I think that the mortgage underwriting standards have tightened up enough that the bubble can never get that big again.
Experiences selling your home and buying a new one at the same time?
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The flippers still have to put down 25% on a property or they just pay cash. You can do that with a line of credit on a property so if you flip it quick, even though the interest rates are higher, no closing costs and no long underwriting so it's a quick purchase and sale.
For conforming probably. There are always a demand for subprime or certain level of risk and reward. It might happen in a combination of assets that triggered a bubble, usually due to people trying to "prove" that risks are mitigated or insured when it is not.
For example, people believing that tech stock will go up forever, or software engineers should make 350k a year after 5 years of experience, is a "bubble".
It is also a race against inflation and leverage.
I really don't understand that sentiment. I have worked a 12 hour shift job all my life, and I flip and rent homes on the side. Contrary to perceptions, most flippers are just working Joes who want to invest in something. Why not real estate? I bought homes when someone else wanted to sell, fixed them up with my sweat and savings putting 25% down, took a distressed property off the market, and then provided a nice remodled property to someone who wanted to buy it. I also paid every cent of taxes I owed along the way. Whats the problem with any of that?
Why do you take joy in people who got hurt in 2008? I never wish bad on investors.
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I've moved due to buying twice and have always bought and moved before selling the old house.
I am doing that right now. In fact I have done that 4 of 5 times we have bought and sold. The first time, when we moved from CA to OR, we sold our first house and lived in a crappy rental for a bit. Worked out fine because reasonable rentals were available at the time in the 1980's. Now for example our house in WA, payment is around $800, could rent for $4500 or so. Anyway the other times we had a bridge loan or second mortgage for a few months, not a huge deal really. Even then, there was a bit of a rush because kids in or need to start school. THIS time, since I am retired we are taking our sweet time looking, when we find the right place, buy, prep move and then list our old place.
AND even though we could pay cash it probably would mean taking some cash from one of the tax advantaged accounts, it will be better to short term borrow again - even though we could finally buy a house with cash, Dang it!! Just because you can, doesn't make it right. Hahahha.
I should qualify my statements to single out the pure speculators that perfumed pigs and moved on to the next, many times juggling a bunch of mortgages they shouldn't have qualified for in the first place. That was the banks fault and American banking law policy. I and my fellow citizens will now and for a long time in the future pay the debt for flippers speculation back in the day. I see a distinction between what I am being called out on and what you fellas are talking about.
Most people have a problem with selling houses you don’t own for profit.
Homes being treated like a stock market by big players is what is once again leaving a bad taste in people’s mouths, borrow cash, buy property and just go in default if it doesn’t work while the operators continue to get paid.
My landlord is wanting to sell the little old duplex to pay off his personal mortgage creating an automatic unopposed eviction for me.
It’s his right to sell but the place interested in buying owns 1/3 of the properties in this area already, is based out of state, is inflexible, doesn’t repair anything unless sued and triples the rent, while throwing up walls of restrictions you normally don’t have in a single or duplex residence
Overwhelming high property values really only help the bank, the fools with rent or mortgage just pay more interest and taxes
The exceedingly small number of individuals that sell at the right time are the exception and yes buying a 150 year old house for $12,000 putting in $10,000 of repairs and selling for $160,000 2 years later is going to anger people as being dishonest.
You likely don’t do that but around here that is what is done, make everything inside pretty but then everything is cracking and looks like ass in 3-5 years.
Another popular scam is to expand the living area of old houses in parts of the home not intended for occupancy to get a bigger floor space number, inevitably you end up with mold due to leaks or improper vapor barriers where the addition is added, being a flood area with a high water table any expansion below ground is a big no no but done all the time, every year dozens of homes have tear out situations from a flooded basement.
Seen this cycle too many times to count
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Not sure there is a typical situation since there are many factors that will determine your options, namely your ability to convince your lender that you are liquid enough to float two mortgages (+ tax) for a period of time. In a ‘hot’ market, the seller may not accept a contingency on the sale of your home but you may be able to negotiate a rent-back with your buyer.
Have done this twice, sort of. Sold our condo in December ‘04 before our home was built in the spring. Decided to close on the condo and move into temp living since didn’t want to be stuck with two mortgages. The other was more traditional sale, I was able to float both mortgages for about a month. It’s always a hassle, good luck!
Have done this twice, sort of. Sold our condo in December ‘04 before our home was built in the spring. Decided to close on the condo and move into temp living since didn’t want to be stuck with two mortgages. The other was more traditional sale, I was able to float both mortgages for about a month. It’s always a hassle, good luck!
But...I DO own the home! In fact, many mortgages that failed were the 5% down or 0% down, given to people who should have never qualified in the first place.
Conversely, I have to put down 25% CASH to buy investment properties. I have waaaaay more "skin in the game" than the average buyer. I "own" my homes more than most everyone else does.
I don't have even a speck of guilt about it. People who don't understand the facts, or just want to be jealous or resentful can "have a problem with it" if they want to, because I don't care.
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In fact, many mortgages that failed were the 5% down or 0% down, given to people who should have never qualified in the first place.
+ 10000000000 %
But it would be considered discrimination if banks didn’t give loans to people who obviously could NOT afford the mortgage , taxes , insurance , utilities, etc....
Just like car salesmen, the broker and agent wanted their commission. Who cares if the people are house poor and can barely pay for the house.
In fact, many mortgages that failed were the 5% down or 0% down, given to people who should have never qualified in the first place.
+ 10000000000 %
But it would be considered discrimination if banks didn’t give loans to people who obviously could NOT afford the mortgage , taxes , insurance , utilities, etc....
Just like car salesmen, the broker and agent wanted their commission. Who cares if the people are house poor and can barely pay for the house.
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I wouldn't worry about the mortgage rates too much. If they go up the home prices will fall. I rather buy with higher rates and lower sale price then low rates at higher home price. Simply because if rates go way higher, the home you just bought will lose value.
Homes are priced on what the public can afford. Its all about the payment, either the bank gets a higher rate or the homeowner gets a better price. One or the other. High rates, lower home prices, low rates higher home prices.
It is true, trying to time the market can be impossible, way more so now, with HUGE government debt, all cards off the table, it would only be speculation on what will happen in the future. So base your decision to buy on your needs because no matter what, high rates, low rates, high home prices, low home prices, the payment will be the same, which is only what the public can afford to pay.
Homes are priced on what the public can afford. Its all about the payment, either the bank gets a higher rate or the homeowner gets a better price. One or the other. High rates, lower home prices, low rates higher home prices.
It is true, trying to time the market can be impossible, way more so now, with HUGE government debt, all cards off the table, it would only be speculation on what will happen in the future. So base your decision to buy on your needs because no matter what, high rates, low rates, high home prices, low home prices, the payment will be the same, which is only what the public can afford to pay.
I don't even know what you mean by saying people don't own the homes they sell. Yes they own them, they might have a big loan on them, but they're still the owner. Kinda like options, you don't actually own the stocks, just have an option to buy them.
Anyway, it's a free market economy. If you didn't like the way the landlord is doing things, you can always move or buy your own place. The landlord doesn't owe you anything. That's the dangers of renting, no point griping about it later when you knew that going in. That would be like a landlord that got mad when a tenant moved. That's just the nature of the business.
Don't get mixed up and blame the wrong thing. Had nothing to do with discriminations. it was a particular loan product that appealed to people who didn't have the money. The banks did it because housing prices were going up. Didn't matter if they didn't have any money, you'd just do a refi and the loan would be paid off and then they're into a new loan. Banks got their commission, brokers got their commission and the loans were sold off to Wall Street. Sure they knew a certain percentage could fail, that was built into the calculation. They just didn't figure out that all of it could fail at the same time. Those types of loan products are no longer available. They were not required to determine if people could afford it, new regulations require them to do so now.
This is not really a problem of being a landlord, but rather 1) super low interest rate leads to investment bubble, 2) poor local building code enforcement, 3) monopoly of a certain market (why only 1 company wanting to fix up old properties, why not 5 or 10 or 100?), 4) poor enforcement of horrible repair work that isn't done right after 3-5 years.
Let's not forget Fanny Mae and Freddie Mac are also in the home flipping and investment vehicle businesses. They basically use their government backing to flip properties at a whole sale scale. Is it evil? Is it a necessary evil? Will it be better off if that 1/3 of the people will not qualify for a loan so the other 2/3 of the loans are good, but 1/3 of the people are perpetual renters? There is no free lunch.
Actually the banks and the government was threatened by groups like LaRaza and the NAACP. These groups demanded that bad loans be made to people who could not afford them, OR, the banks would get vehemetely accused of racism. That was the exact root cause of the whole debacle.
Then, of course, these same ones who caused the whole mess blamed it on "wall street greed" and that lie still sticks today.
THIS ^^^ 1000000000%
I would not even try to do this... Lived in an apartment before buying the house. I know people who bought new construction that got delayed and ended up living in an apartment for several months and are currently scheduled to move into the new place in early January.
This is like the blame on cash for clunkers for raising prices used car prices when it only involved a small part of the market. Community reinvestment act only affected a small amount of banks and it was basically the brokers that made the loans that went under, the local banks didn't go under as badly as all those no doc loans the brokers made. The real lie is thinking it had to do with discriminations. They still have to comply with the same laws after all this time but yet you blame them then, but there's no issues now? But now they do have to make sure people can afford the loans when they didn't have to do that before. If you really believe it, build your case, never really read a solid case for it. A few isolated instances can't be flipped around and made to be the entire case. Just another conspiracy theory.
We had a mortgage office back then. Knew lots of mortgage people. All money is green. I've worked with many mortgage brokers/lenders where I never met them in person. Some are 10+ years now. Same with the borrowers. It's much harder to discriminate against people when they're on the phone. I think if it happened it must have been walk in traffic in local community reinvestment act loans. Watched the whole thing implode. Primarily it was the subprime stuff, you'd see people with 400-500 credit scores. You never see that now, mostly the lowest was in the 600's. Option arms too, those also went away as they were the no doc loans.
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What you're planning to do can be very stressful. What I did, was look for a good home at a good location before putting our previous house up for sale. Once we found a new home by Paradise Developments in Ajax where we still live to this date, we then looked at the financing options, mortgages, loans, etc. We then proceeded to list our property in forums and classifieds, we hired a broker as well. It took 4-5 months if I remember correctly before our house was sold. A former colleague was looking to buy rental property and ended up buying the house. We spent a month renting property before we moved in since all the paperwork, financing, etc. was being worked before we could move in to the new house. Luckily, the new house was already built so we didn't rent for that long.
Back in the Good 'ol wild west days of the mid 2000's we were selling a house and buying our current house. We had an accepted contingent offer on the new house and an accepted offer on our old house, contingent on inspection. The inspection didn't go well (ridiculous nitpicking of a 100 year old house) and the buyers backed out.
Then someone came along and put a non contingent offer on the new house we were going to buy. We had 24 hours to lift our contingency or our contract became null. Everyone had written us off, I believe the new offer was higher, they did NOT want to sell us the house at that point and it was made very clear they felt there was no way we could move foward with the deal.
Well well, we pulled a rabbit out of our hat lol.
Took a HELOC on our old house, used that money to put a down payment on the new house and ended up with 2 mortgages, a heloc and 2 homes for roughly 4 months lol. It was a grand time and I suggest everyone experience the joy of owning 2 homes at the same time with 2 mortgages AND a HELOC at least once in their lives, im kidding of course.
The Owners of our new home and their realtor were not happy. They absolutely wanted to do anything they could to sell the house to the people who placed the non contingent offer, which was a higher offer I believe. Even after we lifted our contingency and the bank sent them the proof of financing they still tried to get out of it.
So looking back I believe there are 3 reasons we did what we did, First our house is on an amazing piece of property you do not find very often in this price range, likely one of the best pieces of property this size in the county. Two, I did not care for their realtor, she really rubbed me the wrong way, especially when she made comments about the house we were selling which were completely incorrect and totally off base. And Three, The owners of our house didn't want to sell it to us. They wanted the new deal. I think their realtor who was also a friend priced the house lower than it should have been. We put our offer in in December right after the house went on the market, and by March when all this went down the interest in the house was very high.
Well I was still young and extremely headstrong back, so I showed them! At one point during the transaction I realized we maybe should have let our contingent offer expire due to some of the nonsense that went on with their realtor. Our realtor dealt with it, but it still ticked me off. And looking back it was a mistake to buy this place for a few reasons, though it has been very enjoyable in some regards. Good, bad or indifferent it sure did feel good proving them wrong. In fact it still brings a smile to my face.
I don't completely remember how it came to be, the people selling us the house ended up getting to stay for a week in the house after we closed, we received some benefit from this, and it was no problem for us because we still had our other house. I will likely never do this again, it is not a good feeling having someone living in your house that you are paying insurance and a mortgage on and you are responsible for....
The people we bought our house from were the original owners, an older couple and it was not just a house to them it was a home, they loved this house and it showed. It was not like there were going to trash it or do something stupid to it. It must have been hard for them packing up while still living here while the no longer owned it. However there is a lot of risk doing what we did delaying possession.
I often wonder about the people who put the non contingent offer in on this place and how they felt, I actually felt bad but its just business, and there is the risk putting an offer on a house that already has an accepted offer, even if that offer is contingent, that the contingency could be lifted as they found out.
Then someone came along and put a non contingent offer on the new house we were going to buy. We had 24 hours to lift our contingency or our contract became null. Everyone had written us off, I believe the new offer was higher, they did NOT want to sell us the house at that point and it was made very clear they felt there was no way we could move foward with the deal.
Well well, we pulled a rabbit out of our hat lol.
Took a HELOC on our old house, used that money to put a down payment on the new house and ended up with 2 mortgages, a heloc and 2 homes for roughly 4 months lol. It was a grand time and I suggest everyone experience the joy of owning 2 homes at the same time with 2 mortgages AND a HELOC at least once in their lives, im kidding of course.
The Owners of our new home and their realtor were not happy. They absolutely wanted to do anything they could to sell the house to the people who placed the non contingent offer, which was a higher offer I believe. Even after we lifted our contingency and the bank sent them the proof of financing they still tried to get out of it.
So looking back I believe there are 3 reasons we did what we did, First our house is on an amazing piece of property you do not find very often in this price range, likely one of the best pieces of property this size in the county. Two, I did not care for their realtor, she really rubbed me the wrong way, especially when she made comments about the house we were selling which were completely incorrect and totally off base. And Three, The owners of our house didn't want to sell it to us. They wanted the new deal. I think their realtor who was also a friend priced the house lower than it should have been. We put our offer in in December right after the house went on the market, and by March when all this went down the interest in the house was very high.
Well I was still young and extremely headstrong back, so I showed them! At one point during the transaction I realized we maybe should have let our contingent offer expire due to some of the nonsense that went on with their realtor. Our realtor dealt with it, but it still ticked me off. And looking back it was a mistake to buy this place for a few reasons, though it has been very enjoyable in some regards. Good, bad or indifferent it sure did feel good proving them wrong. In fact it still brings a smile to my face.
I don't completely remember how it came to be, the people selling us the house ended up getting to stay for a week in the house after we closed, we received some benefit from this, and it was no problem for us because we still had our other house. I will likely never do this again, it is not a good feeling having someone living in your house that you are paying insurance and a mortgage on and you are responsible for....
The people we bought our house from were the original owners, an older couple and it was not just a house to them it was a home, they loved this house and it showed. It was not like there were going to trash it or do something stupid to it. It must have been hard for them packing up while still living here while the no longer owned it. However there is a lot of risk doing what we did delaying possession.
I often wonder about the people who put the non contingent offer in on this place and how they felt, I actually felt bad but its just business, and there is the risk putting an offer on a house that already has an accepted offer, even if that offer is contingent, that the contingency could be lifted as they found out.
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