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Would you be able to afford the home you bought for $400k 9 years ago today for $700k? I think that on a whole, many people who own a home on LI now would not be able to enter the market today and that is the problem. You only have homeowners buying and selling with other homeowners but you need people entering the market as well or inventory starts to swell and prices will decrease as is happening at time.
Not because they are getting sold, but because people refuse to give up their home for less than they feel its valued at. You will never change this mentality on LI. That is why home prices are here to stay. People dictate prices in the end.
So you are assuming the following:
- Nobody changes jobs/moves for job reasons
- Nobody loses jobs, thus affordability is never an issue
- Nobody divorces, no family member dies etc.
People may refuse to sell for a while, but the only effect is the increase in the inventory, i.e. even lower prices in the long run.
Your $400k house in 2000 should have been $495k in 2008 based on historical home price appreciation which keeps track with inflation, not $700k as noted above.
In some areas im sure that is correct. Not in all areas. That is unrealistic. The "Good" areas on LI will maintain prices. I would say maybe a 5-10% decrease at most in the worst cases of homes in "Good" areas artificially inflated based on area and not value.
That seems like a fairly logical conclusion, but nobody knows for sure what will happen, including Moody's, etc. For full disclosure, this was an overall view of the NYS economy so we didn't spend time probing the details of each of their findings/forecasts. I'd say that I live in a good area, NHP(Herricks SD), and I've seen a 20% drop off the peak so far. I agree that it's hard to believe that I'd see an additional 15%-17% decline, but as I said, it is impossible to state with any level of certainty.
- Nobody changes jobs/moves for job reasons
- Nobody loses jobs, thus affordability is never an issue
- Nobody divorces, no family member dies etc.
People may refuse to sell for a while, but the only effect is the increase in the inventory, i.e. even lower prices in the long run.
Correct, most sellers price their house too high and they follow the market down selling for less then they would have if they priced the house slightly undermarket to begin with.
And you want house prices to drop so you can afford one. How is my position worse than yours? A couple of years ago my house would have listed for 900K. I have seen a drop back down to where it would be under normal appreciation. Get over it.
I purchased my home for 400K 9 years ago. Trust me. You will never see my home list for anything under 700K. Welcome to LI.
Whats your problem? If you cant afford this LI is not the place for you. Try North Carolina.
Incorrect. I can afford a home NOW. Even the "conservative" side of the affordable home calculators says that we could handle a 450K house...over 500K on the "aggressive" end. My issues is what I'm getting for that 450 now, as opposed to 6 months from now.
So, despite what you keep trying to tell yourself, my agenda has nothing to do with not being able to afford living on LI. It has to do with not paying more than we should for a house. There are a lot of home owners, such as yourself..who can't face reality...hence I see the same 4 bedroom splits and colonials listed for the last 6 months. Recent sales in the same neighborhoods show significantly lower selling prices than 90% of the sellers are asking.
Your $400k house in 2000 should have been $495k in 2008 based on historical home price appreciation which keeps track with inflation, not $700k as noted above.
As previously stated I put about 300K into my home out of my own money.
Incorrect. I can afford a home NOW. Even the "conservative" side of the affordable home calculators says that we could handle a 450K house...over 500K on the "aggressive" end. My issues is what I'm getting for that 450 now, as opposed to 6 months from now.
So, despite what you keep trying to tell yourself, my agenda has nothing to do with not being able to afford living on LI. It has to do with not paying more than we should for a house. There are a lot of home owners, such as yourself..who can't face reality...hence I see the same 4 bedroom splits and colonials listed for the last 6 months. Recent sales in the same neighborhoods show significantly lower selling prices than 90% of the sellers are asking.
Just out of curiousity, how long is it supposed to take to sell a house?
Prior to the bubble, six months was common and it often took longer than that.
You expect sellers to update their thinking and adjust to today's market, yet use the fact that it now takes a traditional amount of time to sell their homes against them?
Incorrect. I can afford a home NOW. Even the "conservative" side of the affordable home calculators says that we could handle a 450K house...over 500K on the "aggressive" end. My issues is what I'm getting for that 450 now, as opposed to 6 months from now.
So, despite what you keep trying to tell yourself, my agenda has nothing to do with not being able to afford living on LI. It has to do with not paying more than we should for a house. There are a lot of home owners, such as yourself..who can't face reality...hence I see the same 4 bedroom splits and colonials listed for the last 6 months. Recent sales in the same neighborhoods show significantly lower selling prices than 90% of the sellers are asking.
I don’t need to face what your reality is. I own a home. Its beautiful and worth every penny I would ask for it if I were to sell. I am not selling for the next 20 years at least. At that time my Mortgage will be paid off and I will probably walk away with a huge sum of cash regardless of today situation. What I do know is keeping home values up in my area will preserve the neighborhood and the value of it. What people like you need to understand is there will always be expensive homes on LI and LI will always be an expensive place to live.
When I purchased my home 9 years ago for 400K it needed a tremendous amount of work. Was it overpriced? Yup. I was not only paying for the house I was paying for the location. People like you don’t seem to understand that location is huge on LI and the good areas will show WAY less depreciation than other areas on LI that have already hit bottom or close to it.
If you are waiting for the good areas to drop in price to what you consider "Value for your money" you are dreaming. That 350K house I linked to you is not worth 350K by any means. The neighborhood and SD is though. I can site many other examples of house location and value.
Would you be able to afford the home you bought for $400k 9 years ago today for $700k? I think that on a whole, many people who own a home on LI now would not be able to enter the market today and that is the problem. You only have homeowners buying and selling with other homeowners but you need people entering the market as well or inventory starts to swell and prices will decrease as is happening at time.
Personally? Yes.
Obviously my home is prices higher than many. The real question is can I afford a house today at 480-500K with todays interest rates and a DP of 20%. Easily. That would be the value of my home if I put no more money into it.
I also disagree with your final value in your previous post. At 3% annually my home would be valued at 520K today if I did nothing with it at all. I put 300K into it updating it to new construction status. Not one room was untouched. During the bubble it was 900K. Now? 700K in this market. 750K by next year. Still 100K less than my investment. Some things don’t translate to home value. Pools etc..
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