Home prices getting interesting, what price are homes in your neighborhood?

[daylatedollarshort]

$A1.25M / unimproved value $A414,000; tax $A2,600 = 0.2% / 0.6%

Every day I collected the mail last year, the estimated value increased $A1,000. Now about $A200.

What does the A mean in your numbers?

 

[Samsung4321]

What does the A mean in your numbers?

A for Australian.

 

[Retch The Grate]

Home price are up by $1M+ in our neighborhood since we retired (Bay Area suburbs) due to in part to the work at home movement. Families are moving out of the city but many are just moving to the suburbs.

With Prop 13 it makes more sense to rent than sell. We've thought about downsizing and renting out the house, but since everything is up here there is really no place cheaper to move to without moving outside the Bay Area. Smaller homes are even more expensive per square foot, presumably because they are more affordable and have a larger number of potential buyers. We really like the weather, parks, theater scene and all the things to do here. It has been a great place to be retired, so we'll probably just stay put for now. It can actually be pretty inexpensive to live here if you don't have to pay a lot for housing or property taxes.

Yeah, we were part of that, we wanted more space for our home offices and other niceties for the pandemic. We got a good price per square foot by buying 3k square foot house in Daly City for $1.76m, so $587 a square foot. Meanwhile smaller houses in SF are not unusual at $1k+ per square foot. Pricey neighborhoods like Los Gatos were over $1.4k per square foot 5+ years ago already.

 

[2HOTinPHX]

That's what my sister in CT keeps saying.

I would sell this place but I'd never get the million as it would be a $700,000 gain. It's 2,000 SF and too big. Besides, DW will be needing specialized care in the next couple of years and we may be selling then for a much different arrangement (probably not a camper).

This reminded of some good advice the late great imoldernu had posted some years back I saved regarding the value of having home equity saved up for couples as asset protection...

Perhaps the most important part of this thread on retirement, is the matter of protecting one's assets... and even more important, thinking ahead to protect the assets of a spouse, when health requires extraordinary expenses.

Since we, and our spouses will always be healthy, we don't think about what could happen. We just assume we'll both die at the same time.

Statistically that ain't gonna happen. If you already have a net worth of 2 Million dollars, don't read the rest... It doesn't apply to you.

Current medicaid law allows for payment of nursing home expenses under certain conditions. If you understand those conditions, you could save hundreds of thousands of dollars for yourself, your spouse, or your estate... (your kids).

Here are the things you should know about:

Current nursing home costs average from $75,000 to $90,000/yr. A friend on Long Island is currently paying over $135,000/yr. for just basic care.

The state (medicaid) does not automatically pay for this.

You should understand "exclusions".

Know that the "look back period" is now 5 years.

...........................................
As long as a married couple have assets, if one spouse should have to go into a nursing home, the couple's assets will be used to pay for the medical care until the assets go below a certain level, at which time, the state medicaid program will pay for the nursing home care. The asset level varies by state.
............................................

Here's an example that happened to friend, that points up the importance of planning ahead. Bob retired with his wife May, to Florida from Maine. He sold his Maine house for $280,000 and planned to use this as his nest egg during his retirement. He bought a mobile home..(downsized)for $35,000. Shortly after retiring, May began a long slide into Alzheimers, and after three years has to go into a nursing home. (at the time $65,000/yr.) She lived there for 5 years before passing away. Because Bob and May had assets from the sale of their house, medicaid would not pay, and The nest egg was gone.
..............................................
Now, here's what happens....
1. In counting assets, Bob is allowed certain exclusions. In General, the exclusions in his case, were... His house @ $35,000, His car $20,000, Cash (then, $40,000) and some smaller amounts like burial plot and non cash life insurance.
2. The logical thing to have done would be to give away the money in the nest egg, so the state wouldn't take it. That's where the lookback comes in. If he had given away the money to his kids, the state would not have taken the money... but... to prevent this from happening, the state will "look back" five years and deny medicaid payment,if this 'gift" transaction had taken place.

As it happened, May died, an Bob had nothing but his Social Security left to live on.
.................................................

Here's what I took from this...
Nine years ago, we owned a mobile home, and a park model trailer in a campground. Understanding Bob's situation, we took some of our savings, and purchased a home outright. This took the money out of our assets and put it into the house "exclusion". Now, if one of us shold have to go into a nursing home, the state may take from our savings account, but they will not take the house... Essentially this means that one of us will still be able to keep some substantial assets, hopefully enough to stay above the poverty level.
.............................................

This is just one of many, many reasons to look ahead to the future.
See the link to Elder Law on Exclusions. (website)

This is not a pleasant, nor a fun post. Most of you probably have some understanding of the laws, but the matter of elderlaw is extremely complex.

IMHO, when a case involving medical expense, or the legal position of any older relative, the very first thing to do is to contact an geriatric or eldercare lawyer. Not just any lawyer, but one who is deeply involved in elderlaw.
Bookmark the site on Elderlaw. There is a series of Q and A's bout real life situations, that should shed much light on a difficult subject. I thought I was relatively knowledgeable but found that in more cases than not, I had no idea of how the law treats estates and legal matters involving older people.


I have more nighmare stories about friends or neighbors who lost literal fortunes because of small errors in handling legal matters, either because of mistake in timing, or failure to obtain proper legal permissions. Anyone who has dealt with estate administration will understand what I'm talking about.

FWIW, I don't pretend to be a legal reference, and so some of the above may be wrong. Feel free to correct errors.

Just to point up the dangers involved in ignorance of the law. Back to the long Island situation, which involved a very good friend who has since passed away.

When Jim's wife showed early signs of Alzheimers, he sought advice from his children, who were lawyers, but not versed in elderlaw. They suggested that he "gift" to his 8 grandchildren to lower his liquid assets by $200,000, which might later be required to pay for his wife's coming nursing home costs. The gifting was legal. Two years later his wife went into a nursing home. When he declared his assets, he made no mention of the "gifts". After paying for two years of care, he had depleted what was left in his bank account, and the transfer of costs for the nursing home care went to the state. His wife lived in the nursing home for three more years.
As the state went over the accounting, they reviewed the "lookback" period, and found that the "gifting" had been omitted from the application. My friend was charged with medicaid fraud, and found guilty, and sentenced to a jail term. His children hired a criminal lawyer, who, for a considerable payment $150,000, managed to get the sentence revoked. Unfortunately, the interim years of stress took its' toll, and led to his early death... aged 78, but probably unnecessary.

A lesson in crime and punishment, but my point is that the law is involved, and has to be respected. Ignorance of the law is no excuse. Thus the suggestion for the Elderlaw Lawyer.
__________________

 

[ExFlyBoy5]

This reminded of some good advice the late great imoldernu had posted some years back I saved regarding the value of having home equity saved up for couples as asset protection...

/snip/

I sure miss imoldernu's contributions to this forum. I think I will spend a little time and go back to read some of his posts today. I can only imagine what he would have thought of all this COVID madness.

 

[2HOTinPHX]

I sure miss imoldernu's contributions to this forum. I think I will spend a little time and go back to read some of his posts today. I can only imagine what he would have thought of all this COVID madness.

We should put together a tribute thread and pin it for Imoldernus containing post like above. I think we all enjoyed his sharing his life experiances.

 

[Eastbayboy]

Prices have been skyrocketing in Reno because of all the Californians moving here. I read that our prices are higher than Sacramento. I paid 211 for my 855 sq ft condo 9 months ago and now they are selling for 260k. Houses are between 600-1 million in this neighborhood. I have been hoping that prices go down because my kids want to buy a condo.

Are you native to Nevada?

 

[Ally]

Although our West Texas housing prices have always been very reasonable, our neighborhood has increased in value based on sales 51% in the past 3 yrs. Houses are selling in a day, if they even hit the market. Every home surrounding us and catty corner to us has sold in the past year. We plan to stay in our home, especially since our taxes are frozen at what they were 8 years ago. I’m not sure what’s driving this housing boom here.

 

[Eastbayboy]

I sold my three bedroom two bath house that I purchased in 1986 for $110k in an east bay city. Did upgrades and sold it in 2019 for $850k. I took the equity and some cash and bought in the Danville Ca. area, a 2000sf house for $1,2mm. This where my wife was raised! Today Zillow and Redfin priced the house at $1,8mm to $1,9mm. Nice area but overpriced now. Not interested in selling since the escalation of prices.

A lot of young tech workers have driven the price up in my area. They are moving out of San Francisco to the burbs for more room and schools. It is amazes me to see a single family with a stay at home mom buying these homes since I been here. Their salaries must be triple or more what i made when I retired in 2015. Schools are excellent here for their kids so I get it but I’m still amazed at the income to qualify for a mortgage.

 

[Teacher Terry]

East bay boy, no I moved here for a job with the state 25 years ago from Wisconsin. BTW I am not blaming Californians because it makes sense. I was just describing how the prices got so high.

 

[laurence]

My rental property (1400 sq foot condo) just crossed $700k with a couple recent sales in my development. About five miles from the coast as the crow flies here in north San Diego, but 15 min drive from the beach because, you know, SoCal.

I think the young in SoCal have given up on a single family home altogether.

 

[Spanky]

I sold my three bedroom two bath house that I purchased in 1986 for $110k in an east bay city. Did upgrades and sold it in 2019 for $850k. I took the equity and some cash and bought in the Danville Ca. area, a 2000sf house for $1,2mm. This where my wife was raised! Today Zillow and Redfin priced the house at $1,8mm to $1,9mm. Nice area but overpriced now. Not interested in selling since the escalation of prices.

A lot of young tech workers have driven the price up in my area. They are moving out of San Francisco to the burbs for more room and schools. It is amazes me to see a single family with a stay at home mom buying these homes since I been here. Their salaries must be triple or more what i made when I retired in 2015. Schools are excellent here for their kids so I get it but I’m still amazed at the income to qualify for a mortgage.

Most likely their income is more than $300K per year.

 

[ShokWaveRider]

Update: Home prices are still going up here (N.E. Fla.), there does not seem to be any abating. One just listed on the intracoastal marsh (Non Navigable) for $450 a square foot! Less desirable wood frame homes (in our Neighborhood) are taking longer to sell. Concrete homes sell a lot faster.

 

[street]

I did hear on the news yesterday where the experts say, homes will be going down in price through the 2022 year.

 

[Time2]

My daughter and husband bought a Fixer upper for $239k, a neighbor 2 doors down just listed their house for $950k, now, it is a more substantial home, but I think the kids bought in the right neighborhood!
Even if the neighbor settles for $750k.

 

[TrvlBug]

Out of curiosity, I looked up our home on Zillow and my eyes popped! In our hood, Zillow is spot on. We bought our house 25 years ago for 20% of it's current value. The family across the street bought their house, smaller than ours, 4 years ago and it's gone up in value 50% during that time. Like many or most, we could never afford our house today.

 

[aja8888]

I did hear on the news yesterday where the experts say, homes will be going down in price through the 2022 year.

National mortgage rates are now 4.95%. As these rates go higher, many home buyers will not be able to afford the payments on houses so eventually prices on homes will have to come down or sit longer for the buyer who can afford the high price and the high mortgage rates.

House buying for the average working family comes down to payment affordability.

We are seeing house price reductions in my neighborhood as I type this. One home was dropped 10% this week.

 

[livingalmostlarge]

$2M to buy in our neighborhood starter homes

 

[skipro33]

In 2006, I lost our home to a fire. The insurance company valued our place, including the lot, at $560,000 and it was a 1200 sq. ft. home. This week a home on our street is listed at $580,000 and it is a 1350 sq. ft. home. On this observation, I'd say home values have stayed stagnant since 2006. In actuality, the housing bubble popped in 2006 and it took 16 years for it to catch back up. So, I don't think housing prices are actually overpriced. Surely incomes have increased since 2006, making the homes of today much more affordable than they were to the buyers in 2006.
For reference, this is in Northern California in a rural area.

 

[daylatedollarshort]

Prices are still going up crazy here in the Bay Area. I think people are trying to buy before mortgage rates go up even further, then prices will drop after that as mortgage rates increase. A 3% jump in mortgage rates on a $1M loan starts out at an extra $30K a year in interest.

 

[Time2]

In 2006, I lost our home to a fire. The insurance company valued our place, including the lot, at $560,000 and it was a 1200 sq. ft. home. This week a home on our street is listed at $580,000 and it is a 1350 sq. ft. home. On this observation, I'd say home values have stayed stagnant since 2006. In actuality, the housing bubble popped in 2006 and it took 16 years for it to catch back up. So, I don't think housing prices are actually overpriced. Surely incomes have increased since 2006, making the homes of today much more affordable than they were to the buyers in 2006.
For reference, this is in Northern California in a rural area.

I bought in 1994 for $82k, in 2007 the neighborhood houses were $260k to $285k, then dropped back down to the $160k, $180k range. Today they range from $250k to one that just sold for $320k. Florida Panhandle, basic 3 bed, 2 bath, 2 car garage. We had a hurricane in 2018, some houses got a major update while others not so much, so more of a price range than before.

 

[ScoopKona]

I don't think "interesting" is the right word. "Frightening" is more like it.

If I had my way, I'd cash out right now. But my wife and I are living in different states -- she's winding down her career and is under contract. I'm at the farm, being a lumberjack.

She could move in with her mother while we sell the mainland residence and the rental properties. (Mom lives a mile away on the mainland). But she doesn't want to. And every day I'm frankly relieved when I wake up, look at the news, and learn that the 2020 housing bubble hasn't burst.

Some days I wish we hadn't decided on a "all major decisions must be unanimous" strategy for our marriage.

 

[Rianne]

We should put together a tribute thread and pin it for Imoldernus containing post like above. I think we all enjoyed his sharing his life experiances.

Yes, loved Imoldernu's wisdom. So thoughtful. And his unconditional sharing. I learned a lot from him.

 

[Fermion]

The cost to build a house is still really high so that will have some effect on supporting these higher prices.


A 2x6x8 is about $15 (it had dropped to $7 last November)

A sheet of 1/2" OSB sheathing, what used to be one of the cheapest building materials, is at $52! This is essentially a $6 sheet of pressed wood chips being sold for 8 to 9 times that price now.

Copper is way up (wiring). Labor is up somewhat.

Any moderate size house now being sold for under $200k is being sold below cost.

 

[Rianne]

Houses in our neighborhood are sold before they're on the market. Maybe a sign will go up "Coming Soon." Do not see "For Sale" signs. On my block 4 houses sold in the last year.

Our neighborhood has lots of mature trees, smaller brick ranches, sidewalks, and houses pretty close to each other. I'm thinking ranches are popular because the aging population does not want to deal with steps. Bought ours for $210 in 2012, realtor.com says worth $285.