Well, it looks like home values have just taken the biggest drop in 20 years...

http://biz.yahoo.com/ap/070828/home_price_index.html?.v=3

...While NoVA isn't anywhere near the hardest hit region of the country (you would have to go to Miami or Las Vegas for that), I'm amazed to see lots of houses for sale in areas that previously had little or no inventory, including Mantua, Clifton, Oakton, etc.

Anybody got any local housing horror stories/successes?

My mistake. Washington, DC is in the top cities for price drops. Yikes!

I am looking for a house now.
People wont fucking lower their prices.

They still live in 2004-2005

I still say this could be the end of the world as we know it.

Can you imagine when the thousands of people here who bought during the boom get their next little job opportunity elsewhere? Most are in hock up to their eyeballs anyway....how are they going to bring a $100K or more to the settlement table? These houses won't rent for anywhere near the mortgage payment, so that's out.

I imagine a lot of them will just walk away. And, of course, with a foreclosure on their record, they will not be buying anything in their new area.

So, we'll be back to a nation of renters..and neighborhoods go to shit when there's a high proportion of renters so house prices fall even more.

Unless there's a massive government bail-out it could get real ugly.

I wish the hell I had sold during the boom...I don't think we'll see those prices again in my lifetime.

The Dude Wrote:
-------------------------------------------------------
> I am looking for a house now.
> People wont fucking lower their prices.
>
> They still live in 2004-2005


I've figured out something about that. A lot of people took 2nd and 3rd mortgages during the price run-up. Now, they owe more on their houses than they are actually worth. In addition, because people owe so much on these houses when they go into foreclosure, the banks are trying to recover that debt amount at auction, so there aren't real good values there, either.

A lot of people think they can sit on a house at a price they want and think it will eventually sell. I have news for these folks. If your house is on the market for 6 months...IT IS PRICED TOO DAMN HIGH!

People need to decide whether they want to sell their house at a loss of $25K to $150K or ride it out into bankruptcy court, because that is where a lot of these people are going to end up.

The Dude Wrote:
-------------------------------------------------------
> I am looking for a house now.
> People wont fucking lower their prices.
>
> They still live in 2004-2005


People are slow to grasp current trends. I have a Realtor buddy that is turning down listings where people won't be reasonable on pricing. Listing a grossly overpriced house is a total waste of time, says he.

duh Wrote:
-------------------------------------------------------

>
>
> People are slow to grasp current trends. I have a
> Realtor buddy that is turning down listings where
> people won't be reasonable on pricing. Listing a
> grossly overpriced house is a total waste of time,
> says he.


I know a guy who won't lower the price on his house because "I've put a lot of work in it and it is worth it." No it's not.

Your house is worth what the market says it is worth. If you have a 4-bedroom, 2,500 square-foot house, it is worth X-amount plus or minus a few percentage points...period.

The upkeep may result in it selling faster or in you not having to negotiate as much. But there's no fucking way painting it every two years and getting the ducts cleaned every year is going to result in it being worth $100K more than any other 4-bedroom, 2,500 square-foot house in your neighborhood.

Another reason why it's a bad idea to get a gold-plated toliet. -§

Think of those who actually have to come to closing with cash to sell their homes. They buy the place for 500k then sell for 450k. They owe 50k before they can actually sell the home. That is why you never take equity out of a home. Besides the 50k you lost on the home value going down you would also have to pay off the home equity loan that was taken out.

I agree some people are stubborn and want much more than the home will ever sell for in todays market. I don't blame the realtor for not taking the listing.

On the plus side the rental market is in good shape. Come October you could pick up some cheap condos on sale then rent them out if you are into that. A benefit is the condo fee is tax deductible and there are other costs associated with renting a home that you can write off at tax time. The cost of renting really hasnt went down much, maybe 50-100 bucks on a 1,200 a month unit.

I thought the Condo fees are NOT tax deductible...

I thought the Condo fees are NOT tax deductible...

They definitely are NOT tax deductible. I own a condo and can say that with absolute certainty.

duh Wrote:
-------------------------------------------------------
> I still say this could be the end of the world as
> we know it.
>
> Can you imagine when the thousands of people here
> who bought during the boom get their next little
> job opportunity elsewhere?

Not all, but many have sold their previous houses with nice profits, so they either have a lot of equity in their now overpriced homes right from the start, or have cash. They can actually take some loss. Also, there are still companies (and Government!) that pay relocation, incl. buying out houses - my neighbours moved out last year and reloc. company bought their house. They then sold it 5 months later with ~$45K discount.

We've been looking for a new house for a while, and most deeply discounted houses have some kind of flaws - close to a highway, small backyard, poor condition, plain ugly... Good houses are still $$$ and haven't been discounted much.

Fairfax MF---er Wrote:
-------------------------------------------------------
> Anybody got any local housing horror
> stories/successes?

Well like a dozen hispanics moved into one house on our street and the neighbor whos house is for sale has been on the market a long time, I think due to that. So our block's value went down

Dirty Jersey Wrote:
-------------------------------------------------------
> Fairfax MF---er Wrote:
> --------------------------------------------------
> -----
> > Anybody got any local housing horror
> > stories/successes?
>
> Well like a dozen hispanics moved into one house
> on our street and the neighbor whos house is for
> sale has been on the market a long time, I think
> due to that. So our block's value went down

The flop house probably doesn't help. But I've seen houses in neighborhoods without flop houses that have been on the market going close to two years now.

Dirty Jersey Wrote:
-------------------------------------------------------
> Fairfax MF---er Wrote:
> --------------------------------------------------
> -----
> > Anybody got any local housing horror
> > stories/successes?
>
> Well like a dozen hispanics moved into one house
> on our street and the neighbor whos house is for
> sale has been on the market a long time, I think
> due to that. So our block's value went down



Contact the county....can't have more than I think 4 unrelated immediate family members in a dwelling in Fairfax County.

"A benefit is the condo fee is tax deductible and there are other costs associated with renting a home that you can write off at tax time"

Condo fees are certainly deductible if you own the condo and are renting it out. If you live there they are not. My post stated it was a rental property investment not a primary residence. If you own a condo and dont live there and are renting it out and not claiming a deduction then you are getting bad tax advice.
Any work done on rental property is deductible like in new stove, hot water heater, painting etc.

People are fucking stupid, plain and simple. There are two reasons their homes won't sell right now:
1) They're listing too high
2) There are VERY few actual buyers out there

I can personally attest to number 2 as I've been listed for the past month, below the competition and even below the assessed value. Lowering it even more is almost pointless, unless it attracts some dumb shit that thinks he's getting a "steal". This market is so fucked, and I want to punch every realtor that's still saying "now's the time to buy!"

Condo fees are certainly deductible if you own the condo and are renting it out. If you live there they are not

Oh, I live in mine, I thought that's what you were talking about.

stinkypoon Wrote:
-------------------------------------------------------

> This market is so fucked, and I want to punch
> every realtor that's still saying "now's the time
> to buy!"


It is...if you can sell your fucking house!

I wonder how many realtors are turning the gas on in their ovens right now. You have people who started in 2002 or 2003 who were probably pulling in 6-figures every year. Those same people are probably lucky now to make as much as a bagger at Giant.

Stay in school kids. Stay in school.

The bigger problem is the tightening of the credit markets. Mortgage rates in our area are about 6.5%. That's *if* you can get a mortgage. They aren't handing them out like the used to now that the sub-prime markets have collapsed. Now they're actually checking to see if you have a job.

trogdor! Wrote:
-------------------------------------------------------
> The bigger problem is the tightening of the credit
> markets. Mortgage rates in our area are about
> 6.5%. That's *if* you can get a mortgage. They
> aren't handing them out like the used to now that
> the sub-prime markets have collapsed. Now they're
> actually checking to see if you have a job.


Jumbo rates are 7 1/2+, which is probably what most people need to buy a house around here...plus 20% down.

Thanks to all the deadbeats who lied on their credit applications and the fly-by-night mortgage originators and the predatory banks for causing this debacle. Fuckers.

duh Wrote:
-------------------------------------------------------
> So, we'll be back to a nation of renters..and
> neighborhoods go to shit when there's a high
> proportion of renters so house prices fall even
> more.
>
> Unless there's a massive government bail-out it
> could get real ugly.

those people should have been renting anyway... no real change from what should have been happening in the first place.

and what bailout? hand cash to people who stole their houses and loans by lying about their income, just ot save a few percentage points on property value? i'd rather see my house value fall wo what I currently have in my wallet before federal cash handouts to liars or idiots. unless of course i get the cash too

You can still get a mortgage, with just 5%

Who has 20% these days???

realist Wrote:
-------------------------------------------------------
> duh Wrote:
> --------------------------------------------------
> -----
> > So, we'll be back to a nation of renters..and
> > neighborhoods go to shit when there's a high
> > proportion of renters so house prices fall even
> > more.
> >
> > Unless there's a massive government bail-out it
> > could get real ugly.
>
> those people should have been renting anyway... no
> real change from what should have been happening
> in the first place.
>
> and what bailout? hand cash to people who stole
> their houses and loans by lying about their
> income, just ot save a few percentage points on
> property value? i'd rather see my house value
> fall wo what I currently have in my wallet before
> federal cash handouts to liars or idiots. unless
> of course i get the cash too


By bailout, I'm thinking more along the lines of forcing unscupulous lenders to restructure these loans to fixed rate and/or low interest. After all, it's their lying brokers and hocus pocus that hoodwinked a lot of these saps in the first place.

I have no sympathy for the borrowers that lied about their income, etc...but a lot of them were egged on by slimy mortgage brokers.

I have the most sympathy for honest borrowers who pay their mortgage on time every month...but due to the bad luck of having bought at the height of the boom...are now stuck with a house that they can't sell, except at a huge loss.

The problem is that a lot of fools got into this house flipping after watching shows that promoted people making $100,000 off a house flip in two weeks.

Now everybody expects to make huge profits off their houses and new buyers are looking for fixer uppers.

Plus, let's be honest, real estate brokers are a dime a dozen. Can't get a real job... take a quick class and become a mortgage or real estate broker.



Edited 1 time(s). Last edit at 08/30/2007 10:47AM by Lurker..

The Dude Wrote:
-------------------------------------------------------
> You can still get a mortgage, with just 5%
>
> Who has 20% these days???


That's doubtful. There is a credit crunch going on.

I have 20% - actually more in equity if I were to sell and then buy. And I have only owned 3 years.

duh Wrote:
-------------------------------------------------------

> By bailout, I'm thinking more along the lines of
> forcing unscupulous lenders to restructure these
> loans to fixed rate and/or low interest. After
> all, it's their lying brokers and hocus pocus that
> hoodwinked a lot of these saps in the first
> place.

Agreed mostly. But this doesn't encourage people in the future to do what I did... bought a house that wasn't the "dream" house, bought it with a loan below my means with a 10% down payment. Old-school I guess. I don't want to see bailouts other than loan restructuring at current market fixed rates because then the assholes who bought way over their means (either because they were stealing or because the were diots) then get to keep the spoils of their crimes and/or idiocy.

duh Wrote:
-------------------------------------------------------
>
>
>
> By bailout, I'm thinking more along the lines of
> forcing unscupulous lenders to restructure these
> loans to fixed rate and/or low interest.

Most of the scam artists are out of business, out of the country or simply don't have the money available to restructure these loans. That is the biggest problem is that credit to the mortgage brokers themselves is drying up as well.

Unfortunately if this turns into another S&L crisis (which I think it will, but worse) the Feds will end up having to step in at some point. I imagine it would be along the lines of using Fannie Mae or Freddy Mac to set up refinancings at 6.5 percent on debt that can't be covered by the collateral of the property with the hope that the value of the property eventually goes back up enough to cover the loan.

Real Estate will go up, but not as fast as it did before.

"RichieRich (IP Logged)
I have 20% - actually more in equity if I were to sell and then buy. And I have only owned 3 years."

Which is why you do not take equity out of your home if you want to move up in homes. Only me speaking but I wouldnt take equity out of my home unless it was to improve the home like adding a garage or something that will improve the value.

I am also curious why do people buy in a bad neighborhood of very small single family homes, knock down the old house and put up a mansion that takes up the whole lot? You will never get the value out of the mansion. If it was to go for 800k and every home around you went for 400k who is going to buy it. Anyone that can afford the 800k will look in a 800k neighborhood not surrounded by riff raff. I know I am missing something but I dont know what.

RichieRich Wrote:
-------------------------------------------------------
> I have 20% - actually more in equity if I were to
> sell and then buy. And I have only owned 3 years.


If you bought in 2004, you have no equity in your home. You may think you do because of your tax appraisal. But just try to sell it and see what you get for it.

Fairfax MF---er
----------------------------------------------
if you bought in 2004, you have no equity in your home. You may think you do because of your tax appraisal. But just try to sell it and see what you get for it.


Actually, aside from my tax appraisal, I KNOW what I paid, I KNOW that it was WELL BELOW neighborhood value when I purchased it due to its poor condition, I KNOW that all improvements were done with my own two hands (saving $$, not paying contractors), or with the help of friends (who are contractors) and include new kitchen, bathroom, windows, water heater, central A/C, the list goes on (approximately $20K in materials). I KNOW that I have a conventional mortgage where at least SOME of the money pays for principal (almost $20K over the past 3 years). I KNOW that the two homes next to me sold for more than $150K more than I paid three years ago. They both settled within the past 15 days and took less than 30 days to get a contract on them. Like my home, they are in good condition with many updates/amenities. Arguably, my home is a bit more desirable as it is a larger more buildable lot.

So, in conclusion, MF---er, you pessimistic peckerwood, you may THINK all you want, but you don't KNOW squat.

I guess I'm a little confused. I bought my condo in 2001 before prices really took off. Based on recent sales, my condo is still worth $100,000+ more than what I paid. And while that might not seem particularly significant given the prices of single family homes, it is significant in relation to what I paid for the condo.

So is this really just impacting people that bought at the height of the "bubble"? If so, why didn't they expect this to happen? It's not like it wasn't predicted.

RichieRich Wrote:
-------------------------------------------------------
> Fairfax MF---er
> ----------------------------------------------
> if you bought in 2004, you have no equity in your
> home. You may think you do because of your tax
> appraisal. But just try to sell it and see what
> you get for it.
>
>
> Actually, aside from my tax appraisal, I KNOW what
> I paid, I KNOW that it was WELL BELOW neighborhood
> value when I purchased it due to its poor
> condition, I KNOW that all improvements were done
> with my own two hands (saving $$, not paying
> contractors), or with the help of friends (who are
> contractors) and include new kitchen, bathroom,
> windows, water heater, central A/C, the list goes
> on (approximately $20K in materials). I KNOW that
> I have a conventional mortgage where at least SOME
> of the money pays for principal (almost $20K over
> the past 3 years). I KNOW that the two homes next
> to me sold for more than $150K more than I paid
> three years ago. They both settled within the
> past 15 days and took less than 30 days to get a
> contract on them. Like my home, they are in good
> condition with many updates/amenities. Arguably,
> my home is a bit more desirable as it is a larger
> more buildable lot.
>
> So, in conclusion, MF---er, you pessimistic
> peckerwood, you may THINK all you want, but you
> don't KNOW squat.


i heard the qualty of the work was bad which may exaplin why yo uare losing money

lol, you heard wrong! I love how all you numbnuts act like you know everything, when in reality you are complete idiots. I mean seriously, just because none of you have any equity, means nobody else can? If you are all this stupid, no wonder you have no equity or savings! The quality of my work is far better than any of the day laborers in this area. It paid my way through undergrad and grad school. Why would I pay to have a guy who came from house made of corrugated tin, put up drywall? Most never saw drywall until coming to this country.

yea what you do effects that

I don't know where they learned it, but beaners are REALLY good at concrete finishing and hanging drywall. They're excellent bricklayers too.

RichieRich Wrote:
-------------------------------------------------------
> lol, you heard wrong! I love how all you numbnuts
> act like you know everything, when in reality you
> are complete idiots. I mean seriously, just
> because none of you have any equity, means nobody
> else can? If you are all this stupid, no wonder
> you have no equity or savings! The quality of my
> work is far better than any of the day laborers in
> this area. It paid my way through undergrad and
> grad school. Why would I pay to have a guy who
> came from house made of corrugated tin, put up
> drywall? Most never saw drywall until coming to
> this country.


I'm a realist. This is the worst real estate market in 20 years. I guarantee if you bought in 2004 (a year before the height of the bubble) - regardless of the condition of your place - and tried to sell now, you would have to slash the price to unload it. NOTHING is selling. Period.

duh, you are sorely mistaken. Have you looked closely at most immigrant drywall jobs? the seems are visible, the joint compound is not sanded down properly, and often times it is improperly installed (cut poorly, laid across the beams the wrong way, etc.)

Fairfax MF---er, you are a "realist"?!? Where in the real world is "NOTHING" selling? I have no idea where you live, but I assure you, outside of that little world of yours, homes are selling. I just told you the two homes right next door to me just went to settlement within the past two weeks. The contracts were offered in July. My sister is moving into her new home this weekend. Granted, she is a buyer, but do you know who she bought it from? That's right, a seller! Give yourself a pat on the back. Your guarentee is hollow. I know facts. The facts tell me that my sister bought from a person who purchased the home in December of 2003, the seller made $112K after closing costs, commissions, etc. Granted, they were asking for more, and the house was on the market 45 days, but they still made a profit. I know that one of my neighbors purchased his home in February of 2004. He sold in August of 2007 for $144K more than he bought his home. It sold within 30 days. Every week, the Washington Post lists area home sales. Granted, it is the Post and they tend to make a bunch of stuff up, but I doubt they are fabricating the homes sales section. There are a ton of factors that go into home pricing and sales. Bargains can be had now, and if you looked in the right places, they were there at the height of the bubble. Look, I agree the prices have declined, but you make these blanket statements with no facts whatsoever, In your first post, you asked for success stories. I gave you one, and you quickly dismissed it with your guarentees and your know it all attitude. I understand you are depressed about this market, but quite frankly I am pumped. I bought in 2004, I know I can make at least a $100K over what I paid then. Dismiss it all you want, but that number is easily attainable in my neighborhood. With that, my savings and my $20K paid into my mortgage, I can make a nice down payment for a larger/better home at a time when the buyer has some leverage. We haven't decided to sell, but I wouldn't mind doing it in this market. I've made good money off this house and I would rather buy in a buyer's market. I consider it a "success."

I believe Mr Rich. If he got a place that needed some work or had an unfinished basement that he finished himself then he could easily have equity in the place.
At least he is smart enough to keep the equity and not spend it on shiny SUVs with spinning wheels.

Hey Richie, my BS detector is going off.

If you have paid off 20K of principal in only 3 years, you have:

a) a HUGE mortgage, or

b) you have been making pre-payments of principal (a very smart thing to do), or

c) you're full of shit

During the early years of a mortgage, your payment goes almost entirely towards interest.

duh Wrote:
-------------------------------------------------------
> Hey Richie, my BS detector is going off.
>
> If you have paid off 20K of principal in only 3
> years, you have:
>
> a) a HUGE mortgage, or
>
> b) you have been making pre-payments of principal
> (a very smart thing to do), or
>
> c) you're full of shit
>
> During the early years of a mortgage, your payment
> goes almost entirely towards interest.


20K paid into his mortgage? Obviously the guy doesn't know what he is talking about. Your mortgage is upside down....virtually interest only....for the first half of your mortgage. That $20K is almost all interest. You maybe have a grand or two paid down on your principal. All you've done is hand money to the bank.

$20k in principal in 3 years using a standard amortizer with 2004 market rate assumptions means he would have a note of approx. $600k. Not unrealistic in FFX.

To the previous comment, you sure can have equity if you purchased in 2004 at today's market value. I'm sitting on $150k compared to sales in the previous quarter. I was sitting on a $250k this time a year ago. -§

Yes, it is front loaded on interest, but depending on the size of your note and interest rate, you can absolutely pay $20k in principal. I've paid about $26k since inception with a note just over $500k and 4.5% rate. -§

I bought my condo in 2001 before prices really took off. Based on recent sales, my condo is still worth $100,000

I'm [thankfully] in the same boat. Bought my condo in 01, and it's still worth more than double of what I paid. And based on similar property sales in my complex, I could sell it in less than week. Not everyone's screwed: some folks are lucky and some ain't.

You have to make the effort to pay principal because the mortgage companies sure won't make it readily known. Some are slick and it you dont specify that the extra money goes to principal they will put it in escrow and give it back to you at the end of the year.
Just putting even a few hundred in extra every month adds up quick and reduces the life of the loan.

Genevieve Wrote:
-------------------------------------------------------

> So is this really just impacting people that
> bought at the height of the "bubble"? If so, why
> didn't they expect this to happen? It's not like
> it wasn't predicted.


It really depends. Alot depends on all of your neighbors (the % of them) who *did* buy during the bubble times and got a sub-prime mortgage. If you sold right now you'd make $100,000 more than you paid. But what happens in a year when there are 9 foreclosures for sale at the same time you want to sell yours? Banks will want to liquidate the real estate quickly, so they will drop the price. Assume you bought at $300,000 and recent sales are at $400,000. Within a year you could theoretically see price competition drive prices to $300K or below as banks dump foreclosed homes. Even if this doesn't happen in your neighborhood, if it happens in the areas around your home it will also have an impact as buyers will now have large numbers of homes with desperate sellers. Either way, I think if you bought in the last 2 years as an 'investment', you're screwed. If you bought because you needed a place to live, you'll be fine.

trogdor! Wrote:
> It really depends. Alot depends on all of your
> neighbors (the % of them) who *did* buy during the
> bubble times and got a sub-prime mortgage. If you
> sold right now you'd make $100,000 more than you
> paid. But what happens in a year when there are 9
> foreclosures for sale at the same time you want to
> sell yours? Banks will want to liquidate the real
> estate quickly, so they will drop the price.
> Assume you bought at $300,000 and recent sales are
> at $400,000. Within a year you could theoretically
> see price competition drive prices to $300K or
> below as banks dump foreclosed homes. Even if
> this doesn't happen in your neighborhood, if it
> happens in the areas around your home it will also
> have an impact as buyers will now have large
> numbers of homes with desperate sellers. Either
> way, I think if you bought in the last 2 years as
> an 'investment', you're screwed. If you bought
> because you needed a place to live, you'll be
> fine.

Has anyone here ever bought a foreclosed property at a good price? I'm seeing some foreclosed props around here and after you calculate in the work and time to get it back to speed, the cost value isn't all that great. Banks aren't giving this crap away and you always risk the prev occupant trashing the place in mysterious ways as retribution. The guy next to where we live bought a foreclosed prop for 450k unfinished home 15yrs ago and dropped another 400k to finish it. It's worth double that now but I'm more inclined to think thats a function of real estate trend rather then anything else.

Good properties are still selling and FMV as are crap properties. It's just their FMV has always been disparate against good homes and now it's more evident then ever.

duh & WashingToneLocian,
You are the prime examples of why idiots should not speak without knowing the facts. I will lay it out for you (as simple as possible) as to why and how $20K can be paid towards principal in 41 months. First, my mortgage was not that large to begin with (or at least as large as the ones stated above). It was a mere $320K. It was a 100% (no money down) conventional 30 year loan with a rate of 5.5%. The loan originated in February of 2004. This means that I am in month 41 of a 360 month payoff. According to any amortization calculator, my balance would be $304,241.06. (type the word amortization calculator into google and you can check for yourself.) This would be the balance had I done nothing further. However, when I first had the loan, my lender required mortgage insurance because there was no down payment. That insurance was $224/month. After one year of ontime payments, the lender will remove the insurance requirement if you get the house reappraised and the home has appreciated at least 20%. In February of 2005, the home was reappraised at $485,000. Keep in mind that I completely renovated the house (new windows, siding, kitchen, central AC, etc). So, in addition to the ridiculous price escalations going on at the time, improvements were made to the home. After the reappraisal, I continued to pay the additional $224, but this time putting it towards principal. So, months 13 through 41 (that is a total of 29 months) an additional $224/mo was going towards principal. That is a total of $6496 over that period. That leaves a balance of roughly a bit less than 298,000, or $22K less than the original amount. Did you follow all of that?

My original assumptions were based on 30 yr. $600k note and 6.5% over 36 mos (to arrive at $20,700), but you (1) secured a favorable rate and (2) added additional principal to arrive at your position.

Your variables reveal that you have approx. $15k in paid principal over 41 mos. plus the additional principal paid over 29 mo. @ $6.5k.

Perhaps the dissenting crowd have interest only loans? -§

RichieRich Wrote:

> So, in conclusion, MF---er, you pessimistic
> peckerwood, you may THINK all you want, but you
> don't KNOW squat.


Go ahead and put it on the market, you'll find that you won't be able to sell it for shit. You have no fucking clue how bad it is right now. That, on top of the realtor and closing costs you'll have to fork up, means you're stuck. You're just too stupid to realize it.

stinkypoon,
I know that the market isn't on fire, but I just saw both my neighbors houses sell in less than 30 days. This was just last month. I am not greedy. I know for a fact that I could still walk away with a profit if I sold for $20K less than they did and still had to cover closing, realtor fees, etc. My guess is that you are either the last guy to buy before the bubble burst and are indeed facing a loss or you have a crappy loan situation and are understandably bitter about that. The point of my posts are to show that with smart money management, choosing the right property in the right neighborhood, and work on the property can lead to some successes. Sure, I can't sell for as much as 18 months ago, but I am comfortable with the profit that I can make to reinvest into another property. I am sorry your situation sucks, but I am just saying, there are people out there who are making money when they sell.

RichieRich Wrote:
-------------------------------------------------------
In February of 2005, the home was reappraised at
> $485,000. Keep in mind that I completely
> renovated the house (new windows, siding, kitchen,
> central AC, etc). So, in addition to the
> ridiculous price escalations going on at the time,
> improvements were made to the home. After the
> reappraisal, I continued to pay the additional
> $224, but this time putting it towards principal.
> So, months 13 through 41 (that is a total of 29
> months) an additional $224/mo was going towards
> principal. That is a total of $6496 over that
> period. That leaves a balance of roughly a bit
> less than 298,000, or $22K less than the original
> amount. Did you follow all of that?


Per my original contention, you believe you can sell it at the appraised price from 2005. You can't. It's probably worth $380k right now, if you could even sell it. Minus realtor fees, your improvement costs, etc., you will be lucky to break even much less recoup 20%.

Fairfax MF---er,

I have no delusions of selling it at the 2005 appraised price, but I will say that my neighbors house just (three weeks ago) sold for $470K and the one next to him sold for $465.5K. Those numbers are after buyer incentives. I am comfortable in believing that I could easily get $420K if I put it on the market today. Now, things could get worse and I may be looking at lower numbers down the road, but I am talking about today.

RichieRich-

I can't speak for stinkypoon, but I bought in 2000 on a traditional loan and have a ton of equity built up. I also see a lot of houses that appraised for $500K+ in 2005 that are now selling in the $300K range.

RichieRich Wrote:
-------------------------------------------------------
> Fairfax MF---er,
>
> I have no delusions of selling it at the 2005
> appraised price, but I will say that my neighbors
> house just (three weeks ago) sold for $470K and
> the one next to him sold for $465.5K. Those
> numbers are after buyer incentives. I am
> comfortable in believing that I could easily get
> $420K if I put it on the market today. Now,
> things could get worse and I may be looking at
> lower numbers down the road, but I am talking
> about today.


Was that the listing price, or what they actually sold for?

The prices quoted were the actual sales prices. I even lowered them to reflect the buyer cash back that the new owners received. Both were listed for about $10-15K more. One of them did start at a ridiculously high number that was laughable. He quickly dropped his asking price within 10 days and he had a contract about two weeks later. I talked to him about his high price and he said he had always planned to drop it, he just wanted to see if anyone would bite on it and come close to it. Obviously nobody did.

RichieRich,

You mentioned you took out a loan with no down payment.
Mind sharing which bank or org backed that up?

I am looking to do the same, vs 5% down.

RichieRich Wrote:
-------------------------------------------------------
> The prices quoted were the actual sales prices. I
> even lowered them to reflect the buyer cash back
> that the new owners received. Both were listed
> for about $10-15K more. One of them did start at
> a ridiculously high number that was laughable. He
> quickly dropped his asking price within 10 days
> and he had a contract about two weeks later. I
> talked to him about his high price and he said he
> had always planned to drop it, he just wanted to
> see if anyone would bite on it and come close to
> it. Obviously nobody did.


Well, I could be wrong. I just find it hard to believe that anybody is selling anything for only $15K less than a 2005 appraisal.

Not all areas are the same.
If you look in shithole Herndon, sure - aint noone is selling at 2005
But in Tysons - its quite possible.

Kiev,
Navy Federal is my lender. If you are eligible to join, I highly reccomend them. They offer competetive rates and actually have their own settlement services department that saved me a lot on closing. Although in todays market, you can probably get the seller to cover most closing costs.

I am looking at Bank of America, as they now have no PMI.

Their rates are good too.

Fairfax MF---er,

Our neigborhood (Falls Church area) has been fairly stable with not too much of a downturn compared to the rest of the area. Prices rose very quickly and then leveled off and eventually dropped, but it was a small drop. They have held there since. Homes priced fairly don't sit on the market more than a month. I do see people who are about $40K overpriced still sitting there after months though.

So, you are in Falls Church?

22043?

Falls Church and Arlington (North) are doing fine.
Some of those areas are actually SELLERS MARKETS.

Yeah, imagine that.

22042 to be exact. Inside Rt. 50 right on the city border.

Ah, I am actively looking in Falls Church these days.

As much as I hate the man, Bush unveiled a plan today to crack down on predatory lenders and help borrowers in default. No bailout, which is good since it would not teach responsibility, but it focuses on Fed Housing to assist in affordable re-fi's and reform of tax code.

All in all, it should help with the big picture since no one stands to benefit from having every other house on the block in foreclosure. -§

Is his plan going to help?

You got a difference between a real cost of the house, and its BS, overpriced cost :)

I think any benefit that will come out of Bush's plan is to help shore up the confidence of the credit markets by showing he and the Fed are aware of the problem. However, his plan is to help people with good credit histories save their homes. That is fine, but most people with decent credit didn't take sub-prime loans to begin with and those who did have most likely already refinanced their way out of this dilemma. So I'm not sure what kind of impact it will really have in the end.

RichieRich Wrote:
-------------------------------------------------------
> stinkypoon,
> I know that the market isn't on fire, but I just
> saw both my neighbors houses sell in less than 30
> days. This was just last month. I am not greedy.
> I know for a fact that I could still walk away
> with a profit if I sold for $20K less than they
> did and still had to cover closing, realtor fees,
> etc. My guess is that you are either the last guy
> to buy before the bubble burst and are indeed
> facing a loss or you have a crappy loan situation
> and are understandably bitter about that. The
> point of my posts are to show that with smart
> money management, choosing the right property in
> the right neighborhood, and work on the property
> can lead to some successes. Sure, I can't sell
> for as much as 18 months ago, but I am comfortable
> with the profit that I can make to reinvest into
> another property. I am sorry your situation
> sucks, but I am just saying, there are people out
> there who are making money when they sell.

Actually you're wrong on all counts. I bought in 2002, and my situation with the loan is great. My situation, aside from the fact that I can't sell, is perfectly fine. I'm priced WELL below the competition, and I'll walk away with a decent chunk of change when I finally sell.

I'm listing right now a sizable margin below the 2007 assessment value. I've had neighbors, like you, that have sold recently, but I'm listing at 15% below what they sold for and it's a no-go. I'm telling you, go ahead and see if you could sell your place and walk away with that 20% "equity" you think you have. You'll be going against foreclosures and shortsells that are well below what the normal competition is, and what few buyers there are will go to those first. And if you think it'll get better, it won't for a long time. The majority of the ARMs haven't even reset yet.

§ Wrote:
-------------------------------------------------------
> As much as I hate the man, Bush unveiled a plan
> today to crack down on predatory lenders and help
> borrowers in default. No bailout, which is good
> since it would not teach responsibility, but it
> focuses on Fed Housing to assist in affordable
> re-fi's and reform of tax code.
>
> All in all, it should help with the big picture
> since no one stands to benefit from having every
> other house on the block in foreclosure. -§

Good, I've been waiting 6 and a half painful years for him to do something good. I'm just glad he's not doing a bail-out.

stinkypoon Wrote:
-------------------------------------------------------
> § Wrote:
> --------------------------------------------------
> -----
>
> Good, I've been waiting 6 and a half painful years
> for him to do something good. I'm just glad he's
> not doing a bail-out.


yeah. Unfortunately it is too little too late. I saw this shit coming down the pike 2 years ago. Too bad the f-ing regulators were asleep at the switch.

This is what you get when you have "less government." Less government means EVERYONE gets fucked.

RichieRich Wrote:
-------------------------------------------------------
> duh & WashingToneLocian,
> You are the prime examples of why idiots should
> not speak without knowing the facts. I will lay
> it out for you (as simple as possible) as to why
> and how $20K can be paid towards principal in 41
> months. First, my mortgage was not that large to
> begin with (or at least as large as the ones
> stated above). It was a mere $320K. It was a
> 100% (no money down) conventional 30 year loan
> with a rate of 5.5%. The loan originated in
> February of 2004. This means that I am in month
> 41 of a 360 month payoff. According to any
> amortization calculator, my balance would be
> $304,241.06. (type the word amortization
> calculator into google and you can check for
> yourself.) This would be the balance had I done
> nothing further. However, when I first had the
> loan, my lender required mortgage insurance
> because there was no down payment. That insurance
> was $224/month. After one year of ontime
> payments, the lender will remove the insurance
> requirement if you get the house reappraised and
> the home has appreciated at least 20%. In
> February of 2005, the home was reappraised at
> $485,000. Keep in mind that I completely
> renovated the house (new windows, siding, kitchen,
> central AC, etc). So, in addition to the
> ridiculous price escalations going on at the time,
> improvements were made to the home. After the
> reappraisal, I continued to pay the additional
> $224, but this time putting it towards principal.
> So, months 13 through 41 (that is a total of 29
> months) an additional $224/mo was going towards
> principal. That is a total of $6496 over that
> period. That leaves a balance of roughly a bit
> less than 298,000, or $22K less than the original
> amount. Did you follow all of that?


Richie, you don't read too well for such a bright feller. One of my scenarios for your having paid your principal down by $20K in only 3 years was pre-payments of principal. I also said that this is very smart move...I generally pay off my 30 year mortgages in 10-12 years using this method.

And you're not quite right about the conditions for dropping PMI...the house does not have to appreciate by 20%...what has to happen is your loan-to-value ratio has to drop to 80%. So, if you put 15% down...the house only has to appreciate 5% (or you lower the principal amount by 5% through prepayments, or any combination of the two. This is a fairly recent phenomenon, due to passage of a Federal Law. Prior to this law, lenders often REFUSED to allow cancellation of Private Mortgage Insurance regardless of the L/V ratio. I've refinanced mortgages for the sole purpose of getting rid of PMI.

You obviously fancy yourself a real estate expert, but since the mid-70's, I've bought and sold over 30 SFHs in Fairfax County (I currently own 6) and some of your statements are naive, at best.

As follow-up to this thread, it looks like Bush's plan will disqualify most sub-prime borrowers to begin with, especially those who bought around mid-to-late 2005...................see item #3 in excerpt below.

Among the president's new initiatives is the immediate introduction of a refinancing product called FHASecure. This product will now be offered through the FHA and offers help to homeowners who are already in default of their primary residence mortgage loans. Previously, the FHA would not insure refinanced loans from borrowers delinquent or in default, so this is a significant change.


There are specific criteria that must be met in order to qualify:


1. First and foremost, you must have a history of on-time mortgage payments before your teaser rate expired -- which means you must have a decent credit history.


2. Your interest rate must have reset after June 2005 but before December 2009.


3. You must have at least 3 percent cash or equity in your home.


4. You must have a sustained history of employment.


5. You must have sufficient income to make your mortgage payments.

-§

First of all, I have watched many people get carried away with themselves over real estate investments over the past few years. I thought they were going too far over-board as they are not real-estate professionals. (neither am I).Speculators and "flippers" have created a monster and they will pay the price. I was also shocked as to how many people bought into ARM's. They, (the ARM's) are a disaster looking for a place to happen. I remember back in the 80's when I had a condo in Greenbelt and watched as nearly half of the people in my building went through foreclosures when interest rates were up around 17-18%. Fortunately, I had good advice from financial pro's. They all said "DONT TOUCH AN ARM!). "Flippers"are playing a game of "hot potato" and I have no sympathy if they lose their shirt. No more than someone going to Vegas and coming back broke. The ones I really sympathize with nowadays are the youngsters, just starting out, entry level salaries, maybe a kid or one on the way. Ive said from the start that if I get what I paid for my place here in Fairfax Ill be happy. There are far better avenues for investment than real estate unless you are a very smart professional.