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I'm not trying to make it a perfect numerical analysis, but I think even the flawed numbers have use in painting a picture. Everything you said is something that's hosed up about the CA housing market. Leperflesh posted:"Median household income" includes everyone who rents. Even you tweak the numbers and assume that homeowners make somewhere in the range of 150k, is that any better? It's still ridiculous. Leperflesh posted:That said, I'm sure if you compared "Median household income of homeowners" with "median value" it still won't make a ton of sense, because a lot of home owners bought their houses for less than the current median value. In California, Prop 13 actually reduces housing liquidity because it heavily incentivizes homeowners not to sell, even if they're thinking of "trading up" to a bigger home, because their tax bill is likely to jump disproportionately. That's my whole point. Prop 13 is a curse. First-time homebuyers in CA have basically no recourse because the people sitting in 650k houses are paying taxes on a 45k house they bought in 1980. The whole problem is that the household income versus value equation is completely hosed in this area.
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May 5, 2014 19:36
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canyoneer posted:For sale by owner, aka FSBO. I bought my house FBSO, and I was a first time buyer. The house was listed on Kijiji (a Canadian slightly-better-than-craigslist type site) as the seller wanted to test the waters before listing with an Agent. The seller had won the house in a charity lottery from the builder. The process was relatively smooth, but it was a bit of a complicated situation as after we agreed on a price, the seller still hadn't taken possession of the house from the builder (who was dragging their heels). So it was my responsibility to corral everyone involved (including the seller and the builder - a transaction I had no legal part of) to keep moving forward to ensure everything happened properly and in the right order. My lawyer definitely helped, but he was only responsible to represent my interests so it was still pretty much up to me. I did this remotely from 1200km away as well, after traveling to see the house in person. Every case is different, but an Real Estate Agent would have been just a waste of money for all involved. I suppose an agent could have been helpful if I didn't have the energy or desire to grease the wheels myself, but even then I can't see how it would have been worth some percentage of the selling price. The agreed upon price was predicated on the myself and the seller not using an agent. So I got the house for 330k, but if we both used agents they most likely wouldn't have sold it for less than ~345k. mik fucked around with this message at 19:59 on May 5, 2014 |
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May 5, 2014 19:54
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mik posted:Canadian A completely, utterly different ballgame. I'm not saying FSBO is a bad idea in the US, but "it worked for me in Canada" is almost completely irrelevant to whether an American should do it, or how much hassle it'll be. Daremyth posted:I'm not trying to make it a perfect numerical analysis, but I think even the flawed numbers have use in painting a picture. Everything you said is something that's hosed up about the CA housing market. quote:Even you tweak the numbers and assume that homeowners make somewhere in the range of 150k, is that any better? It's still ridiculous. Well yes, it's quantitatively better. I'm not taking issue with the premise that people here spend too much on housing: that was actually a point I raised. All I'm saying is that the statistic you presented exaggerated the problem because of what numbers it's comparing and what those numbers actually mean. I think people who are buying $600k houses today are making on average much more than $90k/year, and I think if you found the median price that those $90k/year median families paid for their houses, it'd be on the expensive end but not as ridiculously unbalanced as that 7x multiplier would suggest. quote:That's my whole point. Prop 13 is a curse. First-time homebuyers in CA have basically no recourse because the people sitting in 650k houses are paying taxes on a 45k house they bought in 1980. My parents bought a house in Morgan Hill in 1986 for about $250k. There were definitely $45k houses in 1980, but those were the really really cheap ones, way way outside the silicon valley area where we're seeing $800k medians now. But yes, prop 13 is one of the worst things to ever happen to California, and I wish there was some political will to get rid of it. Even though, as a homeowner, it would almost certainly wind up costing me more money in the long run.
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May 5, 2014 20:45
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Leperflesh posted:
If you were going to perpetually be a home owner it would be money you'd make back in secondary markets, likely. It's why buying a house you live in isn't the same thing as buying on margin (as someone posted earlier), because opportunity costs imply you've got to pay something to live somewhere. If a huge bubble pops and your house drops by 20%, but everyone else's homes drop by 30% you gained relative equity in the housing market. Yes someone who somehow had money in some resilient account (I can't think of one other than niche bubble ones) could swoop in on a house, but if you just sold your house at a 20% loss you could effectively go buy a nicer house that dropped in value further if shopped well. So if a policy effects all homes, it only hurts you if it currently helps you more than the average peer.
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May 5, 2014 21:12
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Leperflesh posted:A completely, utterly different ballgame. I'm not saying FSBO is a bad idea in the US, but "it worked for me in Canada" is almost completely irrelevant to whether an American should do it, or how much hassle it'll be. In the context of canyoneer's post, which I was replying to, there's nothing that wouldn't apply to a Canadian home purchase. The general principles outlined in his/her post are the same.
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May 5, 2014 21:19
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fishhooked posted:Was thinking about you when I saw the "for Sale" sign go up on a house across the way. We actually toured this house back in early 2012 and was considering buying it but thought it was valued too high at 240k. poo poo man, they've done a lot of work to it but 160k more is ridiculous. I was hoping to get a cool neighbor in there to drink beer with. Definitely out of my price range and way overpriced. But it will probably still sell! You might still get a cool neighbor, it just won't be me 
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May 5, 2014 21:25
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my due diligence ends tomorrow, and seller has agreed to everything goodbye, 95k of hard earned savings, see you on the flip side (I hope)
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May 6, 2014 03:15
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I have a bit of a question: I've heard it commonly said that you can't use bonuses/etc to pay for down payments on homes, but presumably at some point that's not really trackable anymore, right? How long do you need to wait before you can use funds from bonuses/etc or other short-term 'spiky' gains on a down payment on a home?
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May 6, 2014 05:21
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Falcon2001 posted:I have a bit of a question: I've heard it commonly said that you can't use bonuses/etc to pay for down payments on homes, but presumably at some point that's not really trackable anymore, right? How long do you need to wait before you can use funds from bonuses/etc or other short-term 'spiky' gains on a down payment on a home? You can use bonuses for down payments and closing costs, no problem. You generally cannot use bonuses to meet income underwriting requirements unless you can show a steady history (2+ years) of bonuses at that level.
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May 6, 2014 05:33
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SlapActionJackson posted:You can use bonuses for down payments and closing costs, no problem. You generally cannot use bonuses to meet income underwriting requirements unless you can show a steady history (2+ years) of bonuses at that level. Ah, alright. I haven't yet talked to a bank or anything yet but several friends of mine had stories like that and I was kind of confused by the concept. Gift money or debt makes sense to preclude, but salary bonuses/etc seemed like a strange decision.
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May 6, 2014 05:41
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SlapActionJackson posted:You can use bonuses for down payments and closing costs, no problem. You generally cannot use bonuses to meet income underwriting requirements unless you can show a steady history (2+ years) of bonuses at that level. It can also depend a bit on your lender, employment situation, and the numbers involved - if you hypothetically work for the family business the bank may not consider that to be viable funds to close/reserves if you don't have a historical basis for receiving bonus income since the likelihood of fraudulent activity is higher, especially if it's a weirdly convenient dollar amount/bonus issued just after finding out they were short to close. On the other hand, if you work for Google or Amazon or someone like that it's a reasonably safe bet that the employer is not trying to disguise the source of down payment for your house even if you don't have a history of receiving bonus (still can't use it for income qualification). Gift funds, generally speaking, are incredibly stupid and have a high degree of mortgage fraud associated with them.
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May 6, 2014 06:40
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Captain Windex posted:It can also depend a bit on your lender, employment situation, and the numbers involved - if you hypothetically work for the family business the bank may not consider that to be viable funds to close/reserves if you don't have a historical basis for receiving bonus income since the likelihood of fraudulent activity is higher, especially if it's a weirdly convenient dollar amount/bonus issued just after finding out they were short to close. On the other hand, if you work for Google or Amazon or someone like that it's a reasonably safe bet that the employer is not trying to disguise the source of down payment for your house even if you don't have a history of receiving bonus (still can't use it for income qualification). Gift funds, generally speaking, are incredibly stupid and have a high degree of mortgage fraud associated with them. That makes sense about the fraud part. I've always heard the 2 year rule on income had something to do with uncertainty in bonuses/commissions. Maybe you work in sales and had a really balling year and earned $120k after commissions, but maybe next year it's going to be more like $50k.
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May 6, 2014 07:13
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canyoneer posted:That makes sense about the fraud part. Pretty much. Bonus, overtime, and commission all can vary significantly year to year. The current standard for the big 3 loan types is last 2 years plus year to date if you need any of those to qualify. They'll also look at the earnings trend, if it's steadily going down year over year it may be determined to be unstable income in which case you can't use it even with a 2 year history, or may only be permitted to use a small amount. People who earn >25% of their income through commission also generally have to provide a year or 2 of tax returns to check for unreimbursed business expenses since are more common with them and get subtracted from their income.
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May 6, 2014 14:29
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So does anyone have experience selling their house FSBO? Considering doing it because we aren't in a rush to sell.
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May 6, 2014 19:20
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So the property next door to the house my brother and I inherited from my father is going up for auction next month. It has a couple of acres, and is right by a large army base that due to BRAC is expanding. Would it be tacky to put up FSBO signs in the front yard? The other neighbors and my dad worked together to get the property's rezoned to eventually sell to developers..... If a developer buys the property that is being auctioned, we all want to sell to them. It would give them about 9-12 acres to put town houses on (about 80 townhouses). I don't know what to do, on one hand this is what my father wanted to do with the property--and my brother and I as well eventually, on the other hand where are we gonna live that is that cheap (the mortgage is about half what rent/other mortgages in the immediate area go for).
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May 6, 2014 22:36
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Supposedly close in 7 days and I don't have an appraisal yet. Also no new questions or requests from anyone involved. Calm before the storm?
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May 6, 2014 22:49
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Jealous Cow posted:Supposedly close in 7 days and I don't have an appraisal yet. Also no new questions or requests from anyone involved. Did you do the home inspection already and had no repair requests?
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May 7, 2014 00:42
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OneWhoKnows posted:Did you do the home inspection already and had no repair requests? Seller agreed to full termite treatment which is scheduled for this week. Other than that nothing pending from me.
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May 7, 2014 01:34
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Jealous Cow posted:Supposedly close in 7 days and I don't have an appraisal yet. Also no new questions or requests from anyone involved. uhhhh yeah man you should be wigging out on your lender. my appraisal came back low while we were in due diligence, but it meant that A. the bank cancelled the underwriting process and had to start again from scratch, and B. the seller wouldn't move much on sale price, so we had to come up with 10-15k we didn't previously expect to come up with.
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May 7, 2014 02:45
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mindphlux posted:uhhhh Email sent. and I'm actually 14 days out from closing.... I'm on the other side of the world on business and a little foggy...
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May 7, 2014 04:28
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Jealous Cow posted:Email sent. Fingers crossed! At least you're in the closing process. We submitted an offer and the seller verbally agreed to it and asked for the weekend to go over it with their attorney. Then today, he responds saying he wants $100k more. On to the next property, I suppose.
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May 7, 2014 04:31
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OneWhoKnows posted:Fingers crossed! $100k? Welp. That better be a mansion! I'm closing on Friday… but then doing a lease back so can't actually move in for another week. Which is fine (I still have my apartment and I'm paying both rent and mortgage for a month, so it's actually helpful), but I am itching to get in there!
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May 7, 2014 14:20
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lumbergill posted:$100k? Welp. That better be a mansion! It's a farm, but the house is actually very nice. Oh well!
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May 7, 2014 16:14
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Inspired by this thread I just listed my house FSBO on zillow for kicks. Now I need some photos that make it look good.
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May 7, 2014 16:41
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Last year exactly around this time was when I was under contract for a home purchase. Rough area but a great deal on the place from a family who really cared for their home. At the last minute basically I was told I would be required to put down 25% instead of 20% due to shady poo poo my tax prep guy pulled without telling me that affected my income. Had to pull out, which was really rough for me and had me down for a long time. The market has changed and I am now stuck with purchasing a condo, but luckily I found one right next to family, friends and work that happens to be in a great area around here. The total monthly is very affordable and will save me a lot of money versus renting. The inspection went wonderfully and basically my repairs boiled down to "buy two $11 fan blades from home depot for the guest bedroom fan". I got lucky and the seller was a snow bird, so while nothing is really updated (besides a new AC and compressor) it is all in immaculate condition. End unit with solid concrete above and below so you can't hear jack and a neighbor who is 95 and may be Betty White's twin. The first thing she told me was "I've never heard anyone next door in 30 years but I stay up until 3 am and don't give a drat about people making noise". Yay! The appraisal is happening as I speak but everything seems to be going smoothly. I guess the moral here is don't give up!
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May 7, 2014 16:47
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Incredulous Dylan posted:Last year exactly around this time was when I was under contract for a home purchase. Rough area but a great deal on the place from a family who really cared for their home. At the last minute basically I was told I would be required to put down 25% instead of 20% due to shady poo poo my tax prep guy pulled without telling me that affected my income. Had to pull out, which was really rough for me and had me down for a long time. The market has changed and I am now stuck with purchasing a condo, but luckily I found one right next to family, friends and work that happens to be in a great area around here. The total monthly is very affordable and will save me a lot of money versus renting. The inspection went wonderfully and basically my repairs boiled down to "buy two $11 fan blades from home depot for the guest bedroom fan". I got lucky and the seller was a snow bird, so while nothing is really updated (besides a new AC and compressor) it is all in immaculate condition. End unit with solid concrete above and below so you can't hear jack and a neighbor who is 95 and may be Betty White's twin. The first thing she told me was "I've never heard anyone next door in 30 years but I stay up until 3 am and don't give a drat about people making noise". Yay! The appraisal is happening as I speak but everything seems to be going smoothly. I guess the moral here is don't give up! Very nice. If you don't mind divulging, what did your tax guy do that the underwriters didn't like?
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May 7, 2014 17:31
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Apparently he fudged numbers without consulting me at all, which ultimately lead to me having a lower reported income. Income/debt ratio was off by 2% due to it. I fixed all that up this tax season with new people and got some other things in order just in case (halved my car payment, etc). That first time around was pretty awful for me, since I did everything "right". 20% down, near perfect credit rating and opened up lines of credit years in advance for a great debt ratio. I've been saving and getting ready for a long time!
Incredulous Dylan fucked around with this message at 18:40 on May 7, 2014 |
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May 7, 2014 18:36
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Appraisal came back at 14% over selling price. The real estate market is hosed up. Maybe I should be a good 'murrican and open a HELOC as soon as I close 
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May 7, 2014 19:31
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Who are all these guys who can afford to waive all contingencies when they make an offer? I mean, geez. That seems not smart.
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May 7, 2014 23:14
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Taco Pirate posted:Who are all these guys who can afford to waive all contingencies when they make an offer? I mean, geez. That seems not smart. People who believe the market is going to continue to rise at a rapid rate, such that barring the worst possible luck, they will make a profit even if they have to tear half the place down and rebuild. Alternatively, idiots.
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May 8, 2014 00:24
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Jealous Cow posted:Appraisal came back at 14% over selling price. The real estate market is hosed up. I though HELOCs were the only reason to buy a house? The more you buy the more cash you can stockpile in non recourse states and then let them fight you for years trying to evict you. True murricans know how to borrow banks into stress test failing positions.
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May 8, 2014 15:45
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http://www.cnbc.com/id/101654929 posted:Even as deep-pocketed institutional investors pull back on buying homes, all-cash deals accounted for an all-time high of 43 percent of total homes sales in the first quarter, according to RealtyTrac. Jesus christ
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May 8, 2014 18:49
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Guinness posted:Jesus christ Seems like the dumb money following the smart money there. The institutional investors were piling in while houses were clearly undervalued. Now they're ballooning but the individuals with more money than sense read the articles and are copying the big guys. A small downturn is going to see them panicking and selling at a loss. This is also how the stock market works.
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May 8, 2014 19:02
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Jealous Cow posted:Appraisal came back at 14% over selling price. The real estate market is hosed up. My realtor just informed me that my appraisal also came back over selling price  . Then again, this is South Florida...Looks like all the pieces are finally in place!
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May 8, 2014 20:04
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Incredulous Dylan posted:My realtor just informed me that my appraisal also came back over selling price Yeah, I had mine come out 12 grand over. The zillow zestimator figure I got was even more ridiculous.
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May 8, 2014 20:26
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couldcareless posted:Yeah, I had mine come out 12 grand over. The zillow zestimator figure I got was even more ridiculous. My zestimate range is 194k-204k and I'm paying 195k. The appraisal came back at 222k. 
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May 8, 2014 20:55
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Lump Shaker posted:So does anyone have experience selling their house FSBO? Considering doing it because we aren't in a rush to sell. SiGmA_X fucked around with this message at 21:00 on May 8, 2014 |
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May 8, 2014 20:58
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Jealous Cow posted:My zestimate range is 194k-204k and I'm paying 195k. The appraisal came back at 222k. Paying 196K, appraised for 212k, zillow has me at 372K because our neighborhood is ridiculous.
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May 8, 2014 21:34
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Zillow values are pretty funny. Zillow thinks I have one less bedroom than I actually do, which leads to  valuations.Also, the butt-lazy realtor used the same photos from the sale 6 years ago on MLS for re-listing it last year.
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May 8, 2014 21:43
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Lump Shaker posted:So does anyone have experience selling their house FSBO? Considering doing it because we aren't in a rush to sell. I had a friend of a friend try it in a market that had a well established, well advertised website for FSBO sales. He got a lot less bites doing it that way than when he eventually listed it with an agent. Make sure to include that you're "willing to work with seller's agents" (i.e. you're willing to pay their commission), or else expect no realtor to ever show your house to buyers. When it works, it's great, and there's no downside to trying (besides wasted time). Just don't expect miracles. If it doesn't work, also look into a flat fee realtor. May or may not be available in your area.
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May 8, 2014 22:17
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