Free: Contests & Raffles.
Quote from: Buckhunter24 on February 10, 2021, 09:35:11 AMWe just put an offer 5% over list and will almost certainly not get it. Crazy market, might just continue to rent for a year unless something changes.Be sure to look at your payments not price. Buy a house now for $340k @ 3% interest = same $1432 payment as if you get it for $40k less next year but at @ 4% interest. And you know interest will be going up over 4% and will you see that house at $300k again ?
We just put an offer 5% over list and will almost certainly not get it. Crazy market, might just continue to rent for a year unless something changes.
Quote from: Magnum_Willys on February 10, 2021, 09:58:28 AMQuote from: Buckhunter24 on February 10, 2021, 09:35:11 AMWe just put an offer 5% over list and will almost certainly not get it. Crazy market, might just continue to rent for a year unless something changes.Be sure to look at your payments not price. Buy a house now for $340k @ 3% interest = same $1432 payment as if you get it for $40k less next year but at @ 4% interest. And you know interest will be going up over 4% and will you see that house at $300k again ? Yes, is basically my answer to this.Sure, you're spending $600k for a "normal" house today. Is it any different that the house you bought with the same monthly payment that was $300k 10 years ago? No, its the same house. Sure rates qualify you for more money, more money to spend on the same house.Income streams dictate the house you buy, not the interest rate. (Obviously there are other real factors, but I think this is the biggest one in this short term period.
I have been in Construction for um 27 years now, man I getting old. Im telling ya all to slow your roll. Be carefull. Crash is coming in next 2 years. House will be much cheaper. Buy low, sell high. I sure as hell wouldnt buy now.
Quote from: luvmystang67 on February 10, 2021, 10:32:07 AMQuote from: Magnum_Willys on February 10, 2021, 09:58:28 AMQuote from: Buckhunter24 on February 10, 2021, 09:35:11 AMWe just put an offer 5% over list and will almost certainly not get it. Crazy market, might just continue to rent for a year unless something changes.Be sure to look at your payments not price. Buy a house now for $340k @ 3% interest = same $1432 payment as if you get it for $40k less next year but at @ 4% interest. And you know interest will be going up over 4% and will you see that house at $300k again ? Yes, is basically my answer to this.Sure, you're spending $600k for a "normal" house today. Is it any different that the house you bought with the same monthly payment that was $300k 10 years ago? No, its the same house. Sure rates qualify you for more money, more money to spend on the same house.Income streams dictate the house you buy, not the interest rate. (Obviously there are other real factors, but I think this is the biggest one in this short term period.What is the underlying factor in buying a house, the payment. Does it matter really if you buy a $600k house with a low interest rate or a $450k house with a higher interest rate when the monthly payment is the same?
Quote from: vandeman17 on February 10, 2021, 11:10:26 AMQuote from: luvmystang67 on February 10, 2021, 10:32:07 AMQuote from: Magnum_Willys on February 10, 2021, 09:58:28 AMQuote from: Buckhunter24 on February 10, 2021, 09:35:11 AMWe just put an offer 5% over list and will almost certainly not get it. Crazy market, might just continue to rent for a year unless something changes.Be sure to look at your payments not price. Buy a house now for $340k @ 3% interest = same $1432 payment as if you get it for $40k less next year but at @ 4% interest. And you know interest will be going up over 4% and will you see that house at $300k again ? Yes, is basically my answer to this.Sure, you're spending $600k for a "normal" house today. Is it any different that the house you bought with the same monthly payment that was $300k 10 years ago? No, its the same house. Sure rates qualify you for more money, more money to spend on the same house.Income streams dictate the house you buy, not the interest rate. (Obviously there are other real factors, but I think this is the biggest one in this short term period.What is the underlying factor in buying a house, the payment. Does it matter really if you buy a $600k house with a low interest rate or a $450k house with a higher interest rate when the monthly payment is the same?Yes, the $600k house will have much higher taxes, insurance and less deductible interest so the difference is likely thousands a year - enough to go on a hunt every year for sure.
I disagree that high interest rates limit options.In fact, I'd much rather live in a world with high interest rates and low housing prices than the inverse.Low prices mean lower down payment, lower taxes. When the 10k cap on mortgage interest deduction was not in place, this would've also been a preference as part of your monthly payment is tax deductible.The only thing low interest rates are good for (and rates that become progressively lower over time) are total home prices, which benefit the investor only and those who want to take cash out of their home. Rising house prices are really not beneficial for those who want to live in a forever home, they only cost you more in taxes and insurance. If you die in your home, there's no value to you in your home value going it, it just costs you more to keep.As rates rise, if they do, it'll put significant downward pressure on home values. Anyone who "locks it in low" will struggle if rates rise from an investment perspective. If its your forever home, you don't mind this at all as a lower value only reduces your tax and insurance burden.
Quote from: luvmystang67 on February 10, 2021, 11:43:47 AMI disagree that high interest rates limit options.In fact, I'd much rather live in a world with high interest rates and low housing prices than the inverse.Low prices mean lower down payment, lower taxes. When the 10k cap on mortgage interest deduction was not in place, this would've also been a preference as part of your monthly payment is tax deductible.The only thing low interest rates are good for (and rates that become progressively lower over time) are total home prices, which benefit the investor only and those who want to take cash out of their home. Rising house prices are really not beneficial for those who want to live in a forever home, they only cost you more in taxes and insurance. If you die in your home, there's no value to you in your home value going it, it just costs you more to keep.As rates rise, if they do, it'll put significant downward pressure on home values. Anyone who "locks it in low" will struggle if rates rise from an investment perspective. If its your forever home, you don't mind this at all as a lower value only reduces your tax and insurance burden.so you buy a less expensive house but interest rates are high and that is better than buying a more expensive house with low interest rates? The end result is the same out of pocket purely from a monthly mortgage payment perspective. I would much prefer to buy a house with the low interest rates where they are now and not have to worry when they go up. That 600k home that you could afford with a 3% interest rate becomes a $500k home that you can afford when interest rates go up.
If all housing prices in an area fall, the property "per capita" tax rate will rise so taxes won't necessarily change. Taxing authorities will get their money. The $600K house and the $450K house will pay the same taxes in that scenario. We may be in bubble presently, but over a longer period of time I believe housing prices will continue to rise. In the PNW I'd rather be buying equity than paying rent.
Quote from: vandeman17 on February 10, 2021, 12:00:08 PMQuote from: luvmystang67 on February 10, 2021, 11:43:47 AMI disagree that high interest rates limit options.In fact, I'd much rather live in a world with high interest rates and low housing prices than the inverse.Low prices mean lower down payment, lower taxes. When the 10k cap on mortgage interest deduction was not in place, this would've also been a preference as part of your monthly payment is tax deductible.The only thing low interest rates are good for (and rates that become progressively lower over time) are total home prices, which benefit the investor only and those who want to take cash out of their home. Rising house prices are really not beneficial for those who want to live in a forever home, they only cost you more in taxes and insurance. If you die in your home, there's no value to you in your home value going it, it just costs you more to keep.As rates rise, if they do, it'll put significant downward pressure on home values. Anyone who "locks it in low" will struggle if rates rise from an investment perspective. If its your forever home, you don't mind this at all as a lower value only reduces your tax and insurance burden.so you buy a less expensive house but interest rates are high and that is better than buying a more expensive house with low interest rates? The end result is the same out of pocket purely from a monthly mortgage payment perspective. I would much prefer to buy a house with the low interest rates where they are now and not have to worry when they go up. That 600k home that you could afford with a 3% interest rate becomes a $500k home that you can afford when interest rates go up. I actually agree with you, but we are talking about the same house. I'm saying the value of your house that you purchased at $600 will go DOWN to $500. Or if you're buying a house that is in a development (for ease of thought), the average house in that development today may be $600k and in the future may be $500k with rising interest rates. If interest rates make the payment the same for each home, I'd rather have a higher percentage of my payment go to the bank than to the principle for a variety of reasons.1) In the case above, if I "lock in my good rate early" I'm also underwater on my home.2) If its the same $3k out of pocket in each scenario, then in the higher interest rate scenario, I can write off more of my payment (since its interest).3) In the scenario above, if it IS as an investment... you will have a better position to make money if the total price is lower.4) Lower asking prices come with lower down payments and higher interest rates on your cash in-hand. Its easier to come up with the money down for a home when prices are low and interest rates are high.The only real way to justify liking lower rates in exchange for the higher prices that come with it are that you have more equity to borrow against if you want to do some kind of cash-out loan on your asset. If you don't plan on doing this, its really a lot of negative.
I think my main point, is that unless you're super early to the party, the idea that low interest rates let you buy a BETTER house for the same monthly payment is something I reject. It allows you to agree to a higher total price for the same house you would've bought before, for the same monthly payment.