Bought a home bigger than the apartment I was in, in a nicer neighborhood, and paying less monthly, used the tax credit to pay off personal debt and furnish the place.

So, you know, I enjoyed it.

Nope. Bought an estate sale, appraisal for the refi last year was up 5% and the more current comps would push that even higher. Unfortunately, all that really means is higher property taxes.

/DC burbs

That program ended over a year ago. Time to let that boogeyman die and start searching for another evil gov'mint intervention in the market to complain about, like child labor laws.

I'm paying less on my mortgage than I was for rent, and I got my entire down payment back from the FTHB credit. I haven't lost anything.

Shut up, subby. The government always has the little guy's best interests at heart and that credit was everything but a trick. The government couldn't have known prices were going to continue to drop. And besides, my government wouldn't do anything against me just to prop up a major lobbying group like the NAR. Free money from the government always comes without a catch. Yep, I sure made a great decision.

opportunity cost > 16,000 over that some period?

error 303: Bought a home bigger than the apartment I was in, in a nicer neighborhood, and paying less monthly, used the tax credit to pay off personal debt and furnish the place.

So, you know, I enjoyed it.

Same boat here. Rent prices went stupid in California's bay area because of foreclosures on investment properties for rentals as well as people getting evicted and looking for a place to live. Higher demand + reduced supply = no bueno. 3 years ago rent was hovering at about $1950 - $2100 for a 4 bedroom house, where my mortgage is $1550.

Honestly I don't see where my home value matters a whole lot outside of selling it or trying to take out a loan against it. I don't understand the constant hand-writing of "OMG my house is 10% underwater! WHAT DO I DO?!".

Meh, our principle is still much less than the house value. Purchased in 2005 and it'll be paid off in 2014 by our budget

Live around DC, so home values have been relatively stable by me.

I missed out on the military deployment extension window to qualify for the credit by 3 weeks though. That really pissed me off.

FYI it was you could still get the credit if you bought up to last April as long as you put in 90+ days out of home station prior to May 1 2010. My navy workup cycle had me at 84 days in the window as of April 30 and we deployed on May 21. Talk about bad timing

Sarsin: error 303: Bought a home bigger than the apartment I was in, in a nicer neighborhood, and paying less monthly, used the tax credit to pay off personal debt and furnish the place.

So, you know, I enjoyed it.

Same boat here. Rent prices went stupid in California's bay area because of foreclosures on investment properties for rentals as well as people getting evicted and looking for a place to live. Higher demand + reduced supply = no bueno. 3 years ago rent was hovering at about $1950 - $2100 for a 4 bedroom house, where my mortgage is $1550.

Honestly I don't see where my home value matters a whole lot outside of selling it or trying to take out a loan against it. I don't understand the constant hand-writing of "OMG my house is 10% underwater! WHAT DO I DO?!".

I think I'd still have to pay more to get a 3 bedroom apartment(not even a house) in a halfway decent neighborhood than what I pay for my mortgage. The value of my house is just now coming down to what I paid for it though, and of course I've also paid some of it down, so it seems to be good.

You really can't put a price on having been a homeowner for the last two years. It has gotten me laid several times, which is worth more than whatever I've lost to the market.

In this area, practically every house went up by about $8000 dollars when the credit was announced. All of the agents kept telling me, "but the government will give you $8000 dollars!" Of course, they scored higher commissions on those homes. When the credit ended, many of the houses sunk back down to their previous levels.

Good idea in theory, not so much so in practicality.

Realtors are the scum of the earth. Period.

Buying or selling a house isn't difficult. Don't go through a realtor. That entire industry deserves to die off as soon as possible.

I didn't take advantage of the FTHB credit. I did take advantage of the "There are 4 similar houses for sale on this same street, and I'm in no hurry to buy, so 12% under asking price is my final offer" credit.

So far I've broke about even, but I agree it's better than apartment living. The only bad part is not being allowed to sell for five years after the purchase without refunding the 8k - if the place had kept or increased its value, sure. But in this scenario it's just annoying.

I wasn't able to jump in on this one since the owner of the house I was originally looking at inflated their cost by about 20K due to the credit.

ended up waiting three months after the credit ended and then grabbed a place for a steal (they expected it to sell while the 8K credit was still in effect, and pulled the same trick)

I can't figure out why people can't let their timeline dictate what they need as far as housing. If you're letting someone who makes money off of your purchase make the decision for you, you shouldn't expect it to work out in your best interests.

That's ok, I got 18000 in incentives and appliances.
and a low APR that will only happen once a lifetime.

i'm good.

What's the matter subby? Don't qualify for a mortgage or refi?

/3.8% fixed FTW

better than losing 24k - am i right?

We bought the place we were renting. We broke about even on our monthly expense, but we gained about 30% equity by purchasing at a great price, and we picked up the mortgage interest deduction.

So there's that...

Paid $150K, just assessed at $225K. Not bad for 13 months. Took $31K of repairs, but still over a double on cash in.

/Some people have a problem with basements not being highly valued.

EnviroDude: Sarsin: Honestly I don't see where my home value matters a whole lot outside of selling it or trying to take out a loan against it. I don't understand the constant hand-writing of "OMG my house is 10% underwater! WHAT DO I DO?!".

Lets say you are a victim of the Obama economy and lose your job. Rather than making enough $$$ like you did (after you spend 12 months looking for another job), you now don't have enough to pay the mortgage. So you refinance. Yikes, during your year vacation, you chose to eat and were late a couple of times with the payment. Now your credit score is in the low 600's. Guess what, you can't qualify for a nice new interest rate.

So you can't refi. But during that process, you discovered that your home is worth 25% less than it was when you moved in years ago.

Now you are underwater.

DO YOU: Walk away from your house knowing that it will fark your credit for a decade and possibly cost you a job if they do a background search? Continue to try to pay - but starve because you can't afford to tote the note anymore? Sell at a loss and still owe the bank $$$?

This is why it matters. This is just one reason why Obama doesn't deserve reelection.

Answer is C. You short sell the thing, keep your credit from falling off of a cliff and go and rent cause you can't afford a home. Plus you would have to miss an awfully lot of payments to drop below 600. Lets also forget that fact that you just admitted that the person in this story doesn't have a nest egg to rely on which means they shouldn't have bought in the first place.

This is just one reason why people can't think beyond their talking points.

\refinancing investment property and closing on a home in a month

Maybe we should stop tying up such huge sums of public money in encouraging people to tie up huge sums of personal wealth in what is increasingly coming across as an unsustainable financial boondoggle?

/if you can't afford a house then rent. Oh but what about all the money you could have made off it as your property will only increase in value? Yeah . . .

//a rental property can be abandoned in times of regional economic depression. A mortgage? Good luck.

With the $8,000 tax credit, I spent about $7,000 of it paying off a car loan and saved over $4,000 in interest on the car loan. I also happen to live in an area that didn't hugely overbuild homes, so the house has only lost about $5,000 in value from when I first bought it. Add in the fact that rent for a house my size would be at least $100 more than the monthly PITI on the house and that I'm gaining over $400 a month in equity, and I'm up almost $20,000 on the purchase. Thanks, Uncle Sam!

meat0918: Is it that whole 7 year average turnover on a house I remember reading about before the bubble burst?

Stupidest cultural change of the past couple decades.

People used to rent their way up the property ladder until they could afford a place big enough to die/downsize in/from.

Now they buy and expose themselves to having to sell during a short term drop off before they can build any significant equity.

CSB time.

In early 2007, I bought my first house near Seattle. At the time it was appraised for $235,000. I bought it for $220,000.

Today? I've put in some $50,000 in improvements (minor interior renovations, outbuildings & shop, wiring, PV panels). While I don't trust Zillow, they estimate the current value is $128,000. Thankfully I only owe some $80k, so I'm not underwater. And I'm about halfway through the 15-year, 4% loan, which that isn't half bad either. I put a lot down at purchase, meaning the monthly mortgage is much less than the rent around here.

Losing about half the value on the place sucks, but I don't feel too bad. It's a comfortable place, the utility bills are nearly zero, and the location is great; it's out in the country, yet only a 5 minute drive to major transit & rail. It was a direct sale and the seller was my grandma, who used the money to retire after living in the house for the past 40-years - so the money stayed in the family. I'm not going to sell the house anytime soon, so the loss in value doesn't affect me yet, but I think I may end up renting it out once I pay it off and living on a sailboat and traveling for a while.

Most of my friends are finding ways to move to new homes, while keeping and renting out their old ones. They're staying afloat with rising rents and some actually even make a little profit - since interest rates are still stupid low. If the market conditions stay the same, I have a feeling more people will do that vs. eating a huge loss on the sale of their homes.

12349876: meat0918: Is it that whole 7 year average turnover on a house I remember reading about before the bubble burst?

Stupidest cultural change of the past couple decades.

People used to rent their way up the property ladder until they could afford a place big enough to die/downsize in/from.

Now they buy and expose themselves to having to sell during a short term drop off before they can build any significant equity.

The Starter Home > Family Home > Golden Years Home thing has to be the stupidest farking thing I've ever heard of. I bought a home that is big enough for my wife and I, with a partially finished attic that can be made livable for about 2k. Unless we decide to have about 6 kids, we're set. It will be the only home we own, unless we somehow octuple our income/win the lottery and can just buy a bigger home with cash on the spot.

EnviroDude: This is just one reason why Obama doesn't deserve reelection.

I do remember him campaigning on the "We'll make sure you lose your job and house" platform. I also fully expect every campaign promise to happen because when the President wants something, it happens.

mrmaster: Answer is C. You short sell the thing, keep your credit from falling off of a cliff and go and rent cause you can't afford a home. Plus you would have to miss an awfully lot of payments to drop below 600. Lets also forget that fact that you just admitted that the person in this story doesn't have a nest egg to rely on which means they shouldn't have bought in the first place.


In the middle of a divorce, no assets, owe much more on the house than it's worth, wife has no earning potential besides a few hundred in SS disability so I'll be financing *two* households for the foreseeable future.

If I had a time machine I'd go back and grow a pair and insist on taking responsibility for the family budget back, no matter how many fights it would start, once she'd proven she was irresponsible. Or better yet I'd go further back and marry someone else instead of the $5.00/hr receptionist who doesn't understand math and believes that "budgets don't work" yet couldn't resist buying every stupid thing she saw on QVC.

Since I can't change the past the answer is walk away from the damn house, let the bank deal with it, and give her custody of the stupid $500 radio that can blow out candles that she never listens to anymore and the hideous Marie Osmond doll and all those battery operated fake candles.

12349876: meat0918: Is it that whole 7 year average turnover on a house I remember reading about before the bubble burst?

Stupidest cultural change of the past couple decades.

People used to rent their way up the property ladder until they could afford a place big enough to die/downsize in/from.

Now they buy and expose themselves to having to sell during a short term drop off before they can build any significant equity.

No they didn't. People used to buy and live in smaller houses and they would live with their family until they were married and bought a house.

You're the jerk... jerk: 12349876: meat0918: Is it that whole 7 year average turnover on a house I remember reading about before the bubble burst?

Stupidest cultural change of the past couple decades.

People used to rent their way up the property ladder until they could afford a place big enough to die/downsize in/from.

Now they buy and expose themselves to having to sell during a short term drop off before they can build any significant equity.

No they didn't. People used to buy and live in smaller houses and they would live with their family until they were married and bought a house.

My parents rented an apartment for a while, rented a fourplex for a while, then bought a house with plenty of room for my sister and I. My sister and brother-in-law rented a 1 bed apartment for a while, rented a 2 bed apartment for a while, and then bought a house that will be sufficient for a child or two.

Government subsidies distort the market and screw the majority in favor of special interests. Film at 11.

Still haven't decided if EnviroDude is just pretending to have debilitating brain damage or has it for real. But either way his bucket of hate overfloweth and he should probably find a more joyous hobby.

nytmare: Still haven't decided if EnviroDude is just pretending to have debilitating brain damage or has it for real. But either way his bucket of hate overfloweth and he should probably find a more joyous hobby.

I think he's just Fark's favorite Internet Dentist. The style is pretty similar, and so is the massive amount of posting during all damn hours of the day.

Way to look short term, subby.

First, free money from the government, as an upfront lump sum. And it's not chump change, either.

Second, if you're looking long term any and all historical data shows that just inflation alone will send the price up somewhat from where it was when you purchased it. My grandparents dealt with a few housing busts since buying their house in 1973, and were criticized for buying out in the boonies on farmland to boot, but now their house is still worth more than 10x what they bought it for(was worth more than 20x in 2006) and where they live is no longer the boonies, the boonies are 30+ miles away. Now, no one should expect that kind of return, but I think it's perfectly fair on the long term to expect to at least break even on housing cost given you didn't buy in Detroit or somewhere else that is getting more awful by the day with no hope ever(and it's been obviously heading that way since the 80s at least). And that means that given the rate of rent inflation, you come out ahead.

SusanCreature: So far I've broke about even, but I agree it's better than apartment living. The only bad part is not being allowed to sell for five years after the purchase without refunding the 8k - if the place had kept or increased its value, sure. But in this scenario it's just annoying.

I thought it was three years but you cannot sell or rent the house before then or else you have to pay the IRS back the $8,000.

Subby does not seem to understand that markets vary.

whizbangthedirtfarmer: In this area, practically every house went up by about $8000 dollars when the credit was announced. All of the agents kept telling me, "but the government will give you $8000 dollars!" Of course, they scored higher commissions on those homes. When the credit ended, many of the houses sunk back down to their previous levels.

Good idea in theory, not so much so in practicality.

Sounds like by your math it is a wash...

K.B.O. Winston: Almet: I bought a home that is big enough for my wife and I, with a partially finished attic that can be made livable for about 2k. Unless we decide to have about 6 kids, we're set. It will be the only home we own, unless we somehow octuple our income/win the lottery and can just buy a bigger home with cash on the spot.

Really? You'll voluntarily heat a larger home than you need just to look down on the seniors who downsize when they don't need the extra space and start having trouble with stairs?

/protip: not every downsizing senior is using their last house to fund their retirement
//some just don't need as much space after the kids go

Many of the people I know that do have those types of houses rent out rooms to college students or setup a mother in law suite for family/rental purposes

You farked up.

You believed in that market fundamentalist propaganda. You're too stupid to live.

If you qualified and exercised the FTHB credit that means you bought your house 2-3 years ago.

You'd be pants-on-head retarded to think about selling it after that short of a time period.

K.B.O. Winston: Almet: I bought a home that is big enough for my wife and I, with a partially finished attic that can be made livable for about 2k. Unless we decide to have about 6 kids, we're set. It will be the only home we own, unless we somehow octuple our income/win the lottery and can just buy a bigger home with cash on the spot.

Really? You'll voluntarily heat a larger home than you need just to look down on the seniors who downsize when they don't need the extra space and start having trouble with stairs?

/protip: not every downsizing senior is using their last house to fund their retirement
//some just don't need as much space after the kids go

I was talking more about the people who sell the family home as soon as the last kid is off to college, then buy an empty-nester monstrosity, with a living room, office, den, man cave, scrapbooking room, master bedroom, 3 guest bedrooms kitchen, dining room, formal dining room, 3.5 baths, parlor, cigar lounge, reading room, library, and game room. I'm exaggerating, but you know what I mean. The last home, the small home with no stairs, an attached garage, and handrails is smart, and I wouldn't fault anyone for doing that when they're retired or deep into their retirement.

How about if the prices drop another twenty points or so? Then I might start thinking about buying.

Renting is starting to get expensive.