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If I were to be in the market to spend 300k on a second home, I would certainly do my homework. The buyers up here, did nothin but believe the realtor
Lets say a property is for sale, like the one down the road from me. Three bedroom, 1400 sq ft, three car garage, walkout basement.It has 100' of lake frontage, but a very shallow lot. The asking price is 788k.
Ok, so lets go to the courthouse. Hmmm, its assessed at 576k, a 2007 assessement. Its approximately 6 yrs old. Ok, I have the taxes, and the assessment, now i go to the register of deeds and check out the liens against it. Hmm it appears that the property is liened for about 600k. Now, where did the 788k asking price come from. Even if the assessment is lets say20k out, thats still way too much for this property. Ok, next question. How long has this property been on the market. Hmmm, over a year and a half. No takers. My offer would be 550k, in this market. Now lets say one of the weekend buyers looks at the property, as in the past. They get the full treatment from the realtor, but as usual, the realtor, leaves out the assessed evaluation and skirts the issue of time on market. Buy now, before you go home, no need to think about this, real estate only goes up. They ain't making anymore lake frontage. So, the weekend buyer pays full boat and never did any research. TOOO BAD SOOO SAD!
Personally, I wouldn't even look at a property without researching these items. I did my research, I have a lake home, bought in the month of February, at a rock bottom price and paid in cash. I could care less if these buyers loose their butts. So, now we have over 1200 properties on the market, over 400k. lets see, with 20% down. 80k and a 6-8% mortgage...good luck. I fully expect properties here to revert to the mean of 1997. A 50% haircut, after the depression sets in next year. If stating the facts, is pushing buttons, so be it!
Last edited by JoshB; 11-02-2008 at 05:39 PM..
Reason: Innapropiate use of words.
If I were to be in the market to spend 300k on a second home, I would certainly do my homework. The buyers up here, did nothin but believe the realtor
Lets say a property is for sale, like the one down the road from me. Three bedroom, 1400 sq ft, three car garage, walkout basement.It has 100' of lake frontage, but a very shallow lot. The asking price is 788k.
Ok, so lets go to the courthouse. Hmmm, its assessed at 576k, a 2007 assessement. Its approximately 6 yrs old. Ok, I have the taxes, and the assessment, now i go to the register of deeds and check out the liens against it. Hmm it appears that the property is liened for about 600k. Now, where did the 788k asking price come from. Even if the assessment is lets say20k out, thats still way too much for this property. Ok, next question. How long has this property been on the market. Hmmm, over a year and a half. No takers. My offer would be 550k, in this market. Now lets say one of the weekend buyers looks at the property, as in the past. They get the full treatment from the realtor, but as usual, the realtor, leaves out the assessed evaluation and skirts the issue of time on market. Buy now, before you go home, no need to think about this, real estate only goes up. They ain't making anymore lake frontage. So, the weekend buyer pays full boat and never did any research. TOOO BAD SOOO SAD!
Personally, I wouldn't even look at a property without researching these items. I did my research, I have a lake home, bought in the month of February, at a rock bottom price and paid in cash. I could care less if these buyers loose their butts. So, now we have over 1200 properties on the market, over 400k. lets see, with 20% down. 80k and a 6-8% mortgage...good luck. I fully expect properties here to revert to the mean of 1997. A 50% haircut, after the depression sets in next year. If stating the facts, is pushing buttons, so be it!
Now this is how people need to think, but they do not. Excellent write up on the situation.. By the way did you see that the loan rates on jumbo's has now exceeded 10%...
if the economy and overpriced housing does not kill the lakefront market I think rates in excess of 10% and higher lending standards will surely do the trick
Interesting discussion. I have been watching the real estate market in the Wausau area and points further north for the past year with thoughts of relocating there from IL (of course!). I am also looking at the Grand Rapids, MI area. While taxes are high in WI, they are about on par with what we have here in central IL. The fact that real estate prices are significantly lower than what we have here in IL is what is prompting the move for me....... not to mention the beauty of N. WI. As much as I would like to have lake front property, I see a purchase in the Wausau - Steven's point area to be the wiser move for now. I would hope to buy and flip a house or two with an eye toward that lakefront property down the road.
What is happening in WI is happening all over the country. I have had my house for sale here in IL for over a year. I have accepted a verbal offer this week and hope to have paperwork in hand soon. I hope this is the case because I want to get back into the market while it is at the low point, which this may just be. As I said above, I am also looking at Grand Rapids. I am giving the edge to Wausau since I think the economy is stronger and I would really prefer to live there. Unfortunately, Grand Rapids has a lot more housing stock at better prices on the market as potential for someone like me. Perhaps this is a bad thing since it may be an indicator that their economy has really tanked. Housing in Wausau is moving at the lower end of the spectrum. That $300,000+ house will take a litttle longer to move.
The Wausau area seems poised for great growth. Hopefully, this will translate into increased prosperity for points further north. I think the lakefront market still has some correction to undergo. I can not expound on the forces fueling this any better than what has been stated here already. Other parts of the country are undergoing record forclosures and short sales are the norm. This may be what has to happen in the North woods vacation property market. If it does, expect more sane people to come in and buy. The truly wealty will weather the storm and hold on to their places if they have to. At most, I would expect the housing bubble there to be a temporary situation.
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wow!!!
