Housing Softening: MPLS Leads the Way in Price Cuts. (Edina: lease, insurance)

[MN-Born-n-Raised]

Originally Posted by track2514

Well MN Born and Raised, I can see your points, but I also feel that you are off the mark a little bit in regards to basic real estate principles. Interest rates are extremely low right now and just because some predictions say they may stay the same or lower, I am not sold on this idea. Historically, interest rates have been much higher and if there is any sign of improvement you better believe the banks will be pushing to get those rates up because of their recent losses. I bought last year not because of the market, but because I prefer to own and my wife and I have stable jobs. I don't mind if my house loses value since our incomes are too high to rent (without that mortgage deduction Uncle Sam would be taking much more of my money). Also, we don't plan on going anywhere in the near future so for us a house is a good plan.

Reminder #1.

[trackstar13]

Well government intervention is beyond my forecasting abilities in regards to interest rates.

[trackstar13]

To simply say that the Twin Cities housing market is in a decline is factually incorrect. Does that include all zip codes? All houses? How about the rental market? What are the prices for lease options?

[MN-Born-n-Raised]

Originally Posted by track2514

To simply say that the Twin Cities housing market is in a decline is factually incorrect. Does that include all zip codes? All houses? How about the rental market? What are the prices for lease options?

You are grabbing at straws. We were not talking about lease options and the rental market. We were talking about the title of the thread: "House Softening: MPLS Leads the Way in Price Cuts."

I agreed with the article and you didn't. I told people to wait a couple months at a time (if they could) to see if the market continued to soften and you said that was bad advice. You were worried that interest rates were going to rise but in fact the rates went WAY down. As an aggregate during that period, the entire metro housing market softened by 10%. Of course a spcific zip code or price point could rise while other fall. Since 2006, MPLS dropped by 30-35%. I suppose you could find me something that went up but we were not talking about statistical outliers.

So what neighborhood did you live in?? I bet it went down.

Here is my next prediction. The metro area (as an aggregate) has stabilized. I'd feel a whole lot better to buy a home >$400K today than I did in June of 2010. Of course on average you could have saved $40K and gotten a lot lesd interest rate. We just might coming up on the metro bottom. IMHO, close enough.

Come on Professor. Just admit you were wrong and let's move on.



iwaswrgn1.flv - YouTube (Start from the 30 second point. Fonzie finally got it down).

[trackstar13]

"Since 2006, MPLS dropped by 30-35%" So you honestly believe that the Kenwood neighborhood in Minneapolis has dropped by 30-35% since 2006?

Maybe you should check the prices and get back to me: Kenwood Minneapolis Homes for Sale: Kenwood Minneapolis Real Estate

[MN-Born-n-Raised]

Originally Posted by track2514

"Since 2006, MPLS dropped by 30-35%" So you honestly believe that the Kenwood neighborhood in Minneapolis has dropped by 30-35% since 2006?

Maybe you should check the prices and get back to me: Kenwood Minneapolis Homes for Sale: Kenwood Minneapolis Real Estate

The original article references the MPLS metro area. Case-Shillings for instance says "Minneapolis" and they mean the metro area. I thought that went without saying. Without looking at the exact percentage, the MPLS (metro area) went down 30-35%. Some zips more, some zips less. But they all went down including the Kenwood neighborhood.

You are searching for an angle. Prices went down as I predicted in the MPLS market including your Edina example! Now if you like, hide behind a zip code or a price point. Admit you gave bad advice to that family who may have bought a $500K home in Eden Prairie in June of 2010 and now cannot refinance his 5.5% mortgage to 3.5% because they are upside down by $50K! Meanwhile the guy who buys today and waited like I recommended will pay almost 2% less on their mortgage and (on average) $50K less for their home. Still think you were right?

[moving123456]

Originally Posted by track2514

Source Born and Raised? (Not that I doubt you, just want to read it, I have noticed the recent price reductions) Also, it is always a great time to buy if you get the right price. I purchased my house over a year ago now and comparable houses are still selling for more than I paid (on my street and adjoining streets). If people listen to you and wait, they may wait too long and be stuck in another sellers market. As I said before, real estate is cyclical and there are always ups and downs, good luck trying to predict the peak of both.

Finally, if we listen to Born and Raised we wouldn't buy a house like this:

TheMLSonline.com - Edina Listing - $169,900 - MLS#3935437 - Call 763-576-8286

Yeah that is right, 3 bedrooms, 2 baths on a .25 acre lot in your favorite Edina school district for $169,900.

P.S. Where is the evidence of your recession?

That place "5720 France Avenue S" eventually sold at $107,100.

[trackstar13]

Originally Posted by MN-Born-n-Raised

The original article references the MPLS metro area. Case-Shillings for instance says "Minneapolis" and they mean the metro area. I thought that went without saying. Without looking at the exact percentage, the MPLS (metro area) went down 30-35%. Some zips more, some zips less. But they all went down including the Kenwood neighborhood.

You are searching for an angle. Prices went down as I predicted in the MPLS market including your Edina example! Now if you like, hide behind a zip code or a price point. Admit you gave bad advice to that family who may have bought a $500K home in Eden Prairie in June of 2010 and now cannot refinance his 5.5% mortgage to 3.5% because they are upside down by $50K! Meanwhile the guy who buys today and waited like I recommended will pay almost 2% less on their mortgage and (on average) $50K less for their home. Still think you were right?

You still refuse to acknowledge that not all areas of the metro went down 30-35%. If that were the case I would not have been able to sell my house in Highland Park for a profit and houses in Kenwood or other areas would be much cheaper than they are currently selling for as I type. Granted I did buy low and in the right location (near the golf course) and perform several renovations on my own, but this is part of the problem with the real estate market. Many people expect expensive renovations that are contracted out to bring in at least the cost when they go to sell the house. However, that is another issue altogether that I will not get into right now.

To your second point, if the president's mortgage plan passes, current homeowners will be able to re-finance despite being underwater so all the "guy" you are talking about would get is a larger tax deduction until the president's plan goes into effect.

[trackstar13]

Originally Posted by moving123456

That place "5720 France Avenue S" eventually sold at $107,100.

That is a great deal and the land alone is worth that, according to Trulia the cheapest lot available in Edina currently is also on France and it is listed for $139,900.

[MN-Born-n-Raised]

Originally Posted by track2514

You still refuse to acknowledge that not all areas of the metro went down 30-35%.

Read my quote below in bold. Allow for me to try one more time. Areas in the metro area went down on average 30%. Some areas went down more than 30% while others areas dropped at a smaller percentage. a.k.a. I'm acknowledging that some areas didn't drop as much.

See what I wrote below:

Originally Posted by MN-Born-n-Raised

The original article references the MPLS metro area. Case-Shillings for instance says "Minneapolis" and they mean the metro area. I thought that went without saying. Without looking at the exact percentage, the MPLS (metro area) went down 30-35%. Some zips more, some zips less. But they all went down including the Kenwood neighborhood.

Originally Posted by track2514

Granted I did .. perform several renovations on my own, ...

You brought up lease options and rentals rates which wasn't any part of the conversation. Now you claim that YOUR house went up (excluding TVM and not considering the opportunity costs of your "free" labor).
The debate was never framed that you had to do free renovations on your home in order for the entire metro area to go up.

Putting it another way, if someone bought a home in your old neighborhood in mid 2010, they would be DOWN in comparison to the homes selling in February of 2012. We are not talking about renovations with free labor. We are talking about housing trends.

[/quote]

Originally Posted by track2514

To your second point, if the president's mortgage plan passes, current homeowners will be able to re-finance despite being underwater so all the "guy" you are talking about would get is a larger tax deduction until the president's plan goes into effect.

The currnt HAMP program does not include homes purchased in 2010. While I have not read the Obama plan, it's unlikely it will pass (see Obama Housing Plans vs. Reality | UK Progressive ).

I think we are making progress. Is this is your way of admitting that my hypotitical $500K home buyer in Eden Prairie lost 10% and now cannot refinance because of your kneejerk advice? Out of curousity, what classes did you teach at the UofMN. Finance?