People Need To STOP Buying~

ITA! Even Northern VA is getting way out of control. The replica of my dad's house, on a smaller property, just went for 920,000.

Given, it is 5 bedrooms. But a year ago, a smiliar house went for like 700,000. 120,000 profit in a year!

I'm really thinking of staying in the Shanendoah Valley (2 hours SW of DC). I can buy a new, alabeit small, townhome for $125,000. This area is growing too, i think I'm going to get in now while I can still afford it.

we can rehash this over and over but the reality is NO ONE can predict the future. if you are in a position to buy now (whether that be a condo or a home), by all means do so and don't focus on what the future may bring.

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Posted by skew

we can rehash this over and over but the reality is NO ONE can predict the future. if you are in a position to buy now (whether that be a condo or a home), by all means do so and don't focus on what the future may bring.

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I agree! When DH and I bought our house in early 2002, we AGONIZED over the decision. We really thought that was the height of the market. People were discouraging us from buying, saying the bubble was going to burst within a year. Finally we caved in and bought, thinking 'well, we're never going to make money on this house, but at least we'll have a house'. Now look 3 years later-- the appreciation has been outrageous. I'm glad we didn't get scared away from buying back then!!!

IMO, even if you buy now and prices do drop later on, you can always just stay in the house and try to ride out the downturn.

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Posted by computergirl

IMO, even if you buy now and prices do drop later on, you can always just stay in the house and try to ride out the downturn.

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although some may not agree, i would even be willing to sell our house at a loss and take advantage of the slow market and buy the house of our dreams.

I understand there are ups & downs- that's what I was saying- EVERY market is cyclical.

If the market does come down like some economists suggest- then a lot of people who could barely afford the houses they bought are going to be in a lot of trouble... that's the point.

In the end, real estate should gain about 4% on average a year- I think that is the historical average (through all the ups & downs)...

People are very quick to chastize those who don't want to buy right now or who are renting- but god forbid those people who have a mortgage they really shouldn't have qualifed for get caught up in a down turn- they could be in problems.... I just pray it isn't anyone I know

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Posted by Sassyz75

People are very quick to chastize those who don't want to buy right now or who are renting- but god forbid those people who have a mortgage they really shouldn't have qualifed for get caught up in a down turn- they could be in problems.... I just pray it isn't anyone I know

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What does this have to do with the real estate market ups and downs? If the market is UP and you take out a mortgage you cannot really afford, or the market is DOWN and you take out a mortgage you cannot really afford -- you're in the same boat. You still can't afford it!

I assume you are referring to people who are doing 'creative financing' to afford more expensive homes -- like no money down deals, or 1-3 yr ARMs with super-low rates, etc. ??

Please clarify.

We're planning on looking in January so I've been following pretty closely the number of houses in our price range (and within decent areas). Two weeks ago, I searched on mlsli for houses under $400K in nassau - got back maybe 20 results in decent areas. Doesnt' mean the houses were decent, just the area.

Just did it again on Sunday (after the interest rate increase) and already the options are increasing to about 40-45 houses. I'm not saying that houses already on the market are going to drop, but I am saying that the ones that are going to go on the market in say 4 months that would have gone on as $500K last week may be more like $450 or even $425 by the time they do.

It will take a while because it's not going to be a dramatic drop, but the original market prices have been, and I would say will continue to be, lower than what we've seen for the same type of house/area.

ETA: Queens is lagging though - still too high in the decent areas. But, you can afford a lot more 'house' in Queens than in Nassau given the taxes.

I was born in Smithtown and we moved to NJ in '79. My parents tried for 2 years to sell the Smithtown house, even at a loss, and couldn't. They rented for two years, then sold at a loss. It was during the time when Grumman let go a large number of employees and there were tons of LI homes on the market and no one moving here. Anyway, same house in Smithtown went for $650,000 a few months ago. It's all cyclical, but there have definitely been downs.

In general we are entering the peak of home sale season, during the summer. There are going to be more homes on the market, at every price bracket.

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Posted by ThongLori

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Posted by Sassyz75

People are very quick to chastize those who don't want to buy right now or who are renting- but god forbid those people who have a mortgage they really shouldn't have qualifed for get caught up in a down turn- they could be in problems.... I just pray it isn't anyone I know

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What does this have to do with the real estate market ups and downs? If the market is UP and you take out a mortgage you cannot really afford, or the market is DOWN and you take out a mortgage you cannot really afford -- you're in the same boat. You still can't afford it!

I assume you are referring to people who are doing 'creative financing' to afford more expensive homes -- like no money down deals, or 1-3 yr ARMs with super-low rates, etc. ??

Please clarify.

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That's what I meant.
that a lot of people push you to buy a house- but with a 1-3 year ARM it's a risky thing to do- especially if you don't have a lot of $$$ down.. because if something bad happens you really don't have ANY equity the first year.

I didn't mean to start a debate about this...its just that I too remember the late 80s and the rise in prices. I sold RE for a few years and I saw the market come back down. The house I'm living in use to sell for $180 now it sells for over $600 -- That is absolutly insane! Our taes are over 10k...I just feel it is very difficult for young couples to MAKE it these days!

Not that I'm hoping for this, but I forsee many foreclosures in the market in the near future.

You have to take into effect that houses on Long Island were undervalued to begin with. This is one of the reasons for the increase in value. I do believe it may slow down, but I don't think it will drop dramatically, especially if you buy in a desirable area.

Crismicka- i agree on ALL points that you've made!!!

Honestly, the housing situation in NY reminds me of the person that runs around frantically SCREAMING that everyone needs to calm down--- why fight it if you're just going to feed into it.

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Posted by lullabella

You have to take into effect that houses on Long Island were undervalued to begin with.

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im sorry, but i dont agree with this. They are completely over valued now, and there is No logical comparison between the cost of living Vs. average salary in the area. i don't mean this as a personal attack in Any way, but i think its extremely self glorifying for anyone to believe that their 2bdrm 1 bath ranch is worthy of a 500k price tag ... no matter how 'desiraeable' the area may be. BUT as long as the buyers are buying, this mentality will continue to perpetuate itself. JMO

Nobody pushed me to buy a house. It was time.

I have friends who paid 150K for their house in the early 1990s. The interest rate was high and they hardly put any money down. There weren't so many great jobs at the time and they really suffered for a while. They almost went into foreclosure, came close to bankruptcy. There are plenty of people now who are better equipped to buy a house for 500K than they were back then. There is no reason to wait if you can afford it and feel comfortable. It's really hard to generalize about what will happen to people who buy now. I'm a bankruptcy lawyer and there are many people who rent apartments, have no equity in any real estate and are in real trouble. People who buy houses are not the only people who get in over their heads. And people have always complained about the cost of living on Long Island!!! Just some thoughts on all of this.

Not to offend anyone, I feel like I'm being accused of doing a dis-service to other homebuyers because I was willing to pay a price that was higher than what some people would like to see!!!

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Posted by ssdbk


Not to offend anyone, I feel like I'm being accused of doing a dis-service to other homebuyers because I was willing to pay a price that was higher than what some people would like to see!!!

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you didn't do a dis-service, because you needed a home. but what she is saying and what i completely agree with is if people start saying 'no, i'm not going to pay that' and the supply becomes greater than the demand, then prices will go down. right now, there is this insane belief that you have to buy...you must buy...and so people are rushing to buy which keeps the supply in hot demand. but that pushes out a lot of native long islanders! my generation can't afford it here. and while houses may have increased in value over 30% (or whatever the number is), salaries have not and that is a huge discrepency.

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Posted by neeniebean86

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Posted by lullabella

You have to take into effect that houses on Long Island were undervalued to begin with.

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im sorry, but i dont agree with this. They are completely over valued now, and there is No logical comparison between the cost of living Vs. average salary in the area. i don't mean this as a personal attack in Any way, but i think its extremely self glorifying for anyone to believe that their 2bdrm 1 bath ranch is worthy of a 500k price tag ... no matter how 'desiraeable' the area may be. BUT as long as the buyers are buying, this mentality will continue to perpetuate itself. JMO

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I understand your frustration believe me I don't like these prices either! This is the reality we live in and people can afford them to some degree otherwise they wouldn't be buying them.

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Posted by lullabella

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Posted by neeniebean86

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Posted by lullabella

You have to take into effect that houses on Long Island were undervalued to begin with.

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im sorry, but i dont agree with this. They are completely over valued now, and there is No logical comparison between the cost of living Vs. average salary in the area. i don't mean this as a personal attack in Any way, but i think its extremely self glorifying for anyone to believe that their 2bdrm 1 bath ranch is worthy of a 500k price tag ... no matter how 'desiraeable' the area may be. BUT as long as the buyers are buying, this mentality will continue to perpetuate itself. JMO

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I understand your frustration believe me I don't like these prices either! This is the reality we live in and people can afford them to some degree otherwise they wouldn't be buying them.

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Is it that people can afford the houses or that the lending institutions are more lenient?

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Posted by Sassyz75

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Posted by lullabella

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Posted by neeniebean86

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Posted by lullabella

You have to take into effect that houses on Long Island were undervalued to begin with.

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im sorry, but i dont agree with this. They are completely over valued now, and there is No logical comparison between the cost of living Vs. average salary in the area. i don't mean this as a personal attack in Any way, but i think its extremely self glorifying for anyone to believe that their 2bdrm 1 bath ranch is worthy of a 500k price tag ... no matter how 'desiraeable' the area may be. BUT as long as the buyers are buying, this mentality will continue to perpetuate itself. JMO

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I understand your frustration believe me I don't like these prices either! This is the reality we live in and people can afford them to some degree otherwise they wouldn't be buying them.

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Is it that people can afford the houses or that the lending institutions are more lenient?

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It is probably a little bit of both. They aren't giving the money away, so you have to have some credibility to get a mortgage.

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You have to take into effect that houses on Long Island were undervalued to begin with. This is one of the reasons for the increase in value. I do believe it may slow down, but I don't think it will drop dramatically, especially if you buy in a desirable area.

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Lulla,

Can you elaborate on why you feel that houses on LI were undevalued?