Home prices

[cc322]

With summer on the way ,usually the busiest time for home buying, are the price of homes ever going to go down? They seem to be rising as fast as the custom boat market :D Im glad we bought when we did. Also how long will intrest rates stay low? Who has the crystal ball?:confused:

[OGShocker]

Well, my balls are as fragile as crystal but, why do you ask?
The home prices in our area are INSANE. We bought our home in Chino in 1996. The prices on homes half our size have increase to three to five times what we paid.
You will most likely see prices level or drop slightly if interest rates increase...
My .02

[hd&boatrider]

Prices will remain on the upswing at least thru the election and probably thru the end of the year. After that.....probably intrest rates will rise and the housing market will slow down. Just my un-educated guess

[cc322]

Paid 183000.00 in 98 for a three bdrm home in misssion viejo, two years ago added a fourth bdrm and inlarged the family room,plus kitchen upgrades. Now same homes are selling for 540000.00 INSANE

[welk2party]

Rates have already increased. They will have to go up substantially to affect the market. Problem is people are paying the inflated prices. As long as that continues many will be priced out of the market.

[Blown 472]

http://shorewest.com/searchframe.html

[RiverToysJas]

Soon in Ca (it's already happening) the limiting factor won't be price or interest rate, it'll be Property Taxes!
I know of a few people how have bumped up to bigger houses with the equity of a home sale, put a large amount down to keep the payment the same, and then were hit with property taxes of 8-10K/year. In one case I heard it was $16,000/year because of all the taxes added in a new community. I think property tax is something people don't consider when shopping, but they will soon. An $800,000 house in Ca, has taxes of at least 8K/year, on top of Principle, interest, and insurance.
I know of at least one person how added a large addition & remodel with their equity. Then the when they were finished the property taxes re-adjusted for the additions, and the people can't afford the taxes and are moving now.
BTW, I suggest everyone try to keep at least 40% equity in their home, just incase we get a worst case scenario drop of 20-25%.
RTJas :D

[LakesOnly]

You guys don't have shit to worry about untill you try to buy in the San Francisco Bay Area--particularly on the peninsula.
The house my folks bought 30 years ago for $39,500 has just dropped in value to under a million because the Silicon Valley economy is not great at the moment.
The house my brother bought ten years ago fo $291,000 is valued at $950,000.
2/1 apartments fetch monthly rent of about $1400 (also down because of the local economy.
I recently had the chance to walk though a 5-bedroom apartment my friend was renovating in San Francisco. Rent was gonna be $5000/month, personal lubricant not included.
LO

[al cole'holic]

Originally posted by RiverToysJas
Soon in Ca (it's already happening) the limiting factor won't be price or interest rate, it'll be Property Taxes!
I know of a few people how have bumped up to bigger houses with the equity of a home sale, put a large amount down to keep the payment the same, and then were hit with property taxes of 8-10K/year. In one case I heard it was $16,000/year because of all the taxes added in a new community. I think property tax is something people don't consider when shopping, but they will soon. An $800,000 house in Ca, has taxes of at least 8K/year, on top of Principle, interest, and insurance.
I know of at least one person how added a large addition & remodel with their equity. Then the when they were finished the property taxes re-adjusted for the additions, and the people can't afford the taxes and are moving now.
BTW, I suggest everyone try to keep at least 40% equity in their home, just incase we get a worst case scenario drop of 20-25%.
RTJas :D
RTJ hit on a very good point here! Home values have increased so much in the last couple of years that most people don't think of them little minor details. Every time you refi, pull out some $$, or do an equity line against that home that has doubled or tripled in value, your assessor knows and makes the necessary adjustments to your property value and your taxes. That will be a shock to some who may not know that at the time they pull $$ out but when they open that tax bill....:( Good news for California's revenues though.
We already see interest rates trying to come up a bit, but with 10 million people projected to migrate to California in the next 10 years I don't think we will see a drop in the market anytime soon..:D

[rivercrazy]

The only time the tax accessor can make a basis change to the value of a home is when there are significant improvements made to the property or if title has transferred. Taking out an equity line or refinancing doesn't impact your property taxes (unless you make improvements to the property).
I think interest rates will have some effect on property values. However, supply and demand for housing has a much greater impact overall. And supply is forecast to still be lean for quite some time. I think values will stay strong.

[hd&boatrider]

I will tell you this: They will increase the taxes on the assesed value increase a hell of a lot faster than lowering them as was in the past.
Good point Jason on everything but the 40% Jason. I want at least 100% equity and leave it alone.

[Cas]

Look for the interest rates to go up more come August.
As far as the taxes, you can figure your property taxes to be about 1½ % of the purchase price in CA. When there is an addition to your home, the only area that can be assessed new taxes is the area of improvement, usually based on a square footage value that was added to the home. Remodeling a kitchen, bath, putting on a new roof normally are not areas the County Assessors will increase taxes.......that's been my experience over the years on the SF Peninsula and now here in Sonoma County.
I read a study a few years ago that a realtor in San Mateo County did based on home sales from 1950 to 1995. The facts showed that home prices on the Peninsula doubled approximately every 7 years, sometimes it was 3 or 4 years and other times it was 10 or 11. The average was every 7 over a 45 year period. Since 1995, the prices have pretty much doubled again so he was pretty accurate in his findings.
Will there be an end to the madness, I guess only time will tell.

[al cole'holic]

Originally posted by rivercrazy
The only time the tax accessor can make a basis change to the value of a home is when there are significant improvements made to the property or if title has transferred. Taking out an equity line or refinancing doesn't impact your property taxes (unless you make improvements to the property).
I think interest rates will have some effect on property values. However, supply and demand for housing has a much greater impact overall. And supply is forecast to still be lean for quite some time. I think values will stay strong.
This my friend is absolutely, positively, wrong bud :D
You buy a house for 200k last year...refi and pull 100k out this year, your new property tax is based on 300k. Once the appraisal is done and the loan goes through the county is notified on the value...

[rivercrazy]

Sorry but I do not agree. I refinanced twice over the last 10 years and there was no basis change in valuation. Thanks Prop-13!!!!!!!!!!!!!!!!!!!!!!

[cc322]

If you pull money out of your home to add on , and you pull all the proper permits for building you will have your property assesd at the end of construction to show the new square footage, our property tax went up from 2000 a year to 2200 still alot cheaper than moving up and paying property taxes on a 600.000 home , thats one of the reasons we added on. Also if you add more than 500 square feet you pay a school tax, they assume you are enlargeing your home for a new child. But if construction is done in two phases I hear you could get around the school tax.I dont believe by pulling a equity line of credt causes you property tax to increase.

[AdrenelineOD]

I moved here and bought the cheapest house on the market( one of) 200,000 now they say I can sell for 320,000. I remember my dad all excited when our house was worth more than 100000 than what he paid. I took some 15 years or somthing

[AdrenelineOD]

Originally posted by AdrenelineOD
I moved here and bought the cheapest house on the market( one of) 200,000 now they say I can sell for 320,000. I remember my dad all excited when our house was worth more than 100000 than what he paid. I took some 15 years or somthing One year

[summerlove]

Originally posted by al cole'holic
This my friend is absolutely, positively, wrong bud :D
You buy a house for 200k last year...refi and pull 100k out this year, your new property tax is based on 300k. Once the appraisal is done and the loan goes through the county is notified on the value...
Are you sure about that??? I have refied a number of times over the years and that has NEVER happened to me. When I added my pool and remodled, they assessed the value of the improvements only, not the new value of the house!

[al cole'holic]

Originally posted by cc322
If you pull money out of your home to add on , and you pull all the proper permits for building you will have your property assesd at the end of construction to show the new square footage, our property tax went up from 2000 a year to 2200 still alot cheaper than moving up and paying property taxes on a 600.000 home , thats one of the reasons we added on. Also if you add more than 500 square feet you pay a school tax, they assume you are enlargeing your home for a new child. But if construction is done in two phases I hear you could get around the school tax.I dont believe by pulling a equity line of credt causes you property tax to increase.
You bought your home for 200k a year ago, and your taxes are based on that same amount...this year you take out 100k to buy that DCB your wife wants so badly. Your home needs to appraise for 300k in order to take that $$ out, it does and you buy the boat for your honey. Your property tax will go from 2000 to 3000 that next year. (In this scenario I am assuming of course that you owed 200k on the house).

[totenhosen]

Originally posted by al cole'holic
This my friend is absolutely, positively, wrong bud :D
You buy a house for 200k last year...refi and pull 100k out this year, your new property tax is based on 300k. Once the appraisal is done and the loan goes through the county is notified on the value...
You are wrong. I've refinanced twice and had no such issue. Like others said only when an addition is made to the property or when a transfer in title takes place.

[NashvilleBound]

In 1989 we bought a 1947 800sf home in a rural area of San Diego for $187K. A few remodels later :) (paid for as we went) and a smimming hole we are about to close an escrow of just over a million. Crazy.

[rivercrazy]

Your property taxes can only increase by the small amount of valuation increase allowed annually. Unless you do improvements. Then the accessed value increases by the amount of the improvements.
Where do you live Al? :eek:

[miller19j]

http://www.losolivos.com/images/lillebakke632.jpg
3 bedroom | 2.5 bath | Solvang
$799,000
Things have gotten carried away this house would have been 300k 7 years ago.

[FRENCHIE]

i think it wil be at least through the end of the year before we notice agreat drop of or trend change, it cant go on like this forever! but im sure there will be another up swing like this in the next 10-15 years.

[roln 20s]

In Litchfield Park, AZ (west side of Phx) I paid 170K last April for a 2200 square foot, 3 bedroom, 2 bath, office, formal dining (my game room :D), 3 car garage, etc... It was valued at 211K last November, and since I have completed my backyard--spa surrounded by bar with gazebo, built in BBQ, benches, firepit, grass, sprinklers, etc.. (will post some pics sometime soon), the house is approx 235K. Maricopa County says home values in 2004 will increase in double digit percentages (say 10%). End of 2004 I should be nearly 250-260K. Not bad for a first house for a 23 year old :D
I wasn't financially where I wanted to be when I bought this house, just out of school, too much debt, but let me tell you--this is: "the best dumb thing I have ever done" :D
I agree with above- rates will definately stay low until the election. However, I've been told by some finance analyst that interest rates will probably increase around 13% each year, for the next 5 or 6 years. Say 5% this year, 5.65% next year, etc...
Roln 20s

[ROZ]

Originally posted by summerlove
I have refied a number of times over the years and that has NEVER happened to me. When I added my pool and remodled, they assessed the value of the improvements only, not the new value of the house!
Absolutely correctomundo... I'm in the exact same boat
:D

[Hallett19]

Prices are forcast to go up 10-15% this year. When will it end? who knows, like some said, probably when rates go up. Summer is a busy time for the real estate market, but more inventory has not made prices come down yet, we will see as more people start to sell. There hasnt been much on the market recently but I see as anything comes on the market that is priced decently, its gone in the first couple days. If you are looking to buy, your best bet is to find something that has been on for a while and insult the seller with a lowball offer. I sold a house like that about 2 months ago and it worked, offered $40k less than full price, they came back at $35 under and let it go out at $36.5 under full price ! The deals are out there, you just have to find 'em !

[rivercrazy]

Originally posted by ROZ
I'm in the exact same boat
:D
WHAT BOAT? LOL! :D :D :D

[summerlove]

Originally posted by rivercrazy
WHAT BOAT? LOL! :D :D :D
Does Roz have a boat???? There's not one in his profile???
Just curious.

[ROZ]

I'm holding out for Jerry's Eliminator :D

[cc322]

As long as Alan Greenspan is in control rates will be low, good for borrowing bad for savings. And since a election in soon rates will not change that much imo.

[DryHeatOnly]

Originally posted by totenhosen
You are wrong. I've refinanced twice and had no such issue. Like others said only when an addition is made to the property or when a transfer in title takes place.
totenhosen hit it...capital improvements or title has to change hands. See Prop 13.

[rivercrazy]

Originally posted by ROZ
I'm holding out for Jerry's Eliminator :D
A likely story!
If you buy a boat (a real boat), I'll buy you a bottle of Grey Goose! :D