The housing market in our pandemic era

It's all over, even here in WV houses are significantly higher in just the last six months.

DW's nephew's wife lost her job in social work a year ago and decided to become a RE agent. She is doing very, very well north of Baltimore.
 
RetireeRobert said:
I believe this market condition is a combination of low interest rates sustaining demand, and pandemic induced severe shortage of inventory (now less than 1 month supply compared to five months considered normal).
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Bingo. For western WA, add booming tech stocks that people trade for houses.

A million bucks ain't what it used to be.
 
REWahoo said:
Our zip code typically has 25+ single family homes listed for sale on Realtor.com
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aja8888 said:
Homes in our 55+ subdivision that are 20 years old, nicely appointed, brick and hardiplank exteriors, etc are selling for $136/sq ft. That is up from around $125/sq ft when we bought in here 5 years ago.
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I looked up my ZIP code and here's what I found:

8 homes total for sale. (9 listed - but one was a duplicate)

Average price: $89,922.

Average square footage: 1,488.

Average price per square foot: ~$59.75

Definitely higher than it was a year ago. At the beginning of last year there were (approximately) 25 homes for sale with an average price of around $60K. It looks like all of the cheap "fixer-upper" homes got snatched up.
 
REWahoo said:
Our zip code typically has 25+ single family homes listed for sale on Realtor.com, and 3 or 4 of those show as "pending", which I define as sold but not yet closed. Currently there are 10 listed and 7 show as pending. That level of demand is just nuts.
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Given today's mortgage rates I can see why demand is high. Back when I bought my first home I had an 8 3/4% fixed mortgage. But, I also could easily get 5%+ on my passbook savings account. My highest mortgage was 12 3/4% which I later refinanced down to 9.5%. My best mortgage was a variable that was 1.6% over the 1-year T-bill rate with no cap on the upside.

When I think of all the young people working hard so I can collect SS I sometimes feel guilty. But, then I think of the interest rate on my savings and their 3.2% 30 year mortgages and I don't feel guilty any more.
 
Here in north Florida the price of houses keeps going up. The house just 2 down on my street sold a couple of months ago for around $1.4M or $450 a sq ft. and the empty lot that is just a little larger than mine sold for $1+M. All the houses are less than 10 years old except mine that is about 65 years old. I think I am the last hold out from about 38 years ago.
I think this is totally NUTS! I would not be surprised if another 2008 is in the making.


Cheers!
 
The market is definitely softer than normal around here, particularly with rentals. Lots of people moving out to get more bang for their buck. Most seem to be staying in CA, just moving farther out probably assuming they will only need to come into the office once or twice a week when things get back to normal so the longer commute won't be too much of an issue.

We are staying put until at least the youngest graduates high school.
 
Let's face it. The apartment rents have gone up so fast in recent years and many young adults can purchase a home in a starter neighborhood and have payments as low or close to that of a mortgage payment.

We fronted our granddaughter the money to get into a $205K "small" home.

We're very fortunate to live in an ultra low price real estate market. Our all brick 3/2 new homes with double car garages are in the $250-275K range--with small yards.

We bought a 3905 square foot 4/3 1/2 home on one acre just over a year ago for $345K, and our neighborhood prices are up dramatically. Property taxes would be $1,300 if my wife wasn't disabled which gives us a property tax waiver.

For the prices we read about in California, we wouldn't even live in a $1 million home there. It would be lowering our standard of living. That much here would get you a 6,000+ square foot home on a major lakefront.
 
Bamaman said:
Let's face it. The apartment rents have gone up so fast in recent years and many young adults can purchase a home in a starter neighborhood and have payments as low or close to that of a mortgage payment.

We fronted our granddaughter the money to get into a $205K "small" home.

We're very fortunate to live in an ultra low price real estate market. Our all brick 3/2 new homes with double car garages are in the $250-275K range--with small yards.

We bought a 3905 square foot 4/3 1/2 home on one acre just over a year ago for $345K, and our neighborhood prices are up dramatically. Property taxes would be $1,300 if my wife wasn't disabled which gives us a property tax waiver.

For the prices we read about in California, we wouldn't even live in a $1 million home there. It would be lowering our standard of living. That much here would get you a 6,000+ square foot home on a major lakefront.
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It's the opposite out here. Even after coming up with $400k to put down on a $2M house, it will still cost twice as much to pay principal, interest, taxes and HOA (if any) than to rent. Rents are coming down but purchase prices are holding steady at approx $1,000/sq ft.
 
I used to have some odd ways at looking at home prices. For example, any home that costs more than the average worker makes in a lifetime seemed wrong to me. That's currently $1.7 million, FWIW. :)

Also, whenever I looked at an expensive home, I would remind myself it's just a bunch of sticks on top of a patch of dirt.

I missed out on some killer deals in Newport Beach, so the lesson here is: don't think like I do.
 
Chuckanut said:
People predict a lot of stuff. Some of it comes true. Some of it doesn't.
Trends change. If there truly is an exodos from states like California, especially an exodus of the talented people in medicine, tech, etc. then I would expect to see housing prices fall. They might even reduce taxes and regulation. Maybe Californians will be able to buy goose patè again. Or maybe not.

The most powerful forces often come from what we don't see coming at all. At the January 2019 Davos Conference on the world economy there was little if any talk about corona virus. Very little. Almost none.

Check out the 8 Top Stories from Davos 2019. There is not a mention of Corona Virus.
https://www.weforum.org/agenda/2019/01/top-stories-from-davos-2019/

The real issues are: What unexpected thing will come out of nowhere and upset your plans? And how will you deal with it?
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You can wake up now, it was all a dream!!
 
Definitely not a real estate expert, but I can share my recent experiences. Dd is buying her first home and we’ve found the demand has softened, relatively. It used to be houses were listed on a TH, open house over the weekend and the sellers accepted offers (typically multiple) on Monday. So say 5 days on the market. Owner could sell in 24-48 hours, but this way typically brought in better offers.

We’re now finding homes generally sell in a week (maybe 10 days) but with only a couple of offers but, they’re going for the asking price or a little higher. We’ve also noticed new houses are listed almost every day, rather than always on TH.

For us, that’s the Bay Area “softer” market.

We could sell and move somewhere else (many of our friends have and others are planning to do so), but we have lived in this area 50+ years and my husband doesn’t want to leave. The friends who have left, though, are ones who were born and raised somewhere else and typically are moving back to that area. That’s who I think are moving, along with folks who cannot buy in this area.
.
 
RobbieB said:
It's fast and furious here. A home close by was listed at $550,000, received 23 offers and sold at $635,000.
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This has been my experience unfortunately. We are looking at houses and found one we wished to purchase 45 miles away. List price was $600,000. We offered $675,000, cash (with bank documentation of funds), 0 contengencies, and flexible closing date (I had a home inspector perform a pre-purchase inspection that revealed about $10,000 in work that was needed). In excess of 30 offers were received on the place.

The night the owners were reviewing offers, the agent we were working with called and said 3 of the offers were real close and asked what was our "best and final". We increased our offer by $10,000 to $685,000. We did not get the house. I was relieved. The list price was about $150,000 more than I wanted to pay! And it had a $100 a month HOA fee and had high property taxes (had a town tax in addition to the County tax).

A few days later our agent sent us a "coming soon" listing we wished to see. When the listing was posted it said "pending". How could that be we thought and believed it was a mistake. Also when the listing appeared, our realtor called and said someone offered the owner $100k over list, sight unseen and the owner accepted. Wow!!!

I have no idea how we are going to find a new place and we must move by the fall at the latest.

Both of these houses are within 60 miles of Washington DC, so we think that is one of the problems--commuters that w*rk are submitting offers. Other areas of VA are not much better.

We are now seriously considering North Carolina and will concentrate our efforts there. We are finding very few listings in Virginia and they are very expensive and to add insult to injury, sell well above list price.

NC appears to have a much larger pool of the types of houses we like. But one thing that is on my mind is the possibility of catching Covid if we travel (I thought it was risky enough seeing a couple of houses in VA). DW has been vaccinated, but I'm younger and Virginia includes me with everyone else (the last group) and has not even mentioned when they will get to everyone.
 
The housing market is unbalanced due to low interest rates, high material prices and low inventory because people don’t want to move. It’s more apparent in the smaller markets that typically don’t see the bid wars and jump in price like you see in the bigger east and west coast markets. Also, there are company’s that for about 2% of the selling price will set it up like you have all cash to make the purchase, and rent it to you until you can actually get financing. I believe that is just short of fraud, but people are doing it. The downsize on that one is it affects the market function and sets up the buyer for a future default.
 
djsander said:
Also, there are company’s that for about 2% of the selling price will set it up like you have all cash to make the purchase, and rent it to you until you can actually get financing. I believe that is just short of fraud, but people are doing it. The downsize on that one is it affects the market function and sets up the buyer for a future default.
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That’s a new one to me. Do you have an example? Just curious. We’re in that hot DC market and it is a very specific type of property that is in demand.
 
jazz4cash said:
That’s a new one to me. Do you have an example? Just curious. We’re in that hot DC market and it is a very specific type of property that is in demand.
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Ribbon cutters is one for first time buyers. Fly homes is another. I stumbled on to this way to make an all cash when reading the thread on housing bubble over at bogleheads. I’m sure there are more. They appear to be in the hotter markets, however I’m sure there are some in the markets that are normally more tame.
 
Home prices keep spiraling up out of control in our little slice of paradise in rural Northern CA. Home up the street closed for $850k and slightly bigger home around the corner is about to list for $930k. Most of us bought in the $250-300k range back in the mid 1990s.

This is nuts!

Aside from a few million dollar and up custom view homes, there has been zero new construction anywhere near us. It’s a very bad situation for young families looking for their first home.
 
1242Vintage said:
Home prices keep spiraling up out of control in our little slice of paradise in rural Northern CA. Home up the street closed for $850k and slightly bigger home around the corner is about to list for $930k. Most of us bought in the $250-300k range back in the mid 1990s.

This is nuts!

Aside from a few million dollar and up custom view homes, there has been zero new construction anywhere near us. It’s a very bad situation for young families looking for their first home.
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Crazy here too despite reports of people fleeing the Bay Area. House next door to me hit the market, the only SFH in town under $2M (it's small, under 1500 sq ft.) and activity has been fierce. Will likely go 20% over asking with multiple bids. There are really no new SFH being built anywhere around here. Only some condos and townhomes.
 
The housing market is crazy in Northern Nevada. We hit the market Friday morning and had 4 offers and 33 showings by Sunday at 4. We accepted a offer of 400k for a 1950’s 1400 sq ft home.
 
Our neighborhood in our small town has been changing upward for the past 12 years with the original fairly small concrete block houses being bought and knocked down to build McMansions. We are one of the last of 2 to hold out and have no plans to sell our modest mortgage free home at this time. Maybe in 10 years if we have to move to assisted living.

There is a 100' X 130' lot 3 houses down the street from ours that recently sold for almost $1.1 million. Our home that I bought about 35 years ago for $50k is on a 100' X 110' lot. Go figure. At some point I bet many of these houses will be upside down.


Cheers!
 
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