Up, Up and away

[twoplanekid]

As I enjoy watching the housing market in TV, I find it amazing what sellers are able to do in this current market. I monitored a home for sale almost identical to mine that was purchased in the same year. The original listing was $400,000 in late December. The first of January it went up to $450,000. After a few days at this price the listing went pending. After a few more days it came back on the market at $475,000. I noticed today it went back to the pending status. I am so happy I purchased my house in 2014 and still enjoy living in it today. However, now is the time to sell if your thinking about it.

[davem4616]

nice return on one's investment, but then you have find someplace else to live

[Michael G.]

If you sell just to make a profit, you will spend the profit on something else unless you settle for something smaller

[rustyp]

Let's cure this euphoria:

Two years ago if you had a $200K house and wanted to move up to a $300K house it would be the difference plus 6% to sell you house. Thus $100K + $12K = $112K to move up.

Now in this heated housing market your little gem increased 50%. $200K x 1.50 = $300K.
Likewise that new house you desired increased 50%. $300K x 1.50 = $450K
Don't forget the 6% to sell your house which now equals $18K instead of $12K.

Thus to make the same move today is the delta between the two houses $450K - $300K = $150 K plus the $18k =$168K.

Let's recap sell two years ago and move up = $112K
Same exact sales today to move up = $168K
POOF - The winner is the real estate agent.

[manaboutown]

Let's cure this euphoria:

Two years ago if you had a $200K house and wanted to move up to a $300K house it would be the difference plus 6% to sell you house. Thus $100K + $12K = $112K to move up.

Now in this heated housing market your little gem increased 50%. $200K x 1.50 = $300K.
Likewise that new house you desired increased 50%. $300K x 1.50 = $450K
Don't forget the 6% to sell your house which now equals $18K instead of $12K.

Thus to make the same move today is the delta between the two houses $450K - $300K = $150 K plus the $18k =$168K.

Let's recap sell two years ago and move up = $112K
Same exact sales today to move up = $168K
POOF - The winner is the real estate agent.

And one's real estate taxes will be higher due to to the higher price of the purchased home.

[MrFlorida]

Doesn't matter, sell for more, then pay more for next house...when the market calms down, you sell for less, then pay less for the next house....it's all relative. Relators and the tax man are making the most of this market.

[rustyp]

Let's cure this euphoria:

Two years ago if you had a $200K house and wanted to move up to a $300K house it would be the difference plus 6% to sell you house. Thus $100K + $12K = $112K to move up.

Now in this heated housing market your little gem increased 50%. $200K x 1.50 = $300K.
Likewise that new house you desired increased 50%. $300K x 1.50 = $450K
Don't forget the 6% to sell your house which now equals $18K instead of $12K.

Thus to make the same move today is the delta between the two houses $450K - $300K = $150 K plus the $18k =$168K.

Let's recap sell two years ago and move up = $112K
Same exact sales today to move up = $168K
POOF - The winner is the real estate agent.

FYI The real estate agent netted a 50% increase. Was there any more work involved ?

[Stu from NYC]

Supply and demand. Can make a large profit on the house we purchased here two years ago but whats the point.

[twoplanekid]

If you don’t need to sell, then don’t. However, I find it amazing that one could start with a price in late December and then end up selling a house after one failed attempt for an amount almost 20% higher in only one months’ time. Maybe the first asking price was too low at about 46% more than the purchase price?

[Garywt]

Same thing is happening everywhere. My north house was $200000 in 1995 and is $800000 today but offers would come in $50-100k over asking. If I sell and we are not ready to full time in Florida then I lose.

[toeser]

As I enjoy watching the housing market in TV, I find it amazing what sellers are able to do in this current market. I monitored a home for sale almost identical to mine that was purchased in the same year. The original listing was $400,000 in late December. The first of January it went up to $450,000. After a few days at this price the listing went pending. After a few more days it came back on the market at $475,000. I noticed today it went back to the pending status. I am so happy I purchased my house in 2014 and still enjoy living in it today. However, now is the time to sell if your thinking about it.

Yeah, I think the housing party is just about over again. Once mortgage rates start to march upward that will put a damper on ever-increasing prices. If the Fed loses complete control over inflation and has to really ratchet up rates, housing prices will fall.

[Blackbird45]

By now most of us have lived long enough to have watch housing prices go up and go down.
It's just numbers.
Unless you are investing in properties to build up capital, whatever one earns on one end they will spend on the other.

Relax this is going to pass and a new problem will surface to replace it.

[Sinkorslim]

Let's cure this euphoria:

Two years ago if you had a $200K house and wanted to move up to a $300K house it would be the difference plus 6% to sell you house. Thus $100K + $12K = $112K to move up.

Now in this heated housing market your little gem increased 50%. $200K x 1.50 = $300K.
Likewise that new house you desired increased 50%. $300K x 1.50 = $450K
Don't forget the 6% to sell your house which now equals $18K instead of $12K.

Thus to make the same move today is the delta between the two houses $450K - $300K = $150 K plus the $18k =$168K.

Let's recap sell two years ago and move up = $112K
Same exact sales today to move up = $168K
POOF - The winner is the real estate agent.

Sell it yourself

[donassaid]

And the tax man, not to mention that your HOA's just went up to $179/mo.

[joseppe]

The key to leveraging is to not put all of the proceeds into the new property. Take a 100k gain on a sale purchase the next property with 20% down which leaves you with cash from the sale and a higher priced property that should appreciate now at a faster rate. Do the same thing in 3 or 4 years and you can see how it continues to build. YOU may not want to play this game, but many do and make a lot of money doing it. Wealth is usually gained from real estate and business undertakings and not you typical 9-5 job.

[rustyp]

Sell it yourself


OK - still $50K in the hole.

[Travelhunter123]

Yeah, I think the housing party is just about over again. Once mortgage rates start to march upward that will put a damper on ever-increasing prices. If the Fed loses complete control over inflation and has to really ratchet up rates, housing prices will fall.

I would think you are correct
In the late seventies and 80’s when we had 10% to 16% interest rates I think prices continued to escalate at a slower pace

[Bay Kid]

It is all funny money. Just sold my 3 year old Camry, w/28,000 miles, for over $4,000 more than paid for it out the door. Crazy world.

[Cliff Fr]

The people that are hurt are the working people and retired people that cannot afford the Village's. People that already own a home outside the Village's are being affected by the exorbitant price increases in the form of higher homeowners insurance premiums and ever higher property taxes. People outside the Village's that want to buy a single family home are being priced out of the market and forced to pay higher and higher rent.

[RealJudy]

Plus moving costs and other closing fees.

[rsmurano]

Why would you use a realtor? I sold my last house when I posted on the internal site: “I’m thinking of selling my house”. Friends of friends in the community started to call me in hours. I sold as a cash deal, no appraisal, no inspection, and no cost. The paper work comes from a lawyer that the buyers attain, an hour worth of work filling out the disclosure papers and the sales contract.

[sail33or]

Flippers already own a house. They are buying a SECOND house and putting in a pool or birdcage and making $300K after one year.

Also, people who do not even live here are buying houses, waiting one year and selling for huge profits.

A typical buyer is competing with everything and everyone.

It will take Wall Street crashing to end the frenzy.

[Johnsocat]

Supply and demand. Can make a large profit on the house we purchased here two years ago but whats the point.

It's a good time to do a cash out refi. Lower your interest rate and make some nice upgrades on your home...

[Cranford61]

The people that are hurt are the working people and retired people that cannot afford the Village's. People that already own a home outside the Village's are being affected by the exorbitant price increases in the form of higher homeowners insurance premiums and ever higher property taxes. People outside the Village's that want to buy a single family home are being priced out of the market and forced to pay higher and higher rent.
We’ll that’s just tough! Not everyone can afford Beverly Hills, CA either. When socialism prevails, they can move next door. But for me, I don’t want to live next door to, or socialize with people on the fringe. There is a snobbishness to Villagers and the people living on the perimeter like Water Oaks, Stonecrust are aware of it.

[Pachine58]

How do they justify a 40 year old mobile home, a depreciating asset, worth $200,000 + , I don’t get it.

Manufactured homes are different, they are prefab on a foundation. Similar to stick prefab homes sell down south.

[Tom M]

Here's a thought: Just let the original poster be happy that they bought years ago at a significant discount from today's price.

[mrf0151]

Just be happy that most of us started this wonderful real estate ride back in the 60's and 70's and have done extremely well. Retired, 2 homes in TV, one being a full-time annual rental always occupied with no mortgages on either. :MOJE_whot:

[Curtisbwp]

I purchased a ranch in 2004 for $150.00, sold it in 2006 for $239,00

[Bilyclub]

We’ll that’s just tough! Not everyone can afford Beverly Hills, CA either. When socialism prevails, they can move next door. But for me, I don’t want to live next door to, or socialize with people on the fringe. There is a snobbishness to Villagers and the people living on the perimeter like Water Oaks, Stonecrust are aware of it.

Then there are some like a frequent poster here who likes to flaunt the fact that he lives just outside TV but like to use our stuff, especially the cart paths.

[manaboutown]

Just be happy that most of us started this wonderful real estate ride back in the 60's and 70's and have done extremely well. Retired, 2 homes in TV, one being a full-time annual rental always occupied with no mortgages on either. :MOJE_whot:

When I checked a week ago on the house I bought new in 1968 in Alexandria, VA for $28,000 I found it had sold in 2021 for about $700,000. It had been nicely updated and the walkout basement finished but still.....

About 10 years ago I visited a man about 15 years older than me (he is 94 today). He had recently bought and rehabbed an elegant large house, even putting in an elevator. He told me the (custom oversize) French doors had cost him about $8500/set installed, about what he paid for his first house!

[tjdmlhw]

FYI The real estate agent netted a 50% increase. Was there any more work involved ?

That depends, the sellers agent only real job was convincing the seller to let him list it. After that, he just sat back and waited for the offers to come in, so his job was a lots easier than in normal times.

On the other hand, the buyers agent probably had to show his clients a lot more homes than he normally would because the ones they wanted were being bought by people outbidding them. He had to submit numerous bids and try to keep his buyers from becoming discouraged and giving up. So he definitely worked harder for his share of the pot.

[Djean1981]

It's wild. Our same house is being sold new at $90k more than we paid this past early-March. Pre-owned, the same model is selling for up to 200k more. I understand supply and demand. However, although my house is nice, I don't think I would pay today's prices. I'm not sure the house is truly worth the current price. If the market changes, some may have regrets.

[rustyp]

That depends, the sellers agent only real job was convincing the seller to let him list it. After that, he just sat back and waited for the offers to come in, so his job was a lots easier than in normal times.

On the other hand, the buyers agent probably had to show his clients a lot more homes than he normally would because the ones they wanted were being bought by people outbidding them. He had to submit numerous bids and try to keep his buyers from becoming discouraged and giving up. So he definitely worked harder for his share of the pot.

Buyers agent or sellers agent which one did not make 50% more than they did two years ago for the same transaction / same amount of work ? Ref post #4.

[JMintzer]

It's wild. Our same house is being sold new at $90k more than we paid this past early-March. Pre-owned, the same model is selling for up to 200k more. I understand supply and demand. However, although my house is nice, I don't think I would pay today's prices. I'm not sure the house is truly worth the current price. If the market changes, some may have regrets.

Some of that is most certainly due to market inflation. But some of it may also be due to the different lot premiums...

[DAVES]

We all know that homes and the stock market always go up-EXCEPT WHEN THEY DON'T.
Homes are going up for several reasons low mortgage rates, rising material costs, rising labor costs, and rising land costs, Homes are going up everywhere not just in Florida.
Part of the rising cost is due to LEVERAGING. There is no other investment where you can put 20% down and borrow the rest at 3% and put your money into the stock market and make 15-30% on it. Oh and add to this insanity, the average age in the Villages is 70.They cannot deny you a 30 year mortgage due to age.

I do not own rental property. I do wonder what it is like to have a non-rent paying customer evicted. The covid EXCUSE?

I never expected our Villages home would go up. A pleasant surprise IT HAS. An unpleasant awakening. Any place I would move to in or out of the villages has also gone up.

[DaleDivine]

And the tax man, not to mention that your HOA's just went up to $179/mo.

Ummm, NO HOA's in The Villages...
:ohdear::ohdear::ohdear:

[Jerseybob]

I disagree. If you sell now, your north home is potentially at the top of the market ($800K) and the interest rate is low, you have "made" nothing as you have not sold your home.
If the interest rate rises, your north home may begin to slip in demand (the more interest rates increase, the less home buyers can afford to purchase) and market value may also slip back.
If the north house in theory is later valued at $750K when you decide to sell, you did not "lose" $50K, you just didn't capitalize on the value at this time. It has nothing to do with your potential purchase in FL. The interest rate may be the same in both places, but depending on when, where in FL and what you buy will determine what you consider a "good deal".

[CoachKandSportsguy]

Same thing is happening everywhere. My north house was $200000 in 1995 and is $800000 today but offers would come in $50-100k over asking. If I sell and we are not ready to full time in Florida then I lose.

Not necessarily. You can rent for the small amount of time until you retire. . 50K of rent is like 2 years at 2K per month. . Losing means that you lost all the gain. . .or money. . not quite accurate, but it looks good. . . and with 800K in cash in a 10 year bond @ 1.75 is about 14K per year of interest, which is almost 1/2 the amount of the rent. . . you don't really lose all that much. . . so the 50K in overage and interest makes about 3 years of rent, in rough round figures.

Not sure about your financial situation or work or retirement plans, but sometimes there is a way to keep a large gain. . and my mom's house, just lost 50K in value on Zillow. . . from the max, so gains can disappear as well.

good luck

finance guy

[Garywt]

And the tax man, not to mention that your HOA's just went up to $179/mo.

But we don’t pay HOA fees here in the Villages.

[Garywt]

Not necessarily. You can rent for the small amount of time until you retire. . 50K of rent is like 2 years at 2K per month. . Losing means that you lost all the gain. . .or money. . not quite accurate, but it looks good. . . and with 800K in cash in a 10 year bond @ 1.75 is about 14K per year of interest, which is almost 1/2 the amount of the rent. . . you don't really lose all that much. . . so the 50K in overage and interest makes about 3 years of rent, in rough round figures.

Not sure about your financial situation or work or retirement plans, but sometimes there is a way to keep a large gain. . and my mom's house, just lost 50K in value on Zillow. . . from the max, so gains can disappear as well.

good luck

finance guy

Unfortunately all we can get for $2000 a month is a studio apartment. Going from a 4 bedroom colonial wire 4 people that might not work. We are probably looking at $3400-4000 a month which is more than the mortgage. I am retired but my wife is working. We own in The Villages, 3 years now, but will not rent it out. We have gained about $100000 so far in FL.

[Djean1981]

Perhaps, if they have an extra large lot or water view. To me, my lot is better because it's on a non-through street (quiet and less traffic), we only have neighbors to the left and right (none behind our house). Also, and the yard is fenced. The fence is a deal breaker for me. :)

[CoachKandSportsguy]

Unfortunately all we can get for $2000 a month is a studio apartment. Going from a 4 bedroom colonial with 4 people that might not work. We are probably looking at $3400-4000 a month which is more than the mortgage. I am retired but my wife is working. We own in The Villages, 3 years now, but will not rent it out. We have gained about $100000 so far in FL.

Well, I certainly miscalculated on trying to maintain the size and number of people while retired. . . . also miscalculated that you still have a mortgage, obviously I have no idea about what I am typing. We refinanced the mortgage up north from near zero to equal to the TV mortgage so TV is debt free, and the northern house is 80% LTV so when moving, whatever is left over, we put in the UHaul, and drive two cars down stopping a lot along the way.

we are up $150K on zillow, and the people are asking ridiculous amounts for similar houses, built $350K, current $500K, people offering $750K for the same nearby. . . good for them, and the rental is break even on all the annual expenses, with no mortgage, but we aren't selling due to the location. .

see you in a few years.

[jrref]

Although housing prices will go up and down what's making a difference this time is because of the pandemic, many more people can now work remotely and don't have to go to a physical office anymore. These people can now leave less desirable areas and move here to Florida and enjoy the better weather and tax structure.