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Summit posted:I’m buying in this market! Is it dumb? Maybe. Maybe not. People been predicting doom for as long as I’ve been politically/news aware. Everyone is just guessing. I definitely agree with the logical arguments people are making and yet this market just keeps on chugging. Goes to show you it’s not well understood. Yeah that's the thing, you can make lots of reasonable, logical arguments and come to wildly different conclusions, because every one of these arguments is accounting for only some factors; doing so based on summaries of data that are not revealing all the underlying complexity; biased by preconceptions and even political leanings; and in all cases, incapable of accounting for the surprises the future inevitably brings. This is why most of us try not to give any kind of answer to market-timing questions about buying a house. Some of us may have some educated guesses but they're still guesses. All anyone can do even in the best of times is try to make sure they have a decent financial buffer, can actually afford the house they're trying to buy, and then take the plunge with the largest financial decision of their life. If you try to wait a year or two and hope for better conditions you might win that bet or you might lose it and nobody here should try to tell you different because if we're honest then we have to admit that we just don't know.
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Aug 18, 2020 21:54
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Yeah, not only does no one know the answer yet, but no one will know the answer to what will happen to the market for a while. Because a lot of it will depend on the government response and we don't even know what that would look like. There is a universe where stimulus runs out, the slowdown in economic activity starts to catch up with banks, and they need to start foreclosing aggressively and therefore dropping prices dramatically. There is a universe where even though people are losing their jobs, we continue with a severe market shortage of homes. Listings are down by 40% year over year in some areas. New constructions are slowing down to a crawl, and disruptions in supply chains make it hard to start construction quickly. Which, coupled with historically low interest rates, makes it continue to be a sellers market, even if people start getting foreclosed on, since banks wouldn't be under pressure to get rid of foreclosed homes immediately and could wait it out and take advantage of the shortage. In which case prices would stay stable and then rapidly climb once the collapse is over. It's a gamble which is which. But the thing to keep in mind is that in most cases, buying high but staying put for 10 years because it was the right house is probably more financially advantageous than buying low and having to sell it in 4 years because you can't stand the place.
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Aug 18, 2020 22:25
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As for the market itself, lets dispel the on-going myth that cities are dead. Well, expect for one. Zillow 2020 Urban-Suburban Market Report  quote:Are people fleeing the cities for greener suburban pastures? Some faint signals may have emerged in certain places, but by and large, the data show that suburban housing markets have not strengthened at a disproportionately rapid pace compared to urban markets. Both region types appear to be hot sellers’ markets right now – while many suburban areas have seen strong improvement in housing activity in recent months, so, too, have many urban areas.
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Aug 19, 2020 01:21
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Worry less about housing prices and more about long term inflation. In the US if you don't own assets you just get left behind (and $TSLA doesn't count). Of course this is with the caveat that a defaulted loan will probably leave you in a worse place than no house at all
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Aug 19, 2020 02:03
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Gabriel S. posted:As for the market itself, lets dispel the on-going myth that cities are dead. Well, expect for one. San Francisco is always an outlier due to its density/housing problems etc etc Doesn't help that San Francisco has something like 1/8th the number of houses come on the market each year per capita as a similarly dense city like say NYC, so any bump is likely to look amplified Second, you have a bunch of highly paid single guys living 2 to 3 in a one bedroom, if they haven't lost their jobs then now they can work full time remote from Idaho or Arkansas, at least until next summer. My coworker is currently hamming it up lakeside in Pueblo, Co for pennies on the dollar. The 1 bedroom rental market here has absolutely collapsed short term. With no need to go into the office at Apple, Google, Facebook etc nobody is buying in soma/mission bay right now (neighborhoods near the train station that take them to those campuses) which is inflating the number of units on the market. To make things worse 99% of those units are condos with shared outdoor spaces So yeah it's bad but it's partly due to how tight the market is there, and how remote-capable, and how young that demographic is.
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Aug 19, 2020 05:27
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Hadlock posted:My guess is for a U shaped recovery if vaccine research continues to be successful, but if not will crater the housing market Wouldn't there need to be an existing success for things to continue to be successful?
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Aug 19, 2020 15:44
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Gabriel S. posted:As for the market itself, lets dispel the on-going myth that cities are dead. Well, expect for one. To be fair, though, looking at inventory data up to July is still very early. Inventory as a metric is all screwed up due to restrictions and other behavior effects of the lockdowns. Real estate trends tend to move slowly, and I'm not sure how much value I'd place on numbers only 4 months into this still ongoing pandemic. I definitely agree that nobody has a crystal ball, and the outcomes are going to vary by location. A wild-rear end prediction, but I don't see how something of this magnitude doesn't change behavior regarding preferences for high-density living.
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Aug 19, 2020 17:38
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taqueso posted:Wouldn't there need to be an existing success for things to continue to be successful? In the vaccine trials? There are two in the US and one in the UK that are showing good response in the majority of participants. No word yet if the Russian vaccine is just live Ebola or saline solution Hadlock fucked around with this message at 18:28 on Aug 19, 2020 |
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Aug 19, 2020 18:25
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the Moderna one is a stock pump using a method that has never before been successfully used for a vaccine but I guess it counts as "promising" for some definitions of the word
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Aug 19, 2020 18:34
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I'm the idiot who saw the house across the street go up for sale yesterday and said hm more space for about 20% less than I'm renting for I might go for it, I'll use zillow to schedule a tour. Talked to a slimy-sounding agent dude and I'm already nervous out of my skin about it. Going to see it in person tomorrow and I'm 90% sure I'm gonna get the hard sell from the agent's rep, hesitate, and have someone else swoop in and buy it for 30% over asking while I'm hemming and hawing over the weekend. House buying is not fun!
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Aug 19, 2020 18:38
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Not a Children posted:I'm the idiot who saw the house across the street go up for sale yesterday and said hm more space for about 20% less than I'm renting for I might go for it, I'll use zillow to schedule a tour. Talked to a slimy-sounding agent dude and I'm already nervous out of my skin about it. Failing to get that particular house is A-Okay. There will be others. Don't let yourself get caught up in any false narrative of "GOTTA BUY RIGHT NOW" or anything. Go in knowing that you're about to hit a hilarious buyer's market in terms of # of houses available, and if you find something you like, awesome. If not, there will be plenty to pick from in the next month or two.
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Aug 19, 2020 19:10
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Sundae posted:Failing to get that particular house is A-Okay. There will be others. Don't let yourself get caught up in any false narrative of "GOTTA BUY RIGHT NOW" or anything. Go in knowing that you're about to hit a hilarious buyer's market in terms of # of houses available, and if you find something you like, awesome. If not, there will be plenty to pick from in the next month or two. No worries there. I've been on the fence about buying for a while now, but with prices in my area dipping and rates where they are, as well as the very healthy emergency fund I have, I'm finally feeling comfortable buying. I had to stifle a "are you loving kidding me unemployment is like 40%" when the dude I was on the phone with said it was a seller's market Not a Children fucked around with this message at 21:43 on Aug 19, 2020 |
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Aug 19, 2020 21:40
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Not a Children posted:with prices in my area dipping and rates where they are, Where on earth do you live where values are going down?
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Aug 19, 2020 21:46
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GoGoGadgetChris posted:Where on earth do you live where values are going down? The greatest city in America, of course, Baltimore
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Aug 19, 2020 22:00
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Not a Children posted:The greatest city in America, of course, Baltimore seems to generally be fair market value and rising year-over-year, not falling? https://www.redfin.com/city/1073/MD/Baltimore/housing-market
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Aug 19, 2020 22:47
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Baltimore seems to be like 1,000,000x cooler than the news makes it out to be. I know someone who got a PhD in art history and she's able to be a homeowner and support a family of 4
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Aug 19, 2020 22:52
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pmchem posted:seems to generally be fair market value and rising year-over-year, not falling? Man idk what to tell you, I've rented in the same neighborhood for about 6 years and kept tabs on prices and only recently have I seen more than the occasional rowhome for sale for sub-250k that wouldn't need a ton of rehab. I imagine most of that growth is in the fed hill/fells point/canton areas where a lot of it is rehabs sold to young financial-sector people who work in the harbor or dc GoGoGadgetChris posted:Baltimore seems to be like 1,000,000x cooler than the news makes it out to be. I know someone who got a PhD in art history and she's able to be a homeowner and support a family of 4 The city's reputation keeps out all but the biggest most stubborn assholes (i.e. me) from anywhere that isn't water- or college-adjacent, I'm glad of it. We have great parks and an amazing food scene
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Aug 19, 2020 23:09
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pmchem posted:seems to generally be fair market value and rising year-over-year, not falling? Not a Children posted:The city's reputation keeps out all but the biggest most stubborn assholes (i.e. me) from anywhere that isn't water- or college-adjacent, I'm glad of it. We have great parks and an amazing food scene
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Aug 20, 2020 02:51
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Ohfff...learned the hard way that if you're buying an older home you need to get a chimney inspection. Didn't give much credence to the functioning wood burning fireplace claim, but it would have been nice to know what the hell we were dealing with. Apparently, the 100+ year old chimney no longer has a lining, has had the top several feet of brick removed, and is way out of code. I totally believe the prior owners occasionally used it, but it is realistically no longer a functioning fireplace unless we cough up a significant amount of money to fix. Picked the wrong one as the sewer scope was spotless.
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Aug 20, 2020 04:44
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MayakovskyMarmite posted:Ohfff...learned the hard way that if you're buying an older home you need to get a chimney inspection. Didn't give much credence to the functioning wood burning fireplace claim, but it would have been nice to know what the hell we were dealing with. Pretty much any house in my area that has a fireplace has a disclaimer that it exists but is not represented as being functional and or to code. so basically "House has 2 fireplaces, use at your own risk, get inspected before you use it or die/bun your house down"
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Aug 20, 2020 13:17
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GoGoGadgetChris posted:Baltimore seems to be like 1,000,000x cooler than the news makes it out to be. I know someone who got a PhD in art history and she's able to be a homeowner and support a family of 4 Baltimore has nice neighborhoods and then you go two blocks in the wrong directions and there's a trash can fire in the middle of the street.
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Aug 20, 2020 17:09
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MrLogan posted:Baltimore has nice neighborhoods and then you go two blocks in the wrong directions and there's a trash can fire in the middle of the street. This is true of pretty much all medium to high density urban areas
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Aug 20, 2020 18:32
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MrLogan posted:Baltimore has nice neighborhoods and then you go two blocks in the wrong directions and there's a trash can fire in the middle of the street. But enough about Edmondson Ave. 
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Aug 20, 2020 18:41
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Stupid question. If I bought a house with < 20% down payment, even if I come up with what would amount to 20% some time after the purchase, there would be no way to decrease the monthly payments for the life of the loan without refinancing right? Excluding PMI, of course PMI would end as I hit 20%.
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Aug 20, 2020 19:14
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Inner Light posted:Stupid question. If I bought a house with < 20% down payment, even if I come up with what would amount to 20% some time after the purchase, there would be no way to decrease the monthly payments for the life of the loan without refinancing right? You could recast your mortgage: https://www.bankrate.com/mortgages/what-is-mortgage-recasting-and-why-do-it/
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Aug 20, 2020 19:16
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Inner Light posted:Stupid question. If I bought a house with < 20% down payment, even if I come up with what would amount to 20% some time after the purchase, there would be no way to decrease the monthly payments for the life of the loan without refinancing right? Not necessarily. Ask your lender about "recasting" your loan. They all have a policy on it. Some will charge you a fee, some will require a minimum amount (like 5 figures), some will do both. Some don't allow it, though. edit: Inner Light posted:Excluding PMI, of course PMI would end as I hit 20%. Not necessarily. By law, they don't HAVE to automatically remove PMI until 78% LTV (using the original appraised value). Once you hit 80% LTV they must remove it at your written request, but they are not required to automatically remove it. They MIGHT remove it automatically at 80% LTV, but don't bank on it. Once you hit 80%, make a written request to remove it, just in case they weren't planning on it. DaveSauce fucked around with this message at 20:00 on Aug 20, 2020 |
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Aug 20, 2020 19:16
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Went to see the house across the street today. Super cute and updated in a few ways, but definitely needs some elbow grease. Kitchen counters are made of something one half-step above particle board, the unfinished basement is a mess of dirt and detritus, and the entire second floor is ungrounded electrically. All appliances (except the 20 y.o. A/C unit) and roof are new, though. Maybe I'll just throw out a lowball and see if they bite. Is there any harm?
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Aug 20, 2020 19:19
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Not a Children posted:Went to see the house across the street today. Super cute and updated in a few ways, but definitely needs some elbow grease. Kitchen counters are made of something one half-step above particle board, the unfinished basement is a mess of dirt and detritus, and the entire second floor is ungrounded electrically. All appliances (except the 20 y.o. A/C unit) and roof are new, though. Depends on how hard they bite.  FYI, even with a lowball offer, keep your inspection contingency. My Scary House Sense(tm) is tingling.
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Aug 20, 2020 19:23
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Sundae posted:Depends on how hard they bite. Oh, I literally work in construction design and make my bones off of botched professional jobs, so I would never ever buy anything without a guaranteed inspection At the risk of doxxing myself, this is the house - https://www.redfin.com/MD/Baltimore/3811-Hickory-Ave-21211/home/10858955
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Aug 20, 2020 19:34
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That's a cool house with good curb appeal Would be neat if you made friends with the neighbors and tore down that oppressive fence in the back yard
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Aug 20, 2020 19:56
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Thanks for the info about recasting! Did not know about it and will be a big help if I decide to close with less than 20% (and an important question to ask potential lenders). Another question regarding if I receive any assistance from family members for the down payment. I've read differing information. If I provide a gift letter to document it, and it states repayment is not required, is the gift giver allowed to accept repayment? For example even if repayment is not required I decide I have enough to pay them back in the future, is that acceptable? One source I read says the gift giver is not allowed to receive repayment, but other sources say only that the gift giver can't intend to receive repayment. I'd like to avoid fraud 
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Aug 20, 2020 20:50
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DaveSauce posted:Once you hit 80% LTV they must remove it at your written request, but they are not required to automatically remove it. They MIGHT remove it automatically at 80% LTV, but don't bank on it. Once you hit 80%, make a written request to remove it, just in case they weren't planning on it. The 78% rule is to initial value, though.
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Aug 20, 2020 21:00
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Inner Light posted:Thanks for the info about recasting! Did not know about it and will be a big help if I decide to close with less than 20% (and an important question to ask potential lenders). The letter of the law requires intent to commit fraud, so if they really didn't intend for you to repay them and you really didn't intend to repay them when the gift was given you are in the clear. That doesn't mean you can't be investigated at some point in the future. If you or your family member were seeking public office this is a legitimate concern. If the FBI were interested in investigating you for completely unrelated reasons this might also be a legitimate concern. You then get into the fact that lying to the FBI is a crime even if it's completely unrelated to the mortgage fraud being investigated. The abundance of caution is just to avoid giving them a thread that could hang you.
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Aug 20, 2020 21:06
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Inner Light posted:Thanks for the info about recasting! Did not know about it and will be a big help if I decide to close with less than 20% (and an important question to ask potential lenders). If at some future date you decide to give your family a gift that's fine, but don't go into it with that intent, and your future gift is not paying back the previous gift. Do not write about how you will pay them back. Or anything. Don't commit 2 crimes at once.
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Aug 20, 2020 21:06
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Not a Children posted:Oh, I literally work in construction design and make my bones off of botched professional jobs, so I would never ever buy anything without a guaranteed inspection Ah, whoops! Sorry about that. =) You know way the hell more than I do about any of this stuff then, so I'll keep my mouth shut. 
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Aug 20, 2020 21:12
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It’s not fraud if you decide to be a bro and pay them back for that help they provided on your down payment years ago. As long as that decision is your own and it was not expected, it’s allowed. There just can’t be any expectation whatsoever that you’ll pay back that gift. If you decide to do so anyway that’s allowed.
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Aug 20, 2020 21:54
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Stupid refi question since I've never done it. Do people REALLY roll closing costs in to the refi? All the loan officers we've dealt with seem pretty intent on it. It feels pretty dumb to pay interest on that, but at the rates we're talking about it's not truly awful.
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Aug 20, 2020 23:58
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DaveSauce posted:Stupid refi question since I've never done it. I'm in the process of a refi (locked, all paperwork in, etc.) and I am abso-loving-lutely rolling all costs into the loan. If someone wants to give me money at 2.5% on a 30-year loan, I will take it and either spend it now or put it in some ETF that's gonna return more than 2.5% annually over the next 3 decades.
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Aug 21, 2020 00:01
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Summit posted:It’s not fraud if you decide to be a bro and pay them back for that help they provided on your down payment years ago. As long as that decision is your own and it was not expected, it’s allowed. There just can’t be any expectation whatsoever that you’ll pay back that gift. If you decide to do so anyway that’s allowed. Here is the article that conflicts, specifically it says a gift letter must include a clause that says they will not accept repayment, as opposed to simply lacking the intent: quote:You may be wondering if you can repay a mortgage gift. The answer is no. That’s because the gift letter needs to explicitly state that the donor will not accept any repayment. Again, it’s to ensure the legitimacy of the monetary gift. https://www.rockethq.com/learn/home-buying/understanding-gift-letters-and-your-mortgage I guess certain mortgage lenders would be ok with the letter leaving that part out and some would not be?
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Aug 21, 2020 00:13
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"Repayment" is prohibited. You can, however, always give money to your family member or whoever later. It just cannot be repayment of the loan. It needs to be a separate thing. Like my mom gave us $10k to help with our down payment. A couple years later I gave her some money just to be nice. It had nothing to do with my down payment. That's allowed. The concern here from a legal standpoint is that someone you have borrowed money from could legitimately place a senior lien on your home to recover that money, and the bank would then find its own mortgage to be junior debt and potentially unrecoverable or not fully recoverable should you default. Because undisclosed borrowing is a rampant problem, the bank wants you to be 100% clear in writing with your signature attached that you are not borrowing money.
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Aug 21, 2020 00:24
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