Thursday, May 18, 2006

Open Forum

Chat Away! :-)

32 comments:

  1. Anon 1:39, everyone learned the first time to NOT follow your links.

    Seek counseling.

    bryce

    ReplyDelete
  2. Dakota Crossing released their price list on those townhomes. They are starting in the low 400s. My fiance and I will be FTHB and can't afford that unless we get an ARM or a 40-50 year loan. If we stretched it, we could get it, but that would mean absolutely no children and our quality of life shot to hell. Sometimes I feel like I should have saved my school lunch money as a youth because this crap is ridiculous.

    ReplyDelete
  3. Stephanie 81,

    Don't you expect your incomes to rise? What is a stretch at 25 should be a breeze at 35.

    Or even 30.

    Or maybe 27.

    ReplyDelete
  4. Or you can work and save for the first 5-10 years of your marriage to save up for a downpayment. That "should be" a viable strategy if housing prices went back to their historic norm of a percent or 2 over inflation.

    The lunacy of the housing market over the last few years, (easy lending, gotta have it now, live on wild credit mentality) skewed this sensible long term approach to building wealth.

    I believe it will come back once housing is no longer the investment du jour.

    My $0.02.

    ReplyDelete
  5. Stephanie 81

    It does not make sense for a couple to get overextended on house payments. Can you count on being employed constantly during the years of house payments? If either you and your husband where to lose a job, you guys are toast.

    Twin engine aircrafts are designed to take off and fly if one engine fails. This allows the aircraft to return to the nearest airport to get the failed engine repaired. Jobs are alot less reliable than aircraft engines. A couple should be able to make house payments on a single income until the uemployed spouse gets a replacement job.

    May your careers be crash free.

    ReplyDelete
  6. Maybe Stephanie and her husband should find more affordable housing in different parts of the country. If they have non-federal government jobs, the relocation option should be explored.

    ReplyDelete
  7. Stephanie81,

    I was looking at those homes too..and that's out of my price range as well, but that's ok. I'll just keep looking and let those who can afford those buy them. In all actuality when they first started advertising those homes they started in the low-300's and that was in August of 2005. The product hasn't changed..same floorplans etc. yet the price has gone up 100K. Interesting..

    ReplyDelete
  8. Did anyone see the "Ave Maria" community being planned for FL? The builder is Pulte, the master planner is the guy who founded Dominoe's Pizza.

    bryce

    ReplyDelete
  9. My in-laws were looking at Ave Maria last month. Looks like it is going to be huge. My niece was looking at the University. She said it was "over the top" Catholic. This coming from a kid who has attended Cath. school for 11 years.

    ReplyDelete
  10. What used to be my apartment building's tennis court is now under construction to be a condominium called The Tuscany. We used to get fliers advertising that the Tuscany's prices were "starting from the low $400s". Yesterday, I got a flier in the mail saying that the Tuscany's prices are "from the $300s". That's definately a price drop.

    Yesterday's flier also mentioned something new: falling price protection. The flier said that if the base price drops between the time you agree to buy and the move-in date, you will only owe the move-in date price.

    It seems like the home builders know what's going on.

    ReplyDelete
  11. Both of us are 25, college graduates (I have one year left of my MBA program), and both Federal workers.

    We expect for our incomes to grow. However, life happens (job loss, illness, etc.) and it can affect income, especially if a mortgage depends on it. Overextending ourselves this young (or at any age) isn't a bright idea, no matter what Joe Sixpack mortgage broker says.

    Relocating isn't totally out of the question.

    ReplyDelete
  12. Stephanie - you should have 6 to 9 months living expenses as an emergency fund before you buy.

    Sounds like your income should be going up. I'd buy if I wanted to and could afford a fixed rate. Job loss, illness etc. could happen to anyone, anytime. Think disability ins. and prudent financial planning.

    My back-up plan in those early years was mom and dad. Never had to go there though.

    ReplyDelete
  13. "What used to be my apartment building's tennis court is now under construction..."

    This is being built by Bozzuto. I lived in a Bozzuto apartment complex for two years. The location isn't bad (walk to Giant), and the management team was good, but the buildings themselves are low quality construction.

    I was near my old neighborhood over a year ago, and I was very surprised to learn that that the apartment complex is going condo.

    http://www.northpointvillas.com/

    Check out the line about "No Money Down Financing Program"

    Yes, anyone buying one of these places would be crazy (in my opinion)

    bryce - (the guy who "always says that housing prices will always go up" or something like that)

    ReplyDelete
  14. Northpoint Villas are about 1/2 mile from me. I don't know how sales are going. Does anyone else know? Nice area and good schools - but, tons of inventory.

    ReplyDelete
  15. Stephanie 81,

    It's hard to imagine more secure employment than a federal job with guaranteed raises. Especially with the potential of a Democratic takeover.

    Research, Research, Research, your housing possiblities, do the math between potential falling prices and rising interest rates. Shop lenders, understand their terms.

    Decide what neighborhoods you're interested in and go to open houses. Look up tax records online to learn square footage and past sales histories (although tax records are somewhat unreliable, still a useful tool). Become a real estate expert in the neighborhoods you're interested in.

    Make this your hobby for the next year or so. It may sound like a lot of work, but most people find it very interesting once they get started because it has such a huge impact on their life.

    Anyway, if you take the time to make a good purchase, you can be one of the happy posters here instead of one of the bitter ones.

    ReplyDelete
  16. This market can and will undergo a correction (about 5 maybe 10%). However, those that are praying that home values will dramatically drop are going to be disappointed. DC has a large diversified employment base. We are not dependent on a single industry. Historical example: Before microsoft came to WA, Boeing was the big dog. They went through some rough times. So rough that people said that Seattle was going to look like a ghost town. It never happened! Foreign investors (esp. from Canada) came up and snapped up the low priced properties. Boeing eventually rebounded and now Seattle has tech and other ancillary industries. DC is not like that. If you are hoping that a $500K house will be worth $5K in a few years, that would be a serious fault line in our free enterprise system. Your problems then would more have to do with finding bread and food for you and your families. See argentina and other countries where this has happened. And, if that happened to us here, we would take the world down with us.
    -joe06

    ReplyDelete
  17. Dakota Crossing released their price list on those townhomes. They are starting in the low 400s. My fiance and I will be FTHB and can't afford that unless we get an ARM or a 40-50 year loan. If we stretched it, we could get it, but that would mean absolutely no children and our quality of life shot to hell. Sometimes I feel like I should have saved my school lunch money as a youth because this crap is ridiculous.

    When my parents had children in their 20's, they first lived in a rental for about 7 years. A dresser drawer was the first crib (I guess that would be called child-abuse today.)

    As the kids grew up and their income grew (One income, she was a housewife), they were able to afford a large home that they lived in for the next 30 years. It would probably cost about a million if it were located in DC. (It's now worth about $75K in Wilkes-Barre, PA) I think they bought it for $20K back then.

    Half of all marriages today (maybe more) end in divorce and as you just mentioned, there are all kinds of unforseen circumstances (knock on wood). You have bigger fish to fry. In the meantime, enjoy the show as house values collapse over the next two years or so.

    ReplyDelete
  18. The most suprising thing when I read housing blogs is the amount of people who you could tell never even thought about having a parent stay home with their children. That is another big reason for the housing situation especially in DC. I work with DINK's who have kids just to have kids and pay some day care to raise them. Its very said that being a DINK has become the standard. I believe this is not only a major reason for the ridiculous housing prices but also a major reason for amount of problematic children.

    ReplyDelete
  19. Anon 9:07

    "I work with DINK's who have kids just to have kids and pay some day care to raise them."

    DINK - Dual Income No Kids

    Otherwise I agree with you that there are plenty of DINKs (with no kids) in the Washington metro area and this has had a part in running up housing prices.

    ReplyDelete
  20. The most suprising thing when I read housing blogs is the amount of people who you could tell never even thought about having a parent stay home with their children. That is another big reason for the housing situation especially in DC. I work with DINK's who have kids just to have kids and pay some day care to raise them. Its very said that being a DINK has become the standard. I believe this is not only a major reason for the ridiculous housing prices but also a major reason for amount of problematic children.

    I'm a red-meat eating conservative who makes Reagan look liberal and I won't bash or blame daycare providers for all childraising woes nor for the housing bubble.

    At the same time, it's not uncommon to see "power couples" not think twice about blowing $600K on a 1 bedroom condo because they calculate that it's affordable in their price range if they eat macaroni and cheese and don't have kids.

    In a way, it's kind of darwinistic. If blue staters don't want to have kids, I say more power to 'em.

    ReplyDelete
  21. The word "darwinistic" coming from a red-stater? Wouldn't it be "intelligent designistic"... :)

    ReplyDelete
  22. joe06 wrote:
    "This market can and will undergo a correction (about 5 maybe 10%). However, those that are praying that home values will dramatically drop are going to be disappointed."

    It's great that we have psychics reading this blog. Does joe06 realize that U.S. median house prices have already fallen 4.2% from their peak?

    ReplyDelete
  23. Nikki,
    "intelligent designistic" LOL

    Can't wait to see the intelligent designers versions of the infamous Darwin awards --- creationism awards just doesn't have quite the same ring.

    Anne Onimus

    ReplyDelete
  24. PolishKite,

    Please continue to eat red meat as often as possible.

    Also, please understand that to be a real man, one must smoke Marlboro Reds. Please light up as soon as and often as possible

    ReplyDelete
  25. Check out this story about "car condos." http://msnbc.msn.com/id/12873434/


    AKA "you know you have too much money when..."

    ReplyDelete
  26. The Washington Post say suburban lifestyle is unsustainable for an energy perspective.

    Plus, eveytime someone puts gasoline in their tank they are supporting terrorist nations.

    How many 9/11 terrorists were from Saudia Araiba, from whom we import lots of oil.

    http://dcbubble.blogspot.com/2006/05/where-lefant-wanted-to-go-eat-and_17.html

    ReplyDelete
  27. I drove north on Georgia Avenue from downtown Silver Spring today.

    I have NEVER seen so many For Sale signs. Some corners were really bubblicious. I drove past a few- almost all were in open house mode. I did see a few people going in, but I didn't want to bother as I am not in the market.

    Most of these houses are 50 years old on streets where many houses have no driveway, so the streets are filled with cars. Traffic on nearby Georgia is non-stop crowded. It's not an ideal place to live, but prices were around 400K for the cheapest-- usually a small house on a 1/8 acre lot. One even had a window AC unit, so I assume it doesn't have central. You could have that one for a discounted 375K. LOL.

    In my opinion, prices have a LONG way to go down before they reach value.

    Also, a lot of houses for rent. "Investors" might be having a tough time of it.

    A Redskins fan.

    ReplyDelete
  28. PolishKite,

    Hahahaha! That's so clever!

    Please continue to eat red meat as often as possible.

    Also, please understand that to be a real man, one must smoke Marlboro Reds. Please light up as soon as and often as possible


    I actually can't stand cigarette smoke. Interestingly, it appears that nearly every Hollywood celebrity smokes...

    ReplyDelete
  29. interested observerMay 22, 2006 7:46 AM

    General Comment:

    I have spent far too much time contemplating real estate over the past year due to an impending move to DC and attempt to decide between renting and buying (decided to rent for a while). Having looked at lots of listings, I am left with the impression that anyone with a GED has tried to jump into selling real estate over the past several years. Let me just say:
    There is no such thing as a "Callder-sack", "Colder-sack", "Call-de-sac", or "Culldersack". Despite the recent craze for home renovations, I sincerely doubt that any have had their kitchens "upgrated". And, though I suppose it is possible that some have imported materials from Asia, I doubt that "Korean" countertops are a significant selling point. Is this really the best they can do for their 30K commission?

    Just as getting tech stock tips from cabbies was evidence of trouble in 2000, I think this speaks poorly of real estate prospects going forward.

    Interested observer.

    ReplyDelete
  30. I have been a regular visitor to this blog for the last year. I am a big believer in real estate bubble, certainly in DC, NoVA, CA, MA, FL etc.

    I moved here from Chicago and decided to rent given the prices out here. I had rented out my property in Chicago for the last year. Last week my tenant moved out, so this weekend I went back to Chicago just to check on the status of the property.

    At the same time, I had listed my place on Craig's List just to test the level of interest. I expected a couple of people to inquire. But to my surprise, fifteen people showed up. After an unofficial "open-house" for 5 hrs, I had three offers, I accepted the highest one which was 2% below my asking price. From my perspective this was fair as I did not have to deal with a realtor but I don't know what to think of this. This doesn’t make any sense!!

    Is there a housing bubble in or not? Or are we all just kidding ourselves and the prices will keep going higher while we sit on our laurels?

    ReplyDelete
  31. "interested observer said...
    General Comment: ... Having looked at lots of listings, I am left with the impression that anyone with a GED has tried to jump into selling real estate over the past several years."

    Hahaha...That's my observation, as well....But RE is supposedly **the** fastest (or one of the fastest) growing industries to which the lower unemploy. rates are due. Or so I heard (a while ago). I wonder what these guys will end up doing in a year or two, when the RE industry can no longer promise a "get rich quick" situation for sellers and their agents???

    S.S./H. Anonymous

    ReplyDelete