Ok, so we got married 6 months ago and are living with the in-laws in a one room basement. We were going to stay a year to save money and start looking next May (around our 1 year anniversary) for a home. Well, we started looking earlier than we thought we would. Its very hard living in one room, let me tell ya!
The problem is, we are walking into small, tiny capes for $325K??? The market is crazy. Well my DH and I have different views on the future market. He believes we should wait and follow our original plan (till next year), that something is bound to happen because prices can't keep going up. I see it as prices will keep rising or interest rates will rise, which will leave in the same boat we are in today. P.S. We are looking in Western Suffolk, South Shore -- Lindenhurst, Babylon, W. Islip, Islip. Don't think we will go that far East, maybe to Holbrook.
What do you girls think? Should we wait? Do you believe the market will turn. I would love to hear everyone's opinions, views on this topic. Thanks.
Mrs2Be
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Re: LI Cost of Housing - Poll
We looked during our engagement and ran into the same issue as you.
We were disgusted and gave up. We plan to look again in about a year. I figured the more money we put down on a house, the better off we will be.
I know it's hard to predict the future, but I'm agreeing with your husband. With so many people out of work and the market tumbling these days...I find it hard to accept that the houses would still increase at such a ridiculous rate.
I am looking on the north shore of LI from Centerport to Smithtown.
It's very discouraging! Keep your options open, continue looking, but don't settle on something just so you can get out of a 1 room apartment. Worst case scenario is you find your own apartment that you won't feel so rushed to leave!
Good luck!!!
DeniseMang
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Re: LI Cost of Housing - Poll
That makes a lot of sense. Thank you Mrs2Be.
Lisa Rose
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Re: LI Cost of Housing - Poll
We just bought a house in Holbrook and that was after seeing many houses...within our price range that were pieces of c*ap. I can not belive that people actually live that way. Well, my husband and I waited until after we were married because we were saving for the wedding...but if we knew then what we know now we would have bought a house then. The market almost doubled in that time frame. But on the other hand, I do not think we were ready financially to have a house. So, you should really take a step back and decide if you are ready for a house (and all that comes with it) or if you want to keep saving to get maybe a bigger house of one that is in better shape. Its VERY hard to predict what the market is going to do! Good Luck Lisa
Claud2001
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Re: LI Cost of Housing - Poll
You should definitely do a search on this topic b/c there was a very lengthy thread several weeks ago that addressed this same thing.
However, I hate to break the bad new to you guys...but housing prices are not going to plummet - even if interest rates start to creep up again, you will not see a significant decline in housing prices. It will be more like a plateau in the prices that sellers can get for what a home has to offer, or the location. A small capecod that sells for $340K today would probably still grab at least $300K with a higher interest rate, if it's in the right neighborhood/location.
Also, remember that Long Island has a very finite amount of space or locations that are *desirable* for commuters to NYC....so, as long as demand outweighs the supply of housing, prices will seen astronomical.
As far as timing for you to start looking - you need to look at your finances and determine what price you can afford, what down payment you will need to avoid private mortgage insurance (which means you need at least $60K to plunk down on a $300K house), and still have some money left to do simple improvements to move in and get comfy and have some money left for emergencies.
I know this process is scary, frustrating and daunting - I know b/c I am living it everyday! Best of luck to you!
DeniseMang
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Re: LI Cost of Housing - Poll
Thank you, Claud. Yes we do have the 20% but thats it. So I think we will wait a few more months. Even if the market declines a bit becuase the interest rate creeps up as you say, hopefully it will even out, and we have the opportunity to save some more money. Thanks for the advice. The thread a few weeks ago was probably started by me! :-))
bride082003
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Re: LI Cost of Housing - Poll
I'm not a newlywed (yet ) but I wanted to comment on this....we bought our house over a year ago and were saying the same things to ourselves....we'll wait until the market goes down. Well luckily we found a place we loved and just decided to buy it last year because our house has almost DOUBLED in value already. I agree that the market prices are absolutely outrageous - for all your sakes, I hope the prices come down so you can share in the joys of homeownership but on the other hand, I hope the prices stay so that I have some equity $$$ to move on to a bigger and better home after the wedding. Good Luck girls. I know its hard. Just try to get in as soon as you can. And Save Save Save!
NIHA
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Re: LI Cost of Housing - Poll
Maybe too personal, but for those who saved 20% (without help from family), how long did it take? I'm thinking it would take 5 years. Need some encouragement here
DeniseMang
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Well 20% has been my savings for the last 8 years working in manhattan plus wedding money. My poor DH has no money saved really. Just got out of college and is paying off student loans.
MichelleW
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Re: LI Cost of Housing - Poll
We did not have the 20% and I could not even fathom how long it would take to save that much. There are progrmans for buyers that do not require 20% down
Mrs2Be
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Re: LI Cost of Housing - Poll
I'm not counting on them coming down...just possibly staying where they are for a few months so we can get ahead!
We don't necessarily want the responsibilies of a new home, and we love our apt. so right now I'm content.
I want to put enough money down where my mortgage payment doesn't dictate my life. I plan to wait until I'm financially ready to do it, regardless of how high the market goes.
I think a lot of people jump into buying a house because it's the thing to do - only to find themselves falling further and further into debt. I used to work for a mortgage company - I've seen way too many foreclosures!
I think it's important for everyone to realize that buying a home is a huge decision, and you should only do it when you are 100% ready. It could really affect your credit if you make a mistake.
Just hang in there, save what you can and when it's right, it's right. I still think you should look at houses though so you are educated in what the market is doing. If you have to wait a little while longer...it's only for the best!!
Happy house hunting to all!!!
Cira
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Re: LI Cost of Housing - Poll
I have to agree with Claud on this one ... I don't think that houses will plummet, more like plateau - but I honetly don't think that will happen unless rates start to creep up. Just think that a 1% interest increase will increase your mortgage on a $300 loan by $300! Wow!
I've struggled with this question and like you, post tons of information regarding the housing market and trends. We decided to buy! But that's because we found a house that we thought we got a good buy on and we wanted to take advantage of the lucrative rate. My husband and I try, but can't predict this market. But Long Island is a desirable area to live and supply and demand has it's share on the prices of houses.
But you do need to think of your goals and exactly what you want! Remember this is the house that you will be living in! It is discouraging to look at the junk that is out there. All houses need work and if they don't -- they are about 30-50K more!
As far as the 20% -- we are not putting 20% and are avoiding PMI. There are ways around that. We felt that we needed money for closing costs and home improvement on the house.
Good Luck with your decision -- I would suggest to keep looking and monitoring the market. You never know what you may find. We didn't think that the house we bid on would be ours.
And if I see anymore articles, I will post. I was trying to find out information on that New Yorker, but couldn't seem to look it up!
DeniseMang
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Re: LI Cost of Housing - Poll
Oh I found that article in the New Yorker, thanks. That too had differing opinions. I think we are just going to keep looking. Thanks so much, Cira and all of you.
Denise
Claud2001
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Re: LI Cost of Housing - Poll
MichelleW is right - you don't have to put 20% down if you can't afford to.
But, unfortunately the programs that offer you the option to put down less are usually only available to people who make less than $50K/year. And that is totally unfair to the people that make more than that, but are still finding it difficult to buy their first home.
LizD
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Re: LI Cost of Housing - Poll
We just sold our house in Selden and bought one in Merrick. We found that right now people are being a bit more flexible and are willing to negotiate on their homes. Two years ago when we bought in Selden, it was full price only. Homeowners would not even entertain any other offers. We found that the prices in Merrick and vicinity are starting to go down a bit. People are realizing that they can not go that overboard with the pricing anymore (obviously they are still high, but not as bad as a couple of years ago). Just figured since we are going through it now, I would chime in. Good luck with whatever you decide.
MichelleW
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Re: LI Cost of Housing - Poll
There are certain programs offered through Fannie Mae, that are for first time homebuyers that are in certain professions and have a combined income of $150,00 or less
dora
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Re: LI Cost of Housing - Poll
We bought a house a year ago and learned that prices on 'starter homes' don't drop. Basically, people can wait to 'upgrade' their home if the market is bad --> but people are continuously getting married/having kids -- so homes in the <$400,000 range will always be in high demand.
When and if the market drops -- it drops in the 'luxury range' first (if you read the gossip columns regularly, you've seen stories about how Tommy Mattola, Barbara Streisand, and other celebs have dropped the prices on mansions they were selling...) If you plan to wait to buy, bear in mind that it's probably going to be a VERY long wait.
I bought a house a year ago --> prices were really high and decent houses got bought up in just days... It was a nightmare -- but I found something we love (my DH was just a boyfriend back then)and if I paid a lot, it was still worth it since I liquidated stocks (which would now be worthless since the market dropped) to get the downpayment.
I feel for you!! Good luck!!!
Junebride
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Here's our
Story: My husband owned a home when we met - three years ago we said let's sell it (b/c homes are so high) put the money in the bank and move into an apartment and wait for homes to drop... Well needless to say our plan didn't work. We shouldd of bought then - home prices went up over $100,000 while we were looking. We looked for over a year and they just kept going up as we looked. Anyway, none of us know what's going to happen - the only thing is interest rates are the lowest they've been in 30 years - and this helps a lot. We were able to borrow a lot more then we thought. I would start looking - just to get an idea of what's out there - it took us over a year to find our house... it's not that easy out there... plus you get very well educated the more you look. We became housing pros... I'm glad we didn't buy right away. We passed up a lot of homes but we kept on saying it just didn't feel right. Good Luck and keep us posted.
