Real Estate Crash thread

[Self Jupiter]

Lots of older buyers want a larger, ‘’fun’’ property that they hope will draw extra visits from the kids and (especially) the grandkids.

[Hopeless Sinner]

Here’s what I’ve been trying to say what I think would be fair. You all might not agree and I may be called reprehensible. It’s not about prop 13 either. I’m using myself. I started working at age 16 so when I retire at 65, I will have paid in to Medicare and Social Security for 49 years. So far, those taxes have been a % of income with SS capping at a certain level because the benefits also cap in retirement. As long as I’ve earned, I have paid state and federal income tax. That will continue as long as I earn because I’m still receiving for which I can use as buying power. Depending on retirement savings and how I access them, I can be taxed on the withdrawals. That is okay because I may not have paid taxes on those earnings ever until withdrawal.

I bought my house at 23. I know things can change and I may move but my plan is to retire here. I will have paid property taxes on my primary and only house at 65 for 42 years. At 1.5% of value, with value increasing, the first 20 years of taxes have increased to 1100% of original.

I feel that if I’ve paid into my community for 42 years, I’ve probably paid my fair share especially if the upward trend of value of the home continues. I will have paid factors over what was paid for the property. Yes, is the property more valuable, sure. I stand by to access the value, you have to give the property away.

With the increase of people, I’ve seen the services my community provide go down. I wouldn’t expect to move to a new community and not pay property taxes because I’m old at over 65.

I’m not saying my benefactors should not pay the going rate for taxes when they inherit it. I’m not saying I shouldn’t pay a fair an increasing rate while I’m still able to work and earn an income. I’m not saying income generating properties shouldn’t pay market rate.

What I am saying is that telling someone that’s paid in for over 40 years at an inflating rate to either give away ownership of their home to stay or sell and leave because “they’re rich” with home equity is silly to me. Also silly to think that if there is even SS when I get to retirement, it won’t cover my property taxes to live in my own 1,600 sq ft home.

Maybe I’m reprehensible or maybe I don’t see how it’s my duty to increase supply because someone wants to live where I’ve carved out a modest life for myself.

/end rant

Your situation can be described in one word: gentrification. It's usually experienced by the poor in cities when all the nicer areas become unaffordable. It's also like many farmers existence where they are land rich, but cash poor. While obviously you're worried about paying property taxes w your retirement income since you have been diligent in saving you have options. And many of us have moved to areas that once had "low" property tax only to find them skyrocket over the last 30 years so you're not alone. I know it's little comfort but many people are forced out by property taxes after retirement.

[Skidog]

Doesn't anybody buy *down* any more when they get older? I see people all around me, my age, buying BIGGER houses... despite kids moving out.

I can't wait to GTFO of my 2K sq foot monstrosity and maybe think about something in the 850-1K sq ft range.

Went from 2600sq ft in Utah (4bd 3 bath) to 1300sq ft in NY. 3 bed 2 bath. Still have young kids in house....we didnt use half the space in the 2600.

[Conundrum]

Your situation can be described in one word: gentrification. It's usually experienced by the poor in cities when all the nicer areas become unaffordable. It's also like many farmers existence where they are land rich, but cash poor. While obviously you're worried about paying property taxes w your retirement income since you have been diligent in saving you have options. And many of us have moved to areas that once had "low" property tax only to find them skyrocket over the last 30 years so you're not alone. I know it's little comfort but many people are forced out by property taxes after retirement.

Oh, I get it. My recourse is continuing to vote and bitch on the internet. Also hoping for some type of Goonies plot line to develop so I can save my personal Boondocks. Rich stuff Mikey.

[Dantheman]

i think a very smart man once said. Golf Courses and Graveyards, biggest wastes of prime real estate. #caddyshack

Yep.

[Ted Striker]

I can't wait to GTFO of my 2K sq foot monstrosity and maybe think about something in the 850-1K sq ft range.

lol at 2000 characterized as a monstrosity. This is a monstrosity:
https://www.redfin.com/WA/Bellingham.../home/44610143

It's owned by friends of friends. Can't remember whether they're empty nesters or dinks, but it's just the two of them.

[Toadman]

Fortunately, that guy is not representative, but PERS costs are definitely going to bankrupt the state unless we come up with some brilliant solution. Kind of amazing that the state agreed to the old, rich PERS plans; I'm sure they did the math, saw they would be unsustainable, and kicked the can down the road "They can worry about that in 40 years." And here we are, worrying about it. Maybe we should start mining bitcoin using cheap BPA electricity.

But it's these outliers that get all the attention, and those state taxpayers who pay for these pensions focus just on the top and will say, "hell no" to an increases. Isn't that sort of what happened in WI about 10 years ago?

[altasnob]

Conundrum, since you don't have any kids, and refuse to cash out on your home as the value skyrockets, who gets the million dollar proceeds when you die? That is the person who will really benefit from your life choices.

This ties into my general complaint with capping property taxes. Either the person eventually sells and makes out like a bandit, taking their loot to other cheaper locations (and driving up real estate prices there). Or the person stubbornly refuses to sell, dies, and their heirs take the loot to a cheaper location (and driving up real estate prices there).

[nickwm21]

Lots of older buyers want a larger, ‘’fun’’ property that they hope will draw extra visits from the kids and (especially) the grandkids.

They say the next big housing crisis is when all these boomers die off and nobody wants their $2mil 4000sf McMansion in the retiregolf community in bumfuck Phoenix cause it’s 110F year around


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[sirbumpsalot]

lol at 2000 characterized as a monstrosity. This is a monstrosity:
https://www.redfin.com/WA/Bellingham.../home/44610143

It's walking distance from my tiny house, and owned by friends of friends. Can't remember whether they're empty nesters or dinks, but it's just the two of them.

Not at all...sweet house and view. However....no thanks to the multiple trains that will pass by your deck every day.

[skaredshtles]

Lots of older buyers want a larger, ‘’fun’’ property that they hope will draw extra visits from the kids and (especially) the grandkids.

Seems like it would be *way* smarter to simply rent a *really* fun property on the occasion of kids/grandkids visiting... shit - the lower cost of ownership of the small permanent residence ought to pay for a LOT of visits like this.

[skaredshtles]

lol at 2000 characterized as a monstrosity. This is a monstrosity:
https://www.redfin.com/WA/Bellingham.../home/44610143

No argument from me. My "monstrosity" comment was a bit tongue-in-cheek, but for two people (when we finally get rid of the 3rd kid) 2K sq ft is really HUGE overkill.

[Conundrum]

Conundrum, since you don't have any kids, and refuse to cash out on your home as the value skyrockets, who gets the million dollar proceeds when you die? That is the person who will really benefit from your life choices.

This ties into my general complaint with capping property taxes. Either the person eventually sells and makes out like a bandit, taking their loot to other cheaper locations (and driving up real estate prices there). Or the person stubbornly refuses to sell, dies, and their heirs take the loot to a cheaper location (and driving up real estate prices there).

So you didn't read the part where I said I would be fine not capping taxes until I turned 65 and then turning them off, I sign the deed over to the city/county and they get the house when I die? I just want to live in my home without having to move. I'd prefer not to reverse mortgage as there's no guarantee I don't outlive the terms. Maybe I don't understand them well enough and it's a real option. Just seems slimey somehow.

I realize I'm in a unique situation. And really, it will get so busy around here we'll leave anyway. The problem with that is, there's no real way to cash out and live anywhere we'd like to. I realize I'm looking at real first world problems here. Maybe the market tanks someday and all will be well. Or I go with my Goonies idea.

[XXX-er]

IME for 1 person only 1000 sq ft is enough, and the suite is money

[Dantheman]

Seems like it would be *way* smarter to simply rent a *really* fun property on the occasion of kids/grandkids visiting... shit - the lower cost of ownership of the small permanent residence ought to pay for a LOT of visits like this.

My in-laws sold their paid-off house in the SLC 'burbs (which is now worth more than double what they sold it for in 2006) and built a ridiculous new 6,000 sf home an hour away using the exact logic SJ describes. Predictably, 1) none of the kids wanted to make the drive nearly as often as they thought; and 2) the house cost way more to build than they estimated. They spent a decade being house-poor and both working full-time jobs that required commuting to the city every day. They finally sold the house and now overpay to rent a place they don't like. It was brutal to watch.

[Toadman]

They say the next big housing crisis is when all these boomers die off and nobody wants their $2mil 4000sf McMansion in the retiregolf community in bumfuck Phoenix cause it’s 110F year around


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Not to mention it will be 121+F in July and August, and there will be no water for the golf courses, let alone the millions of people living there.

[Ted Striker]

Not at all...sweet house and view. However....no thanks to the multiple trains that will pass by your deck every day.

Yeah, the trains are a huge thing is this town. Every house in that drone shot shakes when they roll by (I know, I used to live in one of them). And that can be twenty times per day/night. And between midnight and 8 am, they blow their horns pretty much constantly within city limits.

[Self Jupiter]

Seems like it would be *way* smarter to simply rent a *really* fun property on the occasion of kids/grandkids visiting... shit - the lower cost of ownership of the small permanent residence ought to pay for a LOT of visits like this.

So you’re saying the housing market ought to be driven by logic?

[Ted Striker]

No argument from me. My "monstrosity" comment was a bit tongue-in-cheek, but for two people (when we finally get rid of the 3rd kid) 2K sq ft is really HUGE overkill.

My monstrosity was tongue in cheek as well, but I see 2K as kinda the sweet spot (and we're dinks). We did a decade in 1100 sq ft one bath, and the only way I'm going back to that is divorce.

[nickwm21]

It really depends if you are vacuuming it yourself or paying someone...


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[Deebased]

I don't think you are reprehensible, but perhaps a but selfish

As our population increases, so does the cost to flush the toilet, turn on the tap, provide hospitals, schools, policing, pavement, etc. And I may be misinformed, but economics of scale are not simple between those increasing costs and population increases - it becomes increasingly expensive per person for those services as the pop increases. You are still using those services, no?

The wage you received when you were 20 something bought you a lot more than the average wage that those 20 somethings get now, so trying to incease the tax burden on the younger population is a self defeating proposition unless wage power returns to the middle and lower classes.

Finally, I still find this notion of retirement from the last 100yrs or so to be silly. It has never existed in the past, and is unsustainable going into the future. Don't agree? Then your argument that SS will not be there for you is moot IMO, can't have it both ways.

Sorry, but everyone needs to contribute. Age, and withdrawal from the regular workforce of the middle classes has nothing to do with it. Not saying your property tax is too high - no idea the costs your community faces, but everyone who has a connection to the system, and can reasonably contribute to the cost, should pay up.

You should be calling Glademaster selfish.

He's a direct beneficiary of public pension systems, in effect another "I've got mine so fuck you" who thinks everyone else should subsidize his choice of careers and standard of living.

[MontuckyFried]

Seems like it would be *way* smarter to simply rent a *really* fun property on the occasion of kids/grandkids visiting... shit - the lower cost of ownership of the small permanent residence ought to pay for a LOT of visits like this.

THANK YOU! I've had the same argument with my wife before about future housing. She said we should get a house someday with an additional bedroom for guests. I said with the money we'll save by staying put with our 3 bedroom home, we can pay for a shit ton of hotel/vacation rental stays. SCIENCE!!!

[Toadman]

Lots of older buyers want a larger, ‘’fun’’ property that they hope will draw extra visits from the kids and (especially) the grandkids.

Yep, I have heard and seen this from multiple retired grandparents. They end up buying a 4 brdrm house, so that when their children come with the grandkids they have room for everyone. I lived across the street from a couple that spends their summers here in Bend, and the grandkids come out for at least a month during the summer. They have all the outdoor toys (bikes, kayaks, floaties for the Deschutes River) that they store in the 3 car garage next to the fully loaded Tahoe, which is next to the Audi Q7.

[Deebased]

1100 square feet is about perfect for a master suite.

[sirbumpsalot]

Yeah, the trains are a huge thing is this town. Every house in that drone shot shakes when they roll by (I know, I used to live in one of them). And that can be twenty times per day/night. And between midnight and 8 am, they blow their horns pretty much constantly within city limits.

LOL....seems Edgemore is about the only place to escape that unless maybe you live along the cliff edge. I've never really heard the train in that area...but I'll admit I didn't purposely hang around waiting for a train to pass and note it.