You must live in California, where a house down the street went directly from “Coming soon” to “Sale Pending” without seemingly going on sale.
Far be it from me to impede the millennial-bashing here, but they could have a genuine complaint that isn’t predicated on them whining that they’re not getting a house for free.
In a lot of the urban coastal areas, 60-year-old 1200 square foot starter homes go for $500k+. In 2 of the markets I’m familiar with, even if you have your 20% down payment and excellent credit, the folk you’re competing with are making all-cash, no-contingency offers, because they’re house flippers, investors, or overseas buyers.
So say you’re young and buying your first starter home. You’ve saved diligently and done the right thing and have strong credit and a 20% down payment – but every house you look at and make an offer on gets all-cash, no-contingency offers from these flippers or investors who essentially just have millions of dollars to throw around to buy houses without regard to their condition and any work needing to be done. And in a really hot market, it may get bid up 10%-20% over the asking price on top of it.
How comfortable would the folk here bashing these folks be spending $500k+ on a house with no contingencies? Inspection comes back showing roof and AC problems, you’ve got to cough up $30k right away. Inspection comes back showing mold or foundation problems, and you’re out for even more.
But as a SELLER, you’re looking at an all-cash offer that executes right away regardless of what the inspection returns and regardless of any house-sale timing issues for anyone needing to sell their house before purchasing yours, and it looks really appealing. Aggregate across a bunch of sellers, and you have sellers preferring investors and flippers over “real” people, and the complaint isn’t just whining about not getting a house at a huge discount.
My first reaction is $500,000 sounds awesome! Around here it’s a $1 million for a tear down, if you’re lucky.
Those nice folks in the OP need to do some more homework on what they can actually afford and decide if they want it, or if they want to keep saving. For me personally, buying a fixer upper that was all we could afford and then fixing it up over several years, was a good decision.
Wrong thread?
Oh boy! I get to be a grumpy old man.
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The money I get from the sale of my house will go to fund the last 20 or so years of my life when I have to live in a senior facility because I’ve fallen one too many times and my wife can’t hear me calling from the other end of the house.
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You can start your married life like we did, in a little house in an “uncool” neighborhood and buy here when you can afford the mortgage.
Until then, get off my carefully manicured lawn which is that way because light yard work is about the only physical activity I’m still capable of doing.
A few of the factors you mention (house-flippers and foreign investors) can indeed be problematic, and around here government has taken steps to regulate some of the abuses. But a lot of it isn’t abuse, it’s just real estate demand soaring for a variety of legitimate reasons. Just exactly what do you expect homeowners putting their houses on the market to do about it?
I can speak as both a buyer and a seller, because most of us who aren’t young millennial whiners have been both. Not only that, but I’ve had to do so both in hot markets in very much in-demand neighborhoods and in dead markets. When I was looking for a house in my former neighborhood, I used to mutter to myself that only one kind of sign ever went up, and it said “For Sale Sold” – a “For Sale” sign with a “Sold” sticker plastered over it. The very, very few that actually had “For Sale” signs inevitably turned out to be in the middle of bidding wars. I finally bought a house due only to the heroics of my real estate agent. My current neighborhood is out in the wilds of suburbia and a little calmer, but real estate is still very active.
Anyway, forget $500K+. In my old neighborhood in the city, which I sold out of a decade ago, and which is an unexceptional ordinary middle-class area, even a very modest bungalow in need of repair would now go for at least $1.2 to $1.5 million, most of that being land value. Just what is it that you expect sellers to do about this, keeping in mind that many sellers are looking to retire and have to have someplace else to live, and that rents and house values all ripple out to the outlying areas from these baseline prices in the city?
We have a three bedroom colonial in the I-95 corridor with a Metro station currently being built a couple of blocks away. We’d probably take 500K right now.
Remembering our own efforts to find an affordable house, I could’ve empathized with a rant about the outrageous prices are being demanded for mediocre housing and semi-intelligent suggestions about what incentives (public and private) might be useful to help out first-time homebuyers. What put this particular letter over the top (aside from the references to greediness and the heart-rending struggles of the “honest” young couple) was the requirement that they be granted entrance to a “cool” neighborhood.
I wonder how the letter writer in the OP would’ve dealt with the widow who sold us our current house, and who (according to the real estate agent) got very fussy when we made our offer which was modestly lower than her asking price, and reluctantly consented with the proviso that we not attempt to cut her take any further since she needed the dough to retire on.*
In the current example, the young couple imagine they are the only ones in difficulty and sellers are all “trust fund babies” or greedy businessmen. :dubious:
*no further sacrifices were demanded of her, and I even refrained from doing my Snidely Whiplash laugh at the closing.
Oh, I don’t expect anything from the homeowners, but to sell at a price that makes them happy to whomever they please.
I’m not proposing any sort of solution here at all, I was merely pointing out that these folk (or if not them specifically, other folk in their shoes) may have a legitimate gripe along the lines of “I’ve made multiple offers on multiple properties for asking price, but keep getting scooped by investors due to them having all cash / no contingencies.”
But yes, the problem of demand soaring, for “legitimate” or offshore investing / flipper reasons, is a whole separate issue that I’m genuinely interested to see shake out in the real world.
Here you have all these areas (if you consider both the coasts and Denver, around 30% of the population), where houses start at $500k - $1M, and median incomes are still $50k-$75k depending on the area. So is 30% of the population just not going to be able to ever own a home? Or will there be a big demand shift as the Boomer population ages, retires, and dies?
You seem kind of hung up on their use of the term “cool”. Would you prefer a different adjective? If they’d used “nice,” “safe” or “walkable,” would you have posted the OP?
I just had a reasonable-but-not-great offer on a house accepted because I’m going to live there. The realtor told me that.
MY LIFE is sometimes difficult, challenging, and frustrating. I don’t understand why the rest of the world doesn’t realize that and just cut me some darn breaks.
Great! Nice to see one of the most distorted, misrepresented, irrelevant posts ever to appear completely out of context in a thread on a totally unrelated subject.
So the problem isn’t the sellers, really. You can’t expect a seller to take a lower offer because it came from “real people” instead of flippers or investors or other fake people. The problem is whatever causes housing supply to lag behind demand so reliably that the flippers and investors will always make a profit.
Here in San Francisco, for years only a small fraction of new housing units were approved compared to what was applied for. Not surprisingly, the housing market is crazy, and now the city is belatedly trying to catch up. The late Mayor Lee had a 6-year program to build 30,000 housing units (not all new, actually, some refurbished subsidized housing was included). Even if successful, this would be only a fraction of the 100,000+ units that we are estimated to be short of demand. The only ones you can blame are the city officials who created this situation, and those who were bankrolling their candidacies. Oh, yes, you can also blame the NIMBY existing residents who don’t want multi-unit buildings in their precious neighborhoods. They’ve got theirs, and screw everyone else.
Regarding flippers and investors, when I was in Paris recently I was told that, to buy a residential property in Paris you have to be able to prove that you have lived there already (presumably as a renter) for the past 6 years. There is no new housing being built in Paris due to their stringent height and other limitations, and this is how they keep the population static at about 2.4 million. No flippers, no investors, according to this source. Care to propose that in your home town?
There are plenty of areas in the city and surrounding suburbs that are “nice” and safe" (and numerous locales that are “walkable” unless one means “I can walk to work” which is kind of limiting).
The letter writer apparently wants a hot location with cachet, but is appalled at the thought of paying a premium for it.
Yes, exactly what I was thinking.
Then some of them turn around and complain about how terrible it is that some people are suffering the effects of gentrification. :rolleyes:
Yeah, I don’t expect things like that to make a big difference, but they might be a tiebreaker if there are two fairly similar offers.
There’s also some cold hard commitment signaling involved. When you write a personalized letter about a house and imagining yourself living there, you’re signaling that you’re invested in the purchase, so you’re less likely to bail or dick around with them over minor stuff.
Heh you see the type of buyer in the op all day long on HGTV…espically the ones who has the whiny pouts having to take a house 15 minutes from work because the condo across the street is 1mil and up