The housing market

[femurphy77]

Anything housing related is crazy right now. When I scheduled a roofer earlier this spring, he was over 2 months out. Now looking for a contractor to do some siding and a build a porch/deck. A couple are a month out, to show up for an estimate.

If you're in the Mooresville area pm me and I'll give you a name and number. He may be booked also but he did us righteous and I'm not afraid to endorse him, I have a neighbor however that I wouldn't let build a birdhouse for me.

 

[wakproductions]

This housing market is nuts. I've been wanting to own a home but now when I look at the prices I feel like the horse has left the barn and it just makes me feel sick to my stomach. I'm renting now; I also work in IT. It's been a life goal of mine to own and pay down a home so that I won't have a house payment and can save that money. Now I'm just worried about being stuck paying rent forever, and when housing prices do come down there's a good chance that the overall economy will pull back and I will lose my IT work. It's a double whammy because I wanted to own a property so I can ride out a fluctuation in the job market now I'm worried about becoming homeless when the next economic wave hits. What do you think is the best thing to do now for someone who feels the prices are unaffordable?

 

[bgcatty]

Hamilton County house prices are moving/moved into the silly stupid high range. Carmel, Westfield, Noblesville are are all at silly prices. Just remember 2008 because what goes around comes around.

 

[wakproductions]

You are literally burning $12k a year right now. Waiting to get in the market at a low spot is not going to negate burning that much in rent. If you want a house, I’d go ahead and get in the market.....but that’s just my opinion.

Maybe just get a cheap starter house if you’re worried about buying in a high market.

Personally, I don’t see the market going down in the next 5 years. You’ll burn $60k in rent in that time if you kept waiting for the market to drop.

This is exactly how people were talking in 2005. Real estate is a good investment so don't worry about the price because you're in it for the long term. But then just 3 years later many people started losing their jobs and realized that they bought more house than they could afford, and homes that sold around $300k were getting foreclosed and selling for $100k losses from the purchase price just a few years earlier. The federal funds rate is at 2%, and what might be happening is people are rushing in to buy and lock in a mortgage before interest rates get much higher. We might see rates get to like 4% or higher over the next 12 months... that should cool off the market for sure.

What's really puzzling to me is that home ownership is unaffordable to many people I know. Maybe with the uptick in the economy the financial reckless are coming out of the woodwork and bidding up prices without any inhibitions.

 

[Hoosierkav]

^ This is kind of what I thought about today.

Would we be better off cashing out on the great selling prices now, and renting a lower cost home, banking everything we would otherwise be spending on our current house, and then wait for the market to tank, and make out like a bandit?

Of course, we want to build a totally custom house, so I don't know how much bearing the market has on that type of construction (vs a "house far" development type of build).

 

[Route 45]

This housing market is nuts. I've been wanting to own a home but now when I look at the prices I feel like the horse has left the barn and it just makes me feel sick to my stomach. I'm renting now; I also work in IT. It's been a life goal of mine to own and pay down a home so that I won't have a house payment and can save that money. Now I'm just worried about being stuck paying rent forever, and when housing prices do come down there's a good chance that the overall economy will pull back and I will lose my IT work. It's a double whammy because I wanted to own a property so I can ride out a fluctuation in the job market now I'm worried about becoming homeless when the next economic wave hits. What do you think is the best thing to do now for someone who feels the prices are unaffordable?

Are the prices not affordable on your current income, or do they just make you wince because you don't want to spend that much money? If you can actually afford a home now, and you want one, then go ahead and buy one. What's the worse that can happen? You lose your job and have to go through foreclosure? So what? You would have been paying rent for those last few years and would have been throwing your money away anyway. What's the difference? Unless you've got a heck of a down payment, you're unlikely to have enough equity in a property to ride out anything other than a very short term of unemployment for a few years anyway.

If the prices are simply out of your range, your only real options are to consider an area where the market is not so hot, or find a better-paying job.

 

[actaeon277]

Have you thought about adding a room (or two) to your existing house?

 

[wakproductions]

Are the prices not affordable on your current income, or do they just make you wince because you don't want to spend that much money? If you can actually afford a home now, and you want one, then go ahead and buy one. What's the worse that can happen? You lose your job and have to go through foreclosure? So what? You would have been paying rent for those last few years and would have been throwing your money away anyway. What's the difference? Unless you've got a heck of a down payment, you're unlikely to have enough equity in a property to ride out anything other than a very short term of unemployment for a few years anyway.

If the prices are simply out of your range, your only real options are to consider an area where the market is not so hot, or find a better-paying job.

Prices out of range for my income. Forclosure is a horrible thing to go through. I've heard some pretty awful stories from 2009 of how that ruined lives. It will ruin your ability to qualify for future borrowings. I'm also not the type of person to live paycheck to paycheck and try to protect savings and assets. This type of rationalization is why the housing market is so awful right now - many people don't even care about their own financial health and are willing to undertake this kind of risk.

 

[Route 45]

Prices out of range for my income. Forclosure is a horrible thing to go through. I've heard some pretty awful stories from 2009 of how that ruined lives. It will ruin your ability to qualify for future borrowings. I'm also not the type of person to live paycheck to paycheck and try to protect savings and assets. This type of rationalization is why the housing market is so awful right now - many people don't even care about their own financial health and are willing to undertake this kind of risk.

I'm not sure how a foreclosure can ruin a life, unless the most important thing in your life is the building that you live in. Family is more important to me. I lost a job and had some financial difficulties about 20 years ago. I was renting, so no loss of a house, but I did have a couple of cars repossessed and had to go through bankruptcy. You know what? I didn't even cry.

I was able to get a great new job, and four years later, I was able to buy a house with no problems, and sold it a few years later to move into a bigger, nicer home. Had no problem getting a decent car, either. The wife even stayed with me. So much for "ruined lives" and "financial catastrophe."

I don't know what line of IT work that you do, but from what I hear, being in a field where you can easily be replaced with a foreign national for half the cost is a bigger financial risk than buying a house. I'm thankful to be in a line of work where I really don't have to worry about being out of a job because of a fluctuating economy. If that really is a worry for you, perhaps you'd better stop thinking about buying a house and start looking to make yourself someone that is not easily replaced or outsourced. You'll never be happy with that kind of worry hanging over your head.

 

[churchmouse]

Are the prices not affordable on your current income, or do they just make you wince because you don't want to spend that much money? If you can actually afford a home now, and you want one, then go ahead and buy one. What's the worse that can happen? You lose your job and have to go through foreclosure? So what? You would have been paying rent for those last few years and would have been throwing your money away anyway. What's the difference? Unless you've got a heck of a down payment, you're unlikely to have enough equity in a property to ride out anything other than a very short term of unemployment for a few years anyway.

If the prices are simply out of your range, your only real options are to consider an area where the market is not so hot, or find a better-paying job.

I have no idea what wakproductions goals and expectations are. The spouse was a loan officer for 15 years and the stories she tells of peoples expectations are hilarious. What they want and what they can actually afford. Again, no knock on wakp's life and expectations.

There are affordable houses out there. They may not be in the areas you dream of living in.

 

[seedubs1]

BS

The issues that drove the 2008 crash are not anywhere near comparable to what is happening today. If you don't understand why, you need to do more research and learn about the driving factors of the 2008 crash. If you think we're headed for another housing market crash, you are wrong. The marked may adjust and drop a bit, but it won't be 2008 all over again by any means. And someone paying $12k in rent a year is not going to come out ahead waiting on the market to drop.

This is exactly how people were talking in 2005. Real estate is a good investment so don't worry about the price because you're in it for the long term. But then just 3 years later many people started losing their jobs and realized that they bought more house than they could afford, and homes that sold around $300k were getting foreclosed and selling for $100k losses from the purchase price just a few years earlier. The federal funds rate is at 2%, and what might be happening is people are rushing in to buy and lock in a mortgage before interest rates get much higher. We might see rates get to like 4% or higher over the next 12 months... that should cool off the market for sure.

What's really puzzling to me is that home ownership is unaffordable to many people I know. Maybe with the uptick in the economy the financial reckless are coming out of the woodwork and bidding up prices without any inhibitions.

 

[seedubs1]

I have no idea what wakproductions goals and expectations are. The spouse was a loan officer for 15 years and the stories she tells of peoples expectations are hilarious. What they want and what they can actually afford. Again, no knock on wakp's life and expectations.

There are affordable houses out there. They may not be in the areas you dream of living in.

This. Expectations need to meet with reality. The market is hot right now and things are selling fast and pretty high, but there's still plenty of sub $150k houses out there. Hell, there's plenty of sub $100k and sub $75k houses out there, and if you're willing to put in the hard work and sweat, you can make one nice.

That's what I'm currently doing. I bought a dump in a nice area. I'm fixing it, and plan to live in it the rest of my life. Once I'm done renovating, it'll be sweet.

What my bathroom looked like 6 months ago:


What my bathroom looks like now:

 

[ghuns]

If you're in the Mooresville area pm me and I'll give you a name and number. He may be booked also but he did us righteous and I'm not afraid to endorse him, I have a neighbor however that I wouldn't let build a birdhouse for me.

Thanks, but it'd a hell of a commute for him. I'm close to South Bend/Elkhart.

Got a call back from one local guy who said spring of 2019 before he could start.

We have a ton of Amish guys around, but they are harder to find. Just a word of mouth kinda thing. And just like Englishmen, their are good ones and bad ones. My BS detector isn't as finely tuned in Dutch so finding a good one is tough.

 

[wakproductions]

I have no idea what wakproductions goals and expectations are. The spouse was a loan officer for 15 years and the stories she tells of peoples expectations are hilarious. What they want and what they can actually afford. Again, no knock on wakp's life and expectations.

There are affordable houses out there. They may not be in the areas you dream of living in.

You're absolutely right. I'm kind of upset right now because a couple of years ago a nice home was affordable with my income.... that is no longer the case. It's causing me a lot of stress. My wife and I had a beautiful home back in 2011 that we really liked, but we had to move to Chicago for a while for my work. I wanted to rent, but she insisted that we sell it. Now we moved back to Indy and I want to own a home because being able to pay down a piece of property is a central value to what I believe is financial freedom, but now we're empty handed with no option but to rent an apartment. I'm really feeling down about not being able to afford what I used to have even though I make more income than I did in 2011.

 

[lovemachine]

Have you thought about adding a room (or two) to your existing house?

Yep. Looks like it’ll be a lot more expensive than I realized.

The other problem is trying to get other contractors to come out and talk to me too.

 

[churchmouse]

Yep. Looks like it’ll be a lot more expensive than I realized.

The other problem is trying to get other contractors to come out and talk to me too.

You are not alone in this. I have 2 HVAC customers that are trying to get estimates to add on. No one shows up. They are all covered up busy.

 

[seedubs1]

The housing market simply hasn't jumped THAT MUCH in the last couple years to make your situation change to where you can't find a house if you're in the same financial situation as you were in the past.

My house sold for $110k in 2010. I just bought it for $117k Spring 2017. You just have to wait for the right thing to come along (and actively search for it) and be ready to sign papers when it does, because someone else will if you aren't on the ball and ready.

Actively search and watch for the right house to come along. Get pre-approved for a loan. Get in contact with realtors and let them know exactly what you're looking for and that you're pre-approved and a serious buyer (some will show you houses before they're listed on the market even).

You're absolutely right. I'm kind of upset right now because a couple of years ago a nice home was affordable with my income.... that is no longer the case. It's causing me a lot of stress. My wife and I had a beautiful home back in 2011 that we really liked, but we had to move to Chicago for a while for my work. I wanted to rent, but she insisted that we sell it. Now we moved back to Indy and I want to own a home because being able to pay down a piece of property is a central value to what I believe is financial freedom, but now we're empty handed with no option but to rent an apartment. I'm really feeling down about not being able to afford what I used to have even though I make more income than I did in 2011.

 

[actaeon277]

Yep. Looks like it’ll be a lot more expensive than I realized.

The other problem is trying to get other contractors to come out and talk to me too.

Well, contractors do like working on new construction. They can schedule job after job, often in the same area. Makes it easier and more profitable for them.

 

[actaeon277]

Yep. Looks like it’ll be a lot more expensive than I realized.

The other problem is trying to get other contractors to come out and talk to me too.

As for "expensive"...
How expensive is buying a new house going to be?

 

[actaeon277]