Don't Buy!!! (banks, house hunting, offer, Realtor)

[fairmarketvalue]

Originally Posted by SoCal Bottom Rider

I purchased both my homes pre-bubble during the last bottom out HERE IN CALIFORNIA. If I was only interested in the money aspect I would have sold my rental at the top of the market but my intentions were and are to hold long term for retierment, children and all that good stuff. If I were to buy a home now IN MY AREA OF CALIFORNIA, i would definitely lose money no question about it. But I better stop talking about CALIFORNIA or will you get upset?

No, enough siad. It sounds like even CA. is seeing "sunny days ahead" (news on a new thread for June). Good luck, sincerely! Let's hope in this particular, I'm right to "hope" that we have ALL seen enough of this bad market and by slight indications already, it will turn around for even the harder hit states like yours. Take Care- FMV

[Ourdreamhouse]

Originally Posted by fairmarketvalue

Good point, although I find case-shiller to be a joke.

Why is Case-Shiller a joke? From what i know, their methodology is very sound, and more accurate than many others which rely on median (vs. actual) home prices. I've not heard any credible challenges to their approach.

BTW, in the interest of full-disclosure, i am at present a renter, having sold my 5-bedroom house two years ago, when i began to get a whiff that the market was softening. Even though my area wasn't particularly "bubbly," it's now worth about $120k less than when i sold it.

I'm ready to buy again (all cash) as soon as i'm sure that the market has bottomed. That may be at different times in different parts of the country. But there seem to be many technical reasons why we're not nearly there yet. (See the article in the WSJournal today, for example, but there are others.)

I believe that, on a national average, those technical factors show that the market still has another 15% drop yet. If that's so, it would be far better for everyone if that drop happened quickly, so that markets can resume normal functioning. Prolonging the agony can only work to everyone's disadvantage.

[SoCal Bottom Rider]

''BTW, in the interest of full-disclosure, i am at present a renter, having sold my 5-bedroom house two years ago, when i began to get a whiff that the market was softening. Even though my area wasn't particularly "bubbly," it's now worth about $120k less than when i sold it.''

If your area is in one of the now declining markets, you my friend, are a financial genius. You executed what is known as bubble-sitting perfectly. Bravo!

[fairmarketvalue]

Originally Posted by Ourdreamhouse

Why is Case-Shiller a joke? From what i know, their methodology is very sound, and more accurate than many others which rely on median (vs. actual) home prices. I've not heard any credible challenges to their approach.

BTW, in the interest of full-disclosure, i am at present a renter, having sold my 5-bedroom house two years ago, when i began to get a whiff that the market was softening. Even though my area wasn't particularly "bubbly," it's now worth about $120k less than when i sold it.

I'm ready to buy again (all cash) as soon as i'm sure that the market has bottomed. That may be at different times in different parts of the country. But there seem to be many technical reasons why we're not nearly there yet. (See the article in the WSJournal today, for example, but there are others.)

I believe that, on a national average, those technical factors show that the market still has another 15% drop yet. If that's so, it would be far better for everyone if that drop happened quickly, so that markets can resume normal functioning. Prolonging the agony can only work to everyone's disadvantage.

See, this is the part I argue strongly against. If another 15% drop is really going to happen, this means in our area, prices would go back lower than what the purchase prices were in the late 80's. I guarantee this is not happening around here and actually prices have not dropped where single family existing home sales are concerned. Now, if we are talking about newer construction that was priced at all time highs about 3-4 years ago, then I can see that happening. But come on, I am quite certain existing home sales were not inflated back in 1989 when the one we sold was built. To build it was between 280,000 and 350,000, depending on sq. ftg. and upgrades. These are all homes of 2,800 - 4000 sq. ft. in size. So as I said, another 15%drop? I'm betting NO. People already realize what great prices these homes are going for NOW. It's why our inventory is cleaning up. They are selling between 500,000 to over 600,000 in our area. Does this make it more understandable as to why and many have a problem with "national averages" and why we get tired of hearing how lame it is to say "RE is LOCAL"- well, it is. This is why!
Thanks

[cohdane]

FMV--

I also doubt prices (at least nominal prices) will drop beneath where they were in the late 80's. But as to your continued insistence that "OUR inventory is cleaning up" and that the market has bottomed, Wheaton, IL (where I believe you're from) is currently listing 13.53 months supply of properties between $500k and $999k according to the Midwest Real Estate Data service. By my count, that's 7 months more inventory than the areas of California that made the headlines.

And according to today's press release from the Illinois Association of Realtors:
[SIZE=2]“Median prices will continue to trend downwards but at a slower rate; for Illinois, the price declines are estimated to be 4.6 percent, 3.9 percent and 2.7 percent for August, September and October (comparing the month in 2008 with the same month in 2007). In Chicago, the declines will be similar save for a slightly lower value (4.1 percent) for August.”

Again I ask, what data-- aside from your own wishes-- do you have to support your claims?

Differences of opinion are fine. It just troubles me that you're so adamant in your defenses/attacks when you continue to supply no facts to back your assertions.

Based on reports, I'd almost venture to say that parts of California are finishing their purge and the Midwest (which scored the lowest on today's existing home sales percentages) is still solidly in the midst of its correction.

I also acknowledge that's a guess on my part, until I see more hard data.
[/SIZE]

[SKB]

Originally Posted by twinmma

I don't buy for the short term...I buy for the long term. I am not worried about my home value. If I just break even, then fine. I am not in my home to make money. I am in it to live and enjoy. As long as I get the downpayment back it doesn't matter to me much how it appreciates or lack thereof.

Who says you will get your down payment back?


My friends bought in 2007, thinking they were getting a good deal at 365,000 ( same house on street had sold at peak for 500,000) put down 113,000.
The house next door is now listed for 270,000 NO TAKERS.

If they had to sell right now and pay an agent, they would lose the entire 113,000.

[staywarm2]

Originally Posted by TexianPatriot

Real estate has a long way to correct. Don't jump in now. Rates are only going to increase (which will bring housing prices down much lower). Plus, interest on a mortgage is tax deductable anyway and as you pay more towards interest on a less expensive home, you get a better write off on your taxes. It's going to get much uglier from here.

Why do you say this? What are you basing your comments on?

[Member1]

It's all Bush's fault.

[fairmarketvalue]

Originally Posted by cohdane

FMV--

I also doubt prices (at least nominal prices) will drop beneath where they were in the late 80's. But as to your continued insistence that "OUR inventory is cleaning up" and that the market has bottomed, Wheaton, IL (where I believe you're from) is currently listing 13.53 months supply of properties between $500k and $999k according to the Midwest Real Estate Data service. By my count, that's 7 months more inventory than the areas of California that made the headlines.

And according to today's press release from the Illinois Association of Realtors:
[SIZE=2]“Median prices will continue to trend downwards but at a slower rate; for Illinois, the price declines are estimated to be 4.6 percent, 3.9 percent and 2.7 percent for August, September and October (comparing the month in 2008 with the same month in 2007). In Chicago, the declines will be similar save for a slightly lower value (4.1 percent) for August.”[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Again I ask, what data-- aside from your own wishes-- do you have to support your claims?[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Differences of opinion are fine. It just troubles me that you're so adamant in your defenses/attacks when you continue to supply no facts to back your assertions.[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]Based on reports, I'd almost venture to say that parts of California are finishing their purge and the Midwest (which scored the lowest on today's existing home sales percentages) is still solidly in the midst of its correction.[/SIZE]
[SIZE=2][/SIZE]
[SIZE=2]I also acknowledge that's a guess on my part, until I see more hard data. [/SIZE]
[SIZE=2][/SIZE]

You are absolutely correct except that out of that price range, most of that 13.53mo. supply is of houses from 700,000 to the 999,000 you gave. And this is the "new construction" example I gave in my earlier post. Some of the "other high end" is actually people who are selling (although not desperate to) becasue their first "real tax bill" came and it's over 20gs a year. These homes are competing with "new construction" in their own neighborhoods and builders are offering great incentives to build a new one as opposed to buying one they built in 2006.

The inventory moving (finally) are the ones below 650,000. In fact, the ones over 600 are moving faster than the ones closer to 500,000, with a big spread and break of almost nothing in between 500-650. I have been watching the market for over 2 years now. We tried to sell from 8/06 to 5/07, pulled it off and relisted 3/08 and sold 6/08. Our price we sold for was 10% less than we ORIGINALLY listed for in 8/06. When I say I watch daily, I mean daily, watiching who showed up as a new list, which houses in my competition had a contract (sometimes wanting to throw "something" against the wall) when I saw a new contract on a house for more $ and not as nice of home as ours, etc..... It was quite an emotional rollercoaster ride, believe me. So I have continued to watch the listings in our area, I remember some of them trying to sell when we did and re-listing, etc.... And they are NOT sitting anymore. Our friends listed their home in july for 639,900 and it sold in 12 days(don't know sale price yet). I also know who bought it. But anyway, this is why statistical "numbers" are sometimes very distorted. Existing homes of all caliber from 500,000 and up are fairing pretty well and it's based on location, location, location; schools, community, and nice homes. It's also finally realized that our homes were NOT listed unrealistically and now buyers are realizing it after doing their own research of comps. Here, you have access to what a home was bought for and when, so it's "fair data" to use to see if a homeowner is trying to "make a killing" and pricing way above everything else in thier area. No one is doing that and I think buyers are re-educating themsleves to know why.


I don't know if that's enough proof for you or not. The only other proof I have is that we got the price we wanted, for our home, by being patient and weeding out the "low ball" buyer expectations that were created from this "national" attention the real estate market took on. Perhaps we are just lucky, I don't know. As for the tightening on bank loans, etc..... We had a BANK appraisal done on our new home we built, just to know where we were at because we paid a great price for our new construction. The BANK appraised it at 100,000+ more than we closed for in 10/07. Are we unrealistic enough to think that if we listed now for 100,000 more we would sell for that?- NO, not in this market. But we did pretty much get it for probably 100,000 under what it was worth from the very beginning of its inception. Builders and new construction have suffored the most in the Chicago suburbs with lots and lots of beautiful inventory that needs to unload and at great prices. We built ours knowing this and it worked. The cookie cutter builders are in trouble, the higher end builders are doing fine and managed their companies well enough to weather this "bump" in the real estate road we are all riding. The higher end builders are still being hired to build someones dreamhome, just not at record speed like they were a few years ago and couldn't keep up with. Hope this helps explain my point of view, hard data or not.

Edit added: And we are talking about inventory time, not prices. Thanks

[fairmarketvalue]

Originally Posted by SKB

Who says you will get your down payment back?


My friends bought in 2007, thinking they were getting a good deal at 365,000 ( same house on street had sold at peak for 500,000) put down 113,000.
The house next door is now listed for 270,000 NO TAKERS.

If they had to sell right now and pay an agent, they would lose the entire 113,000.

VERY hard to believe- what's the catch on the home listed for 270,000? Foreclosure, different than any house, including your friends who paid 365,000, and where was this? Again, hard to believe.