move or stay put? (Carmel, Marion: sale, foreclosures, insurance)

[indigo355]

I bought a home on the westside three years ago. I feel I made a mistake because though my subdivision (off 62nd Street, between Michigan and Georgetown) is okay, the surrounding area seems to be declining at a pretty good clip.

I had a realtor look at my house and I'll probably have to come out of pocket to get rid of it. Thinking of moving to Carmel area, but can't decide since I've got a decent interest rate 5.5 now, with affordable payment, but would want to make some improvements, agent said I probably won't see a dime of my investment if I stay. What do you think? Is the area that bad?

[Zoo Animals On Wheels]

Only you can decide what to do, of course.

Ask yourself this: is your house likely to go up in value in a year or three or five? Or is it more likely to go down (with inflation, just staying the same price would mean the house is really going down in value).

Do you think you will probably enjoy living in that house for the next one or three or five years? Or will you be worried and stressed about the surrounding area going into decline?

Would you enjoy life more living somewhere else? Who knows how much time we've all got; we should consider our current happiness as being a valuable commodity, one whose exact length of time we never know for sure.

Making decisions of this sort is scary. Whatever you decide, try to do it in the most rational manner possible, as free of fear as you can manage.

I wish you luck.

[Naptowner]

Not to dog your realtor, but consider that s/he stands to make thousands from the sale of your house and the purchase of your new one. There is certainly an incentive for the agent to recommend that you sell.

Only you can decide what to do, but if it were me I'd probably stay put. Consider the pros and cons. If you sell your house you will lose money in agent commission, closing costs, and other expenses. Then you have to turn around and pay additional fees to buy another house. If you buy something that costs about the same as your present house, your mortgage payment will likely be higher because of the higher interest rate, and your property taxes may go up as well.

Maybe the surrounding area is going down hill, but the overall market probably isn't going to get a whole lot worse. If you can ride it out for a few more years, your house's value may very well creep back up, if only because of inflation. And inflation cuts both ways - as the previous poster said, inflation will erode the value of your house if the house stays the same value, but the amount you owe will be reduced by the same degree. And since your principal and interest aren't going to change for the next 25 years or so (although property tax and insurance will), your present house is only going to get more and more affordable as time goes on.

You don't say whether you're in a relationship or have children, but if either of those events happen in the next five years, you may very well want to move anyway. I just think that three years in a new house is too short a time to recoup the fixed costs associated with buying and selling a new home. Your realtor may be right about your inability to recover the cost of improvements, though. Outside of a few areas, it is almost impossible to recover the cost of improvements if you pay someone else to do the work.

[Michelle Morris]

If you don't have to move, it doesn't sound like you should. A lot of people are going to have to bring money to closing to sell right now, in all areas. If you really want to, just be aware before you accept any offer how much you will really need to bring to closing.

If this really is "the bottom" like I have heard, then your value might go up a little bit again, and in the meantime you will be paying down your mortgage and building equity. Stay put if you can for a few more years. If you must sell, or just can't take it anymore, then go for it.

[indigo355]

Thanks guys for the advice, you gave me a lot to think about regarding moving and the house, but what do you think about the northwest area (Pike Township) losing ground, so to speak? Do you think I'll lose my shirt if I stay here over the long haul?

[Zoo Animals On Wheels]

In my experience, areas that have started going downhill (increased crime, foreclosures) do not suddenly regain respectability. Instead, they continue sliding down that slippery slope. Sometimes areas are "gentrified," but that usually occurs after the neighborhood has completely gone to the dogs, creating dirt-cheap housing and land that investors see as an opportunity to make a killing.

That said, I'm not terribly familiar with the Pike area, so my remarks should be taken generally, not specifically. Really, nobody can tell you with certainty whether you will or will not "lose your shirt" by staying in your present neighborhood.

[Toxic Toast]

I think that people are too quick to write off Pike Township. Most of it is very safe. The area between 62nd and 71st; and 465 to the west and just past Michigan Road to the east had this crime rate last year:

A violent crime rate of 24.21 compared to 30.59 for the county overall, giving it a rank of 135 out of Marion County's 211 populated Census tracts.

A property crime rate of 43.5 compared to 61.31 for the county overall, giving it a rank of 156 out of Marion County's 211 populated Census tracts.

An overall crime rate of 67.71 compared to 91.91 for the county overall, giving it a rank of 149 out of Marion County's 211 populated Census tracts.

South of 62nd, it is very similar. I know people who live in areas that are much higher in crime with no troubles, including myself in the past. That's not to say it has or hasn't gotten worse, but Pike gets a bad rap in this town, and it is usually not justified.

[BU191433]

I am no expert on the area, but my sense is that while the area will continue to "go down" in value and up in crime, I don't think it will at a very high rate - 5 years from now I don't think the area will change that much. It is a pretty diverse area as far as some nice neighborhood and some not so nice neighborhoods right next to each other.

So if I were you and if I was relatively happy with the actual house and neighborhood, commute times and such - I would probably stay