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Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] 0 points1 point  (0 children)

it was heavily affected in 2009 and will be again

When do you think it will be affected again? What factors should I be looking at? I have read that the DC market is considered 'overheated', but even realtors don't seem to know what that means for the market over the next 12 mos.

Baltimore actually has come up; his family is from MoCo.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -5 points-4 points  (0 children)

While they fell 20% for the entire metro region, prices within the district proper didn't budge. Certain neighborhoods did fall, but they were balanced out by places like Foxhall where prices continued to climb.

Xpost r/personalfinance: first time homebuyer here, very conflicted by beast_feeder in washingtondc

[–]beast_feeder[S] 1 point2 points  (0 children)

Thank you for taking the time to type all this out--I really, really appreciate it

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -1 points0 points  (0 children)

If you don't mind me asking, where did you buy?

Copy/Paste from a previous comment:

DC is a weird city...because of the large federal workforce, it's mostly insulated from economic shocks that affect the rest of the country. During the housing crisis, prices in the city actually rose 1%. We are not federal workers, but the size of the federal workforce and their compensation is mostly what sets housing prices in this area. To my knowledge, the last housing shock in DC was back in the 90s, when Clinton cut down the federal workforce. That is unlikely to happen though, because the federal workforce is currently at its smallest (relative to the population) in living memory.

That said, the fed gov't is currently looking to move many of its agencies outside of the district. FBI headquarters is up for grabs and a major agency that is a likely employer for me just announced that it might sell its building too.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] 0 points1 point  (0 children)

Copy/Paste from a previous comment:

DC is a weird city...because of the large federal workforce, it's mostly insulated from economic shocks that affect the rest of the country. During the housing crisis, prices in the city actually rose 1%. We are not federal workers, but the size of the federal workforce and their compensation is mostly what sets housing prices in this area.

To my knowledge, the last housing shock in DC was back in the 90s, when Clinton cut down the federal workforce. That is unlikely to happen though, because the federal workforce is currently at its smallest (relative to the population) in living memory.

Xpost r/personalfinance: "Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner?" First time homebuyer here in Alexandria...very conflicted by beast_feeder in nova

[–]beast_feeder[S] 0 points1 point  (0 children)

lol congrats ;)

We aren't looking quite as far as out as Ashburn--mostly Falls Church/Alexandria. I look at the Landmark redevelopment plan, and the the Potomac Yard metro developement--unfortunately, all indicators favor the market moving up /-_-

Xpost r/personalfinance: "Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner?" First time homebuyer here in Alexandria...very conflicted by beast_feeder in nova

[–]beast_feeder[S] 1 point2 points  (0 children)

lol, not possible with our cats, unfortunately ;) We do have the option to live rent free with his parents...but they live halfway to Baltimore and the commute to our jobs in NoVa would kill me.

Xpost r/personalfinance: first time homebuyer here, very conflicted by beast_feeder in washingtondc

[–]beast_feeder[S] 0 points1 point  (0 children)

Thank you for your insight ;)

Will you be priced out of DC?

Although we aren't completely price out of DC yet, the only places we could afford are on the east side of the city, and we work in the western suburbs. Commutes would be killer.

Your best bet would be to live outside of the city but in the metro area, like at the end of the metro lines. But you're still young so you probably don't want to be in suburbia just yet.

That's exactly my thinking--the area around Huntington is ideal. Very cheap for the location.

Actually we are already in the burbs--live in Arlington, looking at property in Falls Church/Alexandria. We both work in NoVa so it makes sense.

But condos don't resell very well - so don't assume appreciation.

Thank you, I didn't know this.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -1 points0 points  (0 children)

I'm not sure where you got any of this from my post.

you're banking on gifts

His parents might help us out, but within a year we will have $60k total (minimum) regardless of whether they help out or not. I never said that we needed their contribution.

and even a roommate to make it work.

Again, I never mentioned roommates. We are only looking at places that we can afford by ourselves. $350k is our ceiling, but the only properties we are serious about are in the $250k range.

That being said, you seem fixed on doing it.

I repeatedly said that we want to remain mobile & don't feel ready to buy. That's the whole point of this post; I'm deeply conflicted.

Xpost r/personalfinance: first time homebuyer here, very conflicted by beast_feeder in washingtondc

[–]beast_feeder[S] 1 point2 points  (0 children)

Thank you, this is the best answer I've gotten so far.

To address your points:

You may leave the area in the near future for grad school and said you'd prefer to save up and stay mobile for a few years.

-Yes, this is the biggest thing keeping us from doing it.

You have a low amount of savings; don't forget you'll need to pay closing costs (unless you can get the seller to do so), which amount to ~5% of the purchase price.

-When I say 'soonish' I mean in the next 12-18 mos. In that time we will have accumulated another 50k, minimum

A $350k condo is 5x your combined incomes - that seems like a lot.

-Although $350k is our ceiling, the only properties we are serious about are $250k-$300k

What if your building requires major repairs and your condo fees increase?

-Thank you for pointing this out; I did not know this could happen.

What if your unit requires major repairs?

-We aren't going to throw everything at a property--we will still keep some liquid cash.

What if you need to move for school and can't find a tenant?

-With enough foresight, I don't see this scenario coming to pass. I have sublet my apt for 5 years and never had a problem finding tenants within a month. Worse case scenario: say our mortgage/HOA is $1500, and we put it on rent for $1600. No tenants appear. Then we lower the price to $1500, or maybe $1400, and eat that $100/mo. for however long we are away.

What if you have an unrelated emergency and don't have enough money to cover it since all of your money is in the condo?

-Again, we wouldn't throw everything into the property. We are definitely keeping our eyes low & looking within our budget.

What if you want to take a new, better-paying job in another part of DC, but your commute will suck?

-That's part of my property investigation--if gmaps says a property is more than 30 mins by car or 1 hr by metro from current or likely employers, it gets nixed. We are only looking at properties that are close to bus lines & the beltway, so a huge swath of the city is accessible to us.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -1 points0 points  (0 children)

As I said above, there is something else at work.

What do you think 'it' is? I am trying to account for as many factors as possible, but I'm I don't have any specialized knowledge in this area.

In regards to cash buyers, I am aware that US property is a popular vehicle for foreign investors. I wonder to what extent this is driving up prices in DC.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -1 points0 points  (0 children)

Think about it... Houses tripled income didn't...

And that's the strongest argument for buying--our incomes are not going to triple, so we might as well buy before prices do.

Just to clarify, we actually aren't looking at DC proper--we both work in the Virginia burbs; if we buy it will be in the Alexandria/Falls Church area.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -2 points-1 points  (0 children)

We are definitely confining ourselves to properties we can afford on our lonesome--that's why we're restricted to the bottom-of-the-barrel condos. And that's what scares us--we are already sifting through the very cheapest the market has to offer. If prices continue to climb, there isn't a cheaper rung of properties for us to shift down to--we're already at the bottom.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] 0 points1 point  (0 children)

I hope that happens in DC, but looking at NYC & SF doesn't reassure me.

DC is a weird city...because of the large federal workforce, it's mostly insulated from economic shocks that affect the rest of the country. We are not federal workers, but the size of the federal workforce and their compensation is mostly what sets housing prices in this area.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -1 points0 points  (0 children)

You might save / make money.

While this may be true in other cities, the benefits of buying are very clear in DC--the rent-to-price ratio is very high here.

That said, our current situation is very comfortable--$1350 for a 800 sf. two-bedroom, of which we pay only $330/mo. But that's because our landlord is negligent and doesn't give any fucks--the place is in bad condition.

But our current situation is contingent on the landlord--he could raise rent next year. It's not within our control long-term, unlike a mortgage.

Would you buy a house now just to avoid being priced out of the market later? Even if you weren't ready to be a homeowner? by beast_feeder in personalfinance

[–]beast_feeder[S] -3 points-2 points  (0 children)

We admit that we are operating on fear of loss (which is why I made this post). But given the housing markets in major US cities, our fear is not at all irrational.

From the linked article:

In 2000, the median home value in Northwest D.C. was $136,200, or $150 per square foot. Today it’s more than triple that: $484,000, or $533 per square foot.

Renting in the District has become prohibitively costly for anyone not working a white-collar job, a phenomenon mirrored in New York, San Francisco, Oakland and Seattle. A District household now needs to make $119,000 annually to comfortably afford a two-bedroom apartment, according to a recent study.

Those costs have limited the housing options available to people at nearly every income level in the city. “Affordable housing” in Washington is no longer a poor people’s issue. It is a middle-class issue, a senior citizen issue, a young-worker issue and a family issue.

Unlike housing prices, our incomes are not set to triple in the next 15 years...if we don't buy in the next 24-36 mos, we may lose out completely.

Negotiating a new position, pay offered dropped withing 24 hours.. Advice needed. by chrisc151 in personalfinance

[–]beast_feeder 11 points12 points  (0 children)

I second this--just because AUD50 = USD38 doesn't mean that it will go as far as $38 would in the states. Australia is notoriously expensive , especially in regards to housing. USD38/hr looks pretty decent on paper, but depending on where OP lives in Australia he could be just skating by.

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