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Condo creation is the worst real estate trend ever!!! It only makes money for the developers and took away affordable rental units.
Why? When the condo sells, the developer gets his capital back with a huge profit, then sticks it to the condo owner by charging monthly maintenance fees. The condo buyer is now paying a mortgage, property taxes and ... the monthly maintenance fees which are close to what they would have previously paid in rent.
Then another factor with high condo prices is parents of college students buying them as an investment while their children are going to school. Also foreigners buying condos as investments. And that takes more buying options away from first time buyers.
And condo prices do have an effect of making single free standing houses worth more.
It can make money for the condo owner too if prices appreciate over time . There is a maintenance fee but there are ongoing costs to run a condo building . People that own a single family house still pay maintaince but it’s not broken down monthly .
Condo fees can vary from $100 or so to thousands a month depending on amenities etc .
These fees are listed right on the property listing so it’s not a surprise for the buyer .
Special assessments are definitely something to consider . I have family that own a condo in Florida and they had to spend a ton of money to upgrade the windows to hurricane windows and the balcony too .. not sure the exact amount but I’m pretty sure over $10,000 .
Some people prefer to live in condos even if they can afford a SFH as they don’t want to deal with maintaining a house and yard . They can also make more sense for people that travel a lot.
My house cost us 13k. It was built in 1929. It's a 'kit house' and extremely solidly built. Yes, it took some work, but it wasn't that expensive. And its small, only 712 sf. Its big tiny house size. .
u.s. Starter homes are scarcer, pricier, smaller and more run-down
Scarcer: Builders have found efficiency in building big since land and government regulation is the most expensive part of a job rather than labor and material. It makes sense to add a lot more square footage for not a whole lot more cost to the builder who can then reap the reward. But that's for new construction.
Run Down: For existing homes, lets face it, our housing stock is getting OLD and we as a country did not build for the long haul. Our early suburbs are hitting the octogenarian mark en masse. While you might be able to find a diamond in the rough, my experience as a tradesman and a home inspector has lead me to the understanding that the vast majority of houses older than 70 years old need to be torn down and completely replaced.
Pricier & Smaller: The difference in my area between a 1,200 square foot home and a 2,400 square foot home is about 25%, all else being equal. If you want to be able to commute to your job in DC, Baltimore or Annapolis you're going to have to pay for it. The BASE cost of housing is very high here. The alternative is you can always move to Muncie, Indiana or Canton, Ohio and work in a rubber or glass factory.....oh, wait a second, those are actually located in China now!
You won't get much appreciation with those older homes far away from the job markets either and if you want to fix anything up I'll note that the cost of materials is virtually the same in an expensive area as it is in a run down area and there isn't an incredible difference in labor costs, some, but not too strikingly much. In some rural areas you also have trouble finding anyone of quality at all, same with cities with a large underclass, and you might have transportation issues regarding both areas, especially for labor getting to your job (and yes, you pay for this cost!)
Many millions of older homes in this country are just going to have to rot. They just aren't salvageable and their location may very well damn them to a slow decay via the elements. It isn't worth the cost of tearing them down if no one's going to move there. And the builders are going to build at whatever price point (aka BIG) gets them the most profit. Heck, in a lot of areas they are told by the local city/county government what they need to build, and many need to build a certain amount of "affordable" units or must build some scheme of "mixed class" housing. I see new communities going up that have an apartment complex on one side, townhomes in the middle, and cookie-cutter SFH's all within sight of each other.
I saw this while house hunting. Flippers have bought up many of the starter homes, to refurbish and sell for higher prices. This affected even higher priced homes.
When flippers descend on an area, they can destroy the real estate market for everyone but themselves. They will come from out of town just for the purpose of buying up and flipping a number of homes, then leaving. Then rinse and repeat. This also has a lot to do with the popularity of the color gray for everything. Flippers started making the primary color gray...and many of the things in the home being that color. That's because they buy in bulk and try to use their leftover items in their other homes: gray granite, gray tiles. gray paint, gray or taupe carpet, painting exterior gray (covers cracks), etc.
I feel sorry for people trying to get their first house. The inexpensive fixer uppers just aren't there much any more.
I saw this while house hunting. Flippers have bought up many of the starter homes, to refurbish and sell for higher prices. This affected even higher priced homes.
When flippers descend on an area, they can destroy the real estate market for everyone but themselves. They will come from out of town just for the purpose of buying up and flipping a number of homes, then leaving. Then rinse and repeat. This also has a lot to do with the popularity of the color gray for everything. Flippers started making the primary color gray...and many of the things in the home being that color. That's because they buy in bulk and try to use their leftover items in their other homes: gray granite, gray tiles. gray paint, gray or taupe carpet, painting exterior gray (covers cracks), etc.
I feel sorry for people trying to get their first house. The inexpensive fixer uppers just aren't there much any more.
I will offer a different perspective on this... I think flippers are great for first time home buyers.
Lending requirements have only grown stricter... about what HOMES they will finance. They won't finance a place that needs work, particularly with low down programs like FHA or VA. Those homes have to be very very clean and perfect. There are rehab loans, but they are complicated and actually discourage the homeowner from doing any of the improvements themselves.
The flippers buy homes that won't qualify for financing, and they fix them so they will. New roof, paint and floors, updated and pretty, and now financeable for the first time buyer who can't afford to do those things on their own. That's a good thing.
[font=Times New Roman]Run Down: For existing homes, lets face it, our housing stock is getting OLD and we as a country did not build for the long haul.
The even more cheaply built stuff from c. 1970 onward is going to age even worse.
Some of these towns are not going to have the $75K a year jobs that people want, but you can buy a $30k home with 2 people earning minimum wage.
True , The nice thing about a $30,000 house is you don’t need a $75k job to pay for it .
Or if you have some kind of job or business you can do on the internet .
There is a podcast I listen to sometimes created by a couple that used to live in high cost cities.
They now live in a rural type area a few hours or so from D.C they make their living selling on eBay and they saved up enough to invest in a couple of houses in their area they rent on Airbnb.
There are ways to make it work in a cheap area with a lack of high paying jobs but it’s not the lifestyle everyone wants .
On top of it they are really frugal . But they also travel often for extended periods of time in Europe etc . No kids so that makes it easier .
1500 sq. ft. today is like 2100 sq. ft. yesterday. It's better use of space, usually MORE than one bathroom. It's laid out better. Condos are a more secure way of living. It's a different world. Get used to it.
Earthquake prep. where I am is now standard. We have gone to 2x6 and even 2x8 frame. Where's the rest of N. America? Thinking that hurricane will never happen?? It just hit five staes and most of the Carribean, and those sticks showed these places were not up to snuff in a non-hurricane zone.
If i ever build a three level home it will have an elevator. Standard spine for structural integrity, i.e. earthquake and it's cheap to add when doing a new build. Done.
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