This is a topic on the McLean, Va citizen journalism website. I assume that's an affluent area near DC.
"Is anybody else worried about the skyrocketing home prices around here? All the recent home sales in my neighborhood are at levels way above the prices just a few months ago. And it seems like every fifth house is being hugely renovated--if it's not a teardown with a McMansion going up in its place."
"If you're a homeowner, it's a little breathtaking watching your biggest investment rise by double-digit percentage points every year. But you have to wonder how long it will last--and what will happen when/if it ends. What does everybody think?"
Hard to have compassion for that.
Money Mag published their 2005 list of Best Places to Live.
#1 Moorestown, NJ. Population 20,662. Median home price $367K.
#3 Naperville, IL. Population 163,896. Median household income $95K. Median home price $311K.
Here's the Top 100 list. Saline, MI is ranked 43. That is a nice town. Saline's median home price is $241K.
They also break down the "contenders" by state. Here's Ohio. The only local community to make the contender list is Sylvania with a population of 29,174 and a media home price of $169K. Toledo's median home price is $94K, which is a gain of 2.68%.
Check out that Top 100 list and note how small most of the communities are. Most on the list have a population less than 50,000. They are located near large cities. It's probably the same old story. The wage earners enter a higher income bracket, maybe have more kids, then decide to build a big new home in a small town with good schools, safe streets, and a community feel.
Look at Saline. It's not a suburb. It's out there pretty much on its own. But the University of Michigan is not far away, and it's not that huge of a commute to Detroit.
People leave the city for the suburbs. Then they leave the suburbs and move out even further. This move has a name, but I forget what it's called. I saw an article somewhere that described this locally. It said some people are leaving Perrysburg and Sylvania for Monclova Township, Whitehouse, etc.
Oh yeah, I looked up McLean, Va at the Money Mag site. They made the contender list. Population 49,561. Median household income $112,643. Median home price $530K. Man, if you have a $400K shack, you're bringing down the average.
Isn't it true that the average family size is smaller today than in 1970, but the average home size or at least the size of new homes is significantly larger than in 1970? It seems people prefer to build a large home than move into a smaller, older one located in the city. But again, if you have kids, the public schools have to be a factor.
I think some want to get away from the sprawlsville of the burbs and will tolerate a longer commute to work by living in a small town further away.
Some info about Whitehouse.
"Once a sleepy rural outpost, the village of Whitehouse is becoming a popular destination for new home buyers seeking relief from escalating prices and dwindling lot choices in suburbs directly adjacent to Toledo. A study by a private firm found that the population has climbed 10 percent to 3,000 since the 2000 U.S. Census"
Then Whitehouse will get too crowded and people will move out even further, or they'll move back into the city, maybe downtown. Seems like the only thing that could bust the housing bubble besides a major collapse in our economy, is if people abandon these small towns and burbs and move back into the older homes in the city.
Back in the 1990's, someone predicted that today's housing divisions in the farm fields will be tomorrow's slums in 50 years.
posted by jr at 06:56 P.M. EST on Fri Jul 15, 2005 #
Just take a quick look around Lucas County. There is a boom, and it appears to cut across most all financial demographics.
I doubt that it will be a fall more than a slow slide.
There appears to be a lot of pent up desire that only a severe financial setback could possibly stall.
The way that all, those house prices keep going up, the only way to control/beat it is to buy yer dream home before the price goes yet up again... Buy NOW and buy BIG.
Now if gas prices rise to, say $ 4.00 and above, that could slow things down…
posted by Hooda_Thunkit at 07:05 P.M. EST on Fri Jul 15, 2005 #
Actually, there's even a movement in Ohio called "first ring suburbs" or something like that...the issue is that the suburban cities around the major ones (Oregon, Sylvania, Maumee around Toledo) will begin to experience the same problems as Toledo has as people move into the townships and further outside.
People are making choices - some for taxes which are lower in townships (as most have no income tax), some for schools, some for quiet (no booming, bass-laden music blaring from cars going down the street every 2 minutes), some for space and openness.
However, as these people move out into the townships, they encounter issues they didn't deal with in the cities (smell of manure on fields, dust from fields when there's no rain, tractor traffic, etc) and often water/well and sewer/septic tank issues.
Often, the cost of wells and septic systems versus the convenience of water & sewer lines is a factor in the housing prices - sometimes much lower over the life of the house.
Another main consideration is the interest rates...pretty low over the last years and fears that they may climb. You can get a more expensive home with lower rates than you can when the rates are higher - especially if you've set a budget for mortgage and taxes.
posted by intrepid at 08:18 A.M. EST on Sat Jul 16, 2005 #
Article in latest Toledo Free Press:
"Housing prices have been rising in many markets around the country; the average home cost rose 12.5 percent from the first quarter of 2004 through the first quarter of 2005."
"Local investment advisor Dock Treece, of Treece Financial Services, weighed in on the debate. "There is definitely a bubble of some kind in places like California and the East Coast," he said. "There will likely be some sort of correction, but it is anyone’s guess as to its severity." "
"Tim Schlachter, of local developer Buckeye Specialty Homes, expressed confidence in the housing market in Northwest Ohio and Southeast Michigan. "I don’t see that speculation has had much impact in this area," he said. "There are strong markets in housing for empty nesters and for houses in the $175K to $200K range." The only segment of the local housing market in which Schlachter has seen any weakness is in houses selling between $300K and $400K."
"The prices of homes in Ohio have not kept pace with the national average, rising only 23 percent since 2000. Schlachter said if a serious correction occurs in housing markets, Ohio may fare better than other regions. "There has to be a serious imbalance between asking prices and market values for a major correction," he said. "There is nothing like that overall in Northwest Ohio." "
"One positive sign in the local market, Schlachter’s said, has been the number of homes for sale. "There are over 700 more homes for sale compared to this time last year," he said. "This shows confidence on the part of home buyers." "
posted by jr at 02:57 P.M. EST on Wed Jul 27, 2005 #
WSPD story from yesterday:
"Toledo area home sales were down about 2 percent in the first six-months of the year while the average sale prices were also down just over one-percent to an average of $130,000. West Central Ohio home sales, generally the Lima area, were up nearly seven-percent to an average sale price of $101,000. The statewide home sales average was up about three-percent to nearly $154,000. The most expensive homes at $174,000 were in the Cincinnati area, while Marion and Portsmouth at $93,000 had the lowest average home prices in Ohio."
posted by jr at 03:02 P.M. EST on Wed Jul 27, 2005 #
"Sales of new homes soared to an all-time high in June as the red hot housing market kept sizzling. The Commerce Department reported that single-family home sales jumped to a record annual pace of 1.37 million units in June, up 4 percent from May."
posted by jr at 12:39 A.M. EST on Thu Jul 28, 2005 #
Article at CNN.com in which Greenspan offers more pessimism about housing prices, and speculation about an end to the housing boom.
A blurb from Greenspan:
"The housing boom will inevitably simmer down," Greenspan said in the prepared remarks. "As part of that process, house turnover will decline from currently historic levels, while home price increases will slow and prices could even decrease."
Good time to refinance and lock in a low fixed rate. If you are highly leveraged in a mortgage, brace yourself. Things might get ugly in the housing market.
posted by historymike at 09:28 P.M. EST on Sat Aug 27, 2005 #
One large factor affecting urban sprawl is the advent of interest only loans. These are typically short-term (less than 7 years) and at the given rate as of the day of approval and rate lock. These types of loans can essentially allow a person to afford a home that is anywhere from 4 - 6 times higher than their income. Once the balloon comes due for conversion, the "low" payment of interest only becomes an unbearable burden that unfortunately results in foreclosures.
Currently there is a HUGE stock of foreclosed properties in Toledo. This has nothing to do with people wanting to move to the 'burbs, but demonstrates the financial dilemma our citizens are dealing with. And, for the record, these are not low-end homes in blighted neighborhoods. Lots of the foreclosures are in the 'better' neighborhoods, on homes valued at >$140,000.
Currently there does not seem to be a 'bubble' in Toledo per se. There IS a move among various community groups to support and encourage gentrification of the older neighborhoods. Many of the folks that moved out to all that new construction in Monclova, Perrysburg, Swanton, Delta, etc. are now coming back into the city and buying homes in Old Orchard, Point Place/Shoreland, Westmoreland, University Hills, etc.
If you are currently riding a mortgage rate that is above 6.375% and you are 12 years or less into a 30 year note, it might be prudent to check into refinancing. The amount you save in the long run could be significant.
California, Massachusetts, New York, Florida and Texas are all experiencing EXTREME home valuations due to the solid job markets. A 1100 sq ft home in Toledo that sells for $90,000 will cost you more than $500,000 in the San Francisco Bay are.
In 1975 I purchased a home in a Boston suburb for $46,000 - that same house sold 2 years ago for $322,000. Nothing special about it, just your standard 3 bedroom house. I drove by it last year on vacation and it has not changed one bit on the outside. Makes ya wanna say....YIKES.
posted by DoknowDocare at 10:00 P.M. EST on Sat Aug 27, 2005 #
I encourage people to continue believing there is "no bubble in Toledo" since the vast array of foreclosures will make it easier for people like me to rent a home.
Toledo is a great place to find a $50K home selling for over $90K. "No bubble" -- bwaaaahahahaa!--er ... ahem ... just ignore that. Go ahead and max out your line of credit and outbid the next desperate home-buyer in getting that $60K home for $120K. Go get that interest-only loan ... I'm sure your income in Toledo will shoot up 30% within the next 5 years to prepare for the expiration of the IO period. After all, Toledo's a great place for increasing incomes. {snrk}-- sorry, sorry. As I was saying, a negative-amortization loan is a GREAT choice for home-buyers. After all, having made so much money from the dotcoms, why not plow ...
What's that? You "lost money" from the dotcoms!?!? Why, that's impossible, since it was the New Economy and stocks would keep rising forever ... just like home prices now. There's no way people lost money on stocks, just like there's no way to lose money on property specul--er, "home buying".
{pause}
BWAAAAAAAHAHAHAAAHAAAAHAAAA! Gods, I couldn't hold it in any further. {wipes tears} Whatever happened to the idea that debt was bad? Credit is for poor people -- when did people stop acknowledging that truth? My countrymen are going completely insane. No, it's WORSE than insanity; it's like I live on an alien world, and everywhere I go, I see light-skinned bipeds using some bizarre clicking language to talk to each other. "Click? Click click. Click clack? Clack, click click? Clack!" It's like a bad episode of the Twilight Zone.
What are all you people smoking? Worse, what are the people in California smoking?:
Equity Is Altering Spending Habits and View of Debt
http://www.latimes.com/business/la-fi-homedebt28aug28,0,6044251.story?coll=la-home-headlines
(Just crazy. No wonder Carty is doing so well in the polls. People who believe in this form of a housing market are apt to believe in little blue fairies riding unicorns through Toledo's parks ... and as well, that a man as certifiably crazy as Carty is qualified to hold public office, much less dress himself each morning.)
posted by GuestZero at 07:00 P.M. EST on Sun Aug 28, 2005 #
Syndicate ToledoTalk
