Author Topic: Is this what 2005 felt like?  (Read 9225 times)

Jon Bon

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Is this what 2005 felt like?
« on: January 16, 2017, 03:46:28 PM »
Houses are on the market for weeks if not days, garnering multiple offers, and going over list price. I have been out bid on a few homes, as well as just not being able to move fast enough. I am seeing this crazy level of demand for SFH as well as investment properties.

I know lots of you HCOL folks have been dealing with this for a while, but what the heck is going on? I price a house as high as I can in terms of my comfort level, the numbers, and what my gut tells it is worth, properties are still going well north of that. My hypothesis is the fear of raising rates has temporarily and drastically driven up demand. Supply has not  had a chance to adjust yet, so prices are increasing rapidly.

Does anyone have any stories about when they knew it was time to get out the last time?

What are my fellow Mustachians doing? Continuing to invest in real estate and primary residences or are you holding back, hoarding cash and waiting for things to cool off?

nexus

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Re: Is this what 2005 felt like?
« Reply #1 on: January 17, 2017, 02:27:12 PM »
Obviously I was too young to know what was happening in 2005, but I think it really comes down to your level of comfort. If the math works for you for buying a SFH or rental, do it. If it doesn't, wait or research a different area.

In my very, very basic real estate mind: Can I afford the mortgage based on my down payment? Am I going to have to pay PMI? Those answers are still a 'no' for me, so I rent for the time being.

Eric

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Re: Is this what 2005 felt like?
« Reply #2 on: January 17, 2017, 02:35:09 PM »
Can you get a house with zero $ down on an interest only loan?  If no, then it's not like 2005 yet.  :)

JHoward

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Re: Is this what 2005 felt like?
« Reply #3 on: January 17, 2017, 03:03:23 PM »
In 2005 fewer people were thinking about whether the prices were going to come down someday soon. Everyone was supposed to buy the most expensive piece of real estate the bank would give them a mortgage for because regardless of what you bought and where, the prices were going to keep rising and your house would make you rich.

I feel you on the seller's market thing though. Around here, houses staying on the market for weeks is unheard of - you're lucky to go to a scheduled open house and find that the property is still for sale. I'm sticking with renting until the market slows down or I give up and decide to move. Renting feels like throwing money into a hole, but I know being underwater on a house would feel worse. At least while I'm renting I'm not throwing myself into the hole with the money.

Mr. Green

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Re: Is this what 2005 felt like?
« Reply #4 on: January 17, 2017, 04:54:10 PM »
Can you get a house with zero $ down on an interest only loan?  If no, then it's not like 2005 yet.  :)
I don't know about interest only but zero down loans have been available in my area (DC suburbs) for a couple years now. Still blows my mind that we're back to that after the recent real estate debacle. We don't have bidding wars going on like where ever the OP is from though.

nereo

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Re: Is this what 2005 felt like?
« Reply #5 on: January 17, 2017, 05:10:24 PM »
I half-assume the new congress and administration will open up NINA loans in the very near future.

bacchi

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Re: Is this what 2005 felt like?
« Reply #6 on: January 17, 2017, 06:11:59 PM »
I half-assume the new congress and administration will open up NINA loans in the very near future.

Then it'll really be 2005.

That gives us 2 years to sell and create a cash cushion.

chasesfish

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Re: Is this what 2005 felt like?
« Reply #7 on: January 17, 2017, 07:43:49 PM »
I live in a high cost of living area and experienced this.  I also experienced 2007 and took a bath on a primary residence.

I figured out where I thought I wanted to live, rented a single family house in that block, and jogged the neighborhood looking for "coming soon" signs and asked around about houses that might be coming up. 

Ten months later, I found what I thought is a good house / lot and a fair price from a motivated seller.

As for rental property - I'd be careful, rising rates will impact pricing and Cap rates should normalize, probably more with rising rents and stable prices.  I haven't found a situation in my market where a SF rental makes sense.  That being said, if I were in an area that was really restrictive on allowing new housing (i.e. College towns), I'd still be out hunting rentals


brian313313

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Re: Is this what 2005 felt like?
« Reply #8 on: January 18, 2017, 01:42:53 PM »
We just bought a condo and were in the same situation. On our 8th bid, we finally got a place. It was a fixer-upper so the demand wasn't quite as high. We had our bid in within an hour of the listing. We actually did that on quite a few listings but were still outbid. The problem in our area is that rents are going up too. We got the condo for 165k including remodeling. Renting something like this would have been 1800/month so the numbers worked for us even though the condo seemed over-priced. For us, the premium we may have paid was worth it to be settled. Of course, the market could keep going up. Nobody really knows what the future holds. We really wanted to be in this area though because of public transportation and in the near suburbs so we have just about everything we need in walking distance.

ysette9

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Re: Is this what 2005 felt like?
« Reply #9 on: January 18, 2017, 01:46:38 PM »
From the perspective of a HCOL area, this feels like things are cooling. Properties are having open houses on more than one weekend and not selling immediately. That feels downright odd. :)

Jon Bon

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Re: Is this what 2005 felt like?
« Reply #10 on: January 18, 2017, 01:48:48 PM »
We just bought a condo and were in the same situation. On our 8th bid, we finally got a place. It was a fixer-upper so the demand wasn't quite as high. We had our bid in within an hour of the listing. We actually did that on quite a few listings but were still outbid. The problem in our area is that rents are going up too. We got the condo for 165k including remodeling. Renting something like this would have been 1800/month so the numbers worked for us even though the condo seemed over-priced. For us, the premium we may have paid was worth it to be settled. Of course, the market could keep going up. Nobody really knows what the future holds. We really wanted to be in this area though because of public transportation and in the near suburbs so we have just about everything we need in walking distance.

Congrats and I am glad you found something!

In my case I bought a fixer and appreciation is making me itchy to cash out. However gotta have somewhere to go! Investment properties are still OK in my area but SFH in good neighborhoods don't seam to ever stop going up. I mean the Fed has publicly said they are going to raise rates in 2017. So that has to put some damper on things.

I guess I am spoiled, I bought my first house in 2009, sold it 3 years later and have bought a few rentals and another SFH since then. I mean I don't expect prices to go back to 2009 levels but these prices don't correlate with wage growth so something has to give right?!!

BlueHouse

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Re: Is this what 2005 felt like?
« Reply #11 on: January 18, 2017, 01:51:27 PM »
Can you get a house with zero $ down on an interest only loan?  If no, then it's not like 2005 yet.  :)
I don't know about interest only but zero down loans have been available in my area (DC suburbs) for a couple years now. Still blows my mind that we're back to that after the recent real estate debacle. We don't have bidding wars going on like where ever the OP is from though.
Bidding wars?  No, the process has become much more civilized. 
Step 1.  Realtor posts notice that a house is up for sale - soon (not yet).
Step 2. Open house for one day, timed two weeks after initial notice.  No showings allowed and usually no pictures on Trulia/zillow/redfin until after the open house. 
Step 3.  All Bids are due 2 days after the open house.
Step 4.  I've seen contract prices $100K over asking on a few of the houses that I was tracking.  (just out of curiousity...I'm not getting into a bidding war)

Fomerly known as something

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Re: Is this what 2005 felt like?
« Reply #12 on: January 18, 2017, 02:33:59 PM »
Things shot up 1-2 years ago in my hood but seem to have stabilized a bit over the last year.  Being in the Midwest though spring will tell the next part of the trend.  I did hear that some properties were getting multiple bids but it was those that were correctly priced to the market.

Cwadda

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Re: Is this what 2005 felt like?
« Reply #13 on: January 18, 2017, 02:38:45 PM »
All the rental multi families I was interested in were normally snapped up by cash buyers whereas I'm an FHA buyer. I ended up finding one off-market. Much less competition.

bobechs

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Re: Is this what 2005 felt like?
« Reply #14 on: January 18, 2017, 04:06:22 PM »
There are places, lots of places -admittedly not trendy HCOL locations- where there is an ample supply of sfh that have been on the market for five hundred to a thousand days or more, if that gives any comfort.

Lookee here, what we got:(leading off with 889 days and counting...)

http://www.zillow.com/homes/for_sale/Alva-OK/house,mobile_type/50712_rid/1-_baths/75000-250000_price/282-941_mp/globalrelevanceex_sort/36.816431,-98.637701,36.778836,-98.69658_rect/13_zm/0_mmm/

bugbaby

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Re: Is this what 2005 felt like?
« Reply #15 on: January 18, 2017, 06:05:37 PM »
Can you get a house with zero $ down on an interest only loan?  If no, then it's not like 2005 yet.  :)
+1
Also can you make up your income and get a mortgage with no verification? Or can you count welfare as income and get approval?

Sent from my Nexus 5 using Tapatalk


waltworks

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Re: Is this what 2005 felt like?
« Reply #16 on: January 18, 2017, 08:05:19 PM »
No. My wife and I were in graduate school in 2005, with negative net worth, making ~$35k combined. And a realtor friend of her mother in law tried to get us to buy a $300k and then $450k house (and someone would have loaned us the money, too).

That's not to say I think the price increases of the last 5 years or so are sustainable or that there won't be a big crash at some point. But the drivers this time around are quite different.

I did sell all my rental properties last year. At their prices they no longer made sense as rentals.

-W

seattlecyclone

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Re: Is this what 2005 felt like?
« Reply #17 on: January 18, 2017, 08:15:36 PM »
From the perspective of a HCOL area, this feels like things are cooling. Properties are having open houses on more than one weekend and not selling immediately. That feels downright odd. :)

They're still selling immediately around here. Maybe all the Bay Area people are moving to Seattle and bringing their insane real estate traditions with them?

Mgmny

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Re: Is this what 2005 felt like?
« Reply #18 on: January 19, 2017, 10:28:50 AM »
All the rental multi families I was interested in were normally snapped up by cash buyers whereas I'm an FHA buyer. I ended up finding one off-market. Much less competition.

Why does that matter? The seller will get the money regardless of how it's funded?

Jon Bon

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Re: Is this what 2005 felt like?
« Reply #19 on: January 19, 2017, 10:36:02 AM »
All the rental multi families I was interested in were normally snapped up by cash buyers whereas I'm an FHA buyer. I ended up finding one off-market. Much less competition.

Why does that matter? The seller will get the money regardless of how it's funded?

It matters for a few reasons. The first is that cash means there is no approval process, so the money is already there ready to go. Second it means that you are probably dealing with a professional who might be able to waive other contingencies in the offer (appraisal and inspection come to mind) This type of person is not going to be scared off by a small roof leak like it might a first time buyer. Thirdly dealing with banks can be difficult, and dealing with the government (FHA) is worst of all!


mm1970

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Re: Is this what 2005 felt like?
« Reply #20 on: January 19, 2017, 10:51:59 AM »
Houses are on the market for weeks if not days, garnering multiple offers, and going over list price. I have been out bid on a few homes, as well as just not being able to move fast enough. I am seeing this crazy level of demand for SFH as well as investment properties.

I know lots of you HCOL folks have been dealing with this for a while, but what the heck is going on? I price a house as high as I can in terms of my comfort level, the numbers, and what my gut tells it is worth, properties are still going well north of that. My hypothesis is the fear of raising rates has temporarily and drastically driven up demand. Supply has not  had a chance to adjust yet, so prices are increasing rapidly.

Does anyone have any stories about when they knew it was time to get out the last time?

What are my fellow Mustachians doing? Continuing to invest in real estate and primary residences or are you holding back, hoarding cash and waiting for things to cool off?
So, I bought in 2004 and I'd say FINALLY the last 6 months, my house is worth what I paid for it. 
At the bottom of the market in 2011, the house next door sold for $500k.
At the peak in 2006, the other house next door sold for $869k.

So yeah, I'm not one to talk about how to time it.  BUT.  I've been following my local market for awhile now.  Honestly, I would not get in right now because prices have been going up so quickly.

There was a time a few years ago when the market was finally picking up again.  my officemate was looking to buy, but his requirements were: 1. a 3 BR, and 2. under $700k.

That's a tall order in this town.  He was outbid 9 times and then kind of took a break.

Then a house came on the market.  The owners had one time to view the house, at 10 am on a Thurs.  They went, liked it, bid full price, and got it.  At $650k.  It's now worth about $900k (please ignore the crazy HCOL numbers.)

My point is this: if you have been watching the market, and it seems too good to be true...it might be.  I can't speak for your location, but here - at these numbers - the local jobs economy does not really support regular people buying a house.  And we AREN'T the SF bay area.  It doesn't mean there aren't outside investors or people buying vacation homes.

nereo

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Re: Is this what 2005 felt like?
« Reply #21 on: January 19, 2017, 11:04:32 AM »
No. My wife and I were in graduate school in 2005, with negative net worth, making ~$35k combined. And a realtor friend of her mother in law tried to get us to buy a $300k and then $450k house (and someone would have loaned us the money, too).

That's not to say I think the price increases of the last 5 years or so are sustainable or that there won't be a big crash at some point. But the drivers this time around are quite different.

I did sell all my rental properties last year. At their prices they no longer made sense as rentals.

-W

My story is similar: in '07 we were students and friends & family members were urging us to buy a home for all the wrong reasons.  This was in a HCOL in California.  We looked at what I can optimistically call a "fixer-upper" that had great potential but was listed at $475k.  Living on a small stipend plus $5k in loans (so already spending more than we brought in) I said something about how we'd never be able to afford it. The real-estate agent didn't blink and told us how she'd helped multiple student-couples buy homes, that we could basically use "our future degree as proof we'd eventually be able to pay". A brief visit to the bank confirmed this.

My ultimate "This is NUTS" moment was when I looked closely at the repayment schedule and saw that for the first 5 years our principle would be increasing as we'd be paying less than even the interest. From that point forward it would only get worse. Any hiccup in our plans and we'd be up a creek, so to speak.

waltworks

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Re: Is this what 2005 felt like?
« Reply #22 on: January 19, 2017, 11:11:59 AM »
You were smarter than me, then! We just ended up in a great rental situation and didn't want to move, no numbers run or calculations whatsoever. We got lucky, in other words, and then got lucky again in 2009 when we *did* want to buy a house (we ended up with 5!) and they were on crazy sale.

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Syonyk

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Re: Is this what 2005 felt like?
« Reply #23 on: January 19, 2017, 01:28:23 PM »
Does anyone have any stories about when they knew it was time to get out the last time?

I wasn't involved last time, but my understanding with bubbles is that about the time mainstream media starts going on about how this (bubble) is the new normal, and can continue forever, and of course prices will keep going up - and you see this wisdom echoed everywhere, get out.

Quote
What are my fellow Mustachians doing? Continuing to invest in real estate and primary residences or are you holding back, hoarding cash and waiting for things to cool off?

Bought a house with cash because I couldn't get a mortgage (I was a bum, you see - I took three months off between jobs instead of the mortgage-company-allowed two, and even if I had the cash to pay for it, I could have gone to Vegas and blown it), working on productive property improvements with a focus on long term cost of living reduction.

nereo

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Re: Is this what 2005 felt like?
« Reply #24 on: January 19, 2017, 06:44:46 PM »
Does anyone have any stories about when they knew it was time to get out the last time?

I wasn't involved last time, but my understanding with bubbles is that about the time mainstream media starts going on about how this (bubble) is the new normal, and can continue forever, and of course prices will keep going up - and you see this wisdom echoed everywhere, get out.

That sounds about right.  I vividly remember news stories around 2000 that talked about how this was the "new economy" and it didn't really matter that large, publicly traded companies were not actually making any money.  Poof - dot.com.
Then in 2007 there were endless stories about how great housing was, how it was *very important* that we get even more people (e.g. Low wage earners, those with poor credit) into mortgages because they were the backbone to healthy communities, that statistically people almost never walked away from mortgage debt, that it was not risky because the home was collateral and the land was always worth something.  Poof - housing bubble

notactiveanymore

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Re: Is this what 2005 felt like?
« Reply #25 on: January 19, 2017, 08:42:18 PM »
I tend to think we're in a small bubble or maybe the beginning of a bubble on average nationally. The house price index (values vs inflation) is rising: http://www.economist.com/blogs/graphicdetail/2016/08/daily-chart-20

That said, I don't think it's 2005 yet because of some of the reasons given by previous posters. I live in a college town that is 30 miles from the state capitol, houses a massive university and hospital system, and headquarters of a major insurance company, so we have had a more stable market here. We didn't have a full crash, but we did really see a full-stop end to development during that time. Now we're seeing some inflated prices mostly due to lack of supply. I think part of that is that so many people bought in the last 2 years with the low interest rates and the only new builds were on the really luxurious end. Anyway, point is the cause behind each market's tick up in prices vs. inflation might be different, but until we have more universal causes, we're not in 2005 IMO.

I really liked this break down of causes behind rising prices. It might be a decent reference to check back with to see if any additional red flags have popped up: http://www.investopedia.com/articles/07/housing_bubble.asp

Metric Mouse

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Re: Is this what 2005 felt like?
« Reply #26 on: January 20, 2017, 01:42:28 AM »
Can you get a house with zero $ down on an interest only loan?  If no, then it's not like 2005 yet.  :)

Yes... and many people had multiple of these... I mean, the price is only going up!

Villanelle

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Re: Is this what 2005 felt like?
« Reply #27 on: January 20, 2017, 02:01:25 AM »
We bought in 2007 and our place, which is now a rental, finally reached the point where it was worth more than we paid about a year or two ago.  When our renters move out this Spring, we are considering selling.  I'm not sure what we'll do.  It has positive cash flow but when I look at future maintenance, probably only barely.  But I also hate to get out of the market entirely, and risk not being able to afford something comparable when we finally move back Stateside (2019, at the earliest).

My gut says that selling is just another form or market timing, and that's bad, right? Right??

2Birds1Stone

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Re: Is this what 2005 felt like?
« Reply #28 on: January 20, 2017, 07:23:03 AM »
Houses here are nowhere near those inflated mid 2000's prices yet.

frugaliknowit

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Re: Is this what 2005 felt like?
« Reply #29 on: January 20, 2017, 11:13:00 AM »
I do not think it is productive to try to predict where we are in the housing market cycle.  The most important question to ask yourself is how long you are committed to staying in the home.  If it's less than 10 years, don't buy (my opinion).

In my case, I bought my condo in 2003 (Chicago market), and it's price has still not fully recovered (partly because it's a one-bedroom unit).  However, it's just about paid for, has super convenient public transit, is on a bicyle "super highway" and it would cost about $1100 per month to rent something comparable.
« Last Edit: January 20, 2017, 11:15:12 AM by frugaliknowit »

Jon Bon

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Re: Is this what 2005 felt like?
« Reply #30 on: January 20, 2017, 11:23:53 AM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).




nereo

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Re: Is this what 2005 felt like?
« Reply #31 on: January 20, 2017, 11:34:49 AM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

How do you offset buying and closing costs?

tarheeldan

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Re: Is this what 2005 felt like?
« Reply #32 on: January 20, 2017, 11:38:54 AM »
You can see inflation-adjusted home prices (click the "real terms" tab) here through 2016Q2 and you can adjust the base year with a slider :-)

http://www.economist.com/blogs/graphicdetail/2016/08/daily-chart-20

As 2Birds1Stone said, we have some room to go.

https://www.dropbox.com/s/0jkfxfqcsn20nzv/hpi.png?dl=0
« Last Edit: January 20, 2017, 11:40:57 AM by tarheeldan »

Jon Bon

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Re: Is this what 2005 felt like?
« Reply #33 on: January 20, 2017, 11:39:29 AM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

How do you offset buying and closing costs?

Ugly houses in good neighborhoods. Usually I shoot for "Grandma's house" It is in good condition, generally structurally sound, but interior finishes are 20-50 years old.  Floors and paint go a long way, usually I try to do a kitchen and or bath as well. Lots of this has been timing for me. I started buying houses in 2009, so I have had price appreciation along the way as well.

nereo

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Re: Is this what 2005 felt like?
« Reply #34 on: January 20, 2017, 11:43:55 AM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

How do you offset buying and closing costs?

Ugly houses in good neighborhoods. Usually I shoot for "Grandma's house" It is in good condition, generally structurally sound, but interior finishes are 20-50 years old.  Floors and paint go a long way, usually I try to do a kitchen and or bath as well. Lots of this has been timing for me. I started buying houses in 2009, so I have had price appreciation along the way as well.

Nice, so a mixture of careful selection and sweat-equity.
I'd still be wary of a potential housing collapse, because the last one we lived through you simply couldn't sell good houses for any profit at all. 

Not saying it's not a good strategy, but make sure you have the resources to survive a moderate loss.

Jon Bon

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Re: Is this what 2005 felt like?
« Reply #35 on: January 20, 2017, 11:54:30 AM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

How do you offset buying and closing costs?

Ugly houses in good neighborhoods. Usually I shoot for "Grandma's house" It is in good condition, generally structurally sound, but interior finishes are 20-50 years old.  Floors and paint go a long way, usually I try to do a kitchen and or bath as well. Lots of this has been timing for me. I started buying houses in 2009, so I have had price appreciation along the way as well.

Nice, so a mixture of careful selection and sweat-equity.
I'd still be wary of a potential housing collapse, because the last one we lived through you simply couldn't sell good houses for any profit at all. 

Not saying it's not a good strategy, but make sure you have the resources to survive a moderate loss.

Exactly! Hitting my concern right on the head, I am not the best at articulation, writing is hard....

Now my alarm bells are ringing that I buy a house today that cost 2x what it did in 2009 and it needs work. So I need to sell it at 3x of what it was worth in 2009 to make money. That feels insane to me.

I guess my point in the overall thread here is, sure we might not have the lending insanity we had before: NINA loans/interest only/40 year fixed etc. But the behavior of buyers is starting to feel familiar? They might be more well qualified buyers then the last time, but it still feels nuts.


dougules

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Re: Is this what 2005 felt like?
« Reply #36 on: January 20, 2017, 11:57:59 AM »
Interest rates are low. 

I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

How do you offset buying and closing costs?

Ugly houses in good neighborhoods. Usually I shoot for "Grandma's house" It is in good condition, generally structurally sound, but interior finishes are 20-50 years old.  Floors and paint go a long way, usually I try to do a kitchen and or bath as well. Lots of this has been timing for me. I started buying houses in 2009, so I have had price appreciation along the way as well.

I love my 1958 "Grandma's house."  It's incredibly well built with 2x8 subfloors and oak hardwood... except for the add-on room where we just refinished the beautiful heart of pine subfloors.  I'm convinced that mid-Century modern will come around the same as Craftsman did, too.  We painted a few rooms guacamole green, and when I sanded out some of the rough spots before painting,  I went through the off-white paint to burnt orange, then to the original layer of... you guessed it, guacamole green. 

And while it's not a neighborhood traditionally thought of as walkable, we're still able to walk for half of our errands.
« Last Edit: January 20, 2017, 11:59:38 AM by dougules »

Villanelle

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Re: Is this what 2005 felt like?
« Reply #37 on: January 20, 2017, 10:14:49 PM »
I do not think it is productive to try to predict where we are in the housing market cycle. 

Perhaps not.... But it can be fun!

Since houses are so much less liquid than stocks I think some market timing by investors is going to be inevitable. As a mutual fund investor if you need the some or all of your cash recently invested you can just sell, and have your money within 48 hours. With a house, not so much.

I buy my primary residence with the option (if not the intent) to sell it after 2-4 years. That way I get to keep all the capital gains. If you are buying a turn key house, sure staying 5-10 years is the right call. However that is not what everyone can do (or afford).

We have a HELOC with just under $100k available.  (And this is far, far less than our actual equity, so there's not much danger in it being closed or even reduced.)  So we actually can have a lot of our equity in less than 48 hours.

(And no, this is not a McMansion, despite those numbers.  It's a ~1900sqft townhouse.  Super high COL.)