San Antonio still overvalued... (Houston, Schertz: lease, lender, house)

[banker]

Originally Posted by hello13685

I agree that renters are good and I plan to rent out property myself in the future. I think owning is good if you can get renters. Why not?? Inflated prices are not the only issue for me. As the above poster said, how long you are in a place is key. There's the fact that I will probably be leaving TX soon. And, most importantly, I get a bad feeling about the economy overall. I've pulled my retirement holdings out of stocks, and I have the other 100,000 rotting at 5% this year, so convinced am I that we have trouble ahead. I'll either invest in housing or stocks when the time is right (hopefully soon). I side with the caution of the above poster who just sold his/her house and who doesn't want to make any moves right now.

The only reason to get out of stocks now is if you plan on retiring in the short term. Right now having a 401K and getting in while the prices are cheap is easy money down the road.

[Paka]

Even with a "bad" year, my renters paid their rent on time, my houses in San Antonio appreciated (and my investments went up by 40k+ in interest alone).....I suppose I should be scared, but I choose to be informed.

The "don't buy a house" logic is much like the I'm living on all my earnings and then some and not saving for my old age and retirement now because..... "I won't live that long anyway"..."the world will end before then"..."I might loose it because I do not trust others"...all well and good as excuses, but makes for a LOUSY retirement!

No one has EVER willed rent receipts to their loved ones!

[banker]

Originally Posted by Paka

Even with a "bad" year, my renters paid their rent on time, my houses in San Antonio appreciated (and my investments went up by 40k+ in interest alone).....I suppose I should be scared, but I choose to be informed.

The "don't buy a house" logic is much like the I'm living on all my earnings and then some and not saving for my old age and retirement now because..... "I won't live that long anyway"..."the world will end before then"..."I might loose it because I do not trust others"...all well and good as excuses, but makes for a LOUSY retirement!

No one has EVER willed rent receipts to their loved ones!

LOL Willing rent receipts is funny.

You are right to be informed. It is a much better place to be than ignorant.

[firstclassflyer]

Paka, I gotta be fair here. If these renters are indeed "investing" the difference between their rent and what it would cost to own (depending on the market), then I don't see it being much of a problem. We all know that most of them aren't. That's the rub.
It takes a lot of discipline, but I guess it can be done. Presently,the numbers work.

[ArmyofDarknessII]

As far as I know, prices here in San Antonio are a lot less than other states. You may be right on a couple of homes for 'sale by owner' that will not drop their price, which is predominately with some old folkys. But majority of homes are priced below national average cost of homes.

[hello13685]

Paka, I totally agree that people such as yourself (I assume you bought your homes BEFORE the exaggerated upswing in prices) are in great shape. Probably the same with Banker and Kevcrawford. I'm saying that people, especially those without equity, should not buy NOW. That's why I am living comfortably on a quarter of my income now and saving the rest so I can strike at the bottom of the coming U-curve.

[kevcrawford]

I just bought a house in April and made about $9000 in equity the second it appraised for that much more than the sales price. Finding the bottom of a curve is pure speculation. This could be the bottom. Can't predict it.

[firstclassflyer]

Kev-

Especially you, should know that your immediate equity only looks good on paper. What you can probably sell it for is another story entirely. I'm surprised that you posted something like this, considering the experience that you have in this arena. Appraisal really means nothing in this market.
I do however, agree with you about the bottom of the curve being impossible to predict.

[banker]

Originally Posted by hello13685

Paka, I totally agree that people such as yourself (I assume you bought your homes BEFORE the exaggerated upswing in prices) are in great shape. Probably the same with Banker and Kevcrawford. I'm saying that people, especially those without equity, should not buy NOW. That's why I am living comfortably on a quarter of my income now and saving the rest so I can strike at the bottom of the coming U-curve.

I purchased my home in the summer of 2001...before the huge up swing in prices. My neighborhood peaked out about six months ago in terms of price. I paid $65.53/square foot in August 2001 and currently have it on the market for $100.00/square foot - which is right at the current average for my neighborhood. Factor in the fact that my house has been completely renovated with all new appliances, A/C, cabinetry and tile and it is a steal. Six months ago houses in my neighborhood (fixer-upers) were listing and selling within four to six weeks at around $110.00/square foot. Those prices were unrealistic and unsustainable. It will be interesting to see what we sell ours at - I predict around $90.00/foot when it is all said and done.

[banker]

Originally Posted by kevcrawford

I just bought a house in April and made about $9000 in equity the second it appraised for that much more than the sales price. Finding the bottom of a curve is pure speculation. This could be the bottom. Can't predict it.

As a banker I can tell you that most appraisals come in for slightly more than the sales price - it is a problem that gives many new home owners a false sense of reality for what equity they have. The price you paid is the value. If it was worth $9,000 more - why didn't you pay $9,000 more. The appraisal industry is in bed with the banks - I am in commercial lending - I know this.

The value of your home can only be truly known when you sell it.