Here's Why You Can't Buy a House (It's Not Just the Market)

[Gobears81]

I do see a decline, or softening of prices in some areas; however, the vastly higher RE taxes and HOA fees, and insurance, wipe out any modest price decrease - the prices would have to decrease massively on the more attainable/affordable end of housing, which would mean a large loss of equity for the owner/sellers.

The fact that several people financed purchases or refinanced existing mortgages at the very low rates in the boom means they are reluctant to sell, tightening supply; however, there are also not a plethora of buyers due to lack of job stability or bad employment prospects for the younger or prime age earners. In addition, homes were purchased by investors and rented out-

The very high end of the market is not affected since they are in a different income bracket and often buy all cash (though they might refinance later for liquidity)

I remember seeing an article about the four areas with the highest home price increases - two were in geographically constrained areas, but the other two were Detroit and Rockford. Construction was dead in IL for years (for understandable reasons), but now, prices are holding strong. I think that might be the difference vs the Sun Belt and areas where there has been much more development. If RE taxes weren't such an issue here, I think that we'd see more people moving to Illinois just to live cheaply and possibly work remotely. The assessors here are quite eager to incorporate the price increases, though, and they are extrapolating those residential increases to commercial assessments, despite commercial not seeing the same level of increases.

 

[J Grant]

I remember seeing an article about the four areas with the highest home price increases - two were in geographically constrained areas, but the other two were Detroit and Rockford. Construction was dead in IL for years (for understandable reasons), but now, prices are holding strong. I think that might be the difference vs the Sun Belt and areas where there has been much more development. If RE taxes weren't such an issue here, I think that we'd see more people moving to Illinois just to live cheaply and possibly work remotely. The assessors here are quite eager to incorporate the price increases, though, and they are extrapolating those residential increases to commercial assessments, despite commercial not seeing the same level of increases.

Detroit prices were so low that the only way they could go was up ! ( in some areas )
Not everyone will relocate just to buy cheaper - the lifestyle, weather, family ties etc, enter into it.

Florida has good weather (except for storm threat), the beach etc. And for a while, prices were so low here that they had natural room for expansion. However, they are now reaching the tipping point of being too high for regular working people

As for the high end of the market - in addition to the appeal of the area, Florid and Texas are the only two states that allow unlimited bankrupcty protection for a homestead (as long as not a criminal charge pending) - so folks from out of state build or buy expensive properties for that reason, after they saty in it a one time stint long enough to declare it a "permanent residence" , it can stay empty and use it for holidays /a few weeks a year.

RE is echoing the rest of America - a growing divide of wealth and shrinking opportunities for working folks and professionals both to earn a decent income or buy property which was a traditional anchor of stability and equity..

 

[Fernando]

Detroit prices were so low that the only way they could go was up ! ( in some areas )
Not everyone will relocate just to buy cheaper - the lifestyle, weather, family ties etc, enter into it.

Florida has good weather (except for storm threat), the beach etc. And for a while, prices were so low here that they had natural room for expansion. However, they are now reaching the tipping point of being too high for regular working people

As for the high end of the market - in addition to the appeal of the area, Florid and Texas are the only two states that allow unlimited bankrupcty protection for a homestead (as long as not a criminal charge pending) - so folks from out of state build or buy expensive properties for that reason, after they saty in it a one time stint long enough to declare it a "permanent residence" , it can stay empty and use it for holidays /a few weeks a year.

RE is echoing the rest of America - a growing divide of wealth and shrinking opportunities for working folks and professionals both to earn a decent income or buy property which was a traditional anchor of stability and equity..

I'm optimistic about the future except for the new UAD form.
My children are jumping jobs getting high pay. Mortgage rates expected to go way down when they're ready to buy their first home.
If not for the news on TV, I would think most are doing well in America.

 

[OSU Beavers]