Real Estate Crash thread

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According to Freddie Mac’s latest Primary Mortgage Market Survey, 30-year fixed-rate mortgage rates averaged 3.67 percent (with 0.7 points) for the week ending today, another new all-time low, down from 3.75 percent last week, down from 3.83 percent last month and versus 4.49 percent a year ago.

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With these rates we have decided to pocket list our condo in SF. Hell, we really don't have to sell but a 3bdr/2ba/2 car parking newer construction on the north side of town is hard to come by. The plan is to lock in the low rates on a larger place we know we could stay in for a longer haul.

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Originally Posted by 4matic

So what. It's a rental and I'll clear $600 a month after expenses. The profit is more than I'd get in rent in Ogden and, it's not in Utah. If it matters the Bay Area shitbox is less than 3 hours from Kirkwood and an hour from Santa Cruz. What else ya got?

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Ah, but with 200K worth of purchase power I'd clear over $2400 a month and still have 20K left over. ;)

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Originally Posted by meatdrink9

Ah, but with 200K worth of purchase power I'd clear over $2400 a month and still have 20K left over. ;)

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No doubt. How long until people leave shitholes like Hayward for Ogden?

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Originally Posted by Hugh Conway

No doubt. How long until people leave shitholes like Hayward for Ogden?

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Ogden is perfect for Hayward white trash. Makes room for the Asians with money.

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Originally Posted by Hugh Conway

No doubt. How long until people leave shitholes like Hayward for Ogden?

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I didnt realize sitting on a hill with a fat house overlooking the area in hayward was a shithole. Do educate me. I wouldnt call anywhere in the bay area a shithole without a little education on where they live in that city. Ive got 3 buddies in hayward that have fat houses sitting on a hill overlooking alot of area. Nice frickign houses, i assure you. You might want to specify where in a city they live.

Pretty sure most people call CA property a shit hole just based on the price you have to pay for it. In Ogden I could buy the most incredible Railroad Baron period piece for likely $400k, that in my hood would sell for $5M+ because the weather kicks ass all year round and is by the beach. Is it worth paying an extra $4.5M to live in my hood? Not IMO, but different strokes for different folks.
To get back on thread topic, looks like prices are going back up a bit in San Diego County. I still think they will be lower in 12 months, but that is just the eternal optimist in me:wink:

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Originally Posted by cramer

I didnt realize sitting on a hill with a fat house overlooking the area in hayward was a shithole. Do educate me. I wouldnt call anywhere in the bay area a shithole without a little education on where they live in that city. Ive got 3 buddies in hayward that have fat houses sitting on a hill overlooking alot of area. Nice frickign houses, i assure you. You might want to specify where in a city they live.

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I'm a flat lander :tongue: Nice weather and close to the Bay Trail though.

I think we can all agree about the wife factor here. I know Livski has mentioned it. So, Ogden bad, SF metro good. Hey , if it was up to single male ski heads, we'd all be living in dirtbag apartments. Like Benny.

I have no doubt 4fullofshit will be a spectacular slumlord.

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Originally Posted by ass-to-mouth

I have no doubt 4fullofshit will be a spectacular slumlord.

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Full of shit is something you are certainly an expert at.

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Originally Posted by 4matic

My short sale purchase was approved by BAC. $220k:

http://www.zillow.com/homedetails/15...24958361_zpid/

I talked to the current "owners" yesterday and they want to stay on as tenants. Nice family that got it wrong.

Seems like a fair price as a house two blocks away listed for $278k and is bid at $335k with 20% down. It appears the Asian community has discovered our little neighborhood and is buying with large cash percentage

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Holy crap, the zillow estimate graph shows the asking price (?) was almost $600k sometime in 2006. And you go it for $220, that's quite a downward price move.

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Originally Posted by cramer

I didnt realize sitting on a hill with a fat house overlooking the area in hayward was a shithole. Do educate me. I wouldnt call anywhere in the bay area a shithole without a little education on where they live in that city. Ive got 3 buddies in hayward that have fat houses sitting on a hill overlooking alot of area. Nice frickign houses, i assure you. You might want to specify where in a city they live.

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I believe he was being ironic, considering Ogden is really the shithole in this scenario.

It's time to solicit advice from the mag community.

I had the shit box short sale termite inspected today and he found $15k in dry rot and water damage plus the old gas heater is inoperable. If I can get a reduction in price I'm still willing to move ahead but how should I approach this with the bank (BAC)? Is it a non starter as is sale and just cancel the appraisal and walk?


1. Bathroom needs to be stripped to the studs for water damage

2. All the window frames are dry rotted and require replacement (windows are cheap dual pane)

3. Needs new heater.

Appreciate any advice, humor, and insulting comments.

Landlording ain't catching the little upside and loading it off to the next muppet, I guess.

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Originally Posted by 4matic

It's time to solicit advice from the mag community.

I had the shit box short sale termite inspected today and he found $15k in dry rot and water damage plus the old gas heater is inoperable. If I can get a reduction in price I'm still willing to move ahead but how should I approach this with the bank (BAC)? Is it a non starter as is sale and just cancel the appraisal and walk?


1. Bathroom needs to be stripped to the studs for water damage

2. All the window frames are dry rotted and require replacement (windows are cheap dual pane)

3. Needs new heater.

Appreciate any advice, humor, and insulting comments.

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Unless you live in washington DC(which is the only place in the US that prices arent still going to go down), I'd get a big deduction(like costs+your time) after getting an appraisal of those fixes costs.

dont know if the seller knew or not, but its not going to get easier for him to sell for years and there are plenty of other places if you are patient.

Tough call 4matic, as it sounded like you received a solid price and you said you have a $600 mo positive. From my experience, the seller will not want to do the work prior to the close of escrow for you unless a termite and clearance were part of the contract. So is a termite clearance in the contract? If no, the seller can credit you 2% of the loan amount towards paying closing costs for you. That is the maximum credit they can give you through escrow per FNMA rules. So in your shoes, I ask them to knock $10k off the price and give you the 2% credit to closing costs, if a termite clearance wasn't part of the escrow. If it was, the lender will insist on a termite clearance, unless you amend it being done out of the contract.

So for the second time we put a bid on a house and got the letter back that multiple offers have been placed and now the bank wants the biggest and best. On both houses, they were on the market for less than a week. The previous house was ultimately purchased for $45k over asking price. This is a bit different as the most recent place is literally a craphole, is pretty much unliveable in its current state and would obviously require extensive repairs. I was hoping this would sway people from bidding on it, but yeah, no such luck. I don't get how the banks can just leak out houses here and there, keeping inventory low and drive the market up like they are. Drives me crazy.

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Originally Posted by CS

This is a bit different as the most recent place is literally a craphole, is pretty much unliveable in its current state and would obviously require extensive repairs.

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I hope you can pay cash for it, as lenders will not lend on properties needing extensive repairs, that are not repaired prior to the close of escrow. Only other option is if your financing is a FHA 203k rehab loan.

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Originally Posted by 4matic

It's time to solicit advice from the mag community.

I had the shit box short sale termite inspected today and he found $15k in dry rot and water damage plus the old gas heater is inoperable. If I can get a reduction in price I'm still willing to move ahead but how should I approach this with the bank (BAC)? Is it a non starter as is sale and just cancel the appraisal and walk?


1. Bathroom needs to be stripped to the studs for water damage

2. All the window frames are dry rotted and require replacement (windows are cheap dual pane)

3. Needs new heater.

Appreciate any advice, humor, and insulting comments.

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You are dealing with a bank, either live with the added costs or move on.

I had to pass on a house just last month for this very reason. They might work with you, but it will take 6 months or so. Frankly, you're buying a house well below market value as a short sale as is, you will still be profitable with the added repairs (you are delusional if you think you can be a landlord and not have to pay to fix things, get used to this fact and consider this just the down payment).

Lots of people think being a landlord is super easy, but if a faulty furnace and some minor (15k in the world of termites and structural wood rot is minor) wood work needed you are in for a rude awakening.

Still in multiple offer land out here. We did close on a couple of houses two weeks ago. Have written 5 offers since then. All but one ended up in a multiple offer scenario (surprised they all didn't). I think after today we'll have 2 under contract. One is a decent duplex with a 2 car garage in need of about 10K worth of work for $37,500. The other is a brick SFR 3 bed, 1 bath, 1 car garage for $58,500 that will require roughly 7K to get up to speed.

I'm getting a couple estimates of repair and a furnace guy for another estimate. I should have the appraisal in a day or two. With the repairs it's a close call on value but I have an agreement for a one year leaseback to the owner which really cuts down the carrying costs. They want a fast close so we'll see. The negotiator is not optimistic and neither am I because the house is already in first notice foreclosure but it's worth a shot. i locked a 4.25% investment loan.

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Originally Posted by 4matic

It's time to solicit advice from the mag community.

I had the shit box short sale termite inspected today and he found $15k in dry rot and water damage plus the old gas heater is inoperable. If I can get a reduction in price I'm still willing to move ahead but how should I approach this with the bank (BAC)? Is it a non starter as is sale and just cancel the appraisal and walk?


1. Bathroom needs to be stripped to the studs for water damage

2. All the window frames are dry rotted and require replacement (windows are cheap dual pane)

3. Needs new heater.

Appreciate any advice, humor, and insulting comments.

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unless the house is in an awesome location, keep looking. I'd also have the seller take care of all that so they find everything else thats wrong. aka, keep looking.

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Originally Posted by CS

So for the second time we put a bid on a house and got the letter back that multiple offers have been placed and now the bank wants the biggest and best. On both houses, they were on the market for less than a week. The previous house was ultimately purchased for $45k over asking price. This is a bit different as the most recent place is literally a craphole, is pretty much unliveable in its current state and would obviously require extensive repairs. I was hoping this would sway people from bidding on it, but yeah, no such luck. I don't get how the banks can just leak out houses here and there, keeping inventory low and drive the market up like they are. Drives me crazy.

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Liv2ski as always has the knowledge. You'd have to go FHA rehab. which my buddy did and they give you some nice cash to renovate. liv2ski, do you have to bring estimates to the table and with that multiple ones?

As for the banks leaking them out, i think they kind of learned a lesson back in 08-09. id be doing the same. They released a ton of inventory and the masses were able to grab fha's, get their down payment back from the gov't and call her a day. Best time to buy a house ever. Essentially nothing down, modest interest rates, less than you were paying in rent if you had a family. Lesson learned....the banks screwed themselves foreclosing on everyone instead of short saling or mod'n these loans. They arent making that mistake this time. They can't have us that only paid 200K abandoning loans if there was another meltdown in prices. They'll all be out of business.

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Originally Posted by cramer

liv2ski, do you have to bring estimates to the table and with that multiple ones?

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Last time I did a FHA 203k rehab loan was eons ago. There are two versions of the program. The full on big rehab (that I have done) and the much lower loan amount for rehab (like $20k) that I have not done. On the full on rehab you need to have your contractors meet the FHA appraiser to go over the repairs and costs. The appraiser then does a before and after repairs appraisal and you get your loan on the after value. It is a great program for homes that conventional lenders will not touch due to extensive repairs being needed, but it is tough to find lenders that offer it and know what they are doing.

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Originally Posted by 4matic

I'm getting a couple estimates of repair and a furnace guy for another estimate.

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On my BOA purchase, they found mold during the inspection. The inspector took really good notes, with pictures and I got an estimate of $15k for remediation.
I was able to negotiate a $12K discount and then used a bunch of skibum tradesmen to fix everything and paint for about $15K.
The mid valley Roaring Fork market was still pretty soft at the time, so your ability to negotiate may vary?