Saturday, January 10, 2009

This house looks nice

Too bad it is high-priced for us. We are somehow hoping to get something like this, but it seems out of reach. We'll take it for $330,000. They bought it in 2004 for $292,000. I just saw on another site that they have dropped the price to $374,500 (Craigslist says $389,000). Since they bought in May 2004, that appreciation is approximately 23K per year. Seems like a lot to me.

Some price drops this weekend, and of course few open houses

So you would think with everything on the market, we would have so many homes to choose from. Instead, hardwood floors and granite countertops drove us to a depression. I saw new things on Redfin today that had price drops. Finally! Ah but there are still quite a few that are unreasonably overpriced. I wonder how long people will wait with their homes on the market? Will some of them eventually sell? I don't know anyone else like ourselves (young, double-income, in the market for a single family.) We keep thinking that many of the people who would be bidding on the same homes that we're interested in would be families who have to sell other homes, so we'd be more attractive bidders. Anyone out there who is in our situation? What have you experienced? We could wait longer to buy, but we would like to move now.

What's Up With the Price Point

From Dutch:
FYI.... Listing agents are dumb. They are a big reason we're in this mess. All they ever talk about is the comps. Comparables, although effective in a bull market, obviously aren't the most effective way to price a home in this bear market. Personally, I don't care that the house on the corner sold for $375,000 in 2006. If you wanted $375,000 you should have sold in 2006. THIS IS 2009. The most effective pricing method is pricing the home where the most people can qualify for financing.

Currently we are a society that carries large amounts of debt. Current buyers don't have the lending options buyers had from 2001-2007, even though they too were carrying the debt. During that time, many buyers were taking out a loan for the down payment as well as the principal in order to get a more expensive home. This risk was justified in their minds because they felt that their home was going to appreciate and make them more money (greed). In this market, the main type of loan getting approved is the FHA loan which requires little down and is capped at $350,000. If people and agents really want to sell their home; How come they don't price them within the FHA requirements ? The answer, STUPIDITY. Homes won't sell til prices reflect what is able to be financed. BTW, Anne and I have the ability to put 20% down and don't want to pay more than someone who doesn't.


My husband, Dutch, and I are snowed in today, and are reflecting upon our housing search in the city of Chicago. We are entering our 20th month of looking for a house that meets the following requirements:
1. Three bedrooms that 9x10 or larger
2. At least one-and-a-half bathrooms, preferably the full bath on the second floor and the half bath on the first floor
3. Has a yard, and a garage or the potential for a garage
4. Under $350,000 and priced below 2006 prices (so that we might see some appreciation within 7 years)
5. Within one-half mile walking distance from the El
6. Located in one of our focus neighborhoods: Avondale, Irving Park, Albany Park, Logan Square, Lincoln Square, North Center
7. Stairs to second floor are not too steep or narrow
8. Not in need of gut rehab
9. Eat-in kitchen
10. Dining room

As I write our list of criteria, I realize we may never find this place. Very depressing, and even in a buyer's market. It is so hard to think of a place where we can live now, and yet not be bankrupted by repairs, and grow into for later.