Fort Lauderdale area Housing Market

[Wild Style]

Originally Posted by casualobserver

I've found a realtor industry association website that says there are 17,360 houses available in inventory for Broward County. Despite the fact that sellers are naturally reluctant to start listing their houses way below the pre-glut selling prices for fear they will somehow might be leaving money on the table, I have got to imagine that there have to be some sellers in that 17,000 motivated enough to want to hear any price a seller might offer.

Therefore, my theory is that rather than just fling out gossip-induced 30% shaves, if you find a house that really seems to meet your personal criteria, do a little customized research tailored to that specific seller. I believe there are websites (or realtors) that can tell you what that buyer paid for their house and the year in which they bought it.

If so, I would give them 3-4% per annum appreciation on their investment (adjusted for any apparent permanent improvements) and offer them that price. I think they would be foolish in this market to reject an offer in hand that gives them their investment, plus a bit of appreciation, rather than continue to feed their pipedream that the market is going to return to pre-glut pricing. I think both buyer and seller ought to feel that is a fair transaction.

I'd appreciate knowing if you guys think I'm whacked because that is how I intend to proceed when the time comes. Naturally, a word of caution if the house in question was previously bought in the last few years. In that csae, even though the seller's cost basis is justified relative to them, they may have been forced to pay too high a price themselves.

^^

That isn't how you figure out how much a house is worth. You find out the average income for that particular area (example, average income of people in Victoria park) then from there you can find out how much that house is actually worth). Homes are only worth what people can pay for them.

Originally Posted by happymccamper

So everyone on here thinks all the housing is still going to plundge a whole lot more around here?....I mean honestly...a house that is 299K is going to end up at 199k....I just am having a hard time picturing that. Can the seller really afford to let their home go like that....at 300K is going to 200K? I mean that s my whole dilema then should we rent another whole year to get that beautiful home that was 250k or 300k and is now 150K-200K. I still think we are going to look at some homes and like most have suggested a house is only worth what someone will pay for it. And if the seller is smart and believes what you all are saying maybe they'll get out while they can and take a resonable offer.

try and do research on what happened in texas in the 80s and the North East in the 90s. Homes dropped as much as 75% through out NYC. The problem is, homes appreciated in value artificially. They appreciated based on exotic loans and not on real income. The traditional mortgage is 20% down and the cost of the house you can afford is 2.5 to 3 times your annual income. So if you and your spouse make 60,000 then you can afford a 180,000 dollar home. MAYBE even 200,000. NONTHING can sale for more than what people can afford to pay for said good. Home is a luxury not a necessity so the cost is not something people have to pay. If they cost gets to high people will stop paying, its that simple. So if you want to know how much a home should actually sale for in a given area, you go find the average income of people in that area. Then you apply the math and you will have you estimate for how much its supposed to go for. People like Bale, CJFlorida, Tallrick and others have said this time and again. We didn't pull this information out of the sky, this is the traditional formula for buying a home. Things got out of whack with interest only loans (most of them weren't sub prime but prime that haven't reset yet). People from this year on to 2011 will be losing their homes as their interest rates reset. So they have a choice. Either ask the bank to accept a short sale or end up defaulting (which most will). People thinking they are some how going to "ride out" a market are only deluding themselves. Prices are NOT going to go back to pre bubble levels. Incomes will not allow that. In many cases peoples income have stagnated and in some cases decreased. If I could give real advice I would tell people to wait for two years. Anyone telling someone to buy a home that is over inflated in price shouldn't be giving advice. I would venture to say most saying that probably have very little knowledge of how economics or finance works.

PS

There was a video in the 2008 home market thread about these development in west florida. Not so savvy people bought in at the height of the market for 400,000 in this one development. The builder still had about 30% they couldn't sale so they had a fire sale. The homes in the fire sale went for 150,000. The people who bought early were furious. I laughed.

[happymccamper]

Originally Posted by Wild Style

If I could give real advice I would tell people to wait for two years.

I just don't know if we can hold out for that, we just really want our own home. But I have heard if you plan on leaving the state in 3yrs or less then don't buy. But if you are sticking around its a good time to buy with the type of offers being made/taken and the interest. Because the int rates are not going to stay low forever and we do have an election around the corner. I guess we can look and make resonable offers....I just hate throwing our $$ away on rent. I really don't want to rent for the same price we could own. Grrrr...I wish this weren't so difficult! But good things are never easy right!?

[Wild Style]

^^

I wouldn't listen to anyone basing the decision on to buy a home or not solely on interest rates. I mean, if the interest rate is low but the house is extremely high then whats the point. The price of the monthly still wouldn't be as low as if you were to wait for the prices to go back to where they are supposed to and the interest rate was at say 7% (just a number I threw out). In the end its your decision and best of luck!