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August West
Trad climber
Where the wind blows strange
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Jun 29, 2017 - 03:06pm PT
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What do people do inside houses that cost 1/2 a million dollars and more?
In expensive places it isn't the house that costs 1/2 million dollars.
My moment of shock was when I went to get fire insurance for my "~1/2 million dollar house" and my agent thought I only needed $120,000 of coverage.
When I looked puzzled he said, "if your house burns down, we don't have to replace the lot".
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Reilly
Mountain climber
The Other Monrovia- CA
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Jun 29, 2017 - 04:30pm PT
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Our current market strikes me as the same, could pop any time, or run up another 30% over a few years and only deflate modestly.
Spoken like a true economist, which is to say, nobody knows nuthin'. This
shiz is totally unpredictable. That said, educated guesses are worth more
than a cup of coffee.
I suggest reading Robert Shiller's Irrational Exuberance. He's looked
at this shiz going back hundreds of years. There's nothing new under the sun.
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ms55401
Trad climber
minneapolis, mn
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Jun 29, 2017 - 04:55pm PT
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anyone buy direct from owner rather than deal with realtors
a friend sold his house directly. I think he and the seller were both well-informed and savvy, and it was a win-win
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Jon Beck
Trad climber
Oceanside
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Jun 29, 2017 - 05:16pm PT
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It varies from state to state. Here in California escrow does the heavy lifting in getting the sale completed. Easily done without an agent. Yes, requires some knowledge of the process.
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rick sumner
Trad climber
reno, nevada/ wasilla alaska
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Jun 29, 2017 - 05:41pm PT
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Just a caution Moof. Yes, prediction is difficult, especially of the future. Here in AK many econmic indicators aren't very encouraging. The advice is free, but solid practice for any first time homeowner.
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Flip Flop
climber
Earth Planet, Universe
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Jun 29, 2017 - 08:29pm PT
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I'm fixing a little deck between a modest 1930's cabin and the private lakefront cove. There are places not by the lake where you could get the cabin for 150k. I couldn't even estimate the resale value of this place except maybe 8 figures.
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cavemonkey
Ice climber
ak
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Topic Author's Reply - Jun 29, 2017 - 11:27pm PT
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Me too moose
Circumstances have changed
But I do stand behind "every man should build their own shelter"
Done it
Unfortunately wasn't thinking of baby proofing when I was
Off the grid and climbing full time!
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ß Î Ø T Ç H
Boulder climber
ne'er–do–well
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Jun 30, 2017 - 01:13am PT
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You never own property in the USA. It's really just renting due to property taxes which only go up and up.
So if you must become a house slave, buy something well under your means, like waaay under. Most insightful response 0 0
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Lollie
Social climber
I'm Lolli.
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Jun 30, 2017 - 08:02am PT
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What levels are interests in now in the USA?
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The Alpine
climber
The Sea
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Jun 30, 2017 - 08:12am PT
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Mid to upper 3%
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rottingjohnny
Sport climber
Sands Motel , Las Vegas
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Jun 30, 2017 - 08:49am PT
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When you own a house it becomes your master...
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Winemaker
Sport climber
Yakima, WA
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Jun 30, 2017 - 09:11am PT
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When you own a house it becomes your master...
That's not my experience and I've owned (well, almost) four homes (not houses - there's a difference). I love being able to do things like put in a veggie garden, landscape, put in a patio........ I could never live in an apartment or condo with neighbors noises and smells intruding into my life. When my daughter was young I could build her playhouse how and where I wanted to. I love the privacy of the back yard. I could be paying the same for rent as my total house payment but prefer to keep that money. A home is a companion, not a master, and there is an organic relationship. I've never lost money on a house, in fact made quite a bit over the years. What's not to like?
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rottingjohnny
Sport climber
Sands Motel , Las Vegas
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Jun 30, 2017 - 09:16am PT
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Winemaker... Good point...Not my quote and Excuse my whining...Gotta get back to painting the siding..
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Winemaker
Sport climber
Yakima, WA
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Jun 30, 2017 - 09:25am PT
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Ha! Belt sanded the entire outside of my two story house in Seattle one summer; understand your pain.
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Jon Beck
Trad climber
Oceanside
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Jun 30, 2017 - 09:43am PT
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When you own a house it becomes your master...
maybe for the first ten years. Do not treat your house like an ATM machine and figure out how to do most maintenance your self. My house has allowed me to become a total slacker.
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Flip Flop
climber
Earth Planet, Universe
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Jun 30, 2017 - 10:09am PT
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As an investment, housing is so interesting and multifaceted. Personally, it's the way that I can create value with my skill set. I would be scared AF if I had to call people to fix and maintain my house. When I bought my house, it was gutted and at the bottom of the market. I had already accumulated a full house of reclaimed high-end fixtures and appliances. If I had to spend money it was maximum value and minimum outlay. The location had as much upside as you could want in a first home buy.
Before I astound you with the numbers,my main caveat is that the Dream House remains a major cause of divorce and was certainly a factor in my divorce.
Bought in 2010 for 315k
2011 value after repairs at divorce 475k
Sold my share to ex for nominal buyout. Thinking here is that the better her financial position is, benefits our son directly. So,what's good for the goose is good for the gander. It freed me of the responsibility for repairs and maintenance and the commingling of divorce and business.
So far, so great. She was getting about 3k a month in rent, she was able to buy another home when she moved to Reno a few months ago and just sold the original house for close to 700k. I just looked at zillow and that's how I found out that she sold it. Live action! Man, she's kicking ass. It will get her goat a little that I found out. Thank you Supertaco.
I have great taste in women who have questionable taste in men.
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beaner
Social climber
Maine
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Jun 30, 2017 - 10:45am PT
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Every new purchase resets a higher market value that locks you in to paying property taxes based on the value when you bought it. The longer you hold a piece of property increasing in value, the less taxes you pay overall (big savings).
-NutAgain
Around here (I'm in Bar Harbor, ME), the property taxes are not based on the sale price, but on the last time the property was assessed by the town's tax department. I've owned properties that were assessed for tax purposes 50K less than what I paid, because the town hadn't assessed their value for a few years. Certainly recent neighborhood sales prices are factored into new assessments, and they periodically reassess the entire town. My current home is new construction, and they sent someone over to assess its value after construction was completed. That value stays on the books until the next time the town assesses property values, even if I sell it for more (or less) than the current valuation. Like new construction, getting a building permit for an addition can also trigger a reassessment of the property. So staying put and not moving won't save you from increasing property taxes; we wouldn't end up with your situation of you paying $1000 a month in property taxes and your neighbor paying $100 just because they purchased when values were significantly lower.
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Reilly
Mountain climber
The Other Monrovia- CA
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Jun 30, 2017 - 10:52am PT
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My property taxes are the price of a Starbucks latté per day. Since I own an espresdo machine it's a wash, plus I can drink my latté in my BVD's.
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JLP
Social climber
The internet
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Jun 30, 2017 - 04:14pm PT
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Buy one that's going to appreciate in value and you can ignore most of this thread. You'll pay more up front, and get much more back later. Zillow is a great resource. Click on sales histories. Common mistake is to pay too much for a condo - they're the first to go upside down in a downturn, mostly because there is no land under them and they are traded among the clueless.
Make a spreadsheet, learn interest and payment calculations, make a plan and stick to it like a boss. You'll be ahead of all the brokers and agents you interact with, who probably all flunked math yet spew financial advice based on guesses and generic rules of thumb.
Don't fear the ARM, don't follow advise from the 80's concerning their risk, and don't abuse the extra buying power like everyone in the 2000's - they're the smart money imo, interest rate on your money is king, 30 yr fixed is for chumps.
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