Houses Are Expensive!

I don’t pay close attention, but I have heard rumblings that we are in for another housing bubble. That is why this last go round I fought hard to keep the wife from “dream house” and landed with something that needs work but is not a fixer upper (like last time). Most important, it is in the school district we want and about a 30min work commute.

Even two years ago it was pointless to bid with a contingency on decent houses. If it was at all competitive, cash offers would win, and skipping contingent inspections could tip the scales.

Houses are not the sound investment I was taught they were growing up. I put thousands into my first one and paid over 14k at closing to sell it. I fully gutted and redid the second one and pocketed over 50k. Even people who own their houses outright are going broke getting taxed out of them in places. I say buy the house that you can afford where you want, don’t view it as an investment (even if it ultimately will be).

We are currently looking for homes as well.
We listed our house today. It went “Live” around 1:30pm
We had 3 showings this afternoon and just got our first offer around 7:00pm for $3,000 over our asking price.
We have two home we like and I just know that if we don’t decide by the weekend, they will both be gone.

Guys can live in a closet with a TV. We all know we buy the house for our wife and family. Be sure it’s a safe house, in a safe neighborhood and it’s something you can afford if life deals you a set-back.

I’m glad I don’t have to deal with the selling / buying thing today. It sounds a bit stressful.

Dutchboy wrote:

. We all know we buy the house for our wife and family.

Yeah,but the garage size on my searches get looked at first before # of BR’s

Hope the years in the trades help me out this round. Get me a flathead, Philips, headlamp and 45min in a house with a good friend for a realtor I’ll inspect myself and no need for contingency. Bulging discs, arthritic knees and carpal tunnel might finally pay off…..

When the market is up, the market is up.

Your house is worth more, but so is everyone else’s.

Other than the warm fuzzy feeling knowing your house gained value (and higher taxes), there is really no benefit. Because if you ever wanted to move, it will still cost you more to get a nicer house, or break even to find something similar.

The only way you can truly get a deal, is to buy low and sell high….and wait for the next crash to buy low again. The only problem is that the housing market doesn’t crash over night. It takes time for the values to drop.

If I was single, I’d sell my house right now (for over twice what I paid for it in 2010), and live in my fishhouse until the market crashes again.

When that happens I could buy a house that is selling for $400,000 today for around $250,000 in the future. Or $500,000 today for around $300,000 etc

But with a family of four, and a house that is the perfect size, we decided last year that we’re are staying put.

I watched the local market for something with a second garage and a little more room (we currently have a half acre in town, in a development). But everything we found was obviously more money than we wanted to spend.

Instead of moving, we put up a second garage of our own and now happily sit with everything we need/want. We have a ton of equity (over 60%), which means even if the market tanked our head’s will still be well above water, and we could easily ride out the storm.

My fiance and I are in a similar boat. I purchased our house alone 4-5 years ago as a foreclosure and redid the entire thing. For a home that was built in 2007, it’s amazing what people will do to wreck a place once they know the bank is taking it. At the time, I was starting all over inside a 7 year old house.

Now today, the house is finished and has higher-end finishings than many similar houses in the area that have went for $40-50K more than what I have into our current house. If it wasn’t for an upcoming wedding, the house would be going on the market in the magical housing month of April and we’d pocket the ~$60k profit. The fiance and wedding have essentially pushed that plan off until a year from now. Hopefully the market continues its subtle upswing. If interest rates hold firm, I’m confident the house will move for a substantial profit due to the area it’s in (near the river), and in a rural neighborhood.

There is a lot of money to be made in the real estate market with patience and luck. I rolled a $60k purchase/$110k sale and $104k purchase/$140k sale in small, St Paul houses into my current home.

So, I am “in” for about $5-6k of total down payments and have a lot of equity in a $300k+ home that at 5-6% annual increases nets an annual returns of 300% off my initial “investment”.

Another way to look at compared to renting is that your annual returns will roughly match your total principal, income, taxes and insurance. So you essentially live rent free if the housing market does what it traditionally has done over time.

Now, you should still put in 2-3% a year in updates and maintenance, but that is still a good deal overall.

For some reason I had a notification that someone revived this thread when it appears there are no new comments. Anyhow interesting to read through this as I sit in my new home 2 years later. Looks like the despite all the world’s efforts the housing market hasn’t crashed yet and may even be tighter that it was in 2018.

For those that recall my last house was a nightmare. Water problems, pest infestations, cold temperatures in the winter…. the house sold quickly once it was listed and we pocketed 21k after fees. Lived there for 3 years. With the new house we won a bidding war between 3 other buyers and wound up paying about 5k over asking price. Not too bad i thought. We did put 20% though which I think helped us win out.

I drive by my old place once in a while. Currently they have the roof ripped off and are putting insulation in. A lot of work was needed in that house but glad it went to a couple that was willing to put the time in.

I look around once in a while at whats on the market just for fun. Very little out there. the comments made earlier in this thread could be echoed today. Good luck to anyone looking to buy right now!

I follow a group on Facebook called “For the Love of Old Houses” and it’s fun to see homes for sale, but it’s noticeable how prices range from state to state. Seems houses in the south are generally cheaper. They featured this gorgeous Victorian home this morning – 2451 square feet, 4 bed/2 bath for $200,000!! .. of course it’s in Alabama. I’m not moving to Alabama LOL. But it’s fun to look anyway!

Sharon wrote:

I follow a group on Facebook called “For the Love of Old Houses” and it’s fun to see homes for sale, but it’s noticeable how prices range from state to state. Seems houses in the south are generally cheaper. They featured this gorgeous Victorian home this morning – 2451 square feet, 4 bed/2 bath for $200,000!! .. of course it’s in Alabama. I’m not moving to Alabama LOL. But it’s fun to look anyway!

I think my wife follows the same group because she will often send me these beautiful estates down south that are listed for like 250k lol. It is tempting as the land and buildings are always so beautiful

They sure are expensive. We thought about selling to get a 4th bedroom with a second baby coming at the end of Sept and our house got appraised for 375-400k and we paid 252 for it. That got my wife going on moving and I had to remind her that we will pay that extra money for the new house as well. We ended up settling on a large renovation of our lower level to gain the 4th bedroom. The expenses are present whenever you own a house. I wouldn’t go back to renting though. That’s even more outrageous.

Bought my last house in 2016, lived there until 2018 and pocketed over $75k. Did nothing to it except paint and change some ugly light fixtures. After we got married in 2019 we sold what was my wifes house she had for 6 years and pocketed another $75k, again minimal being done except paint and normal upkeep on a 30 year old home. Took half of that money for a down payment on our new home, put the other half in the bank for new home “upgrades”. Deck, patio, hot tub, 25×40 workshop, etc. Once those projects are complete in a couple years whatever is leftover will go back to the mortgage. Before I started on any projects after just 10 months the home value is already up $50k over what we paid. I like this economy

First ring suburb starter homes under $300k are especially difficult to find. The second ring suburb homes are a little easier to find because they price more people out of the market. Wonder how many people will be moving out of mpls and St. Paul now after all the civil unrest and anti police talk.

crappie55369 wrote:

Anyhow interesting to read through this as I sit in my new home 2 years later.

Aint that the truth, holy cow. This feels like it was a lifetime ago for me. Been in my house for a year and some change now. Lots of changes inside the house and outside but all is well, and nothing actually to do with the actual house, lol.

Apparently I’m looking to set some kinda record… I’ve only moved once in my life. From my parent’s house into my current house. Been here 17 years this summer (Billy and I were quite young when we bought it). I like my house but I’m bored with it. I suppose I should look into redecorating or some landscaping in the next year or two to make things feel updated and new.

gimruis wrote:

First ring suburb starter homes under $300k are especially difficult to find.

My street was full of reasonable, 1970s starter ramblers and splits under 300k until someone decided to start selling them for $350 to almost 500k.

I see alot of 30 something young families who are either house poor or have parents with money.