Home Ownership Overated?

Unbelievable! Bob,

That house would go for at least $400K in the Minneapolis area!

[panhead]

Hey John Galt, my rides have been far and few between this year, as I am still working in Europe. I have a couple planned though, esp for labor day !
I agree with some of the posters here that Real Estate is in a bubble in many areas and will go down in the next few years. Whether it will deflate or blow, we'll have to see. Ex-Jarhead is right about not buying with a rear view mirror, could be costly. When it comes to Real Estate though, there seem to be plenty of deals for those of us who don't mind doing some work, be it rehab or tracking down owners of seemingly abandoned property, or whatever. Just recently, I started looking at two more opportunities, a very likely pre-foreclosure on a mutli-family, and a beautiful, very hidden lakefront lot with an old run down seemingly abandoned summer home. I'm investigating both with cash ready, as either could be a great deal. It's not for everyone, but I gotta say, I find it all fun, from the negotiating (alway fun as long as emotions are kept out of it) to the fixing up. I haven't tried the renting thing yet, but I hope I enjoy that too.
Oh yeah, John Galt, I hear you about the fussy thing, I've learned the hard way to limit my fussiness in this kind of work. My original love of bikes/cars often involves transmission/engine rebuilding so I'm used to a certain level of precision. When I first started remodeling, I was very picky. After working with some carpenters, I learned I was WAY too picky ! This stuff is a lot easier !
-Pan-

[Hyperborea]

In many areas of my state (Iowa), housing prices have been rather stagnant for years. Example - here is a nice house for a young family. The asking price is $120,000 but they'll be lucky to get $100,000.

In Silicon Valley that would go for $600K if in bad neighbourhoods to maybe $1M or more if in the right neighbourhoods.

I was unable to see the pictures because your links were broken and I've fixed them up.

[Bob_Smith]

I was unable to see the pictures because your links were broken and I've fixed them up.

Thanks Hyperborea. There was a space in each file name, so I went to the server and took those spaces out. I hope the images load now. If that wasn't it, how'd you fix it?

[Hyperborea]

After you took out the space my links broke too. I just fixed them. Your original links had backslashes in part of the link instead of forward slashes.

[Bob_Smith]

I should have noticed that... as you can tell I have no training in this. I just fly by the seat of my pants. But now I know - no backslashes in URLs. Thanks for the help.

[azanon]

Since I was going to have to a pay "a" mortgage one way or the other, I simply rationalized that it made more sense to pay my own mortgage rather than someone elses. So I bought.

[BigMoneyJim]

If you are in one of those kinds of locations and will remain there for 5-7 years and more then it may make sense to buy.

That's the real rub. I have no roots at the moment. I may consider a condo next move, but it'll have to look good on the balance sheet to make me consider committing.

3-2-2 == 3 bedroom + 2 bath + 2 ????

-car garage

[KB]

I'd take one of those houses for 100k. But I'm not too sure about moving to Iowa though. What's your weather like in Iowa?

Re. the 100K house in Iowa, it's the same where we are
(Illinois). The house shown would sell for under 100K here also. I mentioned before in our subdivision, it is
rare for a property to sell for over 100K. These are nice
(but smaller) cottages with up to 100 feet of water
frontage. My favorite deal lately was a tavern which had been
used as an apartment for years. A real fixer-upper
but probably 2500 to 3000 SF on a big lot, but not on the water. Also, it is close to a highway which was
nice when it was a tavern. Someone bought it to use
as a single family home. So far, new paint, new doors,
landscaping. Looks good. They bought the whole thing for $25,000. In my younger days I would have been on
it like a cheap suit.


John Galt

[Bob_Smith]

When I was a kid, I was a fanatic about baseball, and Bob Feller was my absolute favorite.

Jarhead, I heard a lot about Bob Feller growing up. He was a favorite of my Dad. When I was a kid Dizzy Dean and Pee Wee Reese were doing the play by play and my favorites were Harmon Killebrew, Willie Mays, Roger Maris, Sandy Koufax... Those were great times.

My wife's family was immersed in baseball. Her grandfather was an attorney and worked as Judge Landis' assistant. When Landis died he became acting Commissioner of Baseball until Happy Chandler took over, and then he went on to be General Manager of the White Sox and President of the Pacific Coast League. My mother-in-law grew up with Landis and other sports figures visiting her home.

[Bob_Smith]

I'd take one of those houses for 100k. *But I'm not too sure about moving to Iowa though. *What's your weather like in Iowa?

KB, the weather here is typical midwest. It gets hot as hell in the summer and bitterly cold in the winter. Probably the best thing about Iowa is that there isn't much here of interest to attract crowds. But if you can find a decent paying job in a small town, it's a good place to raise kids (the schools are good in my town) and you can live very cheaply. If I needed to be at the office at 7:30 AM, I left at 7:25 and parked next to the door. I came home for lunch every day. There is no crime to speak of here - the kids could take off on their bikes and we didn't worry. I worked 4 ten-hour days/week and my wife around 15-20 hours, her mostly at home. In fact I never worked more than 40 hours a week. So we had a good life while working and raising three kids, and I recently ER'd at 52. I probably couldn't have done that in too many places.

[cute fuzzy bunny]

I'd take one of those houses for 100k. But I'm not too sure about moving to Iowa though. What's your weather like in Iowa?

Just like Canada without the invasion planning, the beer, and the back bacon. 8)

[sgeeeee]

Hi Bob,

I got lucky with my house in Iowa. I moved there in 1995 and bought a nice house with a finished walkout basement and a barn on about 3 wooded acres. I sold it 5 and 1/2 years later at a price 24% higher than my buying price. Clearly, not California type earnings, but I was pretty happy.

I was lucky because Shueyville is located half way between Iowa City and Cedar Rapids (about 20 miles from each). A lot of people were beginning to look for property outside of town, so farmers had started sub-dividing fields and putting in houses. But just a year before I moved, the county put a moratorium on further house development in the area until a plan for road maintenance to support the additional traffic could be established. I just happened to be selling when property values in the area were rising.

[sgeeeee]

By the way, Iowa was a nice place to live for all the reasons Bob mentioned -- no crime, no crowds, and some of the best schools in the nation. The good school thing pays dividends everywhere. I liked the way the political caucus process worked too. I think Iowans had more reasonable political discussions because they had to learn how to talk with their neighbors about the issues if they wanted to participate in the process. The caucus is also a true melting pot -- no class structure there.

[trumpeting_angel]

I think hating to fix things, hating yard work, and moving frequently might make buying a little less of a great investment. But if a young single person could tolerate a little fixing and mowing, s/he could always rent out the property when it came time to move (depending, of course, on all those things that depends on). Especially if it were a multifamily, although I've done this with a single-family house and lots of people do it with condos (good for the maintenance-averse, if you can get it for a good price to begin with and dont' forget to factor in condo fees). Gotta really hunt for those bargains, especially during a time of inflated real estate prices such as we have in many areas of the country now.

If one found a way to buy and hold, and buy another property where you moved next, it could be the beginnings of an empire. . .

This is not, of course, for those who cannot tolerate landlording or home maintenance.

Anne

Hello Anne. Re. "this is not , of course, for those who cannot tolerate landlording or home maintenance",
you could add, or "just any work at all", which would
pretty much describe your humble correspondent

John Galt

[bow-tie]

KB, the weather here is typical midwest. It gets hot as hell in the summer and bitterly cold in the winter. Probably the best thing about Iowa is that there isn't much here of interest to attract crowds.

Bob_Smith,
If you don't mind, may I ask where you live in Iowa?

We live just outside Cedar Rapids, and the urban sprawl is beginning to envelop our small town. I wish I knew where all theses people are coming from, so I could send them back

[cute fuzzy bunny]

I wish I knew where all theses people are coming from, so I could send them back

Do they say "Ay?" a lot?

Seriously though...we have the same thing here in CA. I moved from the SF bay area a couple of hours away up to sacramento. It was like moving to Mars. Nothing and nobody. Within 7 years the area was incredibly overbuilt, shopping malls and strip malls were springing up everywhere and like the bay area, you didnt want to be out on the road during rush hours. Supposedly these are all people who were cashing out of their double and quadruple valued homes in the bay area. My home had appreciated by more than 50%. So I moved another 45 minutes north to Yuba City.

Within the last six months theres been a tremendous building boom. A few weeks ago a couple of hundred acres of peach orchard around the corner from my house was mowed down to make room for a gazillion more homes. A sign just got posted in front of a nearby field for a 300,000 square foot retail mall, right next to the new home depot.

Supposedly, these are all the people who cant afford to live in sacramento anymore, and the people who sold their double value homes there cashing in and moving to cheaper digs. My house is up 30% in a year.

I already snooped at real estate prices an hour or so away to the north, northeast and northwest...relatively thinly settled areas in the "middle of nowhere". Prices have already jumped to keep pace.

Like you, I have no idea where these people are coming from, unless the SF bay area has simply emptied itself. In which case I'm curious as to who has bought and is buying all those overpriced homes down there.

Although the traffic did seem a little meager the last time I went down there...

[Hyperborea]

We live just outside Cedar Rapids, and the urban sprawl is beginning to envelop our small town.

It seems that Cedar Rapids has a pop. of 120,000. I don't think that counts as urban.