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I don't think they're buying the next house with their 401K's, i think the downpayment is coming from the equity in their own house that they are moving up from.......
But like I said before.....I dunno......
I agree....but almost HALF of someone's 401K changes is GONE so how do they feel financially. If someone has 50K in cash for their downpayment and HAD 500K in their 401K, they HAD 550K total financial worth. But TODAY their net worth is 350K. That makes people think twice about taking another risk (buying at what could be the top, of what could be a quickly deteriorating market). Not saying they won't ever buy a house again, just that they would be smart to see how this shakes out, given the dynamic nature.
Good and bad news is the way I see it. Bad news I think pre virus prices wills start falling faster than sales. Especially in a few months. But I see falling prices for a few years. Too many people with a mortgage regardless of stimulus and unemployment will lose their will if not financing to pay the bill. Point being the market will see a supply increase which will probably lower prices.
Good news if one is pretty well vested or won't have sell short even if at a lower price it's cash which a lot of people can't get right now. I guess the question would be how low are you willing to go.
We had an offer accepted on a house and as a 40 year old it had nothing to do with my 401k. Sure my 401k sucks right now but I was never using that to buy a house.
I had a plan: I wanted to sell, rent for a while, and then relocate to another state. I listed my house last week, had an offer in hours, and accepted it. I am praying the sale goes through. I think my buyer is, too.
I don't think you can time the market. Nobody can see into the future. If you want to sell, sell. The most important thing is to have a calm, rational plan and to keep a long term view, easier said than done, I know. I haven't always followed my own advice.
For example, I've wanted to sell this house for years. It is a money pit. During the height of the bubble, I didn't sell because I kept thinking I'd get a better price by waiting. Then the crash happened and I figured I'd wait for recovery. Then my neighborhood was in recovery and I didn't recognize it right away so nearly missed it. Then there were more repairs that I had to pay for or I wouldn't be able to sell anyway.
Then I realized a house is not a safety net or an investment. It's a freaking house. I put my life on hold, missed opportunities, missed out on buying better houses, all because I tried to time the market.
Yes and a house can become a fixed monthly expense unlike a rental every 3 years or less. Plus, a tax deduction and potential appreciation in value depending on the state & when you bought it. The home I bought in California has just reached 2006's peak value. Likely will decrease slowly in this recessionary period but a good time to make improvements to increase its value later on.
As of today, I would only accept offers where they are putting 20% down or more if its a non-traditional loan. If not, it is strongly advised you ask the buyer to do so. There have been some huge changes in non-traditional lending minimum down payments & corresponding rates.
My bias has always been don't get greedy regardless of market. 'A profit or can make a lot of money' doesn't mean a darn thing until the house is sold with money in hand. I don't care if the potential is there to make millions because until a legitimate buyer comes along and is willing to pay in your desired price range talk is cheap.
If one can sell a house now without losing a money for 'a' profit with all moving expenses paid including new home or apartment I'd list and sell because the economy won't be the same for a while.
For potential sellers now I'd just make sure the house is move in ready. Don't worry about hgtv make sure it's functional and in repair. Nothing fancy. Sure they're will be plenty of homes that deserve and will get a premium but many were over priced and got a premium based on low supply, not 50-100K in renovations.
That being said they're might be an immediate rush of buyers that just want to get back in market as soon as current events settle down but by late summer or end of the year it will be a different market even if nothing but lower prices.
My bias has always been don't get greedy regardless of market. 'A profit or can make a lot of money' doesn't mean a darn thing until the house is sold with money in hand. I don't care if the potential is there to make millions because until a legitimate buyer comes along and is willing to pay in your desired price range talk is cheap.
If one can sell a house now without losing a money for 'a' profit with all moving expenses paid including new home or apartment I'd list and sell because the economy won't be the same for a while.
For potential sellers now I'd just make sure the house is move in ready. Don't worry about hgtv make sure it's functional and in repair. Nothing fancy. Sure they're will be plenty of homes that deserve and will get a premium but many were over priced and got a premium based on low supply, not 50-100K in renovations.
That being said they're might be an immediate rush of buyers that just want to get back in market as soon as current events settle down but by late summer or end of the year it will be a different market even if nothing but lower prices.
That's what we did. It stung momentarily to drop the price twice but it wasn't "real" money anyway. Our second drop put us $5k below where we probably could have sold but wanted to get out of the competition and low enough to entice a buyer. As long as they accept our pre sale inspection report, we will be under contract within 3 days of that drop.
We won't get ahead but will have enough for the move and downpayment on the new house. And that is just fine at this point.
Just to add, we have to sell now. Husband had already accepted out of state job and is living in an extended stay hotel. Waiting this out was not an option. Plus our kids are at colleges being shut down and 3 dogs is not a good combo for renting.
It looks like this virus is finally a little more real to several more people. There were many homes selling in our area, lots of buyers last few weeks. In the properties we dealt with the many buyers and sellers were moving along so well that their homes were empty for resale. But just a couple days ago I guess people got more cautious, current virus more 'real' to them and owners who do live in their homes are mulling over whether they want people coming in and looking around their homes and touching things.
I mentioned before the closings of courts, at least in some places, because of the 10 max restriction. So any doc needing a judge approval where we are has to wait.
We're hoping a few closings for next several days will be before the clerk's office closes. It's open for now.
Our favorite settlement staff...the pregnant woman who does the best settlement job is finishing up paperwork in her closed office and will stop work soon.
Elsewhere, a good settlement agent is will to tie up loose ends (ours included) by passing settlement papers over the opening in vehicle windows, signatures done, paperwork passed back through the top of the vehicle windows to the agent and that part is done. The idea being, it's serious and even that will be done with soon.
The California Association of Realtors told its members Friday to stop all face-to-face sales activities including showings, listing appointments, open houses and property inspections due to coronavirus concerns.
Thursday’s “stay at home” order from Gov. Gavin Newsom did not exempt home selling, the association noted. The order aims to keep more people away from each other and help limit the spread of coronavirus.
Only “essential” industries can continue to operate, the order says. That includes home construction, the association noted. In recent weeks the industry had been trying to sell existing homes with lots of hand sanitizer and “social distancing” before Newsom upped restrictions.
“This supersedes all existing local city and county orders that are less restrictive,” the association states in its advisory. “Clients and other consumers are also subject to these orders and should not be visiting properties or conducting other business in person.”
We have a planned closing for this Friday and was told its still a go. They changed locations and times of the close but they are still planning on this happening I guess.
Such a strange time I honestly wouldnt mind delaying it since we are living with my inlaws. Not spending money right now is a good feeling but at some point the economy will need to get to work. Crossing my fingers this happens sooner than later.
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