Would you sell your homes?

[Ross812]

We recently sold a rental and vacation property (summer/fall 2021) and bought a larger vacation property ( winter 2022) in a cash deal. We are going to be trying out renting the larger place on AirBnB.  

[flesh]

I'm listing my house next week. 1.5% to selling realtor and 2.5% to buy side. 

 

If it sells for 75k higher than the best comp, it will have been a 200% gain on purchase price since 2014. I just can't have this much tied up in housing

considering my typical returns in stocks. Where I'm at, the extra dough means I'm retired. I may buy again in the future or I may move to Spain in a year. 

 

I never liked working (excluding investing, that's fun ofc). It's always seemed like a waste of life to me. There was a point it was a confidence builder knowing

that I'd proven myself and could accomplish things in various business environments. That period only last about a decade for me and became a given, therefore

not challenging or interesting anymore. 

 

At 43 I'm looking to spend my time with family, rock climbing around the world, scuba diving, dirt biking, friends, reading, etc. My body won't be able to do these things at a level that's interesting to me more than maybe 10 more years if I'm lucky. 

 

I wish I could find something to do besides investing that interests me to make money.... I've been trying for a decade without success. I wish we were in a 

star trek world, I'd put time into that. 

 

I don't know what will happen to real estate prices..... but I know I can average 20% of better through cycles on stocks. If I could refi at 3% rate/20% equity and current values I probably would... however stock gains are not super useful with getting loans and the loan would be so big the income I'd have to prove would be quite high now. I'd have to work doing things I don't like to get that income for a couple more years=boring. 

[ICUMD]

I own land - about 45 acres.  Low carrying costs, in the city limits of where I live.  Picked it up for a song.  Plan to hold it 20+ yrs.  Plus, it gives me somewhere to drive my 1965 Massey Ferguson 135 and grow some plants.  

 

My home?  I'd never sell as it's an irreplaceable waterfront property. 

 

I'll continue to buy BAM for all my other realestate needs.

[Gregmal]

Spoke with another local agent this morning. This is an hour from nyc 
 

highlights:

 

me: there’s like 50 listings right now, usually this time of year there’s triple that 

 

Her: Well they were actually 35  listings and out of those 35 seven have an accepted offer so the inventory is the lowest I’ve ever seen it.

me: my tenants have been looking to buy for about 6 months. They say it’s virtually impossible

 

her: We’re seeing an average of 15 offers some houses 30 to 45 offers there’s so much cash out there it’s crazy people are buying everything up with cash if you don’t have cash it’s hard to compete hopefully it changes because it’s been a real hard time selling homes as an agent 

 

[Gregmal]

https://vosscapital.substack.com/p/the-big-long-a-deep-dive-on-us-housing-7c3?r=9dts&s=r&utm_campaign=post&utm_medium=email

[thowed]

Cheers for the link & insight.  Very interesting.  This is pretty much the story in London, UK for the whole of my life re: supply/demand imbalance .  Instinctively I felt like I shouldn't buy because it's so expensive, but I had my folks who knew the drill & said, 'That's what you think - get on the housing ladder as fast as you can' and they were right.

[Gregmal]

Look at the headlines today….volume down big! Buried in there? Pricing?

 

Median sales prices of new houses sold in April 2022 was $450.6K, up from $436.7K in March. The average sales price of $570.3K climbed from $523.9K in the prior month.

[Castanza]

Link to report

 

https://www.census.gov/construction/nrs/pdf/newressales.pdf

Edited May 24, 2022 by Castanza

[SharperDingaan]

Just to add to this.....

 

Most reports assume buy vs rent is a choice, and that all benefits are financial. 

Totally ignores that most people rent 'cause they don't have down payment, and/or cannot afford the mortgage were they to buy. Totally ignores that benefits are both intangible as well as tangible - if you don't 'get' that, ask your significant other!. Put away the spread sheet.

 

Most reports also assume old/new housing stock is interchangeable.

Totally ignores that the single story post WWII bungalow of old, is well past replacement life (windows, plumbing, electric, roof, insulation, etc.), and obsolete. Not relevant unless the owner intends to demolish (highest/best use of the lot) and replace with new.

 

Most people just don't get the real value of owning a property, though many might 'sense' it

Your capital is devaluing by the inflation rate every year, and you need a place to live. Own debt free, and your capital increases at the inflation rate (nullifying inflation). You also no longer need to pay rent on a place to live (the biggest expense of most people), and in the interim - while you are paying off your mortgage, inflation works diligently to maintain/build the purchasing power of your capital.

 

Most people also don't get that you mortgage against &/or lease the property to get your capital out - you don't sell the property itself. 

Millions of people, everyday, use a HELOC against their home as an ATM, or as a reverse mortgage supplementing retirement income. 

 

The biggest takeaways from all this? .....

If the extended family wants newborns, the small houses the the kids are living in - need to be mortgage free; and the family mansion with all the space, needs to be kept back against future use by the kids. The optimum solution is the single mansion (in a work friendly city) with multiple floors, and each generation living on its own self contained floor - very different functionality vs existing housing stock. In a London/Paris/New York, the 1/2 floor in a new build high-end apartment block.

 

SD

 

 

    

 

Edited May 24, 2022 by SharperDingaan