Housing prices are nuts, paid $17 million now

Luxury homes in my market are doubled or tripled for the most part since the 'rona hit. Even with the bidding wars the sub 1 mil homes are at best 50% up locally. Trusts and commercial rental buyers are driving pricing up in a few neighborhoods.
All gravy for me, aging workforce with no real interest in trades by the younger generations and a increasing demand mean skilled trades here can ask premium pay.

 

Exurbs here in DFW have exploded since (and really even before) work-from-home became a thing. I could drop mine for 1.5x what I paid for it 1.5 years ago. The place we were considering but didn't buy has damn near doubled.

I'm looking at very rural Oklahoma... We could build what we actually want for the profit-minus-taxes on this place. It's tempting, but a damn long commute for dogshit scooping and I really don't want to have to get a real job even if it is back in the financial field and telecommute. Plus I really love having a mortgage that is about one-third of CPI inflation in such a hot market.

Oh, and I didn't pull OK outta my ass: https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494

Only Tennessee is really on the table other than OK. (Or maybe a really low value rural place in AK, but then you're talking "DONE" retirement which brings up the possibility of expat)



First world problems...

 

I'm assuming you were in a coma in 2008?

Unless you got f*** you money and can sit on property for years on the end while simultaneously dumping money into the upkeep and taxes, real estate isn't the risk free investment people love to make it out to be.

 

If you fuck up when you buy- it doesn't matter what asset class you've overpaid on...

 

Agreed 100% but people like to act as if real estate is somehow immune to that fact because it's physically tangible.

 

I can see the movie Yhe Big Short happening again...
Banks are lending money for the super over inflated home loans... someone is going to get stuck holding a bag of crap at some point.

 

Buck Hill is also a favorite. We liked the patio as an outdoor option this past summer.

 

Its pretty awesome. After the downturn in 2008 my industry’s pay went wayyy down. I was making 500-600 a week so I had to do other shit to get by. everyone kept telling me to switch careers but I regularly read industry statistics and could see the shortage on the horizon. I stuck with it and now I’m making north of 100k working 40-45 hours a week and can reasonably expect to be close to 200k in 5ish years with raises and maybe a little more overtime. The median age for a tech in my industry is like 53 and climbing every year. Within the decade we will lose close half our workforce to retirement/aging with positions demanding knowledge of procedural process for repairing ever more advanced vehicles growing. I have an amazing benefits package growing. I pay 11 dollars a week for full coverage Medical. A few more for dental/vision and like 10 bucks a week for a million dollar life insurance policy and a half mil in supplemental/catastrophic injury insurance. The apathy of the new generation is doing wonders for my bottom line. And I will raise my children to understand what a good skill and a determined work ethic can get you. the gap between the haves and the have nots is getting worse. My kids are not going to be on the wrong side of that fence.

 

I was in a coma because I didnt spend like a drunken sailor on property like I shoulda, an acquaintance bought 3 houses (mc mansions) in vegas for pennies on the dollar rented them and sold 10 years later. Needless to say he was many many hundred of thousands of dollars richer.

Rich people know this shit, that was bargain time and sooner or later in a growing market prices bounce back. In the rust belt not so much.

 

its not immune but its pretty good, Vanguard is pretty good too.

 

Some poor sucker is holding my 2.25% mortgage right now. That's less than one-third of inflation. They are literally losing purchasing power by holding it.

 

All this talk of inflation, and then I get this this morning.

Will CD ladders be a thing once again?

 

Possibly...interest rates are going to have to go up.

 

For all this talk of a hot market, I've had a house for sale for 4 months now and finally got my first offer this weekend. House appraised at $415, I had it for sale at $420 for months, then lowered it to $399. Got an offer this weekend for $350. I told my realtor to counter at $390...no response. This house is in one of the hottest neighborhoods in Louisville. I can't figure it out. Mom had this house totally renovated 2 years ago, everything is up to date. Sad thing is that she said she did the renovation for us, but it would have been better if she never spent the money and we sold as is.

 

No singular entity is holding your mortgage - it's been securitized with a thousand others into a residential mortgage backed security (RMBS). And there's tons of investors who view getting 2.25% as a significantly better risk adjusted return than they're getting on commercial paper, etc.

I'd be very interested to hear about this as well.

 

Started to look at building a new house, doing most myself besides subbing out the foundation and shell. No McMansion, just a 2000sq ft cabin/a-frame over a garage. and wow… just really hard to grasp some of the informal sub quotes I’m getting for a fairly simple foundation and framing.

 

That's an option i'm considering too....I"m in the construction biz so i have plenty of contacts and 'friends', but we'd have to see how that goes. The framing/roofing/drywall/painting/mechanicals is what i wouldn't do myself.

Give me a cracker jack box around 1200 sq and im good. I may consider not having a basement and put that $30-35k into a metal garage/building.

https://www.zjhomes.com/floor-plans/new-richmond/

$147k + $27k basement + $12k garage = $186k on my 1-3 acre lot....or $159k without basement.

 

Doesn't quite work like that with amortized loans. During the profitable years of a mortgage, if you are like the vast majority of Americans and making the minimum payment, you are paying mostly interest. 10 years in on a 30 year fixed and you will have barely made a dent on your principal. Since the average person refinances every 3.8 years, and sells a house every 8 years. The lenders know they won't hit a rate of return down at the note rate very often.

People who pay ahead really mess with the plan, but statistically speaking, the house usually wins until it all goes tits up.

 

Not sure what the national statistics are, but a staggering portion of homes in many regions are seeing price escalation with all cash offers. There’s a lot of outcry in some areas that people financing aren’t even able to compete in some housing markets. NAHB is also putting forth some reasonable data on a long term housing stock shortage. If that’s how it’s playing out on the national level, really mitigates the chance of a major forced price correction. A lot of Workforce/Economic Development talks these days are regarding a dichotomy. We have areas with great job growth and near unaffordable working class housing and areas with affordable housing but meager quality job growth or outlooks. This has always partially been the case but it’s magnified to the point that many small towns are dying and in each region, an unfathomable amount of the economic development is occurring in predominately just a handful of zip codes.

 

I pretty much lived / been to all SE Asia, some South America and now in Europe. I have a pretty good knowledge now living abroad as EXPAT. If I didn’t have a kid late age, I would’ve have retired and live as a EXPAT at 42. Lol. Now I have to wait like another 10 years.