<p>CF, Mr Dstark? Nobody calls me mister in the real world. :)</p>
<p>“Too much money, not enough places to invest it.” :)</p>
<p>Our home assessment went up 35% this year!! Thats ridiculous. But, we decided its not worth fighting since next year I turn an age that allows us to readjust our property taxes significantly in the downward direction. Others in our neighborhood went up 30-35% and they are appealing.</p>
<p>My D was in Austin a few weeks ago. She loved it. She said Austin was California on steroid. If I were near Austin, I’d buy a house there for an investment at that price.</p>
<p>Our house is assessed at what I think is a ridiculous value. I have a thought that, although it might be impossible to implement, the owner should be able to sell to the town for 80% of assessed value. You say my house is worth $x? SOLD to the man with the clipboard for $0.8x. Cashier’s checks only, please. </p>
<p>Since I’ve always considered my house a consumption item rather than an investment, I’m not too worried about what the selling price will be. We’re in a HCOL area, so we can easily buy a very nice home for retirement in a lower COL area with the proceeds and possibly bank some also. </p>
<p>The problem with Texas and Austin is water (not enough), too many folks moving here (traffic is terrible and getting worse, Austin is now a sprawling metroplex w/Round Rock, Kyle, Buda… heck, we sprawl almost all the way to San Antonio) and TAXES. All the tax revenue government needs has to be raised from property taxes and sales taxes, due to the lack of a state income tax. Sales tax is 8.25%, and property taxes are high. On a 300,000 house, RE taxes are approx $7000 a year.</p>
<p>We are finally selling after three summers on the market. There had been a lot of inventory at the upper end of our market and those who needed to sell had to cut their prices pretty drastically. We were able to wait it out and are happy with what we’re getting. (We had five offers over the course of a couple months.)</p>
<p>^You call that high? Our assessment is what we paid when we bought the house 20 years ago. Our RE tax is about twice as much as what you quote and we pay a state income tax and sales tax.</p>
<p>Your house hasnt appreciated in twenty years?
Ours is supposedly worth almost seven times what we paid for it thirty years ago.</p>
<p>I’m directly aware of some modestly priced Florida residences that are worth less than they sold for when new, about 29 years ago. This is an unusual case, but it does make a point. </p>
<p>At least in the upper-middle to higher end of the Los Angeles metro area real estate market, prices are significantly higher than, say, four or five years ago. Some folks have said that available inventory is still low – not as many houses on the market as would be expected. </p>
<p>We built our house in 1996 and put on an addition in 2008. At this point, we would be lucky to sell it for the money we put into it, and we were even the GCs on it, so it was less expensive than it would have been for the average owner.</p>
<p>An acquaintance recently bought a house in Seattle. First day listed, bidding war started,18 offers, many are full cash offers. They got the house for a mere $150K over the listed price of $430K, sold $580K! This is for a 40+ year old house, 1600 ft2 split level, postage stamp size lot and needs about $50K upgrade. But location is everything, near bike trail, University, walkable to everywhere. I was told that realtors like to price the home under market value just to start a bidding war. I guess it worked.</p>
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<p>I am sure it did somewhat. Our property assessment is based on the latest sale price. Some of our neighbors have lived in their house over 30 years and low assessment.</p>
<p>Our neighborhood is selling like crazy right now (sw suburb of Houston). They say any house without mold or major foundation issues will be sold in 3 days. Makes me want to move, but I think we should stay where we are until S2 graduates college (3 more years).</p>
<p>Our zip code goes from view properties, all the way to the water, and quite a few homes have been extensively remodeled. ( tear down to foundation, so they can retain footprint without having to move farther from the property line)
But some don’t really have much of a view, however they raise the assessment on everyone as the average price goes up. </p>
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<p>This is why my nephew and his wife are renting in San Antonio. My nephew really wanted to buy – when they knew they would be in San Antonio for the next 3 - 5 years, he really thought buying would make financial sense. Renting is throwing money away was his idea.</p>
<p>But property taxes on a $175,000 house were just about $5,000 a year. For about $800 a month, they are renting a luxury apartment in a great neighborhood. True, the house would have had 3 bedrooms and the apartment only has 2, but for the two of them it is more than enough space. </p>
<p>If anyone thinks that buying would be a better long-term strategy for them, I am sure my nephew would love to hear it. But with property taxes plus insurance plus upkeep not to mention the mortgage/interest payment, they decided to focus on maxing out their retirement funds rather than buy a house.</p>
<p>When you have a big income, the annoyance of high property taxes is mitigated by the fact that there is no state income tax. Not necessarily so much at other income levels.</p>
<p>If you buy smart, you can usually come out ahead if you have 5-10 years in the home. We have never sold a house without a significant profit. However, it’s all about timing it right and location, location, location.</p>
<p>Sold my dad’s home at the bottom of the market in late 2011/early 2012. It seems to be worth about 20% more now, and things are selling much faster now as the market has improved. Oh well. Its all about timing.</p>
<p>I think in every case of a house I sold, the value would have been substantially greater if I’d invested the capital in the S&P 500. </p>
<p>1978-1994
house: 300% S&P 450%</p>
<p>1984-1994
condo: -40% S&P 300%</p>
<p>1996-2013
house : 150% S&P 269%</p>
<p>Of course, I got to live in the house, so I would have had to pay rent otherwise. But I also would have received dividends from an S&P investment vs having to maintain the house. The home was financeable at 80% financing, but the S&P would not have been.</p>
<p>Its not an easy analysis to do, and the years of living for “free” because appreciation was greater than the costs of ownership are likely behind us. I think that is affecting people’s view of housing. Sam Zell believes that the demand for housing from new household formation is shifting to apartments because that model fits the new paradigm of unmarried couples, etc, etc. </p>
<p>Totally,
My brother bought in a new suburb about 10-12 years ago, but now it is all about ( at least locally) cutting the commute, and the suburbs are flatter than the city.
The location still serves him however, and if you can stay put for a while, that is what I’d pay attention to.</p>
<p>We haven’t put much into remodeling, mostly just basic maintenance.
Redid the yard though. Totally landscaped, although it isn’t finished.</p>
<p>I think renting can be fine, unless the landlord decides they can make more money by changing cosmetics and raising the rent.
Which in my area is fairly common.
Rent in one building is going from $890 to $1,500. ( the family who had owned the building through several generations, sold it) Granted, it is probably market rates for a new building, but it isnt a new building, and many of the tenants are lowish income/ elderly.
I know the owners, who also own other businesses and properties in the area, and I think " How much money do these people need, and why couldn’t they give proper notice?"
I’d rather be beloved in the community, than be thought a dic and have more than I could reasonably even spend.</p>