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Worried

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amother

Babyblue

Mon, May 23 2022, 2:47 pm

amother [ Clear ] wrote:

Renting is throwing your money straight into the garbage, as opposed to paying your mortgage which is paying off your own property and assuring you can always sell it and make a profit when/if you wish to. Where does your money on rent go?

No, you absolutely can not always sell your property and make a profit. Anyone who bought during the last bubble did not recover the value in their home until this bubble, almost 15 years later. Buying at a high is financially risky.

Renting is not money in the garbage when it's your short term plan. Renting for 2-3 years is far better financially than locking in a high mortgage for the next 30 years because you're buying at a high. I'll come out way ahead if prices drop and my monthly mortgage payments are much lower than they are now.

amother

Amber

Mon, May 23 2022, 2:56 pm

I am/was also on the market to buy in the greater Lakewood area, but when interest rates shot up I called off my search.

I don’t think house prices will go down, but I’ll calmly wait until interest rates drop before I continue my search.

My budget for mortgage payments now allows me close to $100,000 less of a purchase price with such high interest rates. And said budget was preinflation so it’s not really accurate anymore.

amother

Tan

Mon, May 23 2022, 3:34 pm

amother [ Chicory ] wrote:

Idk about the housing prices going down. In more far flung areas they might be.

In monsey in 2008 nothing went down near us. We bought right at the height and had 0 regrets.

Not true. I personally know of two people whose houses were underwater for a good few years. One bought in Blueberry Hill area which was and still is prime location and another in Airmont. The Monsey family was able to hold on to their house but haven't extended yet as they thought they would at this point. The Airmont family had to sell the house at a loss and moved farther out to New City which was then way cheaper. I'm sure there are many others.

amother

Tan

Mon, May 23 2022, 3:40 pm

amother [ Babyblue ] wrote:

When mortgage rates will inevitably come back down, you refinance at a lower rate. We got a great deal when we bought 6 years ago, so much so that when rates dropped during Covid and everyone and their grandmother were refinancing, our mortgage broker told us that for us it wasn't worthwhile because we had gotten a good rate in the first place.

amother

Mon, May 23 2022, 3:46 pm

amother [ Tan ] wrote:

I happen to agree with this. Interest rates always change, and a home can be refinanced for a better rate when things get better, but overpaying on a house is money you can never get back. I wish there wasn't such a frantic feeling.

amother

Chicory

Mon, May 23 2022, 3:57 pm

amother [ Tan ] wrote:

We live off Remsen. Airmont is not prime location by any means.

Our kids are looking near us and I highly doubt prices will fluctuate, I wouldn’t buy in Airmont on a high.

amother

Crimson

Mon, May 23 2022, 4:12 pm

As an investor and experience in the real estate field I strongly suggest buying now. As much as people keep saying the market will crash, theres a serperate issue here called a housing shortage. This alone is causing the increase due to demand.
Having lived in this town long enough I can tell you that real estate has never gone down.
It wont help you to look back and say I couldve bought cheaper years ago, those days are over and will never come back.
Buy now, the house will continue to go up in value iyh. Also if rates ever go down below your current rate you can always do a refi.
Oh and lock in NOW, like TODAY! Rates can and will continue to increase.
You just need to make sure you can currently afford to cover your mortgage. Daven that parnassah should work out iyh.
Its a scary step to take but dont get cold feet or you may regret it later.
Hatzlacha!

amother

Babyblue

Mon, May 23 2022, 4:19 pm

amother [ OP ] wrote:

Right now both interest rates and house prices are at record highs...

amother

Sapphire

Mon, May 23 2022, 5:08 pm

amother [ Chicory ] wrote:

We live off Remsen. Airmont is not prime location by any means.

Our kids are looking near us and I highly doubt prices will fluctuate, I wouldn’t buy in Airmont on a high.

You know that people are in suffern already, airmont is a bidding war things running off the market. Suffern houses are selling way over asking .

snailmail

Mon, May 23 2022, 5:50 pm

Its the American dream right, don't rent buy buy a house!
But I believe it is all marketing ploy. Owning a home has its own slew of problems & costs. The water pipe breaks - YOU need to pay to fix it. The hot water tank breaks - YOU need to replace it. The AC breaks. The roof leaks. The windows are drafty. The tap drips. You have to fix it all. You can no longer call the landlord and tell them to fix it, or not paying rent until it is fixed. New houses and old houses both can have problems.

The other thing with paying mortgage, after 30 years, you could end up paying more than double the asking price of the house - just for the cost of the house itself with all the interest. So while you do own the house at the end, you have paid the bank a lot more than what the owners who sold it to you got.

Rent goes up - but so does property tax. So after you finish paying off your mortgage - you could still have a $28,000 property tax bill. Having your property value has go up is not always do good as your taxes will go up - unless/until you are ready to sell. Eg Buying a house for $600,000 and then a few year later it is now worth $1.2M is not good for your taxes. Only good for you if you are selling. However, if you need the money to make renovations, then you could also take out a second mortgage (or refinance) on the higher value of your home.

You always need to be able to afford the monthly payments - whether it is for rent or mortgage, credit card or loans.

amother

Lotus

Mon, May 23 2022, 6:04 pm

snailmail wrote:

The fallacy in your reasoning is that for most Americans their single greatest asset is the value of their home.

Of course that is if they were reasonably prudent and bought a home they could afford - paid off the mortgage - didn't refinance the house in order to fund their lifestyle or other expenses - and didn't keep trading upwards but stayed in a relatively modest affordable home.

For most people in the USA they can deduct mortgage interest payments along with real estate taxes up to a certain amount. It used to not be capped but now it is but it is still a deduction.

You live in the house and over time it becomes less expensive than it would be to rent a comparable house. I would have to pay twice or even three times what I pay for my home if I were to try to rent a comparable one now at current prices.

If I had continued to rent I would have nothing except receipts. By paying more or less what I would have paid in rent over the years I know have inexpensive housing PLUS equity of at least $500,000 based on my home's appreciation.

Not all places have super high real estate taxes. Residential homes in New York City have highly favorable tax rates. In California - for better or worse - you pay taxes based on the original purchase price with minor increases each year.

amother

Chicory

Mon, May 23 2022, 7:15 pm

amother [ Sapphire ] wrote:

You know that people are in suffern already, airmont is a bidding war things running off the market. Suffern houses are selling way over asking .

Yes but if the market crashes those housing prices will be affected. There’s much more inventory there.

amother

Tan

Mon, May 23 2022, 7:28 pm

amother [ Chicory ] wrote:

We live off Remsen. Airmont is not prime location by any means.

Our kids are looking near us and I highly doubt prices will fluctuate, I wouldn’t buy in Airmont on a high.

I like how you're ignoring the Blueberry Hill house. They bought in 2006 for over 800k. For a long while their house wasn't worth that amount. By now though it's over a million.

amother

Chicory

Mon, May 23 2022, 8:12 pm

amother [ Tan ] wrote:

I like how you're ignoring the Blueberry Hill house. They bought in 2006 for over 800k. For a long while their house wasn't worth that amount. By now though it's over a million.

You’re proving the point. In the long term it only goes up and up.

I don’t know much about blueberry area. The houses I know in that vicinity have never had a dip. We have several neighbors that sold down there 2010/2012 etc and made a lot of money.

amother

Oatmeal

Mon, May 23 2022, 8:43 pm

Re taxes they are based on the original buying price and can only increase in small increments.

Yes it is a job to own a home. It is prudent to buy a home that has been well maintained so that the upkeep is not overwhelming. For the most part owning a home is a wise financial decision and also gives one peace of mind.

amother

DarkKhaki

Mon, May 23 2022, 9:36 pm

snailmail wrote:

Its the American dream right, don't rent buy buy a house!
Having your property value has go up is not always do good as your taxes will go up - unless/until you are ready to sell. Eg Buying a house for $600,000 and then a few year later it is now worth $1.2M is not good for your taxes. Only good for you if you are selling.

Huh? There is ZERO impact on your income taxes if your home appreciates in value UNLESS you sell (same as stocks you own, no tax impact to appreciation in stock but you pay tax on gains). Even when you sell your home, if you are married filing joint you are able to exclude $500,000 of capital gains.

amother

Heather

Mon, May 23 2022, 10:05 pm

amother [ DarkKhaki ] wrote:

I think she means your property taxes will go up, while you won't get any benefit from the increased value unless you actually sell it.

amother

Valerian

Mon, May 23 2022, 10:09 pm

Right now there are tons of people looking to buy in Lakewood area. Supply is way lower than demand. If the US housing market actually crashes, I doubt it would affect this area much. Because there are too many people with cash in their pockets who can spend whatever they please.

amother

DarkGreen

Tue, May 24 2022, 3:56 am

Just want to wish you Hatzlocha rabba OP. I wish the housing prices were better so many more can buy in areas for Yidden. It's always best to own, and if you need that area specificly, Daven that all should go smoothly.

amother

Tue, May 24 2022, 12:50 pm

amother [ DarkGreen ] wrote:

Thank you!

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