Is it me or are real estate prices going wacko again

[Sho'Nuff]

Long story short, my wife and I are thinking about selling our current place and moving a couple towns over. Basically we like our neighborhood, but due to wetlands in our area it is very hard to do anything with our lot. Since we have small kids, we want a property with more useable land.

Anyway, we have started to look at new homes and all I can say is holy cr@p prices have gone up big time in our area. The average asking price of a 4BR, 2 bath 2100 square foot home in the towns near me is over 500k, which is ridiculous considering the nearest major metropolitan area is Boston, some 55 miles away. Cripes, the neighborhood next to mine is filled with 1000 square foot 1950s era ranches, and they are selling like hot cakes at ~$325k.

Anyone else noticing this? Or are things just crazy in my area?

 

[michal1980]

I'm sure its very regional, and while prices around here aren't anywhere that high. I cant understand the herd think behind home buying.

Houses sales here are going up 10% yoy, and I just have to ask myself why. There haven't been any signs of such wage growth, where is this money coming from? Are people just willing to spend that much more on housing now? And why? What was the big change from last year that causes someone to spend 20-40k more for the same thing as the year before.

 

[Engineer]

I'm sure its very regional, and while prices around here aren't anywhere that high. I cant understand the herd think behind home buying.

Houses sales here are going up 10% yoy, and I just have to ask myself why. There haven't been any signs of such wage growth, where is this money coming from? Are people just willing to spend that much more on housing now? And why? What was the big change from last year that causes someone to spend 20-40k more for the same thing as the year before.

I wonder if people are buying these homes to live in or buying them to rent/flip?

http://finance.yahoo.com/news/surve...5bzY5BGNvbG8DYmYxBHBvcwMzBHZ0aWQDBHNlYwNzcg--

 

[dr150]

Definitely overheated.

The experts are saying Florida is still investable but places like Cali and NYC are overheated and owners buying in today are playing with fire if you plan to sell before one full up/down cycle.

For shits and giggles my wife looked at a house last Saturday at $650k asking. The house had a broken window and other stupid crap which would cost the new owner ~$20k to fix/adequately improve.

The dumb bitch real estate agent arrogantly lectured me that the owners don't have to fix shit in this market. Another visitor agreed with the agent that they also ain't doing shit to their house either b/c it'll sell regardless.

Fast forward to today, the house got several bids and had an all cash offer at $720k. This house is in Silicon Valley btw.

When you have stupid fuckheads giving their money away like it's going out of style b/c of easy bank money (that you have to pay back, lest people forget!) they will fuck themselves in the ass in the downturn when interest rates rise. New owners better grab their balls and have enough to hold out for 10+ years on a dip

 

[13Gigatons]

A house sold here for double what it is worth. We also have a high amount of defaults though which is not surprising.

It's a nice neighborhood though if you can get used to the zombies.

 

[maddogchen]

Really overheated. Nothing less than $1 million for a 3 bed 2 bath 1200+ sq ft here in my county.

I now see billboard signs saying you can get a jumbo loan of up to $3 million dollars for just a 10% down payment. It's back to crazy markets again here in California

 

[Nograts]

It blows my mind what people pay for houses in the Northeast and the California coast. The wife and I watch HGTV all the time, and these young kids are getting married and buying like 700k homes that are maybe 2000 square feet at best. I'm surprised first off that they are able to afford that, that's 4 times what I pay for my mortgage and my mortgage is about just shy of 1/3 of my income.

I grew up in the Rockies though, midwest. For even 300-400k you could get a really nice 3-4k square foot home that was built 10 years or less. Prices are definitely rising there but not like the east. So... yeah. I might retire in Montana or South Dakota or some no-name place just so I can buy a lot of land

 

[Red Squirrel]

It blows my mind what people pay for houses in the Northeast and the California coast. The wife and I watch HGTV all the time, and these young kids are getting married and buying like 700k homes that are maybe 2000 square feet at best. I'm surprised first off that they are able to afford that, that's 4 times what I pay for my mortgage and my mortgage is about just shy of 1/3 of my income.

I grew up in the Rockies though, midwest. For even 300-400k you could get a really nice 3-4k square foot home that was built 10 years or less. Prices are definitely rising there but not like the east. So... yeah. I might retire in Montana or South Dakota or some no-name place just so I can buy a lot of land

Yeah it's pretty insane. Then you go in places like Vancouver and Toronto and it's even more insane. Regular houses that are over a million dollars. It baffles my mind that people want to live in those areas, or work in those areas and commute for hours every day. I guess I consider myself lucky.

 

[Red Squirrel]

I now see billboard signs saying you can get a jumbo loan of up to $3 million dollars for just a 10% down payment. It's back to crazy markets again here in California

That's insane, I wonder how those loans even work, there's no way the average person is going to be able to pay it in their life time, and it will get written off at some point or the other either due to death or bankruptcy. Does it end up being the tax payers that pay for it?

And I was nervous when I took out a 7k loan lol.

 

[Ns1]

Yes. CA is crazy right now.

 

[V00DOO]

Yeah, CA is crazy overheated thanks to all the Chinese coming over here to live. My neighbor's house just sold for $800 fucking K. The property tax alone is almost $10k a year which means a house hold needs to make at least $150k to afford it.

 

[Feneant2]

Why do people pay these prices anyways, do they think they can build equity and double up when they sell? I know in Canada the bubble will burst and loads of people in the big cities will end up owing half again what the house is worth on their mortgages.

And this may be the small town guy in me talking, but would someone want a million dollar home in a place like Toronto or Vancouver that's a 100 year old 900 square foot dump when you have places out East like Moncton or Charlottetown where you can get a new 1200 square foot bungalow for 200k. Hell, around here 5 year old houses with a finished basement can take 2 months to sell at 200-210k.

Interesting site for Canada : http://www.crea.ca/content/national-average-price-map

 

[TheSlamma]

As I stated in the saving thread, my place went up $160,000 this year according to the assessors office.

Yes prices are going crazy, have been for awhile now. I've lived in this place for 18 months, if it cost what it does now I wouldn't have bought it.

 

[Nograts]

As I stated in the saving thread, my place went up $160,000 this year according to the assessors office.

Yes prices are going crazy, have been for awhile now. I've lived in this place for 18 months, if it cost what it does now I wouldn't have bought it.

Damn. I'd sell that while I could if it were me, move to Longmont or Castle Rock or something. 160k invested for x years = way more than what my house will ever be. Hell just move to the outskirts and buy some land.

 

[Ns1]

Yeah, CA is crazy overheated thanks to all the Chinese coming over here to live. My neighbor's house just sold for $800 fucking K. The property tax alone is almost $10k a year which means a house hold needs to make at least $150k to afford it.

They probably paid that 800k in cash.

 

[dr150]

Yeah, CA is crazy overheated thanks to all the Chinese coming over here to live. My neighbor's house just sold for $800 fucking K. The property tax alone is almost $10k a year which means a house hold needs to make at least $150k to afford it.

These dumbfucks don't even understand the TOTAL cost of ownership beyond mortgage payment, which indeed is the property tax, insurance, utilities, minimal upkeep, necessary upgrades, etc.

A/C went bust...that's several thousand. Roof?....need to keep that shit up to spec as well. Plumbing? Appliances? Landscaping?...

All this crap would not be such a big deal....UNLESS you're OVERpaying hugely for a POS Silicon Valley house making you house poor from the get-go (forget those vacations, eating out, new car, etc)

Additionally, in Silicon Valley, people forget there's huge fault line(s) right down the valley. When that thing sets off, you're going to be looking at damage to the walls, and god forbid, foundation (try selling a house with a broken foundation). Earthquake insurance you say? That type of insurance is so expensive as to be out of acceptable range for many. So most folks will be SOL when an earthquake occurs.

Heck, my walls have cracks from this active fault line and regular little shakes through the years. People forget this bit of fact when purchasing.

The total house cost, bubble mechanics, force majeur make it a loaded gun ready to go off. Lots of people are going to get seriously hurt.
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My wife laughs at these POS houses in the valley. For this money you can have an overbuilt German house in Germany and live like a King.

 

[halik]

West coast getting pummeled by chinese trying to hide money, it's been going for a while now (since both their domestic real estate plays and now equity bubbles are popping).

 

[Slew Foot]

Silicon Valley seems especially overheated right now. Houses in my area run 1.3-2.5 mill and they sell in a week, usually for mostly cash. And they seem to be all owner occupied, must be tech people cashing in.

 

[kaerflog]

People don't even care because interest is so low right now.
All they care is whats my monthly payment is going to be. They don't care if they have to pay that until they die.
I think most people don't ever think about owning a house outright anymore.
Here in Orlando, you get get a very nice house for $250K, a $200K mortgage will run you $900(on 3.5%) + taxes + insurance which is very doable for a lot of people.
I've been looking at house lately but fuck, I think its overpriced.

 

[chowderhead]

These dumbfucks don't even understand the TOTAL cost of ownership beyond mortgage payment, which indeed is the property tax, insurance, utilities, minimal upkeep, necessary upgrades, etc.

A/C went bust...that's several thousand. Roof?....need to keep that shit up to spec as well. Plumbing? Appliances? Landscaping?...

All this crap would not be such a big deal....UNLESS you're OVERpaying hugely for a POS Silicon Valley house making you house poor from the get-go (forget those vacations, eating out, new car, etc)

Additionally, in Silicon Valley, people forget there's huge fault line(s) right down the valley. When that thing sets off, you're going to be looking at damage to the walls, and god forbid, foundation (try selling a house with a broken foundation). Earthquake insurance you say? That type of insurance is so expensive as to be out of acceptable range for many. So most folks will be SOL when an earthquake occurs.

Heck, my walls have cracks from this active fault line and regular little shakes through the years. People forget this bit of fact when purchasing.

The total house cost, bubble mechanics, force majeur make it a loaded gun ready to go off. Lots of people are going to get seriously hurt.
.
.
.
My wife laughs at these POS houses in the valley. For this money you can have an overbuilt German house in Germany and live like a King.

These all cash buyers could give a crap about what you think. They are parking their money in real estate or buying a house so their children can attend college there. You called the real estate agent arrogant but she was right and you were wrong. Why do you care how someone spends their money? An all cash buyer doesn't care about future interest rates because they are an all cash buyer. Earthquakes? Great like they don't have natural disasters in other parts of the world.

 

[Imp]

lulz... You amateur Americans.

http://www.theglobeandmail.com/repo...ach-record-high-price-in-may/article24761542/

The real estate market is red-hot within Vancouver proper, according to new data released Tuesday. The median price for existing detached homes sold last month hit new highs of $2.88-million on the city’s west side and $1.2-million on the east side – up 25.8 per cent and 26.3 per cent, respectively, over the past year.

Does no one keep track of which houses are actually being bought by Chinese nationals anywhere? Everyone up here in Canada is saying the same thing, but super low mortgage rates + "gotta buy a house, gotta buy a house" + no solid stats on which ones are Chinese national owned (i.e. not Chinese looking Americans/Canadians) = no idea.

 

[Ns1]

chinese beverly hills y'all

http://www.bloomberg.com/bw/article...ng-binge-transforms-california-suburb-arcadia

 

[dr150]

These all cash buyers could give a crap about what you think....You called the real estate agent arrogant but she was right and you were wrong....

You're correct. She's right. She'll find a sucker to bite...again and again until it tanks. I don't play bidding games with fools who want to overpay or play with real estate agents who manipulate/fuel the emotions of "desperate" buyers thinking: "Shit! If I don't get into the game now, it'll be more expensive later!" After all, the more buyers pay, the more commission agents get. So she'll win with fools....until the market tanks. And when she can't make commission in that down market she'll have to work at Target, just like many agents did when they left the game after the last bubble.

I saw this screenplay in 2007 and didn't bite.

I bought houses in 2009 after the plummet. Guess how I did?

Every pro real estate broker I've talked to personally agree that it's as crazy or crazier today than when that bubble burst. They even recommend not to buy as it's unsustainable. No shit. LOL.

....And, btw, many buyers aren't Chinese nationals. Many are hard working Silicon Valley lower execs trying to make a go of it and are going to get butt hurt. Sad to see.

At the end of the day, it is what it is.

 

[Ns1]

PALO ALTO (CBS SF) — Neighbors in Palo Alto say houses are getting bought up by Chinese and other foreign investors who never move in, leaving neighborhoods full of empty “ghost” homes.

Life-long Palo Alto resident Tom Wacha says he sees a lot of the uninhabited homes, saying “I do see houses in the neighborhood that don’t seem to be inhabited, that seems like a lot of money has gone into them.”

Realtor Ken DeLeon says many of the buyers are coming from overseas, and realtors are even printing brochures in Mandarin to lure more Chinese buyers.

”For us, about twenty percent of the buyers are coming from China,” DeLeon said.
Only about half of those Chinese buyers are choosing to live in the homes they’ve purchased.

“They’re just happy to have parked their money in a relative safe haven that’s a good investment, and they’re not worried about losing $10,000 a month in rent,” DeLeon said.
DeLeon and his team already print brochures in Mandarin and are now making videos in Mandarin to market to China.

txt

 

[holden j caufield]

what happens when the chinese economy hits a slump. Prices near coastal California are nuts.