- Joined
- Jan 13, 2012
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- Las Vegas
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Just my .02¢ about the housing. I follow this because I'm a recent landlord and buying houses is "my business".
What I think is going on right now is a disproportionate amount of home sales are going to investors. Indeed, investors have pretty much shut out legitimate home buyers. A few months ago, I was given to understand that Fannie/Freddie would waive to the appraisal requirement. My first reaction was WTF!!! but I can see that if they don't, nobody will get a house because most homebuyers need credit and investors don't. So, now a private buyer can outbid a cash investor and yes, housing prices have jumped sharply. But, at least in my area the prices are literally back to where they were 20 years ago and even if they increase, housing is a lot more rational than it was in 2004-6.
Just to use my own home as an example, it sold for $225K in 2005. I bought it for $63K in 2009 and in 2011 I bought an identical unit for $45K. Now, I see they are asking $65K and even if a lower credit buyer gets it, the intrinsic value is still greater than the retail price. In short, this is no way anything like the craziness of 2005.
What I think is going on right now is a disproportionate amount of home sales are going to investors. Indeed, investors have pretty much shut out legitimate home buyers. A few months ago, I was given to understand that Fannie/Freddie would waive to the appraisal requirement. My first reaction was WTF!!! but I can see that if they don't, nobody will get a house because most homebuyers need credit and investors don't. So, now a private buyer can outbid a cash investor and yes, housing prices have jumped sharply. But, at least in my area the prices are literally back to where they were 20 years ago and even if they increase, housing is a lot more rational than it was in 2004-6.
Just to use my own home as an example, it sold for $225K in 2005. I bought it for $63K in 2009 and in 2011 I bought an identical unit for $45K. Now, I see they are asking $65K and even if a lower credit buyer gets it, the intrinsic value is still greater than the retail price. In short, this is no way anything like the craziness of 2005.