Home Prices

[Quasi]

I realize this is a little out of step with the usual JREF fare, but is anyone else really concerned about home prices? Here in Boston, a decent 2 room single family will run you $400,000 in a bad area to $800,000 in a "good" area. Even a condo in Cambridge or Somerville can go for 600-800. I also recently heard prices have collapsed 25% in western Mass. and that soon, 1 of 7 families will go bankrupt. I will be buying a house not too long from now. Scary stuff. I can't imagine having a 400,000 dollar morgage. What is the alternative? Move 1-2 hours away in New Hampshire (you still must pay Mass. income tax even though you don't live there if you work there.)

[whitefork]

Chelsea or Everett? ;) Outside of 128 or 495 - maybe the Plymouth area?

And before anyone suggests that this thread is out of place, I'd say the housing prices around Boston are pretty paranormal.

[Thanz]

Did you perhaps mean to post this in the "Community" forum? Or do you think that the house prices are paranormal? Or maybe you are just generally skeptical about house prices....

To address your main question, however, I thought that house prices here in Toronto were crazy until I read your post. Are you serious? A two bedroom in a BAD neighbourhood for $400K? :eek: (I think that is the first time I have used the eek smiley. That is how crazy I think those prices are)

I think you need to be concerned about what is driving the market. In the early 80's, at least around here, there was a lot of buying and quick flipping of real estate that drove the market prices to unprecedented levels. Of course, like some sort of grand pyramid scheme, it all came crashing down.

Now, however, the housing market seems to be driven more by what I would refer to as "real" demand - people buying a house not as a quick flip investment, but to live there. This is mainly due (again, here at least) to low interest rates that make mortgages more affordable and attractive.

So, do you know if the demand is "real" deman, or are people buying and flipping like Tom Vu and other late night get rich in your sparetime hucksters?

[JSFolk]

Move to Fitchburg or Leominster, buy a decent old Victorian for $200k, and take the commuter rail into Boston, and the T to work. Fitchburg is the end of that rail line, takes about an hour and twenty-three minutes to get from there to the Harvard Square stop on the Red Line. Spend your time on the train reading.

Send me the $200k-$600k you save. :cool:

[Brown]

I almost went to work in Boston. The cost of living, however, was just ridiculous.

[Mr. Skinny]

I've got to say that I'm shocked as well. $400K for a home in a bad neighborhood is more than I can handle.......I'd be thinking about moving.

Here in good ol' Dayton, Ohio, I have a one and one-half story brick home with two bedrooms and a half bath upstairs and one bedroom and a full bath on the main floor. It has a full basement with a rec room, laundry, and office area. It was built in 1936 and has hardwood floor, a fireplace, and plaster walls.

It's not big, but it's in one of the nicest suburbs of Dayton. The school system is one of the top ten in the entire state. Police, fire protection and other city services are ideal.

I paid about $61K for it about 20 years ago. I figure it would sell for $150-160K today.

Your post reminds me why I've never wanted to live on the east or west coast of the US.

All hail the Midwest.......home of affordable housing!

[Skeptical Greg]

Do you think it might have anything to do with it being the State Capital?


I think you will find a concentration of government bureaucracy in any area is inflationary wherever you find it.


It is an excuse for politicians at all levels, to give themselves raises while they raise taxes..

[Thanz]

Originally posted by Mr. Skinny
Here in good ol' Dayton, Ohio, I have a one and one-half story brick home with two bedrooms and a half bath upstairs and one bedroom and a full bath on the main floor. It has a full basement with a rec room, laundry, and office area. It was built in 1936 and has hardwood floor, a fireplace, and plaster walls.

It's not big, but it's in one of the nicest suburbs of Dayton. The school system is one of the top ten in the entire state. Police, fire protection and other city services are ideal.

I paid about $61K for it about 20 years ago. I figure it would sell for $150-160K today.

Your post reminds me why I've never wanted to live on the east or west coast of the US.

All hail the Midwest.......home of affordable housing!
After a little over a year on this board, this thread is becoming a series of personal "firsts" for me. The eek smiley would have been enough for me, but now I get to say something that I have never before felt the urge to say until I saw this post from Mr. Skinny.




















Bite me, Skinny :p

[Mr. Skinny]

LO ****** L, Thanz. :)

Welcome to the not-so-sooper-sekrit-Bite Me, Skinny- society. :p

[Colloden]

You think that’s bad ?
Pity the Japanese, some of them have had to take out 100 year mortgages due to the astronomical land prices over there.

Not a nice thing to inherit. :(

Bite me harder, Skinny. :)

[WildCat]

Originally posted by Mr. Skinny

All hail the Midwest.......home of affordable housing!
Except Chicago, my sister just bought a 2 BR condo in Uptown (not a real good neighborhood) for $300k. And the rehab work on it (it was converted 7 yrs. ago) was sub-par. Single family? $700k and up. In my part of town (Lincoln Park) $400k will get you a small vacant lot (25' x 75'), which is why I rent.

Of coarse if you buy a sh--hole in the ghetto it's a little cheaper, roaches and crackheads included free of charge.

[JesFine]

I haven't looked at house prices in the SF Bay Area lately, but I am pretty sure they are just as bad out here. I keep thinking they have to go down sometime, but they just keep going up. It's uncanny. A few years ago, I saw a studio apartment being sold for -- hold on to something -- one million dollars.

Perhaps you didn't hear me.

A STUDIO apartment.

One MILLION dollars ($1,000,000).

This was the height of the dot-com days, so it probably doesn't exist anymore, and I hope nobody really paid that, but I wouldn't be surprised if someone did.

[Brown]

Originally posted by JesFine
I haven't looked at house prices in the SF Bay Area lately, but I am pretty sure they are just as bad out here.When I worked for a very short time in the Bay Area, real estate prices really floored me. A modest (and by that, I mean very small) apartment just a few blocks from my office was way out of my price range. And there was nothing special about this apartment at all. It was about thirty years old, and although it was in good shape, it was showing its age.

I asked some of the folks at the office how they could afford to live in the area (they made much more money than I did), and many of them said that they they couldn't afford to live in the area. Some of them lived between 60 to 100 miles from the office.

[SRW]

I went looking for housing around Foxburro and found the prices pretty reasonable. As I recall there was a large colonial for $180,000, which would be a huge leap up from my little 3 bed room ranch which would sell for $450,000. Unfortunatly I was not able to get the transfer (and a month latter they closed down the plant so that was a good thing.)

[Boo]

Thank you all for reminding me why I live in a small town in the middle of nowhere. I have a 1300+ sq. ft. home, hardwood floors, 3br 2 ba on .8 of an acre. I closed for 55k and have gained 10k in value in 5 years.


:p



Boo

[Michael Redman]

In my Midwest neighborhood, a 1400 sq ft. house just sold that was being listed at $595,000. I rent, too.

[Sundog]

I'll stay where I am, thank you. We have a 3500 sq. ft. home in one of the very best neighborhoods in town, with 5 bedrooms, 2 1/2 baths, maid's room, utility room, two living areas and a room for my studio, and a two car garage, all on 1/4 acre. We paid $136,000 for it.

[Quasi]

I guess I am also concerned for many of my friends and family who bought in the past 2-3 years. If the prices collapse, they will not recover for a long time, plus interest rates are going up. It will be interesting to say the least to see what happens. I have a 1 hour and 50 minute commute right now on the rail, which is terrible, but I read a lot. I am also oncerned about the collapse effecting the economy and business i.e. we may not have jobs if that market collapses. But what is the worst that can happen?

[Hexxenhammer]

Originally posted by Michael Redman
In my Midwest neighborhood, a 1400 sq ft. house just sold that was being listed at $595,000. I rent, too.

Where do you live? South Minneapolis?

I'm in a 1st ring Minneapolis suburb and our tiny little townhouse was 125k. Probably worth about 150k now. We've only had it 3 years.

[Psi Baba]

Pittsburgh has one of the lowest housing costs of any metropolitan area in the country. You can still get nice homes in decent neighborhoods for under $100,000. Between $100K and $200K you can get homes you couldn't even dream of touching anywhere else. If you want a half-million or million dollar palace, we've got those too.

[Segnosaur]

I bought a 3 bedroom town home in Ottawa approximately 3 years ago for 140k. (Its in an area where all the houses follow one of several identical building plans.)

Over the past winter, houses with my identical floor plan in my neighbourhood were listed for sale at 215K.

So, that's about a 70k increase in less than 3 years.

[Hexxenhammer]

Originally posted by Psi Baba
Pittsburgh has one of the lowest housing costs of any metropolitan area in the country. You can still get nice homes in decent neighborhoods for under $100,000. Between $100K and $200K you can get homes you couldn't even dream of touching anywhere else. If you want a half-million or million dollar palace, we've got those too.
As my buddy in Pittsburgh tells me. Of course, he still lives with his parents at 30 years old. And he's got a good job.

[diddidit]

I read somewhere fairly recently (might have been in National Geographic) about a family in Silicon Valley. Despite a six-figure income, they were homeless, and lived in a shelter.

I've got it pretty decent - we bought our house for just under 80k, and got about 1400 square feet, a double-size lot (132' square), great trees, a detached garage with shop, an almost-daily walk-thru by a flock of wild turkeys, and a short walk to a park with Lake Michigan access. Of course, we have the worst kitchen in Michigan, and had to deal with the previous owner's cat whiz problems. I'd prefer a shorter commute, but equivalent houses near my job are twice the price...

did

[Michael Redman]

Originally posted by Hexxenhammer
Where do you live? South Minneapolis? Ramsey Hill in St. Paul.

It's interesting how one direction of sprawl becomes very popular (and expensive), while nice, undeveloped land can be had cheaper where people are not flocking. Here, and in Houston, everyone seems to want to go West, and they have to deal with higher prices, and worse traffic (plus, sun in your eyes driving to and from work). To the South, in both cities, there is undeveloped land open that is closer to downtown, and cheaper. (I'm thinking Pearland in Houston, S and SE suburbs here) In fact, it seems people want to go West in many metro areas, and the east side is often the older, more run down area of town. What's the deal with that?

[Thanz]

Originally posted by Michael Redman
In fact, it seems people want to go West in many metro areas, and the east side is often the older, more run down area of town. What's the deal with that?
This goes back many many years and has to do with the fact that prevailing wind patterns in North America run west to east. THe west end of a city will therefore generally have less smog, pollution, smell from industry in or near an urban centre.

[WildCat]

On the plus side, even though monthly rent here is almost $2 per square foot, there's easily a hundred restaurants within walking distance, night life galore, and even (believe it or not) easy street parking (though go a few blocks in any direction and that changes rapidly!). Wrigley Field is within walking distance too, though I'm a White Sox fan. I can park my car on Friday, do things all weekend and not have to drive again until Monday. If I had a job that didn't require lots of tools I wouldn't have to drive at all. I can also catch a cab right in front of my apartment 24/7 without having to call for one.

Which is the reason prices are high here.

[BTox]

I thought central NJ prices were high, but there are always places that are worse. We paid 230K 11 yrs ago for 2600 sf house on 2 acres, today it's ~ 425K.

[jj]

Originally posted by BTox
I thought central NJ prices were high, but there are always places that are worse. We paid 230K 11 yrs ago for 2600 sf house on 2 acres, today it's ~ 425K.

Sold a 3200 sq ft 5 br house for 525K last year near Morristown.

Bought 5 years before that for 345. Now worth over 600K.

In this economy.

You figure.

[BTox]

Yep, our house is almost 40 years old. New developments in our town (between Princeton and Somerville) are selling at 600K and up. Amazing what people will pay to live in NJ!

[jj]

Originally posted by BTox
Yep, our house is almost 40 years old. New developments in our town (between Princeton and Somerville) are selling at 600K and up. Amazing what people will pay to live in NJ!

Hillsboro?

I'll be staying in Bridgewater in October, and driving down to Princeton to give a talk on Oct 7, I think, after I give a talk in Middletown. If you get IEEE local section stuff, look for it :)

[Hexxenhammer]

Originally posted by Michael Redman
Ramsey Hill in St. Paul.

It's interesting how one direction of sprawl becomes very popular (and expensive), while nice, undeveloped land can be had cheaper where people are not flocking. Here, and in Houston, everyone seems to want to go West, and they have to deal with higher prices, and worse traffic (plus, sun in your eyes driving to and from work). To the South, in both cities, there is undeveloped land open that is closer to downtown, and cheaper. (I'm thinking Pearland in Houston, S and SE suburbs here) In fact, it seems people want to go West in many metro areas, and the east side is often the older, more run down area of town. What's the deal with that?
Yeah, when my wife and I want to move to a single family home instead of our townhouse in a few years we'll probably end up looking in like Eagan or SE Bloomington if not Inver Grove Heights. We won't be able to afford to move into a house in our current neighborhood.

[BTox]

Originally posted by jj


Hillsboro?

I'll be staying in Bridgewater in October, and driving down to Princeton to give a talk on Oct 7, I think, after I give a talk in Middletown. If you get IEEE local section stuff, look for it :)

Yes, Hillsborough. There's an IEEE on Hoes lane in Piscataway near where I work - are you an electrical engineer? I'm a chemist, electronics are Greek to me ;)

[jj]

Originally posted by BTox


Yes, Hillsborough. There's an IEEE on Hoes lane in Piscataway near where I work - are you an electrical engineer? I'm a chemist, electronics are Greek to me ;)

That's IEEE World HQ there.

Yeah, I am an EE.