While we're on the topic of real estate, I am currently agonizing over when to jump back into the real estate market.
I've been on the sidelines for a while—having sold by the hair of my chinny-chin-chin in the nick of time—and have been waiting for things to level off. I personally believe we still have a long way to go before the market hits bottom and starts creeping up again. I don't believe that there are regions that won't be touched. I just think they get touched later, perhaps in different ways.
Say, for example, that the financial services industry gets wrecked. Doesn't that eventually trickle down into lost jobs, lost bonuses, and lost ability to spend like crazy?
One would think.
In another scenario, property values explode at an insane rate, creating unsustainable financial situations that depend on too many x-factors. Job loss, ARMs, divorces, property taxes, even flooding are all factors that can affect people's best-laid plans. Are Manhattan and the surrounding areas immune? Are we all suffering from mass delusions? If we're so immune, then what's up with the foreclosures near me? The apartments for sale in the high $200s when last year nothing was under $300k?
So if I'm so sure we've barely begun our slide, why am I tempted to buy right now?
A couple of single-family, four-story brick houses from the 1800s have gone up for sale near me. They need complete overhauls. I would have to rent out a "granny flat" in the bottom floor to cover the property taxes and utilities. The mortgage would be as much as renting elsewhere, but I'd be pushing it if I lost my job or jumped back into freelancing. I'm not one for precarious lending situations.
But the idea of a house, a real house with a backyard one stop from Greenwich Village, is tempting. A whole room just for my underwear, as C is fond of saying. An office! A guest room! A dog! Another dog and office for my guests! My real estate strategy is this: Buy what you can afford, and buy with intent to live in it. Can I? Could I? What about future travel? What about renovating? What a hassle.
Then today, I looked at the before and after shots of my last place. Wow.
Can I do it? Do I have the energy and skill to renovate for a third time?
Yes.
Will I?
Get back to me on that one.
9 comments:
You know you want to! And we all want you to, too.
That is, those of us not within walking distance, otherwise known as 'getting roped into painting' distance.
Then again, pizza is a powerful attractant, and I do have wheels.
Most of the pizza here is Egyptian pizza. I wonder if my native NY/NJ friends will paint for Egyptian pizza.
Maybe I could order in from Benny Tudino's.
What's with all those dogs?
Making up for lost time.
Hold off on buying. Mystic Meg (self) has been predicting a property crash for 5 years and it is happening now. So don't go spoil it by buying!
I definitely agree and have anticipated a crash since prices went beyond the ability of people to pay (not that this stopped anyone).
The balancing act comes in with getting a mortgage while rates are still low and before banks quit giving people like me mortgages (I've only been officially full-time employed for a year, since my company incorporated in the US and was freelance for seven years prior).
Here's a great blog on real estate, though it is more regional and not so targeted to where I am, right by Manhattan (which has some complicated factors).
Speaking of that blog, check this out, which was on the blog and came from the WSJ on April 10.
Meanwhile, just 21% of economists expect home prices to hit a bottom this year, while 67% see the bottom in 2009 and 12% say it won’t be until 2010.
To me, it would all depend on the price. If the place(s) you're looking at need serious work, you might be able to get them for less than the current book value...which means you'll still make out okay if prices drop further.
I tend to think the New York area will see settling of prices but not a full-scale crash...except in certain suburban locations that have seen serious overbuilding. But I don't really understand JC. It's convenient, but it doesn't seem to be the choice of Europeans coming to New York; and as far as I can tell, they're the ones keeping our real estate economy as strong as it is. (My neighborhood in Brooklyn is more and more heavily French, German, and English.)
These places need complete overhauls, and are WAY below market value. (Aha, he thinks.)
I think the reason JC isn't overburdened by Euro-investors is 1) developers overbuilt and 2) it's in another state so people assume it's really far away.
Which suits me just fine.
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