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Real estate going crazy.

The ability to deduct property taxes and mortgage interest for most folks removed a bit of incentive for home ownership over rental living.

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No way. Appreciation alone is still the driver to own versus rent. The standard deduction covers the lost deductions for 80%+ of homebuyers.
 
No way. Appreciation alone is still the driver to own versus rent. The standard deduction covers the lost deductions for 80%+.
Standard deduction is 12k/24k that is way more than everyone I know was getting before....plus you don't have to fill out all the forms.....

at some point if the prices keep going up, young families are just going to be forced to rent until in their 40's.

The days of a nice starter home 100k-120k (back in 2009) are gone.
 
I'm looking for a place around Gainesville. My kids are no longer in school so I don't need to live around here any more. My Daughter wants to go to North Georgia Uni. So I'm looking for a house near there to buy instead of rent.
I'm only in the "Let's see what kind of VA mortgage I can get" stage.
I bought a house in Detroit for $138k. Then the sub-prime mortgage thing happened and everyone's property values dropped.
So I'm a little wary. My upper limit I'm willing to borrow is $250k and it better include an acre or more of land.
I keep hoping to wake up and find out that the bottom dropped out of the market. I don't think that's going to happen any time soon.
You are correct. Demand will dictate price for years. We are 3.5 million homes short.
 
People are buying and flipping down here like crazy. Bidding wars on prime property. Easy way to make a quick 100 thousand if you’ve got the nerve to chance it. Saw one listed recently with a $500k markup.
When this latest bubble bursts, gonna be be 2009 all over again. Anybody caught standing when the music stops…
Wrong.
 
Same here. I had a house built for $298k, just before the market got crazy. I was offered $345k after only 5 months living there. Then last month I was offered $369k. My annual tax assessment came back and valued it around $364k. Property values are absurd right now, so those looking are really screwed but Owners are sitting pretty. My Agent said it's the best time to use the increased equity while you can; get the lowest interest rate possible and refinance it later if need be.
 
Standard deduction is 12k/24k that is way more than everyone I know was getting before....plus you don't have to fill out all the forms.....

at some point if the prices keep going up, young families are just going to be forced to rent until in their 40's.

The days of a nice starter home 100k-120k (back in 2009) are gone.
It is already brutal for young families with one income and even two incomes for some. Inflation coupled with housing demand is a killer right now and for years to come. November can’t come soon enough.
 
It is already brutal for young families with one income and even two incomes for some. Inflation coupled with housing demand is a killer right now and for years to come. November can’t come soon enough.

November won’t fix anything. The damage is done and continues to have the ripple effect.

It’s a clown world we live in folks,and we’re all members of the circus
 
I bought a rental house last year that the seller couldn't find a place to move after the sale. I rented it back to him for 5 months and he finally found a replacement property. It's tough to replace what you are selling unless you really step up to the plate. Also when you sell and buy another property there are plenty of expenses. Selling costs, moving costs and closing costs including mortgage expenses add up. Not to mention the new drapes, paint, etc. etc.
 

I don't think it's that easily dismissed.

One driving issue is money availability, both cash and credit. Homes purchased with cash are at an all time high. That's largely fueled by the fast appreciation of home values; people are selling their homes, paying the (now comparatively small) mortgages, and then buying a replacement property with the left over cash. That cycle will stop as appreciation slows. It's already slowing. The ratio of cash sales will begin to drop.

At the same time, credit is going to tighten. We could see a scenario where the economy is so inflated, the fed has no choice but to dramatically adjust rates. It will not surprise me to see 8% to 10% borrowing rates within a year.

I also think we'll see an employment correction as the economy worsens. Which, in turn, leads to foreclosures and excess supply. That spec starter home that would have been $175K five years ago, which sold for $275K this year, could be $100K in foreclosure.

It happened fast in 2007/2008. Easy money drove that one. No reason we can't see a repeat, since easy money is driving this one, and the easy money is going to go away.
 
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