patrick.net

American in Japan says

Tell that to whoever is buying in the overpriced areas…

Yeah, BA for sure.

I would never buy an expensive house right now but reality is some people have few other options in the bay area I have some insight because I interview a lot of tenants many of them in high tech starting families there are very few rental properties in areas where youd want to raise a family

Interest rates are low house prices are down so people buy because they can afford the payments

I have a contract down on a 2br 1 bathroom Chicago condo for $138k. The original asking price was $165k. I rent a tiny studio right now and wanted more space. If I need the extra income I figure I can rent the 2nd bedroom.

robertoaribas says

1. Are condos a worse investment than homes. Perhaps. I didn’t buy any of these for appreciation however. The average price for the 3 of them I purchased, with rehab and appliances is $40K. I am renting one for $750, one for $825, the third I anticipate $795. They are all close in, near the light rail and near centers of employment, i am much more concerned about future rent trends then future price trends. Factoring in a month of vacancy and $1000 for maintenance, i am making 12 to 14% on each of these, without loans.

Smart boy.

@toothfairy

Sorry about my ignorance here...
About starting a family, are they more concerned with schools, safety or other? (even if the children are under 6).

seems like folks want safety and cleanliness newness and updates not found in typical rental

So is summer *really* the worst time to buy a house in terms of seasonal effects on the price?

American in Japan says

So is summer *really* the worst time to buy a house in terms of seasonal effects on the price?

Depends on the area, but history shows that fall is the best time as people who tried to sell all summer get desperate. Winter is good too but normally the best houses have already been snatched up by then. The best day historically would be Christmas Day where your offer would likely be the only one.

Summer can still be good, you normally have lots of houses entering the market and the houses that have already been on the market will sometimes lower their prices to compete with the new wave of houses. But yes, the beginning of summer is usually the worst time to buy a house.

Is anyone buying a place in May or June??

We are planning on closing in June. Well see if it goes through or not.

American in Japan says

Is anyone buying a place in May or June??

Maybe.

After selling our Santa Barbara house in 2005 and renting since, we bought a house in the East Bay late last year...a fixer-upper on a great street in one of the best school districts. Subsequently, we sunk over 100k in the remodel (which came out great!) But lo and behold, after many years at the same employer, I was laid off (insert "ouch" here) and we decided to relocate for another job opportunity. Surprising to me, we had several offers after just a brokers tour and the offer we accepted was from a very qualified buyer that paid asking price, giving us all of our investment back as well as an $80k profit after all costs (including moving) are weighed in. I am pleasantly surprised about the resiliency of some local markets, have a great appreciation for good school districts, and am once again going to be a happy renter!

Ducky,
I see that the house(s) on Victory Lane near the park have been scooped up. But hope springs eternal below $200k. How about the short sale at 1111 Carey? Let us know if you are thwarted by the RE Cartel.

You can add me to the 'bought in 2011' list. I just closed escrow today.

$440k for a place that rents for $2500/month. Year 2000 price.

vain says

You can add me to the ‘bought in 2011′ list. I just closed escrow today.

$440k for a place that rents for $2500/month. Year 2000 price.

Ok so the tenant is you paying around $2200 a month then. I've never heard of a 2/1 in daly shity renting for that much. I had good friends who rented for $1400 in 2001 -2006, for a skinny 1/1 with the bay windows and the garage downstairs. bart was right there across the main street. Love SF!

Katy Perry says

vain says

You can add me to the ‘bought in 2011′ list. I just closed escrow today.
$440k for a place that rents for $2500/month. Year 2000 price.

Ok so the tenant is you paying around $2200 a month then. I’ve never heard of a 2/1 in daly shity renting for that much. I had good friends who rented for $1400 in 2001 -2006, for a skinny 1/1 with the bay windows and the garage downstairs. bart was right there across the main street. Love SF!

It's a 3BR/2BA. Purchased with cash. I'll take a $200k loan against it soon, have a payment of $1050ish, and rent out the downstairs for $1200. I will live upstairs for free. Cash flow $_$.

If prices fall, cool, we'll be in position to buy another with cash. If prices rise, I can't complain there.

vain says

It’s a 3BR/2BA. Purchased with cash. I’ll take a $200k loan against it soon

why would you take out a loan against the house that you just paid for in cash? if you buy another house with that loan how is that buying in cash if it's borrowed money?

I wish I had parents who gave me money also.

Vain are you a realtor/broker?

Katy Perry says

vain says

It’s a 3BR/2BA. Purchased with cash. I’ll take a $200k loan against it soon

why would you take out a loan against the house that you just paid for in cash? if you buy another house with that loan how is that buying in cash if it’s borrowed money?
I wish I had parents who gave me money also.
Vain are you a realtor/broker?

Bought it in cash because the home didn't qualify for a loan due to a missing water heater. Nobody is giving me any money. The loan against the house would be to repay members of the family. I probably dodged a few thousand dollars of extra fees for not using a loan to purchase. You're probably going to mention income soon too. I can be unemployed after I get the loan and will still be fine since I'd just resort to living in the bottom unit and rent out the top unit for $2k.

We use a broker in our immediate family.

Summer is almost here...but traditionally not the best time to buy...
This year...

American in Japan says

Summer is almost here…but traditionally not the best time to buy…
This year…

I agree. Prices have inched up on the MLS. And folks that got foreclosed on previously can actually buy again.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/05/31/MNIL1JKERQ.DTL&tsp=1

vain says

I agree. Prices have inched up on the MLS. And folks that got foreclosed on previously can actually buy again.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/05/31/MNIL1JKERQ.DTL&tsp=1

Debt slaves will always find ways to go into debt. This article certainly encourages living in credit.

after horrible new england winter went down to florida to check out the market. Total impulse purchase and closing soon. Will use it as a vacation/winter home for the next few years.

Bought a 4/3 townhouse 1/2 mile from the beach with rooftop deck that has panoramic view of the ocean. Place is 10 years old and in good shape. Can still walk my kids to school (1 block). Paid $799,000 and mortgage is $3,382; $/sq foot is $379. Neighboring properties sold for $880K (two and not as nice) and one across the street is going for $1.1M. I was paying $3800 in rent so after tax deduction, insurance, and maintenance (I itemize a lot as a small business owner), Im about $300 less/month. This isnt including the money I collect off investments I didnt put down on the house (about $400) and money towards principal ($800/month). Typical rent for this place would be $3800-$4000.

I am in South Fl.Had the contract done with owner today.
Will go mortgage shopping starting Monday and closing in September.
This is a 2X 2 condo.May be it might still go down..but I liked the unit..its in the same wing where I rent now but on diff floor.corner unit.
Paying around the market price,HOA is the biggest expense @320 pm
Price is 62.5K for 1100 sft condo that is 32 year old

If prices aren't going up much in the summer, what are they going to do from September?

American in Japan says

If prices aren't going up much in the summer, what are they going to do from September?

If you are referring "they" to government then they are going to come up with more money to give away struggling irresponsible people. :)

I bought last year, I put in the offer in July when values were at certain level, the Real estate cheer leaders were calling the tax credit a success. The Offer went in on July 15, to close on Sept 1, by the time the bank appraised the place, the news did a 180 and the RE was gloom and doom again. By the time I was appraised it came in 10K under the asking price, which is what I got it for.
Had they appraised a week or even a few days earlier, the Appraisal would have came in 20K over and the bank would have been trying to get me to take out more money to cover move in repairs and getting the house in order.

When I bought, there were less than 25 houses that had sold in 2 to 3 years in my part of town. There's been well over a hundred since then.

I think houses moved this year, but I think it's because the prices have been coming down. If that changes, the sales will stop.

I am buying property and building a house in Plano TX. It is about 15 miles north of Dallas. I have been reading this group for years. I waited a few years to join, and rarely comment. I am interested in real estate, but not really for investment reasons. I own a 3,000 square foot house and will sell it to build the new one. I am getting a one time close loan that will be interest only until the build is done. Then, Once I occupy - I will lock in the rate (will not be more than 1% over today's rate) and will get a 10 year fixed that will turn into an ARM for the last 20 years. I do not want an ARM, but have had difficulty getting a loan for the last 2 years. I was in no rush, and have waited until everything meets my criteria. There is some risk, but being a contrarion in a bad market can be good in some cases.

I plan to try to flip to a 30 year fixed once construction is done. This will be easy unless interest rates sky rocket in the next 8 months. I think interest rates are going up, but no need to argue with me. All the graphs and charts give me a headache. I could be wrong, but I am willing to take that risk. Now that I could not lock to a fixed 30 year, I will be just fine if rates hold until the construction finishes.

The place is called Normandy estates in Plano. It is a nice neighborhood and was completed at the worst possible time. Nobody could get financing, so it currently sits at about 4% occupancy. But, the West side of Plano is built out, and this is prime location. It will be built out at some point, but it could be several more years. This is not a big deasl to me as the total neighborhood is relatively small with stable stuff all around.

Dallas - there were problems here, but nothing like other areas. Lots of foreclosures, but mostly because people got loans they could not afford. Dallas has everything people need, except there is no real NATURAL attractions and it is hot. Those are big deals, but it has kept housing reasonable. New housing can keep going north for a long time.

I am excited. I am not smart enough to debate some of the arguments on here, but I have never understood how everybody can seemingly ignore a major element of the statistical method. The USA has always been growing / prospering in general. Down periods, but huge upward trend. Predictions are great, but look outside of the last 200 years and you will find that once powers start to decline, the old graphs are no longer relevant. This is true with business, countries, sports teams, etc. The decisions made on a start up are vastly different than those made for a mature company. No graph / chart fills all possibilities.

I am thinking of buying a condo in areas which are not much affected in terms of jobs loss. But not sure if this is a right time or not.

Good luck. Nobody knows for sure. Research opinions on both sides in your area of the world, and then come to your own conclusion. There are too many variables to make perfect decisions, so just try to make a 'well thought out' one. I made a good profit selling my Apple stock, when I thought it reached a good profit level. Yesterday, I saw something to the effect that it went up 5,000% since. That makes me laugh. But, no regrets, because I thought it through and ended up being VERY wrong.

In my city you can find condo's for 40k now, houses still .. you know, they still want 50-100k for a home that needs to be gutted. Some of the price drops I've been seeing are desperate sellers worried that the market will dry up again when winter hits, and want to move the place. I am seeing better deals, but still all the investors are changing the face of RE. When these price drops come, my guess is that more underwater owners make that decision to walk away.

everything says

my guess is that more underwater owners make that decision to walk away.

More taxpayer $$ will flow to the banks to cushion their losses.

We are planning on putting in an offer for a house, but since it is much lower than the listing price I don't feel confident saying we're going to buy.
We have a mortgage broker and a real estate lawyer and my obsessive researching skills... and if the sellers decline I will obsessively research other properties. Since this is the first house that we have seen that we were willing to spend *any* money on, finding another could take some time. We are really really lucky that we mostly fit comfortably in our apartment and our landlady lets me plant things next to the driveway... I am nesting here quite well.
What made me start looking harder was that 6 months ago houses that didn't suck were starting to be sold for amounts that didn't make me weep. More recently, a local friend had to get a new apartment and discovered rents had gone up a lot while we were busy having babies. We haven't had a rent hike in 2 or 3 years, so I expect it's only a matter of the next water bill before the landlady knocks on the door and shrugs apologetically and there goes half of the next pay raise.
At the price we would like to pay, the mortgage/taxes/etc would increase our monthly outlay by about 20%. However, we would get three times the space and (unless inspection says otherwise) it's a legal two family-- so if we had to rent out rooms or even a whole floor that would bring our expenses to well under neighborhood rents.
Caveat: we live in New York City, which has a thriving rent culture. Our third year here, our landlady thought it was terrific that we were subletting our second bedroom and only asked that we give her a little extra for the hot water our friend would consume. Meanwhile she and her adult son and daughter and her daughter's twin girls were living upstairs in her three bedroom apartment ...
...which is to say: Any house we buy has to have flexibility built into it. There needs to be room for my sister and a big dog and whatever life throws at us, or the debt is not worth it to me...
But maybe I'm being greedy, and I should stay renting month to month. Right now, my family is comfortable either way and it isn't clear if there is a wrong answer-- or a right one.
I thought being a grown up would make things more clear. grumble grumble.

Thanks for the stories so far...

these stories are helpful as we are considering a purchase in Austin, TX.

Anyone else? Summer is about over so the cyclical component is on your side if not the longer trend.

If it won't kill you, I'd rent and let Austin cool-off for at least a year or two -- literally and figuratively. Austin may be one of the better-looking glue horses in the US housing market, but don't believe the hype:

http://www.carvajalgroup.com/austin-real-estate-market/2011/03/06/california-new-york-make-a-bee-line-to-austin-tx/

Or do, and make some Austinite and his realtor wealthy. Every third person you meet here these days is, in some way, involved in real estate, and they refer to Californians as fish in the proverbial barrel.

The house below closed this month for nearly 100K more than it listed for initially in 2009 -- and that was in the midst of the tax credit free-for-all. Somebody got lucky...

http://www.zillow.com/homes/1001-Arcadia-Avenue-austin-tx_rb/

If you are referring "they" to government then they are going to come up with more money to give away struggling irresponsible people. :)

I'd say this was prescient of you all the way back in July - but then again, I guess this strategy is pretty old hat by now.

I recently got married I am looking to buy a house in the $1 million range in the Los Angeles area. In this price range in the areas I am looking at, houses seem to be going fairly quick, and homes seems to be getting multiple offers. I have also looked (with no intention or ability of buying) homes going up to $1.5 million, and these houses seem to be moving. Is it just that people with money and able to afford in this price range are still buying homes? Have homes in this price range not taken the same hit % wise as homes in lower price ranges?

beautybar1 says

Have homes in this price range not taken the same hit % wise as homes in lower price ranges?

Supply/demand. People making the big money in LA generally have to live convenient to their work. They could hire a car service and commute but that's still lost time, and when you're making $100,000 a week, time is certainly money.

Prices down in Laguna Beach are far from sticky though. Eg:

http://www.redfin.com/CA/Laguna-Beach/31551-Toto-Loma-Ln-92651/home/3264197

Aug 16, 2011 Price Changed $999,000 -- SoCalMLS #L35759
Jul 08, 2011 Price Changed $1,199,999 -- SoCalMLS #L35759
May 04, 2011 Price Changed $1,250,000 -- SoCalMLS #L35759
Apr 15, 2011 Listed (Active) $1,300,000