US housing market, would you buy now?

[ASAP]

Originally Posted by XutvJet

I don't see rates dropping much at all and we're years, maybe a decade, away from seeing 3-5% rates again. At the surface, buying a house with a 8% mortgage seems nuts BUT I remember buying my first house back in 2000 and 7-9% rates were common place. It's funny just how accustomed we've all become to these artificially low rates.

I am not all in favor of renting unless you've just sold a home and are looking to buy or are building or simply don't have the means to put down a big down payment (20%+).

We paid off our home back in 2013 and have been looking for the last 3 years, but got out-bid a number of times because people would pay stupid money above asking. We were going to do that. We have the money to buy what we want without a loan BUT hardly anything is on the market now Weird times. I fully expect a number of homes to come on the market in the next 6-12 months as people have been living well beyond their means for years and the money is drying up. Layoffs are ramping up too. It's all just a cycle.

i agree... i think the notion about rates coming down soon is ENTIRELY false... and that's what's still driving a lot of holdouts... otherwise, there will be more and more inventory just piling up

[floridaorange]

Originally Posted by nerdogray

Right now, I live about 20 miles south of Nashville but have lived all around, including downtown. Living downtown was pretty cool, and I'm an introvert. There are tons of new rentals that have sprung up in downtown and midtown (and everywhere else really) if you're looking for apartment living. Single-family homes can be had for renting, but you're looking at a serious premium unless you get something a bit out distance-wise. I will never, ever rent an apartment again unless it is reinforced concrete. I have had WAY too many bad experiences with noise and smoking. I was told that unless a building is over seven stories, it will likely be wood frame... meaning noise and smoke will be way worse. That being said, the next place I rent will likely be midtown or downtown area unless I find a small single-family home or end-unit condo with a layout that doesn't put my bed right up against my neighbor's on either side of the wall.

I'm really curious as to your new job. I just got cut from mine of 5.5 years. Maybe I should apply to your new company. Nashville is a hub for healthcare IT, which is pretty much where I've been for the past 10 or so years. Everything is getting offshored. Optum/UHC acquired Change Healthcare and is on the way to completely destroying it. All they wanted was the data and managed to convince the DoJ otherwise.

Interesting. My best friend since I was a kid works in sales for Case Management for workers comp - left Nashville for central florida - he uses his Nashville home as an air bnb - it does well - and bought a house here as well judt before $800k condos went up across the street, in an area that is clearly gentrifying. Anyway, the owner of his co just sold to private equity - so now he’s also looking after 4 yrs w. the co for a better option.

We bought our house in 2010 for the price it was built for in 2002. Nearly perfect timing as it’s worth close to 3 x what we bought it for now. Our interest rate is 2%. If it were me and I were single moving to Nash, I’d find a fixer upper in an area that is close to gentrification or rent from someone who has an extra pool house or something just to get acclimated. But buying right now - no. Wait a few yrs.

[dreamingat30fps]

Considering I bought a condo I didn't really want back in like 2005 just because I needed a place and everyone kept telling me if I didn't buy something I would never be able to afford anything because prices were only going higher. Then 2008 came and my condo was worthless and I was soooo ready to move out. The whole area became crap since all the new buildings they were going to make got put on hold and a bunch of places became section 8 housing.

I'm kinda weary about buying shit in a hot market, especially if I don't know the area and I'm basically guessing if I'm going to be there in 10+ years. That condo is now probably worth what I paid in 2005... maybe a little more with what happened the last 3 years... but I would have had to stay there for like 13 freaking years. Luckily our current house I bought in 2011 when prices were still fairly low.

[BRAKE!]

I don't see rates coming down until the Fed can see CPI/PCE numbers hover over their target for at least 6 months to a year. The current rate hikes have got us to where we are now and it's working to curb inflation and so the Fed has no reason to decrease it yet.

But that's besides the point. I wouldn't buy in your situation for a year or so. This is because;
1) You're moving to a new area and you may not know where the best place for you is yet
2) You got a new job - what if you hate it? The last thing you need in that situation is to be locked down due to a home.
3) For most housing markets a break-even point is 7 years for a home (factor in taxes, maintenance, HOA fees, lawn care, etc). Unless you are certain to a high degree that you will stay at least that amount, chances are you'll lose money even if the place appreciate a little.

For those reasons, I would stake out a nice rental, try out the job, see if the area provides you/your family with what you're looking for in life, (if you have kids, check out the school districts) and then purchase.

[JustinHEMI]

Originally Posted by BRAKE!

I don't see rates coming down until the Fed can see CPI/PCE numbers hover over their target for at least 6 months to a year. The current rate hikes have got us to where we are now and it's working to curb inflation and so the Fed has no reason to decrease it yet.

But that's besides the point. I wouldn't buy in your situation for a year or so. This is because;
1) You're moving to a new area and you may not know where the best place for you is yet
2) You got a new job - what if you hate it? The last thing you need in that situation is to be locked down due to a home.
3) For most housing markets a break-even point is 7 years for a home (factor in taxes, maintenance, HOA fees, lawn care, etc). Unless you are certain to a high degree that you will stay at least that amount, chances are you'll lose money even if the place appreciate a little.

For those reasons, I would stake out a nice rental, try out the job, see if the area provides you/your family with what you're looking for in life, (if you have kids, check out the school districts) and then purchase.

Good points!

Thanks all!

[GOLFFRR]

Originally Posted by BRAKE!

But that's besides the point. I wouldn't buy in your situation for a year or so. This is because;
1) You're moving to a new area and you may not know where the best place for you is yet
2) You got a new job - what if you hate it? The last thing you need in that situation is to be locked down due to a home.
3) For most housing markets a break-even point is 7 years for a home (factor in taxes, maintenance, HOA fees, lawn care, etc). Unless you are certain to a high degree that you will stay at least that amount, chances are you'll lose money even if the place appreciate a little.

For those reasons, I would stake out a nice rental, try out the job, see if the area provides you/your family with what you're looking for in life, (if you have kids, check out the school districts) and then purchase.

some good points here.

[RickFLM4]

I'd rent short term and shop to purchase very selectively.

[Nuckle]

Rates are here to stay in my opinion. Housing prices will come down. Wait. I see studies that suggest the death rate is greater than the birth rate.

[dmatre]

Several years ago we moved cross-country for a new job. We immediately bought a house based on the fact that we absolutely wanted our son to be in zone for a top-rated public school, and the belief that rates wouldn’t stay low and we’d miss our opportunity.

Fast forward three years, and circumstances led to a move back cross-country, back to the town we left earlier.

We sold for just a bit more that what-we-paid-plus-improvements. However, when you factor in real estate agent fees on both houses, we lost money on the housing (made enough at the new jobs to be able to recover, but still not nice).

My advice would be to rent until you are solidly established at work, and until you get to know your new town better. Although interest rates are near their historical average, and like won’t return to the 3’s or 4’s in our lifetime, prices will fluctuate with the economy- and we average a recession at least once a decade.

[Condorll]

Originally Posted by JustinHEMI

Both good points and I'm not interested in renting out my current home. For the area I'm moving to, even if things slow down, I don't expect housing prices to "crash," which is what has me leaning towards buy now, refinance later.

Just be aware that when you refinance if your home has dropped in value you will have to make up the difference to retain your loan to value ratio.

Example:
$ 500,000 home with 20% down = 400,000 mortgage.
Refinace in 3-5 years but home is only worth $400,000.
An 80% mortgage (320,000) will require you to make up the difference between your remaining balance and $320k in cash (or another loan if you qualify).

Of course this might be an extreme example but depending on area could be relevent. West coast homes can zig zag in value depending on the economy, 2008-2009 was devestating to WC home values as an example. Florida can be as well depending on the economy and hurricanes, the time to refinance will be a critical decision.