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zhandfull

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Just checked Zillow and my home in Rancho Cucamonga has doubled in estimated value between March 2012 and today. The numbers appear pretty spot on compared to comps in the area. Just over 8 years and it has doubled! Comes out to price appreciation of about 11.1% per year.
Sustainable? What’s the next eight years going to hold for price appreciation in RE?

Can prices continue to increase with interest rates arguably no where to go but up?

Mortgage broker told me way back in 2007 that prices would continue to go up but interest rates would need to drop or wages would need to rise. Don’t remember, but think mortgage interest rates back then were about 6%

Oh, one one more thing, my house is only up about 11% since 2007. That’s .85% a year appreciation!

Timing is everything if you are going to do well in RE.
😁
 
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Go-Fly

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Ever house I've owned, I have set the sell price the day I bought it. Never be afraid to move and move up but don't over do it. I had the same broker for 35 years. She did all our commercial properties and homes. The truth is, the more money a broker makes because of you, the better the deals are that head your way.
 

pronstar

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That’s great appreciation

But even a broken clock is right twice a day...don’t trust Zillow numbers for anything important.

If rates remain low, prices will remain high.
People don’t buy based on price...they buy based on a payment. And bank mortgages look at a buyers ability to make that payment.

To meet the Fed’s target inflation rate, interest is gonna remain low. Raising rates will slow both inflation and the velocity of money in the system.


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2Driver

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In March 2012 housing was still scraping along the bottom.

How did your portfolio do this year if you start on March 23rd.
 

zhandfull

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In March 2012 housing was still scraping along the bottom.

How did your portfolio do this year if you start on March 23rd.
About 8% home appreciation from March of this year according to Zillow for my first time buyer type tract home.
 

zhandfull

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That’s great appreciation

But even a broken clock is right twice a day...don’t trust Zillow numbers for anything important.

If rates remain low, prices will remain high.
People don’t buy based on price...they buy based on a payment. And bank mortgages look at a buyers ability to make that payment.

To meet the Fed’s target inflation rate, interest is gonna remain low. Raising rates will slow both inflation and the velocity of money in the system.


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I guess that’s my question. Are homes still affordable? If not, can rates go down anymore to help with affordability or will materials and wages Increase inflation to a point that rates will have to go up?
 

pronstar

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I guess that’s my question. Are homes still affordable? If not, can rates go down anymore to help with affordability or will materials and wages Increase inflation to a point that rates will have to go up?
Historically, homes are very affordable right now.

Excellent podcast/video here discussing affordability of homes right now in a historical context, and why they’re affordable even though prices appear high.




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zhandfull

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Historically, homes are very affordable right now.

Excellent podcast/video here discussing affordability of homes right now in a historical context, and why they’re affordable even though prices appear high.





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The greater fool theory is real, till it’s not! 😁
Reminds me of 2008-2010. When the fools ran out of fools.

That George guy seems pretty sharp. 👍
 
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84miller

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Real Estate is always based on affordability, who can afford to buy. The economy crash of 2007-2008 was due to anyone could afford a house because low variable interest entry loans, with low qualifying loan requirements...fyi you could work at McDonalds and buy a 300K house (low end) with no down payment. Of course when the variable interest went up, mass foreclosure. Huge recession. I believe find a place you want to live forever, pay it off, done. There is big money to be made in real estate and big money to loose. It is just nice to have a place paid for to live in for me.
 

attitude

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According to Zillow my house has been worth about 450 for the past two years and then shot up to 493k in the last 3 months. Seems a little odd.
 

Icky

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We bought a shortsale February of 2012 in Rancho Cucamonga. Based on our last appraisal (which they didn't show up for) a month ago, our house has doubled.
 

zhandfull

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We bought a shortsale February of 2012 in Rancho Cucamonga. Based on our last appraisal (which they didn't show up for) a month ago, our house has doubled.
Well timed purchase! 👍
 

dribble

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Can prices continue to increase with interest rates arguably no where to go but up?


😁
No. Prices can only increase to the point where there are still enough buyers to qualify. When the first time buyer is locked out by price (and /or payment) the real estate house of cards collapses. I say this not as an expert in real estate but as someone who has witnessed this several times over several decades.
 

LargeOrangeFont

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According to Zillow my house has been worth about 450 for the past two years and then shot up to 493k in the last 3 months. Seems a little odd.
Probably the lack of comps or sales in the area. It is just an algorithm, it’s not 100% accurate. The more transactions in an area near you the closer to accurate it might be.
 

NicPaus

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I checked Zillow Friday on the house I am working on in San Pedro. Showed 516k. It was bought 8 years ago for 170k. Ghetto area with shifty neighbors all around. Rental we are fixing up. It was 1600 a month 3 1. Going to be 2500 when finished and adding a ADU in back to rent.
 

pronstar

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I checked Zillow Friday on the house I am working on in San Pedro. Showed 516k. It was bought 8 years ago for 170k. Ghetto area with shifty neighbors all around. Rental we are fixing up. It was 1600 a month 3 1. Going to be 2500 when finished and adding a ADU in back to rent.
As we were prepping to move, I remember seeing a crappy house in Harbor City being advertised for over $1M.

Million dollars homes in Harbor City...we couldn’t get out of LA fast enough.


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NicPaus

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As we were prepping to move, I remember seeing a crappy house in Harbor City being advertised for over $1M.

Million dollars homes in Harbor City...we couldn’t get out of LA fast enough.


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Right by where you staid my realtor tried to get me to go in on a R3 month ago. 1 house on it already all pimped out for 700k. Build 2 more behind it.

I was and still want to buy 1 not far from there from a inmate here. He reached out to me but since disappeared. Hopefully everything is good with him. It needs everything. Going to buy it for my lead guy to live in. He had a 4th kid and his 2 bedroom is to small. Price is High but at 2.75% it would work for us.
 

zhandfull

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If you are waiting for things to cool off, housing has always been cyclical, give Joe and Kamala 24 months.
My thoughts is where to invest in the near future? I'm not sure RE is the right choice. With that said I'm not sure stocks or bonds are any better. Like you said, maybe the sidelines are the place to be for the next 24 months.
 

bldrinker

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Bought my house for 192k in 2014. Zillow has it at 336k now which should be close.

Wife and I also sold our individual houses for 40k and 50k profits the same year.

I’m ready to sell and upgrade but can’t pull the trigger because I don’t like the 20yr loan on a 550k house.
We are kind of spoiled with our tiny mortgage payment.
 

Icky

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Well timed purchase! 👍
Better to be lucky than good. About 2010 I decided to get serious about buying a house and stop spending money on partying.
I just posted that because I know zillow can be off by a lot, but I thought I'd share for your reference.
 

THE WIDGE

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We were looking at upgrading house in havasu to a 1800 plus , Rv garage, pool, but at 700k, geeze, it really got silly over the last year, same houses were 550k a year ago, and 400-450 two years ago
 

n2otoofast4u

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We were looking at upgrading house in havasu to a 1800 plus , Rv garage, pool, but at 700k, geeze, it really got silly over the last year, same houses were 550k a year ago, and 400-450 two years ago
Totally off subject, but did you end up getting another K9 partner?
 

RodnJen

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No. Prices can only increase to the point where there are still enough buyers to qualify. When the first time buyer is locked out by price (and /or payment) the real estate house of cards collapses. I say this not as an expert in real estate but as someone who has witnessed this several times over several decades.
That has been true, historically. What seems to be happening now is hedge funds and other venture capitalists are buying up entry level homes as fast as they can. It’s not the same market that it was 20 and 30 years ago when many of us were trying to bust that first nut.
 

zhandfull

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I checked Zillow Friday on the house I am working on in San Pedro. Showed 516k. It was bought 8 years ago for 170k. Ghetto area with shifty neighbors all around. Rental we are fixing up. It was 1600 a month 3 1. Going to be 2500 when finished and adding a ADU in back to rent.
Think that’s going to be the new trend that really screws up a neighborhood and raises prices even more (ADU’s).

Might be my ticket out of my starter neighborhood. Built a second garage in my backyard 16 years ago. Maybe a garage conversion is in order then rent both garage and house out before my escape from neighborhood.
 

THE WIDGE

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Totally off subject, but did you end up getting another K9 partner?
we just received funding for a new dog. Final decision has not been made as of yet, should finally know by the end of the month. Been a long 4 months LOL. Thx for asking
 

ParkerMagic

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Listening to Zillow is like a professional athlete trusting a girl when she says "I'm on the pill I promise"...

Zillow is garbage.
 

ParkerMagic

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What seems to be happening now is hedge funds and other venture capitalists are buying up entry level homes as fast as they can.
I have yet to see any of this in California. Not a single one. Pure rumor at this point.
 

240Hallett

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Listening to Zillow is like a professional athlete trusting a girl when she says "I'm on the pill I promise"...

Zillow is garbage.
Are there any online sources that will give you fairly accurate values without having to give your info to a realtor?
 

HNL2LHC

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Listening to Zillow is like a professional athlete trusting a girl when she says "I'm on the pill I promise"...

Zillow is garbage.
I use it for historical values only. I don’t look to them for current market values. I look to MLS services for what the current market pricing is. Depending on your area you will have to find access to the MLS services.
 

RodnJen

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I have yet to see any of this in California. Not a single one. Pure rumor at this point.
Old article but you get the idea.

“Wall Street has been investing in residential housing for decades. What is new is the scale of these purchases. Hedge funds are buying thousands of single-family houses around the country, especially in states hardest hit by the housing crash, like California.

The Inland Empire region of California is one of the most sought after markets for single-family homes.”

 

Waterjunky

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Lets see zillow here. I bought in 2012 and Zillow has it at about 2.5x what I paid. No way could I get that out of it. On a trade off, my finance guy (family friend) sends an automated update every few months and they have it pegged at about 10% more than I paid. My guess is that both are junk due to lack of comps.
 

ParkerMagic

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Old article but you get the idea.

“Wall Street has been investing in residential housing for decades. What is new is the scale of these purchases. Hedge funds are buying thousands of single-family houses around the country, especially in states hardest hit by the housing crash, like California.

The Inland Empire region of California is one of the most sought after markets for single-family homes.”

Your article is from 2012. Things have changed slightly.
 

ParkerMagic

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Are there any online sources that will give you fairly accurate values without having to give your info to a realtor?
Not that im aware of. Each neighborhood is different. You really need in-depth market knowledge to price a home. You can get a rough idea on Zillow but it won't be accurate at all.

There are some places that crossing a street increases values. Zillow doesn't know that.
 

pronstar

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Are there any online sources that will give you fairly accurate values without having to give your info to a realtor?
The only way I can think of, is to use their “sold” listings to give you an idea for comps.

Generally speaking, tight comps will give you a good idea on your home’s value.

Start with a circle a mile out from your home, then evaluate the homes that have sold within 90 days or so.

Homes with similar finishes, square footage and bedrooms/baths will be your comps.

The best comps are close to your home, I like to use 1/4 of a mile if possible.



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