House Buying Thread

NTP66
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House Buying Thread

Postby NTP66 » Wed Mar 17, 2021 1:41 pm

Two new houses being built nearby, on basically the same plot of land. Prices are absolutely insane right now, and according to our RE agent neighbor, houses in our area aren't staying on the market very long at all, so it's been crazy. On this particular, one of the houses sold off half of their land to the developer, who is squeezing these houses onto it. Neither will have much of a yard, if any, which is uncommon for the suburbs. The larger house is almost directly behind the existing house, so if you look out the new house's front porch, your entire view it basically your neighbor's back yard and house, about 30-40' away. So strange.

mac5155
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House Buying Thread

Postby mac5155 » Thu Mar 18, 2021 12:10 am

I feel like there's going to be a bubble here soon when materials come back to earth... Like your 450k house today is worth 350k in 5 years.. And you're upside down on your mortgage?

I guess that's assuming the price of materials comes back down...

Beveridge
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House Buying Thread

Postby Beveridge » Thu Mar 18, 2021 9:26 am

I think it's going to take a while for prices to come back down. They sure aren't going to ramp it down the same rate they ramped it up.

The base price on our house went up 11,000 over the past 2 months. It's nuts.

DigitalGypsy66
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House Buying Thread

Postby DigitalGypsy66 » Thu Mar 18, 2021 9:32 am

I've mentioned in other threads how I live in an area that is known for its pine forests - some natural, most are crop forests. They have been clearing THE HELL out of these loblolly pine forests all over the area since the fall, because of timber prices.

What gets me is how fast they clear it. Like dozens of acres down in a day or two. I drove down a road I travel only 1-2x a week, and there were trees on it Tuesday...this morning, nothing but stumps. It's nuts.

One forest was cleared and the owner wanted to make 40 mobile or manufactured home lots. The surrounding neighbors said hell no, and bought the land and now it will be 20 lots with a minimum square footage of 1500. That is if you can get materials to actually build anything.

mac5155
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House Buying Thread

Postby mac5155 » Thu Mar 18, 2021 9:38 am

I had heard that there was a run on southern yellow pine because of the Canadian border being closed.

AuthorTony
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House Buying Thread

Postby AuthorTony » Thu Mar 18, 2021 9:45 am

During some recent remodeling, I bought pine for various projects. The pine I bought from Home Depot came from New Zealand and the pine I bought at Lowes came from Chile.

NTP66
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House Buying Thread

Postby NTP66 » Thu Mar 18, 2021 9:59 am

Tony refuses to buy American.

willeyeam
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House Buying Thread

Postby willeyeam » Thu Mar 18, 2021 10:01 am

Wait til the Somerset County Patriots fb page finds out about this

Dickie Dunn
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House Buying Thread

Postby Dickie Dunn » Thu Mar 18, 2021 10:14 am

I feel like there's going to be a bubble here soon when materials come back to earth... Like your 450k house today is worth 350k in 5 years.. And you're upside down on your mortgage?

I guess that's assuming the price of materials comes back down...
Interest rates definitely play a role as well. $400k mortgage at 4% is $1,910 a month P&I. Cut that rate to 3% and up the house price to $450k and the payment drops to $1,897. Since the mass home builders all have their own lending division that will give you the best rate 99% of the time (and provide significant discounts on closing costs) they’ll make it work however they have to in order to justify the price.

I think there will be a price correction at some point, but nothing too significant. Builders make an astronomical profit on any build due to their extremely limited overhead risk and internal lending departments. They’re more likely to let materials cost eat into a bit of their current profit or reduce buyer incentives versus establishing price points they can’t justify in 3 years. You go into any of these mass developments and the lowest price you pay will be during the “VIP” offering while the model home is being built. After that every model’s base price increases monthly until the development is finished.

AuthorTony
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House Buying Thread

Postby AuthorTony » Thu Mar 18, 2021 10:16 am

Wait til the Somerset County Patriots fb page finds out about this
Tony refuses to buy American.

Bring on the New World Order. :lol:

NTP66
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House Buying Thread

Postby NTP66 » Thu Mar 18, 2021 10:23 am

Wait til the Somerset County Patriots fb page finds out about this
Tony refuses to buy American.

Bring on the New World Order. :lol:
Image

mac5155
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House Buying Thread

Postby mac5155 » Thu Mar 18, 2021 10:43 am

Just checked the 2x4x10s I bought last week


Murican flag stamped on em.
Stars n bars baby

MrKennethTKangaroo
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House Buying Thread

Postby MrKennethTKangaroo » Thu Mar 18, 2021 10:50 am

I feel like there's going to be a bubble here soon when materials come back to earth... Like your 450k house today is worth 350k in 5 years.. And you're upside down on your mortgage?

I guess that's assuming the price of materials comes back down...
Interest rates definitely play a role as well. $400k mortgage at 4% is $1,910 a month P&I. Cut that rate to 3% and up the house price to $450k and the payment drops to $1,897. Since the mass home builders all have their own lending division that will give you the best rate 99% of the time (and provide significant discounts on closing costs) they’ll make it work however they have to in order to justify the price.

I think there will be a price correction at some point, but nothing too significant. Builders make an astronomical profit on any build due to their extremely limited overhead risk and internal lending departments. They’re more likely to let materials cost eat into a bit of their current profit or reduce buyer incentives versus establishing price points they can’t justify in 3 years. You go into any of these mass developments and the lowest price you pay will be during the “VIP” offering while the model home is being built. After that every model’s base price increases monthly until the development is finished.
This is a good (albeit not angry) post from the dunn. I'll add that #maction is viewing an existing home's value based on replacement cost, and since mac built his home, i can see why he feels that way. but the reality is that replacement cost really isnt the way homes are valued in most instances.

barring any economic calamity that the Fed can't solve with fake money, i dont see home values dropping any time soon. i could definitely see a slower pace to the increase in home values. but a decrease in home value? no dice

Beveridge
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House Buying Thread

Postby Beveridge » Thu Mar 18, 2021 10:52 am

Real Estate only goes up, baby.

robbiestoupe
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House Buying Thread

Postby robbiestoupe » Thu Mar 18, 2021 1:01 pm

Real Estate only goes up, baby.
Hello 2005, you called?

Shyster
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House Buying Thread

Postby Shyster » Thu Mar 18, 2021 8:03 pm

What gets me is how fast they clear it. Like dozens of acres down in a day or two. I drove down a road I travel only 1-2x a week, and there were trees on it Tuesday...this morning, nothing but stumps. It's nuts.
Have you ever watched videos on YouTube of modern logging equipment in action? It's fascinating to watch. Check out how fast this thing goes:



I can watch stuff like this for hours.

DigitalGypsy66
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House Buying Thread

Postby DigitalGypsy66 » Thu Mar 18, 2021 8:11 pm

Very cool.

MrKennethTKangaroo
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House Buying Thread

Postby MrKennethTKangaroo » Sun Mar 21, 2021 5:12 pm

Friends of ours just entered back into the pgh market in some higher end areas. They looked at a place this morning. It is showing until Tuesday and then highest and best offers are due.

There are 47 appointments scheduled for that house. 47! Not sure what kind of crazy offer you would need to compete w 46 other buyers

mac5155
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House Buying Thread

Postby mac5155 » Wed Mar 24, 2021 4:57 pm

My homeowners premium came due today, and I noticed in reading my disclosures that I still have the construction cost listed as my coverage amount, as opposed to the recent appraised value. There is a $74k disparity there, in that the cost was lower. Is it worth asking my agent to pay more money? I do have a "guaranteed replacement cost" clause (Erie). Just curious how yinz would handle this sitchiation.

Troy Loney
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House Buying Thread

Postby Troy Loney » Wed Mar 24, 2021 5:02 pm

My homeowners premium came due today, and I noticed in reading my disclosures that I still have the construction cost listed as my coverage amount, as opposed to the recent appraised value. There is a $74k disparity there, in that the cost was lower. Is it worth asking my agent to pay more money? I do have a "guaranteed replacement cost" clause (Erie). Just curious how yinz would handle this sitchiation.
Insurance is only going to cover the replacement cost value. They aren't going to cover the house at it's appraised value. They are going to cover the cost to rebuild the damaged property.

And you want the coverage amount to be lower, the higher the coverage, the higher the premium you are going to be paying.

mac5155
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House Buying Thread

Postby mac5155 » Wed Mar 24, 2021 5:13 pm

My homeowners premium came due today, and I noticed in reading my disclosures that I still have the construction cost listed as my coverage amount, as opposed to the recent appraised value. There is a $74k disparity there, in that the cost was lower. Is it worth asking my agent to pay more money? I do have a "guaranteed replacement cost" clause (Erie). Just curious how yinz would handle this sitchiation.
Insurance is only going to cover the replacement cost value. They aren't going to cover the house at it's appraised value. They are going to cover the cost to rebuild the damaged property.

And you want the coverage amount to be lower, the higher the coverage, the higher the premium you are going to be paying.
I understand that, but on your logic couldn't I tell them the house is worth $10k and have the 'true replacement cost' coverage?

It may very well cost the appraised value or more to rebuild the house...?

mac5155
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House Buying Thread

Postby mac5155 » Wed Mar 24, 2021 5:13 pm

Obviously not advocating to pay more, just want to make sure I'm not going to end up screwed

Troy Loney
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House Buying Thread

Postby Troy Loney » Wed Mar 24, 2021 5:22 pm

My homeowners premium came due today, and I noticed in reading my disclosures that I still have the construction cost listed as my coverage amount, as opposed to the recent appraised value. There is a $74k disparity there, in that the cost was lower. Is it worth asking my agent to pay more money? I do have a "guaranteed replacement cost" clause (Erie). Just curious how yinz would handle this sitchiation.
Insurance is only going to cover the replacement cost value. They aren't going to cover the house at it's appraised value. They are going to cover the cost to rebuild the damaged property.

And you want the coverage amount to be lower, the higher the coverage, the higher the premium you are going to be paying.
I understand that, but on your logic couldn't I tell them the house is worth $10k and have the 'true replacement cost' coverage?

It may very well cost the appraised value or more to rebuild the house...?
There are tools that are used to determine the replacement cost value and whoever owns the mortgage is going to demand that the property insurance covers the cost to rebuild. And I think there might be other state / federal rules that require the property be covered at the RCV.

So, you can tell them whatever, but for a residential mortgage that won't matter. You can probably get away with some thing on the commercial side, but not a residential mortgage.

If you think the cost to rebuild your house is way more than what the coverage is, you can probably say something to your agent, but they'll probably tell you the value is auto generated (basically just plugging in some info about the foundational materials, the square footage and the zip code)

mac5155
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House Buying Thread

Postby mac5155 » Wed Mar 24, 2021 5:25 pm

So I just refinanced and gave them a copy of the disclosure too, I guess they'll tell me if it's not high enough. Otherwise I'll just leave it as is.

Troy Loney
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House Buying Thread

Postby Troy Loney » Wed Mar 24, 2021 5:32 pm

So I just refinanced and gave them a copy of the disclosure too, I guess they'll tell me if it's not high enough. Otherwise I'll just leave it as is.
I'm sure you provided evidence of insurance as part of the refinance. If they deemed the coverage amount to be inadequate, they wouldn't have made the loan. And also, they wouldn't tell you to change the coverage, you don't have a say in the amount of coverage. The homeowners has to cover at RCV and that amount is arrived at through whatever tool the insurance company. Though, a quick peak, it looks like you can haggle with the insurance company for how they determine depreciation, but that would apply to actual cash value, not replacement cost.

But basically, this **** only matters if you are filing a claim, and the coverage limits only if your house is totally destroyed. In which case, it's going to be a nightmare for you, on top of the haggling you would have to do with the claims people, sorting out what damage the policy covers and what it doesn't.

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