A lot of McMansions are, at least, fairly inoffensive. Avoid the extremes of contemporary fashion, when you go to sell it down the line the new owner won't have to immediately rip everything out. Find a couple of rising yuppies just as bland as you are and it won't hurt at all.
I can't believe people are willing to blow $250-350k+ on a new house and get linoleum and carpet all over the place. Engineered wood floors (or if nothing else, cork and bamboo floors) aren't that expensive and add a ton to value and sellability (saleability, sale-a-something, whatever).
― milozauckerman (miloaukerman), Tuesday, 12 July 2005 02:53 (nineteen years ago) link
Nope. My fault for being very unclear. But the opposite. It's easy to rent a roomy one bedroom place in a "hipper" neighborhood in town for around $700 a month... but purchasing similar can produce a mortgage that's around $1400/month instead. It's a factor of 3 from rent to mortgage if we're talking about renting vs. buying a house, respectively.
And after all that, Seattle still isn't in the top 10 real estate bubble states. I don't want to even think about how much a shitty L.A. suburb house mortgage is.
― donuty! donuti! donuté! (donut), Tuesday, 12 July 2005 07:07 (nineteen years ago) link
― donuty! donuti! donuté! (donut), Tuesday, 12 July 2005 07:09 (nineteen years ago) link
That makes no sense. (I'm not saying you're wrong - just that I don't get it.) How can an investor afford to buy a property to rent it out for less than the mortgage payment? Renting should always be more expensive than buying (on a macro level.)
― geyser muffler and a quarter (Dave225), Tuesday, 12 July 2005 11:30 (nineteen years ago) link
My wife and I are in the process of selling our condo now, its been on the market for a month. No biters. Kind of sucks because there are a some nice houses in our price range in town, but they sell quickly. And we are looking for a fixer-upper, we like the old charm compared to the new McMansion shit.
We really are pleased that we bought the condo when we did 4 years ago as its gone up in value $75000 since, which gives us a great chunk to put down on a house when we step up. And our mortgage is around $600 a month, which sure as hell beats rent around here. Averages around $1000 a month for 1 bedroom.
We both have pretty bad credit as well and have been told our max purchase price is around $232000, which doesn't get you much around here. Lucky to get 1/2 acre of land...most of the houses need new roofs, updated electricity and lots more work. But all in all, i would prefer to have a mortgage rather than rent these days purely for the tax breaks.
― Lupton Pitman (Chris V), Tuesday, 12 July 2005 11:42 (nineteen years ago) link
― carbon (carbon), Tuesday, 12 July 2005 12:46 (nineteen years ago) link
― kingfish (Kingfish), Tuesday, 12 July 2005 12:54 (nineteen years ago) link
m.
― msp (mspa), Tuesday, 12 July 2005 12:57 (nineteen years ago) link
― carbon (carbon), Tuesday, 12 July 2005 13:34 (nineteen years ago) link
And this is certainly what most parents look for in a school.
― Brian Miller (Brian Miller), Tuesday, 12 July 2005 13:39 (nineteen years ago) link
― carbon (carbon), Tuesday, 12 July 2005 13:43 (nineteen years ago) link
but they get less funding. and when nearly 100% of the kids are economically disadvantaged, their parents don't always have time making ends meet to help them with their homework or to discipline them. or they've got parents who are basically fucking up hard. etc etc. so meanwhile, your kid might be one of the few in class that can read. the teacher is spending all her time with every other student or with discipline issues cause so many kids just doesn't care, or are bored, etc. there's just a deficiency.
what do you do? it's your kid's future hanging on your actions.
i personally would rather go for some middle ground. not snootyville academy. but public school in a middle class neighborhood where they will still get some diversity yet still get attention. then, on top of that, make sure my kids hang with lot's of other types of kids.
me and my wife went to ghetto schools and survived, but frankly, i KNOW i got held back. i can live with my own fate, but i want better for my kids.
i don't know if that makes me some kind of sell out to certain ideals i've always put forth. have i?m.
― msp (mspa), Tuesday, 12 July 2005 13:55 (nineteen years ago) link
It's that Elvis song. The real estate people got so mad at him after that, they had been flipping ghetto housing like crazy until he came along.
― TOMBOT, Tuesday, 12 July 2005 13:58 (nineteen years ago) link
I don't think this is true. What is true is that the value of the investment property should equal the present value of future rent cashflows. Once the mortgage is paid off, the landlord will still be able to collect rent, so that means that in the short-term, mortgage payments could exceed rent payments.
― o. nate (onate), Tuesday, 12 July 2005 13:58 (nineteen years ago) link
school district is a fairly common problem we are having as well as we are trying to start a family as well. most of the places we have seen have shitty schools...although their is always private school for mucho $$. But we figured by the time our children are old enough to start kindergarten (in 5 years time if we have one within the year), we may be able to pack up and afford a bigger home in a better district. we'll see.
― Lupton Pitman (Chris V), Tuesday, 12 July 2005 13:58 (nineteen years ago) link
― Lupton Pitman (Chris V), Tuesday, 12 July 2005 14:01 (nineteen years ago) link
Most real estate investors (ie people who buy houses and small apartment buildings to rent) think in terms of cash flow and short terms, like five years. You always assume that there will be a mortgage payment, and that the mortgage will never be paid off. Most investors don't hold property that long. So while you may find some cases to the contrary, look at it this way: If you are an investor and you want to buy a property to rent out, the immediate question is, "can I rent it for enough to cover the cost of ownership and also make some profit?" If the answer is no, then it's a bad investment.
― geyser muffler and a quarter (Dave225), Tuesday, 12 July 2005 14:07 (nineteen years ago) link
― o. nate (onate), Tuesday, 12 July 2005 14:12 (nineteen years ago) link
― geyser muffler and a quarter (Dave225), Tuesday, 12 July 2005 14:15 (nineteen years ago) link
risky. he's banking on the fact that boom or no boom, rich kids go to vanderbilt university here... and daddy will pay for the nice "condo" that's near bars, class, and all the other rich kids.m.
― msp (mspa), Tuesday, 12 July 2005 14:18 (nineteen years ago) link
But that's only in the short-term. In the long-term the rents will even out with the mortgage costs. And if there are any long-term investors in the market, they will affect the prices you can get.
― o. nate (onate), Tuesday, 12 July 2005 14:25 (nineteen years ago) link
geyser, nobody is paying attention to the rent ratio. They're paying attention to the free money. Everything just keeps appreciating, it's like magic, the prices just keep going up and up!
This paper by a couple of physicists shows the whole thing coming down on top of us in mid-2006.
― TOMBOT, Tuesday, 12 July 2005 14:27 (nineteen years ago) link
― geyser muffler and a quarter (Dave225), Tuesday, 12 July 2005 14:28 (nineteen years ago) link
― o. nate (onate), Tuesday, 12 July 2005 14:39 (nineteen years ago) link
― kingfish (Kingfish), Tuesday, 12 July 2005 14:43 (nineteen years ago) link
Calculations by The Economist show that house prices have hit record levels in relation to rents in America, Britain, Australia, New Zealand, France, Spain, the Netherlands, Ireland and Belgium. This suggests that homes are even more over-valued than at previous peaks, from which prices typically fell in real terms. House prices are also at record levels in relation to incomes in these nine countries.
America's ratio of prices to rents is 35% above its average level during 1975-2000 (see chart 1). By the same gauge, property is “overvalued” by 50% or more in Britain, Australia and Spain. Rental yields have fallen to well below current mortgage rates, making it impossible for many landlords to make money.
To bring the ratio of prices to rents back to some sort of fair value, either rents must rise sharply or prices must fall. After many previous house-price booms most of the adjustment came through inflation pushing up rents and incomes, while home prices stayed broadly flat. But today, with inflation much lower, a similar process would take years. For example, if rents rise by an annual 2.5%, house prices would need to remain flat for 12 years to bring America's ratio of house prices to rents back to its long-term norm. Elsewhere it would take even longer. It seems more likely, then, that prices will fall.
― teh Nü and Impröved john n chicago (frankE), Tuesday, 12 July 2005 14:49 (nineteen years ago) link
It's a renter's market because a lot of people are moving on from renting to buying, people in that echo boomer age range who all decided to settle down at once and caused a 'housing shortage' to crop up at the same time the investing populace of all ages decided condominiums were a better bet than tech stocks.
― TOMBOT, Tuesday, 12 July 2005 14:59 (nineteen years ago) link
I guess I'm a bit confused by this statement. How will the market not permit widespread losses on rent? Will owners just hold out and lose money until they can get what they need? Will renters just pay whatever landlords say? There are plenty of places that were bought years ago that don't need to get the kind of rent required to cover recent mortgages.
If the demand is not there at a given rental fee to cover mortgage costs for a certain price paid, then a loss will be generated. Since so many people are buying at inflated prices (economist cites NAR figure of 23% of houses bought in 2004 were for investment purposes), the possibility seems entirely plausible.
― teh Nü and Impröved john n chicago (frankE), Tuesday, 12 July 2005 15:00 (nineteen years ago) link
$315,000. I put 10% down, because I can, and my coworker here says he got a deal from Wells Fargo at 5.5% 30-year fixed.
That's $1,618.20 a month according to Bloomberg.com, not including the condo fee, maintenance, closing costs and all that jazz.
Right now I pay $1250 in rent, plus electricity, and that's it. That affords me the ability to put at least $400 a month into investment accounts which will hopefully weather this bullshit.
Also the building I live in is fucking old as hell, $315K? Fuck that! Sucker even covered up the hardwood with carpet.
― TOMBOT, Tuesday, 12 July 2005 15:14 (nineteen years ago) link
-- geyser muffler and a quarter (right.knewi...), July 12th, 2005.
The Economist had an article maybe 6 months ago saying the exacpt opposite -- that in MANY housing markets, right now, it's cheaper to rent than to buy. Potential rental income may be a large part of what drives value (if there is such a thing), but only supply and demand drive price.
Of course, this is for the reasons stated above -- investors buying lots of properties, property flipping, general market euphoria and/or panic.
Rental incomes are much more tied to reality, I think -- because you're not dealing with mortgage loans, people can only pay what they can actually afford to pay. And investors aren't renting, so there's not all that artificial pressure.
Also, when enough people are buying, it means those same people aren't renting, so less demand for rentals. And vice versa.
― Hurting (Hurting), Tuesday, 12 July 2005 16:07 (nineteen years ago) link
but you'll pay less in taxes if you're paying a mortgage which might more than make up for this difference; factor in the equity you gain in the condo and you could well come out ahead. but I'm not an accountant so maybe not.
― kyle (akmonday), Tuesday, 12 July 2005 16:15 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 16:16 (nineteen years ago) link
I pay less in FEDERAL taxes, but the county and the state could give a shit. If I factored that in, which the bloomberg calculator doesn't, I suspect my ACTUAL monthly payment would be even more.
― TOMBOT, Tuesday, 12 July 2005 16:19 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 16:21 (nineteen years ago) link
― Bnad (Bnad), Tuesday, 12 July 2005 16:41 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 16:57 (nineteen years ago) link
― Brian Miller (Brian Miller), Tuesday, 12 July 2005 17:03 (nineteen years ago) link
― Allyzay knows a little German (allyzay), Tuesday, 12 July 2005 17:05 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 17:37 (nineteen years ago) link
if you have at least 1 functioning brain cell, rent don't buy. let the stuff that comes w/ buying be some other shithead's problem.
― Eisbär (llamasfur), Tuesday, 12 July 2005 17:37 (nineteen years ago) link
― Brian Miller (Brian Miller), Tuesday, 12 July 2005 17:42 (nineteen years ago) link
― Brian Miller (Brian Miller), Tuesday, 12 July 2005 17:43 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 17:46 (nineteen years ago) link
― Eisbär (llamasfur), Tuesday, 12 July 2005 17:47 (nineteen years ago) link
-- carbon (identitymachine...), July 12th, 2005.
Or, in the case of Jersey City, IN the ghetto. $375,000 for a two-bedroom. Not even near the PATH. One of its selling points is "walking distance from HOBOKEN." !!!???
― Hurting (Hurting), Tuesday, 12 July 2005 17:49 (nineteen years ago) link
― Eisbär (llamasfur), Tuesday, 12 July 2005 18:01 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 18:04 (nineteen years ago) link
― Eisbär (llamasfur), Tuesday, 12 July 2005 18:06 (nineteen years ago) link
― Hurting (Hurting), Tuesday, 12 July 2005 18:07 (nineteen years ago) link
HAHAHAHAHAHAHAHAHAHA wtf seriously?
― Allyzay knows a little German (allyzay), Tuesday, 12 July 2005 18:11 (nineteen years ago) link