I think that arms for investors and interest only no down loans shouln’t have been allowed in the first place, but then people would chant oh our freedom is being restricted.. That is a bunch of you know what.. To me freedom is not the ability to buy a property which you will be stressed out in for the rest of your life because prices were pushed up with poor financing programs offered by banks and finance companies. And if lenders keep pushing these products it will come back to bite them again in the long-term.

My peice of advice: Don’t give in to the pressure to buy what you can’t afford. Look at what happened to Japan in the past. As buyers we hold the cards even when prices were going up, we don’t have to buy into this inflated market.

I will repeat myself here, “Condo-owner” IS “mc lovin my popcorn ceilings”. Same IP address, same email. PLEASE stop feeding the troll.

When you posted that above, I read it as “mc lovin my popcorn ceilings” was a condo owner, as in “poor bastard bought a $750k 1BR condo in Belltown”. I was actually thinking “I shouldn’t be feeding the troll, but what the hell…”

Now, where’d I put my pink pony… :(

I registered and read the article Can the Midwest regain its economic clout?

I do not disagree that the economy of the Seattle area is different from that of the Midwest. And yes, real estate values will always be worth more in areas where there are jobs to be had than areas that are economically depressed.
.

I am guessing your point to be that upward pressure on Seattle rents will be a result of increased demand due to increased immigration and the increased immigration is due to the fact that cities like Seattle are where the jobs are, right?

http://www.redfin.com/stingray/do/printable-listing?listing-id=1321331

On Redfin for 39 days at $410K (It was posted at $529K for 90+ days).

Carrying costs for a ‘investor’:

$410K carrying cost: $2460/month
Dues: $339/month (didn’t see this posted previously)”

You can’t base the carrying costs on what he has it for sale for. If you look up the property, it shows that he bought it on August ‘05 for $324K. So you need to base your analysis off that. He’s still listing for 90K over what he paid 2 1/2 years ago.

I’m in the market for a house now and this is what i see every week. Prices are still way over 2005/2006 levels. They are just not the insane prices that hit in spring of 07.

- james

But, after reading Deejayoh’s Troll-Warning post above… I guess some people just deserve it. Swing away, Merrill!

A friend just moved into an apartment on Phinney Ridge just before Christmas. It’s a 1 bedroom, about 750 sq ft, quite nice (not fancy, not crap) and it’s 1050 a month. FWIW…

I disagree with your analysis of the situation, but that’s a subjective matter. What’s not subjective is the number of bedrooms in the condo in question: it has one bedroom, not two.

$1,600 sounds a little spendy for a 1-bedroom apartment in Phinney Ridge, but I guess it was about five years ago that I spent $620/month for the same.

I’m sure you could get some excellent, completely unbiased information from any starving realtor. Maybe condo-owner can help you out.

I will repeat myself here, “Condo-owner” IS “mc lovin my popcorn ceilings”. Same IP address, same email. PLEASE stop feeding the troll.

great points condo owner! I am looking on buying a condo n the Capital Hill area. Is there any blog sites without so many renters and people living at home with mom and dad. I am looking for a site with better information about the housing market from people who actually have been through the buying process and are not so angry about being priced out. Thanks.

I’m sure you could get some excellent, completely unbiased information from any starving realtor. Maybe condo-owner can help you out.

If you’re just looking for information on the process of buying, Google is probably a better starting point. If you want info on specific homes/comps/recent sales, RedFin, Zillow, or something similar will have that info (to a limited degree). If you want to know what the market is doing, this is your best bet – the people posting here don’t have a financial interest in your decisions.

Good luck.

Supply and demand, in deed. I just read an article from the Chicago Tribune that addresses some of the reasons why housing in the Midwest is so cheap. Check it out yourself, and contrast Seattle’s economy with the factors that the author says are contributing to Midwestern towns’ demise.

Angie- I couldn’t read the article, apparently you have to be a subscriber.

So, you’re saying that increased inventory of homes for sale has no effect on rental supply?

All you renters and those still living with mom and dad, this is your big chance to get a fair deal on a house and start your long journey of owning a home and realizing some finanicial gain along with your stocks and bonds and 401k’s and 5% CD’s. But don’t wait too long ’cause you may miss out again and have to watch prices lift off while your rents climb higher. Good luck renters!

Fair deal? What’s fair about buying something for twice the price? $1500 rent (split) allows me to contribute heavily to my 401(k) and savings while still having a life; buying the exact same unit at close to $3000/mo pretty much rules out everything except eating.

Yeah, sign me up. Do you work for John L Scott or Windermere?

What does your father-in-law do fo a living? I’m just curious.

My Father in-law does very well for himself, and he rents (and has for as long as I’ve know him.. more then 15 years..). His income is 6 figures (about 1/3 of the way to 7 figures). He also has quite a bit in the bank, another good sized chunk invested, and still has money left over for trips around the world and his “toys” (cars, home theater, etc)… (Is more then several million considered significant?)

What I suspect is more telling is that I know quite a few people who own homes who are barely making it… putting almost everything they own into their home (though mortgages as well as upkeep and renovations).

I myself sold our home in CA about 6 months ago, and I can tell you for both my finances, and my state of mind, renting has been great. I also looked at where I would have been finanically if I’d rented during the 4 1/2 years I owned.. I would have been MUCH better off..

Even with all that we’re planning on buying again.. but I’m in no rush to get into a mortgage until some of the housing crazyness straightens itself out.

Correct. (I am a big fan though)

Also, the multiple names were not to boost previous posts. That was simply word play for the post at hand. Unfortunately, Tim apparently needs to vet each new name, so I promised not to do it anymore.

I would have argued that you reexamine the post which prompted it, except that I see the brainless insults are accompanied by an unsupported (and incorrect) assumption.

Except that they finish without more than brainless insults.

So you are looking for positive information about the housing market on a site called Seattle Bubble? What sounds odd about this buyer? Could your well hidden secret be that you are actually a real estate agent because you are certainly not a rocket scientist.

I found a great way to make money off Seattle real estate. I sell short. Check out ticker – SRS. I made 7% on my investments since this mourning. Hey maybe Seattle Real Estate is making someone rich.

Really now? I thought salaries in the US have gone nowhere in the last 5 years, while house prices have doubled.

Employers don’t care how much it costs their employees to buy a house. They care about making a profit, and pay their employees accordingly. If house prices rise above the level that wage earners can afford, they have to come DOWN.

I suggest you check out marketwatch.com, or ft.com, or economist.com, or wsj.com. They should all have multiple, daily, very helpful articles that let you know how great your decision to purchase a condo in a trendy area right after the peak of the worlds largest asset bubble. I am sure most of those writers are dirty, hippy renters who cry themselves to sleep, so its safe (and brilliant) to do the exact opposite of what you read. Nobody realizes that if you catch a knife, you can sell your blood easier!

Right…you really think the owners of these little poo-boxes, many of whom used kinky financing to purchase them, can afford to bleed cash like this for years on end? I like your PMA, but this notion is truly laughable.

Define significant.

PUFF PUFF PIZAAAASSSSS!!!!

Or they can move to a less expensive place. Rents will only go as high as what the market will bear. Supply and demand are influencing factors.

Supply and demand, in deed. I just read an article from the Chicago Tribune that addresses some of the reasons why housing in the Midwest is so cheap. Check it out yourself, and contrast Seattle’s economy with the factors that the author says are contributing to Midwestern towns’ demise.

Still want to go live someplace cheap? Knock yourself out…and write if you find work.

They are people whose livelihood / paycheck depends upon homes selling (real estate “professionals”, mortgage brokers, loan underwriters).

OR

They are people who bought recently with little or no money down only to see their “asset” or “investment” decrease in value.

OR

They are people who don’t have a lot of liquidity (little in savings) and who were planning on tapping some of their equity for either improvements to their home, paying off other debt, or just to spend, spend, spend.

I think the negative posters and real estate cheerleaders fall into one of those 3 groups.

Just a theory….

Many of the people who in the past few years would have bought that condo are now going to rent (because they forsee the -10% / $40K hit they are going to take over the next year)… this represents a large portion of the ‘entry level’ / first time buyers out there today.

So lets say usually 10% of all 28 year olds and 25% of all 31 year olds were buying their first home (on average). Then lets say 50% of these people read the news paper / internet blogs. (we can assume that because they apparently have enough money to buy a home, so they must be able to read)… Then lets say 50% of those people are scared $hitless because they heard that the market is going to drop by 10% and that would wipe out atleast half of the downpayment they had saved up…

So what do they decide to do? Rent… That increases rent demand substantially over the next few years.

So if the market is tanking, and the guy is set to lose $40K on his condo (lets say 10% of a 400K place), he could gamble and try to rent the place for $1600/month (reasonable for a 2BR newish condo downtow). He’s left with $1600/month cost to him.

That means $19,200 / year or about 2 years until he has lost that $40K he would have lost instantaneously…

So if the market bounces back within 2 years, (even a short term dead cat bounce) he’s break even (actually possibly even ahead due to tax implications of taking a loss and depreciation).

How do you define “significant financial portfolio?”

Do you seriously think that there are not even wealthy people who have chosen to rent in the current market and anticipate prices to drop?

Do you think that the (tired) points you make about the Seattle market will protect recent buyers from declining prices regardless of how much prices have risen and why?

How would you like to be the owner of that Phinney Ridge condo above?
Next, you are wrong that home purchases always pay off in the long run. Many people who needed to sell to relocate in the early 90’s lost money in most of the U.S. market.

I’m rich, rich, rich, I tell you!

All you renters and those still living with mom and dad, this is your big chance to get a fair deal on a house and start your long journey of owning a home and realizing some finanicial gain along with your stocks and bonds and 401k’s and 5% CD’s. But don’t wait too long ’cause you may miss out again and have to watch prices lift off while your rents climb higher. Good luck renters!

I think the only person for whom losing 50% of the value of their home is not a disaster is an insolvent person. When you essentially have nothing, losing half of that probably isn’t a big deal. You just file bankruptcy and move on. I’ll admit that it’s shockingly easy to acquire new credit after a BK these days (albeit, at stupid rates). Many real estate lenders will let you back into the game two years after your BK if you’ve managed to get your credit score up decently and can pull together a down payment. Well, at least that was once the case. After this past August I can’t say whether it still is or not.