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I am curious as to about how many total homes are in the neighborhood. You said 18 for sale in the MLS. Any idea on how many others for sale by owner?
Are there any fundamentals that supported why the prices of these houses ran up to where they did? Large new, high paying employers, etc? What do local people feel justifies why they increased at a much higher rate than wages? Why are folks in that neighborhood now able to afford a much higher percentage of their incomes for housing costs than families could 5 years ago?
Lastly, what are comparable homes renting for in the area? I find it very interesting that when you applied common sense as to the rate of appreciation, your numbers came out to 50% less than the houses are currently listing for.
Again....what valid reasons can you come up with to justify paying so much more than these houses sold for 4-5 years ago? What large positive changes in that neighborhood make it so much more valuable than before 2002?
Unfortunately, I don't know how many are FSBO, but I'll take a spin around there soon and give you an exact number. I wouldn't want to make a mistake and post something that isn't "factual".
I wish I could find the link between the enormous appreciation in price and some concrete economic upturn, but I can't. Unfortunately, the economic base here seems to be deteriorating. Wages have been and continue to be inherently low. There is a heavy amount of service sector jobs, (e.g McDonald's, Walmart). I believe our biggest economic boom in the last year was that a Lowe's Home Improvement store was built. The largest area employer is the County and they have been laying off people and are soon to cut more employees. On a more positive note, there has been some new restaurants built. There are no new high paying (high skilled) jobs and unfortunately, whatever little manufacturing that was here has left or is in the process of leaving. There was to be a large private golf course community to be built not too far from the area we are interested in. However, the builders have stopped construction, are selling their initial inventory and are just going to finish building the golf course.
As for rentals in the area, they are mostly in the $1200-1300 range. However, you can find some for around $900. They are few and far between, but on occasion you can find one listed.
I don't know why they think their houses are worth double what they would be in a normal market. I do know that, if they are waiting for a ton of "retirees" to buy their houses, they may have to wait a long time. 10% of the elderly in this country live below the poverty line, and who knows what the percentage is for those who are just "getting by". If they are waiting for European investors, they may have wait a long time for them too. Europeans are fickle, maybe next year Korea will be the hot place to have a second home, so I wouldn't bank on them to buy.
Hope that clarified the housing situation here for you.
Unfortunately, I don't know how many are FSBO, but I'll take a spin around there soon and give you an exact number. I wouldn't want to make a mistake and post something that isn't "factual".
I wish I could find the link between the enormous appreciation in price and some concrete economic upturn, but I can't. Unfortunately, the economic base here seems to be deteriorating. Wages have been and continue to be inherently low. There is a heavy amount of service sector jobs, (e.g McDonald's, Walmart). I believe our biggest economic boom in the last year was that a Lowe's Home Improvement store was built. The largest area employer is the County and they have been laying off people and are soon to cut more employees. On a more positive note, there has been some new restaurants built. There are no new high paying (high skilled) jobs and unfortunately, whatever little manufacturing that was here has left or is in the process of leaving. There was to be a large private golf course community to be built not too far from the area we are interested in. However, the builders have stopped construction, are selling their initial inventory and are just going to finish building the golf course.
As for rentals in the area, they are mostly in the $1200-1300 range. However, you can find some for around $900. They are few and far between, but on occasion you can find one listed.
I don't know why they think their houses are worth double what they would be in a normal market. I do know that, if they are waiting for a ton of "retirees" to buy their houses, they may have to wait a long time. 10% of the elderly in this country live below the poverty line, and who knows what the percentage is for those who are just "getting by". If they are waiting for European investors, they may have wait a long time for them too. Europeans are fickle, maybe next year Korea will be the hot place to have a second home, so I wouldn't bank on them to buy.
Hope that clarified the housing situation here for you.
Well my friend, you pretty much know the answer then. You can not find any reason to justify the run up in prices. In fact, just the opposite, the economic base seems to be deteriorating.
I know renting can be a pain. But what does your gut instinct tell you the values in that neighborhood will be in 2 years? In 5 years?
I was under the impression that these forums were so that individuals could benefit from the opinions and ideas of others. After reading many of your posts, I get the impression that you are one of many scared realtors, afraid of what is yet to come. If you cannot be helpful with your realtor rhetoric, maybe saying nothing at all is best. Realtors are not willing to accept the bottom falling out because so many were making it hand over fist and now many are hungry and in foreclosure on investment properties themselves. If you feel a property is worth 110k, make an offer. Local infrastructure in florida cannot support these high real estate prices, nor can sellers continue paying notes on investment properties they were not able to flip. Watch the forclosure rates in florida continue to go up, watch the prices conitinue to fall and then make a move. Good luck to you
I was under the impression that these forums were so that individuals could benefit from the opinions and ideas of others. After reading many of your posts, I get the impression that you are one of many scared realtors, afraid of what is yet to come. If you cannot be helpful with your realtor rhetoric, maybe saying nothing at all is best. Realtors are not willing to accept the bottom falling out because so many were making it hand over fist and now many are hungry and in foreclosure on investment properties themselves. If you feel a property is worth 110k, make an offer. Local infrastructure in florida cannot support these high real estate prices, nor can sellers continue paying notes on investment properties they were not able to flip. Watch the forclosure rates in florida continue to go up, watch the prices conitinue to fall and then make a move. Good luck to you
I told the poster to try it and let us know how it goes.
I also stated that I thought they would be wasting their time.
Looks like an opinion to me or am I not allowed to have one.
And no I am not scared and I have bought and sold property this year and made money on them. There is money to be made in any market regardless of where it is moving.
NY62
I am leaning very strongly toward your advice. I have been in the analytical business all of my life. Unfortunately, not for myself, but for someone else, so the end result is they give me a little, just enough to keep me hangin round. Still, I know the trade and I am not of excessive means to -just buy what the hell I want when I want.
Thanks for your reinforcement of what I already know though. Simple example of the math is that you can rent an oceanfront condo, pretty nice, for $1,600 month with no liability for tax, insurance, upkeep. That same condo would sell, if you gave the investor what he wants, or as you say, what he needs is $450,000. The $450,000 at 6.5%, is $29,250 interest only plus $5,760 tax(provided you get exemtion), plus $1200 insurance yr, 350 maintenance fees mo.,plus over time .5% upkeep,say $2,000 yr. That all tallies up to $42,410 yr. My rent is then a savings of $42,410-$19,200=$23,210 savings over rent versus own with no problems and at this time certainly no appreciation. That analysis by itself should tell condo owners the gig is up. Still...because that is what I happen to want I am willing to pay as much as $350 for the right condo. Now I admittedly am the dumb ash what is their excuse? I guesyou don't want to hire me now?
Hey if you can get that condo 100,000. cheaper and it is exactly what you want good for you.Not all people look at it like what if value goes down. If your buying that house to be your home and plan on staying in it for a length of time it will appreciate it could take ten years but who cares its your home not an investment. The problem is everyone looks at homes now like stocks or something it used to be people just wanted to own a home they lived in it raised families in it and had memories in it you cant put a dollar amount on that. I know when my parents bought for 12000.00 they could hardly afford it but they did it just to have a home at no time did they refi or anything it was not an investment.anyway if you look you mite well be able to pull off the deal you are looking for check into short sales. Good luck and if taxes and homeowners comes back down to earth you will be ahead of the curve. IMHO I think this is what realy is hurting florida the most. You can still get more for your money in florida house wise but add the homeowners and taxes and you are not sayving a heck of alot anymore.I am in NY and that used to be a big selling point not any more 9000. in taxes here 6000 there 1000 homeowners here 3500 there . 10000 compared to 9500 is not a great sayvings. and if you add in hoa fees It costs more in florida. Like I said good luck
I told the poster to try it and let us know how it goes.
I also stated that I thought they would be wasting their time.
Looks like an opinion to me or am I not allowed to have one.
And no I am not scared and I have bought and sold property this year and made money on them. There is money to be made in any market regardless of where it is moving.
Please tell us lowly civilians how all these thousands of people who bought in 2003-2005, based on appraisals, and now must sell due to transfers, illness, whatever...can "make money in any market"???
This is not a forum for flippers or pro real estate investors. It is a forum where regular folks share opinions on areas of Florida to live and raise their kids.
Please tell all these sellers how they can make money....or not lose a ton? They are competing with lots of inventory, builders giving huge incentives, high taxes, high insurance, lots of rental homes at reasonable rates.
Exactly what should these people do if they have been job transferred, have already moved, can't afford to carry two houses...and have not had one showing. Or have had only offers that would mean they would lose $50,000 or more???
We are trying to sale our rental in Pensacola, I bought in 1996 so I only owe 52,000. I was hoping to sale for 150,000 but would welcome 125,000. My p&i is now the same as the taxes and insurance. I used to be able to rent it and make a small profit, now I'm short every month.
We are trying to sale our rental in Pensacola, I bought in 1996 so I only owe 52,000. I was hoping to sale for 150,000 but would welcome 125,000. My p&i is now the same as the taxes and insurance. I used to be able to rent it and make a small profit, now I'm short every month.
Sorry to hear that. Unfortunately your story is becoming more and more the norm all over Florida. The sad thing is despite those that made money by buying and selling at the right time during this bubble, overall this will be a total mess for the people of Florida.
We are trying to sale our rental in Pensacola, I bought in 1996 so I only owe 52,000. I was hoping to sale for 150,000 but would welcome 125,000. My p&i is now the same as the taxes and insurance. I used to be able to rent it and make a small profit, now I'm short every month.
Not wanting to sound too cold,but when you could have gotten 150 for it,why didn't you,were you waiting till it was worth 200,you won't see 150 for a decade,200 for 20 years,selling into weakness is never a good choice but it sounds like you'll walk away with money in your pocket,thousands of others won't
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jim cramer is an dumb**s
