The Housing Market is Insane

[K Graham]

The housing market has been a seller's market since late 2020. This is the craziest I've ever seen it. Inventory is low, and buyers are overbidding on properties even paying cash to avoid appraisal. More and more people are trying to buy before rates go up.

I read an article last week that avg home prices rose 16% in 2021, which got me thinking. Income for real estate agents is tied to home values as they work on commission (typically 3% of purchase price). There are 1.3 million realtors in the USA, and so this data means every one of them got a pay raise that was more than double inflation.

Anyway, my wife still lists homes for sale and her clients are getting offers well above asking price and they're going under contract within 24 hrs of listing. Buyers are sweetening the pot by removing due diligence periods and appraisal/finance contingencies, which I would never recommend a buyer do. Buyers agents are having a nightmare of a time writing offers they know will get rejected and trying to show houses moments after listing before they're no longer available.

I've noticed that while we do fewer transactions every years since 2015, the overall volume is usually about the same (roughly $18-21 million). The avg price of homes she sold was $255k in 2015, then $315k in 2017 and this past year we did fewer transactions but with an avg home price of $510k.

[Dr. Shades]

This is one of the reasons my attorney told me I should've gotten divorced 10 years ago. I had to buy out her half of the equity in this market. 10 years ago I would've been able to obtain a new mortgage that was far, far lower.

Incredibly woe is me.

[Doctor CamNC4Me]

This is one of the reasons my attorney told me I should've gotten divorced 10 years ago. I had to buy out her half of the equity in this market. 10 years ago I would've been able to obtain a new mortgage that was far, far lower.

Incredibly woe is me.

Sell your crap, man. Move to the midwest. I saw a decent house, 3br/1ba, cabin in rural IL for $40k. It’s bananas how cheap it is out there.

- Doc

[Dr. Shades]

Sell your crap, man. Move to the midwest. I saw a decent house, 3br/1ba, cabin in rural IL for $40k. It’s bananas how cheap it is out there.

Normally I'd do that, but she got half of my retirement, too. Therefore, I'll be working at least until I can begin drawing social security, but most likely until my new mortgage is paid off. . . when I'm somewhere around 80.

[dantana]

Well, the bright side is we won't be seeing a Lifetime network/Dateline/American Greed episode based upon you opting for a different type of dissolution. (I'm not trying to imply I think that would ever cross your mind)

[Jersey Girl]

Sell your crap, man. Move to the midwest. I saw a decent house, 3br/1ba, cabin in rural IL for $40k. It’s bananas how cheap it is out there.

Normally I'd do that, but she got half of my retirement, too. Therefore, I'll be working at least until I can begin drawing social security, but most likely until my new mortgage is paid off. . . when I'm somewhere around 80.

I'll admit that we've only had one mortgage in our lives and that was back in the 80's and I've never been divorced, so there might be something I'm completely ignorant about here. That said, I'll pose a question.

What makes you think you have signed yourself into 30 years of slavery on the house?

[K Graham]

This is one of the reasons my attorney told me I should've gotten divorced 10 years ago. I had to buy out her half of the equity in this market. 10 years ago I would've been able to obtain a new mortgage that was far, far lower.

Incredibly woe is me.

What do you owe on your house and how much equity do you have now?

[msnobody]

The housing market has been a seller's market since late 2020. This is the craziest I've ever seen it. Inventory is low, and buyers are overbidding on properties even paying cash to avoid appraisal. More and more people are trying to buy before rates go up.

I read an article last week that avg home prices rose 16% in 2021, which got me thinking. Income for real estate agents is tied to home values as they work on commission (typically 3% of purchase price). There are 1.3 million realtors in the USA, and so this data means every one of them got a pay raise that was more than double inflation.

Anyway, my wife still lists homes for sale and her clients are getting offers well above asking price and they're going under contract within 24 hrs of listing. Buyers are sweetening the pot by removing due diligence periods and appraisal/finance contingencies, which I would never recommend a buyer do. Buyers agents are having a nightmare of a time writing offers they know will get rejected and trying to show houses moments after listing before they're no longer available.

I've noticed that while we do fewer transactions every years since 2015, the overall volume is usually about the same (roughly $18-21 million). The avg price of homes she sold was $255k in 2015, then $315k in 2017 and this past year we did fewer transactions but with an avg home price of $510k.

It is crazy. Buyers are even foregoing a home inspection. Our former home which sold in December was sold without the buyer requiring a home inspection.

When we were looking for a new home, we looked at one house where there was someone inside seeing the home, we went in next. When we came back outside there were cars lined up for home showings. We made a offer on that particular house, but thankfully, our offer was not accepted and we wound up with a wonderful home that surpassed that one by far. My aunt sold her home in 15 minutes of it hitting the market.

[Dr. Shades]

What makes you think you have signed yourself into 30 years of slavery on the house?

I guess I could sell it before it's paid off. But I have to live somewhere, so if I sold it I'd just have to buy another place anyway.

What do you owe on your house and how much equity do you have now?

I owe: $195,500.
Equity: $122,500.

[msnobody]

You know, situations change. A few years down the road and the picture could look much brighter.