New home construction/real estate mkt.

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vacerator

Well-known member
Joined
Feb 19, 2016
Messages
4,533
Location
Macomb, Michigan
Well, the old thread has been archived. Expensive Lumber prices, and steel I beams have inflated the already hot markets suffering from low inventories. A house in my neighborhood just sold for $315,000. Market value was estimated at $280,000, and asking price was $290,000. Unheard of!
A 2018 or 19 steel tariff is to blame for the high I beam costs. Every home built on a basement must have at least one supporting the main floor. Local codes prohibit an engineered beam, and it wouldn't be cheaper anyway. We have ZERO I beam makers in the states since Bethlehem steel closed in Pa. Why would a tariff be passed with that existing condition? The industry supported the tariff. I guess because they can now charge more.
 
The old thread wasn't archived but moved to the Dirty Laundry Forum because of the political discussion in it. As you know political discussions don't belong in the public forums but in the sections for paying members only. So if you want to discuss politics, please pay the fee of $12 for a year so you can discuss politics there to your heart's content. If not, you know what the consequenses are.
 
Renovation-A coworker who was renovating his place told me 3/4 in particleboard panels are now 80 bucks for EACH 4X8 sheet!!!!!NO RENOVATING in my future!!!!Will lumber prices go down?WHO KNOWS!!!2X4's now over 20bucks each!!!!!
 
Renovation

 

<span style="font-family: helvetica;">I was working with a contractor on some changes we wanted to make to our laundry room.  He came in at over $10K for minor modifications.  He told me, if he were me he would wait.  What we wanted is purely cosmetic and can wait.  He was showing me how some of these prices have more than doubled in some cases.  I appreciated his honesty.  We'll look at making the changes down the road.</span>
 
I completely agree with reply #1. To be honest, politics shouldn’t be allowed at all on this site since the DL forum tends to overflow onto the rest of the site but I don’t really have any saying on how to tell anyone how to run or operate the site.
 
Yes, in the building industry we have seen numerous lumber price increases over the past year, along with the shortage of steel, concrete blocks, windows, and appliances. As well as harder to find labor.

It has really made the cost of houses increase. Yet here in my town alone I have driven around in various areas lately and counted at least 30 houses under construction or about to break ground. It really is something how much construction is going on.

Really want to buy a house but most are getting more expensive than I am comfortable with and just don't seem a good value anymore.

I do not expect prices to go down like in 2009-12 era but I think there will have to be a cooling off period at some point. Current rate of growth is unsustainable, I do not know how people afford a $250k home in my area which is what many of these new homes are going for, which are an average 3/2/2 home on a smallish lot.
 
I do not expect prices to go down like in 2009-12

If the Fed suddenly quits pumping trillions of endless QE dollars into this orchestrated scam and forced to increase interest rates, 2009-11 housing prices will look like a gigantic rip-off.
 
My house is currently estimated at more than double what I paid for it in 1998!  If I had a place to go I'd sell now while the market is good and pocket the money til the bottom falls out.  But in this part of TN, the bottom doesn't really fall out.  Even in '08 we still had a housing boom.  The hottest market in the Mid-TN viewing area is Spring Hill (Maury County because the taxes are much less than on the Williamson county side).  It's unreal how many new constructions are going up around the GM (old Saturn) plant.  More people are willing to commute now too.  The average commute time is now 45 minutes.  I drive an hour.  But I've been a commuter pretty much since I was 18 years old.
 
Bubbles and such;

In my twenties, I didn't get why home prices always increaesed. Each year I saved for a down payment I needed more to afford the same house.
It was explained to me that the system is set up so lenders, and realtors make money first, then sellers. As the cost of most thongs only goes up, never down for long, they need to make more too.
It's become harder and harder for first time buyers.
It's a cycle, and less profound in some markets for a bubble then a crash.
Indianapolis for example, and others mostly maintain a healthy moderately priced market without bubbles. Chicago is always expensive, like California, NY, and Toronto. Minneapolis is alo high.
While I do think the market will cool down, I don't think it will crash like in 2008, but I suppose we should never say never.
I guess I'm greatful for the Fed, and the stimulous, etc. My aunt worked for the Federal reserve and explained to me how the money system works. She did ok in real estate too, selling high and buying in low.
Our dollar isn't backed by silver or gold today. It's only as good as our productivity, and buying power. Thas fine so long as the job market is healthy too.
Money is a tool. It moves people and people move money. We take nothing with us to the grave. Sure it's nice to leave some to ehrs, charities, etc.
I do think not only the wealthiest should enjoy some capital gains.
I think some other nations do some things better than we as far as "people first, then money, then things" goes, but it's out of my control, and beyond my power.
As I am but a few years away from medicare and social security (which I've paid into my entire working life), I do hope it is there and still healthy.
I hate to sound non chelant about the future of healthcare, housing, etc., but, I'll be dead, and it won't be my problem.
I do hope our grandkids can do a bit better than thier parents are currently, as I did a bit better than mine younger than they, but not later on like them.
It's nearly impossible for younger people to save much if they are not living with family still.
 
On Tucker Carlson, he reported about the skyrocketing real estate market, and that Wall Street firms like RE speculator Blackrock (et al) are buying up a huge number of houses to turn them into rentals.
 
Yup, lumber prices have doubled in the past year, and they also seem to have quadrupled compared to a few years ago.

For example, a heart redwood 2x4 I got for about $6 two years ago now costs $20. Amazing. I was going to re-roof this house this year, however since it will need replacing the cedar shakes with asphalt roofing, and that in turn means purchasing enough plywood to cover up the spaced sheathing, I'm going to put it off another year. Which means I'll have to climb up there this summer to replace deteriorated shakes.
 
One of my fears is that big companies will buy up all the non-luxury level homes and most will have to rent.

Although, to me renting isn't even a "cheap" option like some make it out to be. I see homes for rent and the monthly rent is almost twice what a mortgage payment with property tax and insurance would be for that property. Of course renting, you don't have to worry about paying for maintenance, but come on how much is the average person paying out for maintenance every month. You don't replace the HVAC system or paint your home every year let along every month.

Another thing that really annoys me is flippers who will buy a house that's cheaper, slap down some carpet and a coat of paint (but not bother to update the outdated 80s kitchen or bathrooms) and then throw it on the market a few months later for 1/3 to double what they paid. Come on, I know those cheap updates you made didn't make it appreciate that much.

And why is not the average person, that just needs a place to live, not buying those homes? It seems the flippers buy every cheaper home there is. You would think the average first time buyer would really want a place like that. Or are buyers now only looking for new construction or move in ready?
 
Though it is not true of every young couple looking for their first house there are many out there who eschew buying a fixer upper and that is a huge mistake that has been happening now for the last maybe 15 years. They are so goo goo eyed and brainwashed into moving into an already updated older house that they'll spend $100g more than they could have gotten the house or a similar house that just needs some work.. The goal is , or should be in their mind. " just get a goddamed house" even if it isn't perfect, you can work on the fixing up at your leisure but at least you're in the game now.
 
“Flippers”

Are what caused the real estate market in Northern California, especially the San Francisco Bay Area to be so outrageously high priced.   This practice began in earnest  in the mid 70’s and had become progressively worse.

 

There once was a time when the average person would buy an average home for a fair price, make small improvements over time, happily live there for decades while paying the mortgage off and finally in their retirement have the equity of their home paid for home as security for their golden years.

 

Now all people seem to be interested in is turn and burn and the almighty dollar. If they buy high and the bottom falls out of the market, well they just walk away from their obligation and let the property go into foreclosure.  And then  BUY another home at the current low market price and start the process all over again.  This unbridled GREED is what has put home ownership out of the reach of the common working man and women.

 

Its a very sad state of affairs when so many are homeless.  People that work 40+ hrs a week and can’t even afford a roof over their heads, let alone ever be able to entertain the thought of owning their own domicile. 

 

Eddie
 
So True Petek!

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" just get a goddamed house" even if it isn't perfect, you can work on the fixing up at your leisure but at least you're in the game now. I blame a lot of this behavior on the MANY home buying shows on HGTV.  Almost without exception the potential buyers want to tear down walls, gut perfectly good and serviceable bathrooms and kitchens because the are either “dated or not OUR style”!

Nothing stays in style forever and tastes change over time as we age and evolve.  But a solid home in a good neighborhood will be a comfort for many years to come.  The remodeling and upgrades can come later, when you can afford to pay CASH for them.

Eddie 
 
Flippers and

Absentee landlords who rent the house by the room are the bug bear around here, As we are predominantly a university city we have a huge amount of students needing accommodation, All spare land around the city itself has been turned in student halls and then after the first year they have to move out and go local to live often a landlord will own multiple houses and turn them into HMO's Homes Of Multiple Occupancy often charging each student by the room so the end price is often double the mortgage on the house, I know how hard it is to find a house big enough for us to live in at a price we could afford in an area we wanted to live. It took a while to find and we bought a flipper no one else wanted as it meant too much work before any return. Sadly there are fewer and fewer homes left for families it has to burst at some point meanwhile all the absentee LL who are just wanting the money let these once lovely house turn into disrepair and lower the house cost locally...

Austin
 
Hedge funds...

are the ones buying up "inexpensive" homes and converting them to rentals. At one point 2008-2012 in FL they were buying something like 40% of the market, always paying cash of course and completely warping markets and degrading family neighborhoods.

Anywhere that one can still buy a new house for $250k it's pretty unusual any more. In Denver where our daughter lives a small new 1500 sq ft single house goes for $700k+. The 3 yr old house next to hers sold this week for $40k over the asking price of $699k in less than a week. This kind of market is unhealthy for anyone except the rentier oligarch 0.1% , always the beneficiaries of our bought off manipulated-in-their-favor financial system...hedge funds need to be heavily taxed and regulated in order to make the real estate fair for average folks imo. When teachers, nurses, firefighters and policemen can't afford a small single home to raise a family something is drastically wrong.
 
You are right about the HGTV type shows making out all houses have to be perfect. Or especially homebuyers looking at homes and scoffing at the kitchen and bathrooms because they aren't done in the latest design trend, proclaiming it all has to be redone, yet I think "What's wrong with that? It's way nicer and newer than anything I've ever lived in!"
 


"What's wrong with that? It's way nicer and newer than anything I've ever lived in!"

 

Most of it is brainwashing viewers into "upgrading" something that isn't necessary to part them with their cash. It's usually sponsored by those looking to profit...Home Depot, Lowes...you get the point.

 

Sometimes things are a bit too far gone to repair or awkwardly designed, but that isn't always the case. I enjoy older stuff but I wouldn't want to deal with 2 separate water facets in the bathroom sink for cold and hot water with no option for warm...on a tiny pedestal.
 
I agree!

Excuse me......I don't have stainless steel appliances. I still have the almond frig with bottom freezer (which I have had for years-before they ever were popular!) and now everyone has to have one! Go figure. I have the almond stove (with coils-and I love it and it's spotless, and yes, I cook-all the time!) and dishwasher, too, and might I add, they are in mint condition, not because I don't use them, BUT because I take care of them. I will not go out and buy stainless steel just because every other AH has to have them. Now they bitch about the fingerprints! I remember liking SS in the early 80's. Everyone thought this was institutional. Guess they've been institutionalized now!

On all of these home shows, they all want "open floor plan". Really? Then go buy four walls with a roof on top and call it a box and call it a goddamn day. I like hallways, doorways, staircases, niches. Sorry peeps! I like character but the younger people have no taste. Problem is mommy and daddy are kicking in the bucks to help them get what they want WITHOUT ever having to work and sacrifice for anything. Then again, these contractors have priced themselves out of work. So who can afford to hire them when I could get it all done right from the start. And, I firmly believe there is a SUPERFINE line between experience and expertise! Some of these guys don't know their ass from the elbow and yet charge big bucks for shoddy workmanship and you end up with a huge mess and unsatisfied. And, it kills me that all of these people with their new $50,000 kitchens with cherry cabinets and Subzero fridges and Viking stoves with 18 burners and YET they don't even cook! Can you imagine! And you have to wonder why they don't like Americans!

I don't know guys--where have all the humble people gone? All the genuine people?
 
Re: Reply#22

Amen Louvac! You took the words right outta my mouth.

Seems theres no imagination or appreciation for individuality, every one wants the same thing. I lived in 22 different rentals between ‘70 and ‘80. Every one of them that I ever looked at before renting it I could visualize what I could do with it with what I had to work with money and possession vise. Now granted I couldn’t expect that a landlord would make any changes anyway, but my point is there is a way to make anything work if you have an imagination.

My husband and I have lived in our current home for almost 27 years now and we made improvements a little at a time. We love our little townhouse even though its “dated”. It reflects us and its PAID for.

Eddie
 
Same here Eddie!

I sleep at nite with no worries! We didn't "bite off more than we could chew"!
When many had it tough during the 2008 housing market debacle we laughed! That's your problem you paid a seller more for the house than what it was worth! And the banks should get their due as well! It's all greed-look at me! Look at what??? Any why should they be bailed out! Put their ass out on the street! Good enough for them! (OMG---I am sounding like my grandparents) ROTFLMAO!!!!

It seems to be happening all over again here in CT. Commercials are advertising that houses are selling at "top dollar". Really? Don't be a fool and get into those bidding wars-you'll be sorry! Take your house and shove it!

Being an economics major--there is no economic advantage to owning or renting. Renting can save the savvy consumer lots of money with the expenses that can come from home ownership.
 
"open plans"

I saw a Temecula Ca. flipper who said that is what sells, so he removed a nice vintage solid oak built in china hutch betwen the kitchen and dining room.
 
What an idiot!

He is an idiot. What they don't get is that to the smarter person, you can tell that something was removed or destroyed because overall it ruins the original effect and the new look doesn't quite cut it!

People do not appreciate old world charm and logic. We do and we are the wiser for it!
 
Just about every older house for sale here has had the wall between the kitchen and living room removed to create an open concept. I've been in some smaller 3 bdrm bungalow/ranch styles (1200-1500 sq ft) where they've also removed the wall of an adjacent bedroom to enlarge the space leaving only 2 bdrs on the main floor. Our neighbor a few doors down, in a smaller traditional 4 level side split just knocked down their dividing walls between the living room/dining area and the kitchen.. I personally don't care for it but they love it so that's all that matters in the end. Why I don't like it is because when you walk in the front door the first thing you see is the kitchen area and the new island where the wall once blocked all that. In that type of setup I think you have to be fastidious in keeping things tidy and we're not. Along with that I don't want guests sitting in the living room area watching me cook. Not that we do much entertaining anymore, I just wouldn't like it. To each their own.
 
I heard recently from someone that Canada has a requirement to put in a central vacuum in a newly constructed home according to the Canadian health code. I don't know if that's true or not.
 

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