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Low inventory for 2017
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PostPosted: Sat Apr 01, 2017 7:47 pm GMT    Post subject: Low inventory for 2017 Reply with quote

And more of this expected, a 438 sq foot condo in Cambridge selling quickly for $471K, 72K over asking price of $399K.

Sold for $238K just 6 years ago.

(Is the access to this second floor condo from that wooden ladder-type staircase?)

Will this ever end or are potential buyers being forced to pay inflated prices or risk being "priced out forever"?

https://www.redfin.com/MA/Cambridge/6-Hancock-Pl-02139/unit-2/home/11566321?utm_source=myredfin&utm_medium=email&utm_campaign=instant24_listings_update&utm_content=refresh_with_promo&riftinfo=ZXY9ZW1haWwmbD01MDIxMDQmcD1saXN0aW5nX3VwZGF0ZXNfaW5zdGFudF8yNCZ0cz0xNDkwNjk2ODIzMTEyJmE9Y2xpY2smcz1zYXZlZF9zZWFyY2gmdD1pbWFnZSZlbWFpbF9pZD01MDIxMDRfMTQ5MDY5NTI4MV8zJnJlZnJlc2hfdmFyaWFudD1yZWZyZXNoX3dpdGhfcHJvbW8mdXBkYXRlX3R5cGU9NyZzYXZlZF9zZWFyY2hfaWQ9ODQ0MzM0NCZsaXN0aW5nX2lkPTY0MjUxNjczJnBvc2l0aW9uX251bWJlcj0w

http://www.foxbusiness.com/markets/2017/04/01/buying-home-will-be-harder-than-ever-this-spring.html
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Real Estate Guy
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PostPosted: Sun Apr 02, 2017 11:05 pm GMT    Post subject: Reply with quote

It will come down HARD.....soon. Can't wait.
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PostPosted: Sun Apr 02, 2017 11:24 pm GMT    Post subject: Reply with quote

Real Estate Guy wrote:
It will come down HARD.....soon. Can't wait.


~6% nominal annual appreciation rate since 1987.
~8% nominal annual appreciation rate since 2006.

Seems like the nominal appreciation, like the boston real estate market in general, goes through spurts followed by lengthy plateaus (where real prices fall...) I wonder how much nominal prices will decline.
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victorgbishop



Joined: 03 Oct 2016
Posts: 25

PostPosted: Mon Apr 03, 2017 3:14 pm GMT    Post subject: Reply with quote

Real Estate Guy wrote:
It will come down HARD.....soon. Can't wait.


What really stinks is that - I've waited for this time for 4 years. Watched rates plummet. Scratched and saved over 30k, see rates rising - almost daily and now, there's low inventory.....what is going on???


We live in a townhouse and are expecting in early May with baby #2. Need room badly and NOW there's low inventory??? I've been toying with going on Zillow and seeing who has been foreclosed on and try and sending them a letter to purchase their house.
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Real Estate Guy
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PostPosted: Mon Apr 03, 2017 6:46 pm GMT    Post subject: Reply with quote

I feel your frustration. Going direct to any buyer is a good idea. Realtors just skim off any deal with rhetoric and lies. Most of them would sell out their families for a commission.
It's a bad time to buy. The fools are out in full force. Now it's low inventory and the "I have to buy now before rates go up further" people. Ya, that's intelligent. I'm telling you, by the end of 2018 there will be plenty of inventory and interest rates on a 30 year will be in the 5's. Property will begin a 20-25% correction, more outside Boston east. No doubt. Be fearful when others are stupid,and be greedy when things actually make sense.
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Real Estate Guy
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PostPosted: Tue Apr 04, 2017 3:47 pm GMT    Post subject: Reply with quote

Smart author:


http://www.realclearmarkets.com/articles/2016/03/22/2016-2018_is_looking_a_lot_like_2007-2008_to_me_102074.html#disqus_thread
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PostPosted: Tue Apr 04, 2017 5:13 pm GMT    Post subject: Our Economies Run on Housing Bubbles Reply with quote

Thanks for that article.

An interesting more recent viewpoint from across the pond:

http://www.marketoracle.co.uk/Article58618.html
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Real Estate Guy
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PostPosted: Tue Apr 04, 2017 6:43 pm GMT    Post subject: Reply with quote

Very good read.
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PostPosted: Wed Apr 05, 2017 2:03 pm GMT    Post subject: Buying a Home in Today's Rough Real Estate Market Reply with quote

On Point on WBUR did a show on the current real estate market. I haven't listened yet but here is the link to the podcast and comments:

http://www.wbur.org/onpoint/2017/04/04/spring-real-estate-market

I think the popular wisdom at least in Boston is that prices will continue to go up up UP and with low inventory persisting and high demand continuing, this prospect seems guaranteed.

So, is this a "fools rush in" scenario or are people smart to be buying NOW?
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victorgbishop



Joined: 03 Oct 2016
Posts: 25

PostPosted: Wed Apr 05, 2017 5:18 pm GMT    Post subject: Re: Buying a Home in Today's Rough Real Estate Market Reply with quote

Anonymous wrote:
On Point on WBUR did a show on the current real estate market. I haven't listened yet but here is the link to the podcast and comments:

http://www.wbur.org/onpoint/2017/04/04/spring-real-estate-market

I think the popular wisdom at least in Boston is that prices will continue to go up up UP and with low inventory persisting and high demand continuing, this prospect seems guaranteed.

So, is this a "fools rush in" scenario or are people smart to be buying NOW?


I am trying to jump in and I do believe - after listening to the podcast- this is a smart time to buy now.
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Real Estate Guy
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PostPosted: Thu Apr 06, 2017 2:07 am GMT    Post subject: Reply with quote

You couldn't be more wrong. This is the worst time to buy. Here is the NAR Forecast in late 2005, just months before the worst decline in history. Everything sure seemed rosey then too, huh? Sound familiar?

https://www.nar.realtor/RMODaily.nsf/pages/News2005101201?OpenDocument
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PostPosted: Thu Apr 06, 2017 12:07 pm GMT    Post subject: Reply with quote

Is the home building activities really low? I see A LOT of new homes/condos building in Boston area.

If the inventories is low currently, that means existing landlords not selling, and might acquire more home as investment, while a lot of first time home buying demands available. If this was true, that mean rent is going up fast, to drive buying demand and investment demand up.

At this point, to define if it was a good time or bad time to buy, we should look at the rent level, in relate to the home price(monthly mortgage payment) in the same area.

Other major key factors beside rent to buy, we also need to consider mortgage rate, economic condition(job security and income) etc.

I think home price is very high, yet it is supported with high rent and low interest and not to bad economy. So currently the housing market is balanced.
With that said, on the price depressing side, new inventory is building up, on the price supporting side, wage might go up due to good economy and higher inflation.
It is a balance game now in housing market. And if any of support factors disappear, we will see housing market deteriorate quickly. I don't see that happening in this year, or maybe even next year, but not sure what happen after.

For those who has to buy, just think about if you could stand the fact that your property lost 20 to 30% value in the near future. As long as you can take that risk, and all you need is a stable place to live for a long run, I see no big deal to buy. Anybody else should look the other way from buying.
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Real Estate Guy
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PostPosted: Thu Apr 06, 2017 12:17 pm GMT    Post subject: Reply with quote

Fairly good analysis and good advise. Don't buy now unless you can stomach a 20%-30% correction. There is more downside risk than upside for further appreciation. If I was a seller for example, I'd sell and wait, and buy low. If I was a buyer I'd search for a value add deal. Something where work needs be done, so maybe all I'd lose is my sweat equity. However, to buy now, and pay top dollar given the down side risks is never a good decision in my opinion. However, I hope a few do buy......I need foreclosures to buy again next correction.
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PostPosted: Thu Apr 06, 2017 3:13 pm GMT    Post subject: Boston Globe article from 2003 Reply with quote

Interesting Globe article from 2003. The current building boom reminds me of the late 1980s:

http://articles.chicagotribune.com/2003-02-16/business/0302160392_1_housing-market-house-prices-years-as-mortgage-interest

"One can certainly summon evidence to support the existence of a bubble in Boston, one of the hottest real estate markets in the country. But many real estate agents and economists also contend that Boston's current price run-up is not of bubble magnitude, because the forces driving the market are different than what propelled the 1980s boom when people feverishly flipped properties or bought apartment buildings to convert to condominiums.

A major reason house prices have shot up faster in Boston than elsewhere is because new construction has not kept pace with strong demand, said Lawrence Yun, an economist with the NAR. During the late 1980s, his data show 10,000 to 16,000 homes, including apartment-to-condo conversions, were built each year in the Boston area."

Yeah, I know, "it's different this time".
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Real Estate Guy
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PostPosted: Thu Apr 06, 2017 7:15 pm GMT    Post subject: Reply with quote

Another great read. It shows just how wrong economists are, ESPECIALLY ones hires by the National Association of Realtors(NAR). All Lawrence Yun cares about is his paycheck, and those who provide it-REALTORS. He, nor they, care about the stupid buyers that over pay and hurt their futures. It's their commission that matters. Every time a bubble pops, propaganda is spread right up to the point where it can't be denied any longer(due to hard statistics). I feel bad for the buyers that just don't understand this. I'm sure they all want house, but most of them are too young to realize what the Fed Bank has done and just how severe and drawn out this BUBBLE is.
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