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But what is true in all cases is the houses should return to historic norms.
Well ... I don't see how that's going to apply here. For one thing, this is a brand new subdivision built in 2006. If you try to compare property sales in the '90s ... there just isn't anything that is comparable.
In the '90s most of the homes in this town were only 1200 square feet, 1500 tops. And, the homes were much older going back 40 years. These new homes are typically 2200 to 2700 square feet, much larger, much nicer (double paned windows, tile roofs, etc.) so ...
There were no homes like this in this area until 2006.
I'm not sure why so many people look at house prices in complete isolation of any sort of fundamental. If you're waiting for prices to decline in an area that already has prices that are historically sound then you may be wasting your time. If you can rent a place for $2000 that is selling for 500k (this was often the case in California) then it makes no sense to buy the place regardless of whether prices are stable or declining.
Well ... there's the financial side and then there's the fact that you're also looking for your home. There's also so many other factors involved.
As far as renting ... it can be cheaper but I have dogs so renting is a MAJOR hassle for me. We only got this rental out of shear luck after trying dozens and dozens of landlords. Nobody wanted dogs and my dogs are family so ... I'd be happy to never to go through the hassle renting again no matter how much it costs because I love my dogs.
Also, there are some houses that are cheaper but, they're cheap for a reason ... the construction quality is cheap. So, I'm sure those prices will go down further and drive down prices overall but, if that happens, I could care less about those "comps" because ...
If the contractor was too cheap to put on a tile roof when they were getting 500-600K for these houses ... I don't want anything to do with it because I know they were probably cutting corners elsewhere as well. It's ridiculous in this day and age to still have comp roofs ... especially since we have a forest fire burning just 15 miles away.
Thankfully there's better quality construction which is what I'll be buying but ... which location? Sure, there are other homes in this particular style on the market and probably more to come but, the house I'm interested in has a very private, cul de sac location on a beautiful park. With minimal neighborhood traffic ... which I really like.
Just yesterday as I was driving through I was asking myself ... is there any other location I would want? No, not really. So ... if I wait for prices go down further (which is probable but still somewhat of a gamble) ... is it worth it for a location I don't like nearly as much? Afterall ... this will be my home for years to come.
My point is that, at least for me, there's a lot more that goes into buying a home than "fundamentals."
Well ... there's the financial side and then there's the fact that you're also looking for your home. There's also so many other factors involved...
...My point is that, at least for me, there's a lot more that goes into buying a home than "fundamentals."
You're not alone. The vast majority of home buyers are the same as you. In fact, probably only a very few even think of fundamentals when they need to buy a home. They think of their need and their requirements, the schools, amenities, crime rate, location and price.
I don't dispute the fundamentals, but in my experience it is not the fundamentals that drive the real estate market. It is the supply and demand, mortgage rates, home buyer needs and emotion. There are some other factors that could be included such as greed, but those are the major ones.
In fact, probably only a very few even think of fundamentals when they need to buy a home.
This is exactly why relatively few people ever achieve financial independence. For most people a home purchase is the largest investment of their lives, and yet they let their emotions take the place of analytical reasoning. There are no shortage of brokers and agents that encourage this type of reckless behavior. The truth is that done correctly a home purchase can be a dream come true, done incorrectly, it can become your worst nightmare.
Do any of you have any suggestions for those of us who did buy high?? I'm at least 150,000. mortgaged over the value of my condo. Not only that, it is sickening to see houses that I really wanted going for what I am paying for my condo. I do not agree with the mortgage defaults by people who are buying lower then letting their first mortgage default. Suggestions anyone?
'Well ... I don't see how that's going to apply here. For one thing, this is a brand new subdivision built in 2006'
I find it comical how some people believe their community is 'special' and shielded from the decline because its a new community. New ones are the ones getting hit or will get hit hard becuase most of them bought at the peak!
Do any of you have any suggestions for those of us who did buy high?? I'm at least 150,000. mortgaged over the value of my condo. Not only that, it is sickening to see houses that I really wanted going for what I am paying for my condo. I do not agree with the mortgage defaults by people who are buying lower then letting their first mortgage default. Suggestions anyone?
Unless you absolutely have to sell your home right this minute, I'd strongly suggest you just ride it out. And if you don't have to sell, there's not much point in looking around at other peoples' deals and berating yourself because you didn't get the "perfect" deal. The same thing happens when people cash out, then look back a few years later to see their old homes have risen in value. Then they say "I should have stayed in." I know it's frustrating, but I'd advise you not to play these headgames on yourself, it's just not worth the stress.
I find it comical how some people believe their community is 'special' and shielded from the decline because its a new community. New ones are the ones getting hit or will get hit hard becuase most of them bought at the peak!
You completely missed the point. First of all ... I haven't bought anything yet. And yeah ... this neighborhood has been hit very hard because it was so expensive.
The point is ... if you're trying to find comps going back to the '90s (as suggested by another poster) there are none because this neighborhood didn't exist back them.
This is exactly why relatively few people ever achieve financial independence. For most people a home purchase is the largest investment of their lives, and yet they let their emotions take the place of analytical reasoning. There are no shortage of brokers and agents that encourage this type of reckless behavior. The truth is that done correctly a home purchase can be a dream come true, done incorrectly, it can become your worst nightmare.
Uh ... may I remind you that I'm buying now when prices are a lot lower than they were ...
I won't be paying $550-600K like these homeowners did. I'll be paying a lot less than that.
Yes of course. A 500k home that was 600k last year sure is a deal when the same home sold in 2004 for 350. Right?
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