Maybe there will be no "correction" to housing market- U.S. housing market's underproduction crisis getting worse

[Hillbilly Deluxe]

I can't complain here.... We are super busy at work - our biggest clients are several of the big national homebuilders and they are gobbling up farmland, old golf courses, former industrial land, closed shopping centers and even less-prime land (like low-lying areas with poor drainage and marginal soil) and building houses there. I can't even remember a time we were less-busy.

Is one of those Walton ? They just closed on 517 acres of land about 3/4 mile from my house. Gonna build 1000 homes on it. I hope the new people in the area area accustomed to gun shots, coyotes, deer eating that expensive landscaping, dirt late model car noise, hobby air planes and traffic. Traffic because in addition to this 1000 home development, another builder is putting in 600 new homes about a mile from this 517 acres...

 

[alarmguy]

...
Do t get me wrong, I’m all for owning RE and own multiple properties. I recognize that what I can afford doesn’t make it prudent. Going back to my earliest posts on this, the overinflated market, fueled by printed money, insanely low interest rates..

I could not agree more as far as the "printed money" and "insanely low interest rates" and I too am all for owning RE.

 

[alarmguy]

I can't complain here.... We are super busy at work - our biggest clients are several of the big national homebuilders and they are gobbling up farmland, old golf courses, former industrial land, closed shopping centers and even less-prime land (like low-lying areas with poor drainage and marginal soil) and building houses there. I can't even remember a time we were less-busy.

I have to agree from a consumer point of view, having recently made 7 trips to Florida looking at homes I am amazed at the communities still being built, its actually a bit overwhelming.
Then, the Myrtle Beach area, yes, golf courses being swallowed up.

 

[BMWTurboDzl]

The problem with this is you didnt take into account the monthly payment. Home prices mean nothing, its the payment.
The property owners get the money in a low interest rate economy

Well, let’s not say we are buying a house in Florida just yet.
This just started out as a curiosity but we really liked what we saw, at the same time we love our home and where we live but feel like the area has stagnated and ready for our next phase of our lives now that the kids are grown and have their own homes.

We are looking in Northeast Florida because it is only a 4 Hour drive from where we live now and Pretty easy drive for our adult kids.

We considered pretty much everything from Saint Augustine to the Georgia border along I 95.
We have pretty much settled on an area in extreme Northeast Florida toward Fernandina Beach/Amelia island area and Yulee.
We have the community picked out, well actually two communities, we keep going back-and-forth, we have homes picked out right down to the specific lot and are under construction, however the timing is not great, we have the holidays coming up and we’re big as a family on the holidays, it’s also difficult to get timing right with a new homebuilder when you move out of your existing home.
Throw in a little separation anxiety about moving and we’re not sure if we will or we wont but pretty sure within the next couple years we will.

At the same time we very well may call the builders agent in a day or two and tell them to send contracts! We have done a similar thing last month and chickened out/didn’t sign.
After seven weeks of contemplation we have pretty much settled on one community and one specific lot where a home is being built.
One of the uncomfortable feeling is our costs will be significantly higher than South Carolina not drastic but significant.
The property taxes, HOA fees, CDD fees really start to add up, yet the communities very nice.
If I still lived in New York they would seem cheap but after being spoiled in South Carolina for so long they seem just a little pricey meaning I’ll pay about double in fees and property taxes than I pay now maybe a little less than double but it’s significant.
Add in gas and good is more expensive too.

At the same time we love the area and places to dine as well as the stores and beaches.
One thing that does concern us is I doubt the boating will be as good as the boating in our 41 mile long lake here but willing to give that up as much as we like it.

As you can see this is not been an easy decision for my wife and I but really at the point if we decide to do a complete remodel of our existing home in South Carolina or just sell it at the top of the market and buy a brand new one in Florida, decisions decisions decisions and we have been driving ourselves nuts over it 🤪

Don't forget no state income tax in Fla.

 

[alarmguy]

Don't forget no state income tax in Fla.

Yes, I have not, and again, coming from NY Florida is cheap but SC is cheaper for sure and we do have a good life here but I want something new to experience before the day of reckoning comes (gulp) as I get older. Dont get me wrong though, Florida is good, SC just a little better and cheaper but WAY better than the Northeast.

For some reason I dont pay much in SC state income tax, literally almost pennies, heck we get a lot back every year. So much so the state audited me just 2 years ago, maybe 3. Ive had the same accountant in NY for decades now because we have a commercial building we rent out and only recently looked at my tax return.
I guess because that income is from out of state its not SC taxable, I noticed that on the SC return. I do pay NY state income taxes on that income as well as Federal. So yes, once I sent SC my Federal tax return, case was closed.

What reminds me everyday about SC is whenever I am in Florida I pay more for gas roughly 40 cents a gallon. Todays direct comparison is $3.37 at Costco where I live and $3.75 at Costco in Jacksonville Fl.
Its all good though, dont misunderstood me but it will cost me about $3000 more in community fees (aka extended property taxes) in FL for a home 2/3 rd the size and brand new again! Also a new to us lifestyle change that I think/hope will make it all worth it and again, still a bargain compared to the northeast and the community in Florida delivers on the amenities for sure.

 

[Snagglefoot]

Here is some info on income tax and sales taxes.

 

[wpod]

That report goes only to 2019. We need more current figures. I'm hearing serious talk in parts of the country of housing demand slacking and sell prices dropping.

Everything I see being built my way is massive $400K+ McMansions. I wonder who really has the scratch to afford one of those. No one is building more economical housing, even though that's what we really need.

The big problem really is speculation in housing, fueled in part by the the 1997 tax code change for capital gains from selling primary dwellings. That's what has made everything unaffordable. I believe a house should be a place to live, not a means to make quick big bucks.

Then again people were boasting they made money selling their used car for more than they payed for it and people bragged on the money they made on their stock investments. The builders make houses for big bucks.

 

[alarmguy]

Income tax discussions make great click bait but when moving it's silly to base a decision on state income taxes. One must take their own finances into account and apply them as a cost of living.
A state without state income taxes will tax other items higher than some states that have a income tax.
One needs to compare the whole cost of living. An example for us was our 3000sq ft home in South Carolina has a property tax bill (including vehicles of less than $4000)
A new home we almost signed contracts on in Florida last year was 2,100 sq ft, much smaller postage size lot, taxes and fees of living at that house were over $8,000 a year.
Just some examples of cost of living.
South Carolina gives you a small break on property taxes once over 65, Florida doesnt unless you make under $27k a year
Gas is cheaper in SC
Food is cheaper in SC
All I am saying is you need to look at the actual cost that you as an individual will pay in any state, not rely on one tiny portion of the tax code of that state. No state income tax is blown out of proportion in the media because media reporters have no clue what they report on.
BTW- We love Florida

 

[ekrampitzjr]

Too many people seem to be obsessed with finding a US state with no income tax. You homeowners need to be wary. A state that doesn't have an income tax will more than make it up elsewhere, probably in a way you don't like.

Pay attention to Alarmguy above about the difference in real estate taxes between South Carolina (with an income tax) and Florida (with none). The real-estate bill is much higher in Florida.

By the way, Florida charges a sales tax on services. You get your house or car repaired? You pay sales tax on the labor charge. And guess what is the major expense on most car repairs? Labor. In fact, if you send something out of Florida to be repaired, upon its return the labor for the repair is taxable. Hmm, if I lived there, I think I'd rather have a state income tax.

True, Texas doesn't have a state income tax, but school boards have taxing authority. In many Texas localities you'll get the usual real-estate tax bill from the locality for $X,000. Then the school tax bill will arrive for the same house, also $X,000, sometimes more than the first bill. And, no, they're not duplicates. You have to pay both bills.

Rule of thumb, though there are exceptions: if you can elect school board members in your locality, they can probably tax you. That's why you can elect them. If you buy property in another state, be aware of what's going on with school taxes and overall property tax levels. You might save $X,000 on state income tax, but pay 10X as much extra for property and school taxes. TANSTAAFL.

 

[supton]

True, have to look at all the variables. It just gets hard tracking all of them!

In NH, we lack sales and income tax, so it’s all about property tax. Well… every town has a different property tax rate. And of course, some towns are more desirable than others (or at the very least, their houses cost more), so its like, you have to compare housing in each and every town against each other, to try to figure out TCO.

Even that’s not the full story… I moved a town with a low rate, but lots of expensive homes on the lake. I made sure to not be close to the lake, so I’m on the poor end of town (still rather nice), so I think I milked it to the best I could. So now you have to look at each house in each town to find the best…

 

[ArrestMeRedZ]

Washington has no state income tax, but a high sales tax. Oregon has state income tax, but zero sales tax. People who live on the border like in Vancouver WA do their shopping across the river in Portland and get the best of both worlds.