I cannot find what meets my needs. And if it has been impossible today, chances are it will be even harder tomorrow! But hey, we continue to look! Something will happen, that's for sure.

[Bp25]

OP, you are talking about home price in dollars as if dollar has an absolute value, it does not.

One thing that no one mentions is monetary base expansion. Fed printed a bunch of money, there is 3 times more money in the economy today than there were a few years ago. In theory, everything should be 3 times more expensive. Since the money did not get equally distributed, it went into stock market and housing market and increased prices there but groceries and everything else did not go up that much yet (but eventually it will, it's called inflation!). You can call it a bubble, but unless fed takes the money back from market, I don't see how it will deflate overall. Money can move from one housing market to another, or from one asset class to another, but the money that went into the economy has to go somewhere.

So, bottom line is that a 450k home is still a 450k home in 2010 dollars, it just happens to be 650k in today's diluted dollars. I know $ is still strong compared to other currencies because every other central bank did the same thing but there is no doubt that $ today has 1/3rd value compared to, say 2008, before QE started.