In 2 months a house is put up in the market for over 250 k more. I think renovation mustn’t have cost more than 100k .
Are flippers a sign of heated market ?
Trump might as well be a negative to Bay Area housing market. He threatens to grow GDP at 4%, which will induce inflation and cause mortgage rate rise. He threatens to lower the $1M mortgage deduction limit. He also threatens to restore Fannie and Freddie to private companies and get them off government books.
Mortgage rate has already increased by 0.6% after Trump elected. The higher GDP growth he threatens will be a negative to Bay Area housing since our wage level is already high and also his threatening 4% GDP growth might benefit the states he loves, not Super blue California.
If mortgage rate rises to 5% or 6% under Trump’s super heated economy, I would be very concerned about BA housing price.
The best scenario for Bay Area is a national low growing GDP but an overheated Silicon Valley GDP growth. That’s what we have enjoyed in the last 8 years, with super BA economy and a super low mortgage rate. I start to miss Obama already.
Opportunity comes in all shapes and times. Obviously in a market that is pretty heated a flipper can probably move a home faster and make more but who is to say a flipper can’t buy really cheap in a lukewarm/cold market knowing that yes it will take longer to flip but the entry price was so low??? I think people are infatuated with the reality flipping shows to the point they think oh they can do it too. And let’s be honest, that little interest if any from bank accounts aren’t exactly making one’s retirement come that much sooner so real estate provides that hope/avenue to make more (hopefully).
Haha, I checked it out after you mentioned it. Too bad I have zero money right now.
I closed on a Hayward home last month and had to take out margin of my stock portfolio just to fund the down payment!
I’m a small fry. I’m just here learning from everyone else.
Yeah, I guess I got spoiled after buying my Fremont 3/1 for under 500k… I mean come on, trust sale wanting 560K. Ok, but you need in my estimate at least 100k if not more to fix up to be decent. Well, that means say nearly 700k on a property with no disclosures at all. Naw, I pass…
Same boat, relatively small fry too, but let’s be fair to ourselves, if you can tread water in these waters no one is a small fry…
Only if flippers are mostly new and inexperienced. Similarly, when the market is abounded with new and inexperienced realtors.
Did the bank care about the margin loan? I had a margin balance when I bought my house and they didn’t seem to care. Wondering if that’s common or exception
Meanwhile mortgage fixed rate for 30 years is 4.5% already meaning person who could afford to buy 1M house a month ago now can afford a house only for ~940k. And rates are still going up.
Probably there are some ppl who locked their rates so I think after couple months when they will have to renew their approvals (if they will not buy anything until then) the number of ppl willing to renew approvals and to buy will be significantly less.
Good info. Thanks. Few months from now, mean Spring!!!
People with cash reserves…get ready
@elt1 wins again with his 2017 call.
what was his call?
2017 will be the year of correction. Prices fall across the board.
When mortgage rate goes up and economy is not in recession, will rent goes up or down? If recession?
Foreign buyers doesn’t care whether mortgage rates goes up r not. Only Trump factor will come to the picture . It will be interesting Winter/Spring season in bay area RE.
Thats good news for local buyers , less competition from chinese all cash buyers
the whole world cares about FED base interest rate.
For international buyers (unless they are not already sitting at present moment of time on US dollars) - if FED base interest rate goes up that means every other national currency goes down (no exception). Most international buyers to get american dollars have to exchange them for their local currencies at official/non-official exchange rate which totally depends on our FED base interest rate. So what I mean is that after FED will raise base rate ALL international buyers who willing to buy any RE with US dollars (no matter where even in Africa) have to adjust the amount they can afford to new exchange rates.
So pretty much they are in the same boat will local buyers just from different perspective.
Turns out getting a real estate developer in WH is bad for real estate. Ironic.
USD is worth more now, we should go buy in foreign countries. Foreign buyers will be less and less with a strong dollar.
Maybe Ariozna and Las Vegas will be hot again with BA affordability going down.