9% increase in Rent YOY
http://seattlepi.nwsource.com/business/ ... ent28.html
Rental rates have increased by about 9% in the last year and up 6% since the Spring of 2007.
Since you all know I own, my rental costs are locked in and this increase has allowed me to now CASH FLOW my condo, as in owning costs the same amount as renting for me. (I got a killer deal in June 06 when I locked in my price)...my neighbor just sold his studio for a 23% gain (150k to 185K) in 1 year due to the developers accidently underpricing many units (didnt calculate our sqr footage right, boo ya for us).
Rental rates have increased by about 9% in the last year and up 6% since the Spring of 2007.
Since you all know I own, my rental costs are locked in and this increase has allowed me to now CASH FLOW my condo, as in owning costs the same amount as renting for me. (I got a killer deal in June 06 when I locked in my price)...my neighbor just sold his studio for a 23% gain (150k to 185K) in 1 year due to the developers accidently underpricing many units (didnt calculate our sqr footage right, boo ya for us).
Comments
Hey finance - I guess that means somebody out there paid a 27% increase, huh!
not surprising that you didn't highlight the last line. I've already seen some stories about developers giving up on the condo track.
Just like the slowing appreciation of the housing market. The rate of appreciation has still increased, but at a decreasing rate...is only up 6.9% YOY as Tims graph shows.
How did you get a 27% increase on a property that appreciated 23%?
My theory still stands that the Seattle market impact of the housing crash will be minor compared to other markets. The good news is that as the Seattle market slows/declines, the FED lowering rates and rest of the nation will be bottoming out, thus most likely reducing the rate of decline in Seattle (every part of the economy impacts others, directly or indirectly).
Basic math... for the "increase" in rent to average 9%, and with two of us on the thread seeing 0% - doesn't there have to be someone with 27%?
Those Dupre + Scott statistics are absolute BS.
Basic math... for the "increase" in rent to average 9%, and with two of us on the thread seeing 0% - doesn't there have to be someone with 27%?
Those Dupre + Scott statistics are absolute BS
Still increased? WTF? Don't you mean "Down" to 6.9%? I made a bet with a guy in January that YoY appreciation would be negative in 18 months. That was 5 months ago. The appreciation was 12% year over year at that point. Since then, the YoY figure has dropped 1% a month. Every month. That means in 12 months, it would go to zero - except that some time in the next 2-3 months, the MoM figure will go negative - at which point the YoY figure will start dropping even faster. If you are looking at 6.9% as a sign of strength you probably ought to take your eyes off the rear-view mirror - because you're about to rear-end a semi.
As Barbie says, "Math is hard"
I think acknowledging that appreciation is slowing is equally not crazy.
Forecasting some sort of real estate apocalypse while saying everything will be just rosy for renters strikes me as about as one-sided as the lines you'll get from many real estate agents.
I wonder if the real estate industry and it's one-sided analysis has created a backlash which is equally subjective? Sometimes I think so when reading posts here.
And I say that agreeing that there is a definite possibility of some depreciation in this market, which will hurt the short-time buyers (if you've bought in the last 12 months in particular) if it's a steep decline.
I'm not as concerned about those who bought more than 12 months ago or those that are able to hold for the longterm.
The place I rented before I moved out was a 4br house with friends. The landlady has not increased rent from $1700 for over 5 years going on 6. Normally the house would rent for ~2,000 or 2,100 per month near the MSFT campus, yet not sure she really understands the concept of raising rent, lol.
So ya, there are going to be people with flat rent and some with higher rent increases. However there is more than 3 people in the rental market, doh, compared to the 3 person sample you gave above. Its all a matter of if a $100/mo (200, or 300...whatever) increase in rent is worth it to move, as it is expensive and timely to pack your crap up and move to another apt or house.
If you sell today how much will you make between now and September 2007? If you don't sell, how much will you make (or lose)?
Not sure I follow. Let's try another example : beanie babies. Some people bought in, I did not. Eventually beanie baby apocalypse hit, and I did just fine.
OK, new example: dotcoms. Some people invested heavily. I did not. Nor did I get a job for a company with no business model. They crashed. I was essentially unaffected despite being a tech worker.
Alright, how about another example: USSR. The whole nation collapsed. I didn't live there. It had essentially no impact on my life.
So let's be reasonable here. Any time anything extreme (or even horrible) happens, but you are not exposed. Well, it means you are not exposed. If I have zero exposure to real estate except for rent, explain how I will be impacted by a crash. I guess my rent will probably decrease, and then I'll find a house on the cheap. [YAWN]
One more reason to think seriously abour renting long term and finding a different path to the American dream than homeownership.