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Fresh fears of crash in house prices.

Discussion in 'Current Events' started by iGav, Apr 18, 2004.

  1. macrumors G3

    #1
  2. macrumors regular

    #2
    I hope they come down as well but only in a month or so's time. I'm putting mine up on the market this week. Bought it for £82k last May, next door just sold theirs a few weeks ago for £118k. Valuers are coming out on Friday.

    Only problem is trying to find somewhere after that. Good job they have a good supply of tents in Argos!!!!
     
  3. macrumors 6502a

    Sparky's

    #3
    Having never been to the UK but seeing what has happened here in the last 35 years in housing costs (in the USA) I can understand your plight. Right now we are experiencing another rise in the Average house price, along with a sustained almost record low in the interest rates, with a guesstimated average of about 5.0% for a 30 year fixed loan and even lower right now for flexible. One thing thing though is that we (all I know and what I have read) is that there has never been a "reduction" of prices, just a tapering off of increase. I watched a home I had that chance to buy with my then new wife in CA in 1970 for $30,000, but ended up renting, one year later it sold for $62,000. I moved out of the area but several years (1982) later I noticed it went on the market again for $185,000, and after I moved to NY I found out it sold for $310,000. I know this because I made very good friends with a neighbor when I lived there, and never moved (he paid 28,500 for his house in 1966, and feels he could get $300+ for it now)
    And a sidebar note: how much have your wages gone up in 40 years?????
     
  4. macrumors regular

    #4
    Being a young un (32), i can safely say i haven't a clue how much wages have gone up in the last 40 years!!!! I would imagine in most jobs they would go up about 3-3.5% each year though. My parents bought their house in 1968 for £2800. Others are going in the street for £140,000.
     
  5. macrumors 65816

    voicegy

    #5
    San Diego "Living"

    San Diego was ranked the nation's 7th "most livable" big city in the nation, despite its high housing costs, according to a report by the Washington, D.C.-based nonprofit group Partners for Livable Communities.

    But who can afford to buy a home in one of the most "livable cities" in the US? Some statistics:

    San Diego is the third most expensive resale housing market in the United States. (The most expensive market is San Francisco followed by Anaheim-Santa Ana.) (National Association of Realtors 2/12/04.)

    The weighted average price of newly-constructed, single-family homes is $602,232 – a 145% increase over the last 8 years. The average price for a new attached unit is $360,147. (MarketPoint Realty 2/12/04)

    San Diego County’s resale single family homes are at a median price of $425,000; the median resale price for condos is $304,000. (SDUT 1/25/04; December median price)

    $468,450 was the overall median price (half priced over, half under) in January for all existing homes (SDUT 2/26/04) – more than two and a half times the national median. The national median for existing homes is $171,600. (National Association of Realtors, 2/12/04.)

    Only 16 percent of San Diegans can afford to purchase a home here, down from 20 percent just over a year ago. (SDDT/California Association of Realtors, 1/18/04)

    OK, well, one can always rent, right?

    The average apartment rent in San Diego is $1,158. (SDDT 7/17/03)

    Families need to earn more than $22 per hour to afford to rent a two-bedroom apartment in San Diego. (National Low-income Housing Coalition – Out of Reach, 2003)

    :eek:

    (The most livable big city was Charlotte, N.C., followed by Cincinnati; Denver; Fort Worth, Texas; Jacksonville, Fla.; and Kansas City, Mo.)
     
  6. macrumors 68030

    Capt Underpants

    #6
    YAY! Go Fort Worth, lol! We just bought a house in F/W. 2,000 square feet for $108,000. Cost of living down here is so cheap.
     
  7. macrumors 6502a

    Sparky's

    #7
    And in the "Big Apple"
    http://www.homestore.com/Cities/NewYork/NewYork.asp?poe=homestore

    And: http://www.newsday.com/business/ny-bzreal303729641mar30,0,159658.story?coll=ny-business-headlines
     
  8. macrumors 6502

    #8
    Wow! We paid 129,000 for 1600 square feet on 1/4 acre.
    I hope prices don't drop any time soon in my neck of the woods. We bought at 10% below appraisal with 2.25% down payment. I knew it would be best to wait until I had 20% or more to put down, but we loved this house and neighborhood, and, more importantly, I was afraid interest rates would go back up before we saved up the down payment. I am hoping to refinance at a rate even lower than my current 6% as soon as I have a down payment big enough so that we will own at least 20%. This way, I don't have to pay the mortgage insurance.
     
  9. macrumors 65816

    kettle

    #9
    History repeating

    can anyone say "negative equity"?

    could be bad, but worse than that because there is a lot more borrowed on credit cards and alike this time, which could be the difference between hard times and loosing everything. :(
     
  10. macrumors G3

    #10
    exactly... you would've thought people would have learned after the last time... :rolleyes: it's almost like people who are buying now, which is pretty much at the zenith of the market, think that they're going to see the same increases in price as the last 5 years... we as a country simply cannot continue this upward trend... something HAS to give.

    I've got no sympathy for people who've got the 5x+ salary mortgage, the 4 credit cards and loans secured on their homes, as well as everything on store credit... when it all comes crashing down I look forward to picking up a cheap loft in W1 :p :D

    Interest rates are expected to be at around 5% by the end of this year and that's going to hit people very heavily in monthly repayments. Ouch! glad I paid off my credit cards a couple of years ago! heheh
     
  11. macrumors regular

    #11
    Put me down for one as well :D

    (Not that I even have a deposit or anything.)
     
  12. macrumors 6502

    #12
    I did not purchase my home as an investment. I wanted a place to live. Having a lot of equity helps, as I mentioned earlier, but I am more interested in living here for a long time than making lots of money. My loan is less than 2x my anual pay, by the way. And I have a remaining 666.01 in credit card debt, which will be paid off by the end of summer. But, a lot of people may be in deep stuff if they are up to their eyeballs in debt and planned on paying off with a home equity loan.
     
  13. Moderator emeritus

    Rower_CPU

    #13
    Tell me about it (great stats, BTW).

    As a soon-to-be college grad (Master's degree) and husband I'm scared ****less of the housing situation here in SD. I really love the area and after living here for 6+ years I've got a lot of friends here, but when it comes time for career hunting I almost don't even want to look locally.

    2.5 times the house cost for a fraction more salary (typically)? WTF?!? :mad:
     
  14. macrumors 68040

    MongoTheGeek

    #14
    I read SD as South Dakota and thought that things must really be getting bad.

    As for where to live why don't you stay where you are right now?
     
  15. Guest

    caveman_uk

    #15
    Me neither. I'm no saint when it comes to credit cards but I only have one and it's all paid off every month. I have a mortgage at 1.5x my salary - I bought a house in 1996 and haven't moved. It's now worth three times what I paid for it but I have no intentions of doubling my mortgage just to get another bedroom...
     
  16. macrumors 65816

    Dippo

    #16

    YEA, Charlotte!!!

    Oh course it really depends on where in Charlotte you live.
    There are new sub divisions popping up all over the place.
     
  17. Moderator emeritus

    Rower_CPU

    #17
    Everyone knows SD is San Diego. :p ;)

    I'm renting right now - that's over $1600 a month that I don't see any return in investment on. For me, renting is not a good option.
     
  18. macrumors 68040

    mactastic

    #18
    Our median house price just hit $444,190 here. That puts the affordability index at 14%, and the income needed to buy a median priced house at $103,000 annual income. Ouch. Combining our income, my wife and I still don't make enough to buy here. Maybe next year though.

    I'm seeing a noticable drop in rental prices, which must be scary for people who buy investment homes. I missed an opportunity to buy 6 years ago when it would have been paying about 20% annual return, but now I'll probably hold onto my money for now and see how things go for the next 2-3 years. Not that people won't always pay big money to live by the beach though...
     
  19. macrumors 68020

    #19
    Here in No. Va. it's in the $300's, but our friends in Fort Worth might balance that a bit... but iGAV is saying the *national* average in the UK is $300K, that means even in Wales and places like that? The whole *country* is out of sight?!

    I was thinking of moving to Dallas or Fort Worth later but people tell me that prices there are ramping up rapidly too...
     
  20. macrumors P6

    wdlove

    #20
  21. macrumors 65816

    voicegy

    #21
    I know a lot of folks who are looking around at the "outskirts" of San Diego proper - Spring Valley and the like - and personally know of three people who work where I work (at SDCS Ed Center) that ended up purchasing in Temcula! Talk about a commute - one of them rides a motorcycle to save on the gas.

    It's senseless. One tries to buckle down, grab an apt. together, rent for a few years and live on macaroni and cheese and save up. But can one ever save up an appropriate amount of money over time for a down if these prices continue to go out of control? At least the median prices of condos are "reasonable", comparitively speaking. :(
     
  22. macrumors 6502

    #22
    My wife's uncle lives in San Diego. He came to visit last summer. He took a look at our little $140,000 house and told us it would probably bring nearly half a million in SD on a smaller lot! I don't know how serious that figure was, but I'm sure it would cost a lot more! I'd have to get a 70 year mortgage if I lived out there! Either that or a better education and some skills!

    The median house price for Versailles was only $91,900 in 2000. Lexington was around 111,000. I had assumed Versailles would be higher. Here, they build them big, brick, and on large lots to make a bigger profit considering the smaller number of homes that the developers are able to get approved. In Lexington, they pack them in tight and wrap them up in grey vinyl! Either way, both numbers seem great compared to San Diegos 2000 median house price of 233,100. Where can I go to get more current statistics? These numbers are from http://www.city-data.com
     

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