patrick.net

Techie, sounds like you've got it figured. Unless you're desperate to sell, then it's another story.

Unfortunately, being a woman is kinda like eating out in a restaurant. I order what I want, but always wish I'd ordered what someone else is eating 'cause it looks great too. Right now there are houses that are $40k less than mine that are better in some way, and I'm stuck with the house on my plate. On the other hand, my house suits me just fine.

:) we're fickle, but ya'll love us anyway.

Surely you can refinance to a lower rate to 'ease' the house poor situation? It may require throwing some extra cash at it to decrease the LTV, but that would let you lower the payments, and if you split the difference (Payments drop by 300, but you pay an extra 100-150 to get mortgage retired faster) you can come out ahead on the payoff date, too.

Just a thought.

Since late 2007 I've paid $60,000 in rent. Why should you be wanting to "break even" on this deal?

Troy says

Since late 2007 I’ve paid $60,000 in rent. Why should you be wanting to “break even” on this deal?

Why not? My ex used to say, "Just knowing that I can is awesome."

You have a 340k mortgage and the house worth 340k to 350k.
And you wish to sell it for 385k.

Solution: Wait for 2 to 5 years, then sell it.
By that time, you will feel like "break even".

sfbubblebuyer says

Surely you can refinance to a lower rate to ‘ease’ the house poor situation? ...

Went this route about 24 months ago, costs dropped about $150 a month, it would have dropped more, but since the equity in the house dropped from 15% to 10% from the housing market drop, the PMI costs are higher. I'm at 4.99% now, and I doubt the house would appraise high enough to have even 5% equity now. I doubt the bank would refinance it, and 1/2 percentage isn't worth it. The Higher PMI fees would eat up all if not more of any savings. In 36 months the PMI is scheduled to expire and I'll have another $250 reduction in expenses.

I got a call this morning, they countered at 360k.

Even overpaying, if I had a house on 2 1/2 acres with geothermal in place, I would stay there as long as employment was available. Tell your wife to suck it up, and try and find cheap ways to give her nice surprises like flowers or a weekend away to take the sting out of being house poor.

We're house poor, and just became second child poor. Ugh!

TechG, guys like you who has HH income over 100K should be able to handle 400K home w/o too much hassle. The main problem is not the house, but the credit card debt you guys got there. Selling the house can be a solution to that problem? I can hardly think so. Let's say, you sold it at 380K. How much do you think you got in your hand after subtracting realtor fee, credit toward buyer, other expenses and taking care of 340K mortgage? Almost zero, isn't it? You may save few hundreds to a thousand by downsizing/rent though, what will you do w/ it when you have card balance to take care of and the wife doesn't want to feel like a poor? You already knew all of this, and it will be a tough thing to do.

I think the real problem is the wife. I'm not sure what you can do about that though.

zzyzzx says

I think the real problem is the wife. I’m not sure what you can do about that though.

yeah and it's about this point that they tell you they're pregnant.

Katy Perry says

The va Jay Jay gets what the va Jay Jay wants,…… or no va Jay Jay! ha ha ha!

"That's no Va Jay Jay, that's his wife"

zzyzzx says

I think the real problem is the wife. I’m not sure what you can do about that though.

Oh, you offering any "services" to help me with that. :)

zzyzzx says

I think the real problem is the wife. I’m not sure what you can do about that though.

A box of chocolates, flowers, bottle of bubbly and suprise vacation to the Bahamas should appease the little lady for a while. Certainly saves one the headache!

Yeah, you gotta deduct your non-renting payments to figure what "break even" really is. you know americans are supposed to have to pay every month to live somwhere don't you! Sounds like you like your house and are also a person who doesn't like change. did you calculate the cost to move all your junk? The loss of time. Moving is expensive!

The FED is walking the line on pinting money for their owners but not driving very high inflation. That's their optimal strategy. Makes their owners ever more wealthy and keeps the system from being replaced by a competitor. So, you probably will not have hyper-inflation nor financial collapse to scare you to sell. The future will probably look a lot like the last four years. Ever lowering prices and job prospects. Higher costs of living. Hard to plan for something like that!

5% equity is fairly sweet. But you can probably beat that rate with a 5% equity even on a new buy today. Not sure. Worth checking out before you sell. Also, lots of costs to buying which I'm sure you have calculated too. Plus new stuff for the new house!

TechG, so what's goin'on there after new offer?

As maxweber pointed out, moving is a bitch. Movers alway break a thing or two while handling stiffs. You don't want to spend on new stuffs since you're downsizing. To me, moving is a perfect excuse for new stuffs. My wife told me that she will buy new furnitures and appliances when we buy a house. I won't stop her doing that because I am tired of our old junks too. That will be another 20K added on our unofficial closing cost. As a man we are, we're naturally not counting those things, but ladies will do that for us. Just openning the wallet will do the trick.

Since you bought the home at peak years, and things don't look good in your area, I don't think moving is such an appealing idea. There maybe a reason that I don't know... so can you tell us what's your monthly financial situation will look like when you downsizing? Is there any other idea on you to cut your debt? Of course, you don't have to tell if you don't feel like to.

Tech, I feel your pain. My wife, even though she did the math and knew that it wasn't worth it, still insisted upon looking at houses for 3 straight years. Fortunately, cooler heads prevailed and she never made that bad decision. Instead, she simply subjected herself to 3 years of frustration waiting for prices to drop to something reasonable. It truly is a woman thing. They really are the driving force behind any push for home ownership.

seaside says

TechG, so what’s goin’on there after new offer?

We refused to go any lower then 385k and they refused to go that high, so Game Over.

Glad that you're not desperate. Lots of people are.

At the height of the bubble I had a house worth about $325k, now it's in the $185k range. I still have tons o' equity and the payment is low. So what the hell. My little country house ain't fancy, and I certainly don't feel guilty when there's a bit of peeling paint or the hole in the siding where a billy goat butted through - back of the garage - fits right in. It's not trashy, but it certainly wouldn't pass HOA muster.

But driving past the houses in town (I'm rural) on 1/4 acre or less that are 20 years younger than mine... with style and professional landscaping... sometimes a girl can dream.

TechG, you will get better off when better times come. I hope you and you wife together, keep things under control.

I bought the same time as you Tech. My wife understands, she just doesn't give a damn. It comes down to the kid, and where she wants the kid to go to school. That's pretty much the end of story. She has admitted that I was right and that she's going to have to work YEARS LONGER to make up for the hole her ego's need to consume the world for the excuse of a child but how can that be wrong?

Of course we moved to this town because of a gaggle of chatty cathys. "OH, THIS IS THE BEST PLACE!" 2 out of 4 of her friends are now divoced and have lost/sold their precious houses. A third is divorced but was lucky enough to blackmail her husband to stay for 3 years. Time's almost up, and she's just about to lose it. Their children will soon have to share desks with the sodomites.

Its almost been worth it.

knewbetter says

It comes down to the kid

http://www.youtube.com/watch?v=Ubsd-tWYmZw

I'm not quite that fat, but probably that stupid. Plus my wife is a lot hotter than her, so I've got an excuse.

The kids are incidental. Just another tool in the toolbox to rationalize what they WANT and not what's good for the family. No debt is good for the family. Savings are good for the family.

Thank you for your post. It helps ground me in all the reasons we rent. Sometimes I get tempted looking at houses. I really need to stay away from the ledge on that. I just got my emergency fund really filled out. I don't need to be making us house poor. It is a good reminder when I get a little tempted.

Hope you and your wife either find comfort in your home or get a great offer.

I listed my Palm Springs house, which I bought as a foreclosure in '08, in August of this year. I paid $850K. Put $400K and lots of sweat labor into it. I bought in the best area. Huge mid~century modern. Noted architect. Done to the tits, but done both on a budget and with the thought of possibly reselling (translation: I didn't make it TOO personal). I listed @ $2.5M and I have a an all cash buyer. Contingency period is over and due to close in next few weeks. I've enjoyed living in it for a while. I didn't list until the 2 year period had passed. I listed it according to SOLD comps. Not 'listing' prices. Will be making a nice profit. Now I have my Beverly Hills house and my San Diego places I bought and fixed up. Will move into one or the other for a while before I list those.

Could still fall out of escrow, of course. Anything is possible. But NO LOAN CONTINGENCY. Still, the house appraised at sale price. If buyer backs out now I keep the earnest money deposit.

I'm still waiting for SF prices to come down. But I'm beginning to lose hope. Too many people want to live there and prices have just not dropped enough to make sense to buy. But I'm patient and I have all cash to buy.

I'll head to South America for a few months to wait and watch how the economy fares in the next few months. I'm due for a nice long vacation.

Renting was good for me for the years between '05 and '08. I sold all my real~estate by the end of '05. I missed the peak by a year or so, but I got too spooked by the bubble prices and could not believe that people were still paying as much as they were. I lost money in the stock~market crash, but have since recovered a lot of my losses there. Still, I'm not too optimistic about the markets and the US economy. Unlike Patrick, I find 0bama to be bad for business and bad for real~estate. I would have preferred to have had the market find its bottom without much meddling. But, the economy is what it is. Not much you can do about it, but watch it and either take a risk or step aside and just keep renting. Los Angeles will continue to drop, I think, but I bought a killer property at a distressed price and am currently restoring it and enlarging it.

This site has been great for those of us who saw the bubble coming as far back as '03. There are lots of places where money can be made, but you have to have cash. And you have to be careful with what you do. No place in the market for first time 'do it your~selfers'.

Good luck to all of you. I know your hearts are in the right place. We may not agree with policy issues, I'm quite conservative, but I want this country to go forward and succeed. I assume most of you do, too. We will have a bumpy road ahead. That is for sure. But money can be made in all sorts of markets. You just have to study it and make it your 'raison d'etre'.

God speed.

cab says

elliemae says

Techie, sounds like you’ve got it figured. Unless you’re desperate to sell, then it’s another story.

Unfortunately, being a woman is kinda like eating out in a restaurant. I order what I want, but always wish I’d ordered what someone else is eating ’cause it looks great too. Right now there are houses that are $40k less than mine that are better in some way, and I’m stuck with the house on my plate. On the other hand, my house suits me just fine.

we’re fickle, but ya’ll love us anyway.

Ellie Mae, I thought you had more of a head on your shoulders than to play into classic untrue chauvinist blanket statements like this person is making, not to mention his saying that he should push his wife in front of a bus and kill her. Women, unbeknownst to him, are just people. Some are smarter than others and some are more educated than others and some make better decisions than others. I guess his wife certainly can’t be too smart after all, because she married him. I can only pity her, in 2010 being together with someone with disgusting attitudes like his. She should dump him and let him have his stupid house. Maybe his white floors will stay cleaner with only one person walking on them.

i can tell you're a woman.

am i a chauvinist for figuring this out?

cab says

Evidently you don’t think there’s anything abnormal about this guy saying he’d like to murder his wife

show me the evidence where i said any such thing.

oh that's right, there is none.

Well the good news is I finally found a use for this fancy Ignore button. Thanks.

1993 called. It wants its rabid "gender-studies" diploma back.

Wow, and I thought these cretins were extinct already.

I fancy myself a feminist - you know, the kind that believes that a woman can often perform a job that in the past would be considered a man's job.

That being said, the feminazi equal of rayray is just as funny as the original.

cab says

I’m a person. A person who believes it’s stupid to lump people together into stereotypes.

cab says

You’re an IDIOT...your stupid attitude obviously has something to do with your low intelligence and your chauvinistic attitude toward women... two dumb peas in a pod...Friggin’ IDIOT...his wife certainly can’t be too smart...Vapis Bevery Hills girl...This guy is a Cretin...

Glad to know that you don't play into sterotypes.

elliemae says

cab says

I’m a person. A person who believes it’s stupid to lump people together into stereotypes.

cab says

You’re an IDIOT…your stupid attitude obviously has something to do with your low intelligence and your chauvinistic attitude toward women… two dumb peas in a pod…Friggin’ IDIOT…his wife certainly can’t be too smart…Vapis Bevery Hills girl…This guy is a Cretin…

Glad to know that you don’t play into sterotypes.

Cab, meet petard.

Nice work, Elliemae. If we were both single, nothing much would come out of it, but I would offer to buy you a coffee anyway.

you wouldn't buy me & your wife coffee now? I hear tell that there's a coffee house on every corner in Calif.

this is easy - YOUR HOUSE IS WORTH WHAT SOMEONE WILL PAY YOU FOR IT......NOT...WHAT YOU THINK IT IS WORTH...!

709hannah says

this is easy - YOUR HOUSE IS WORTH WHAT SOMEONE WILL PAY YOU FOR IT……NOT…WHAT YOU THINK IT IS WORTH…!

So if you have no buyers and someone walks up and offers you 1 dollar, that is the value of your house? I'll buy your house for a dollar if you want to sell it.

709hannah says

this is easy - YOUR HOUSE IS WORTH WHAT SOMEONE WILL PAY YOU FOR IT……NOT…WHAT YOU THINK IT IS WORTH…!

So, Techie... why do you have so many women pissed off at you? (two and counting...)

@techgromit

"So if you have no buyers and someone walks up and offers you 1 dollar, that is the value of your house? I’ll buy your house for a dollar if you want to sell it."

if you have no buyers..and you have to sell...what do you suggest someone do...? jesus man your logic is so %^#$%@$....!

if your house is for sale..it will sell for what someone is willing to pay....people 'sell' their homes for zero dollars all the time...its called having to move with no sellers so you just walk away and the bank takes it back...put a price on that....aaahhh..how about $00.00.

"I’ll buy your house for a dollar if you want to sell it."...jesus we are so doomed in this country with dimwit strawman logic like this.....what is a house worth..well if it is listed for $100k and you get no offers and you relist it for $90k and still no offers and relist for $80k and on and on...what do you think the house is worth...?

you tell me .....'We refused to go any lower then 385k and they refused to go that high, so Game Over.'

gromit...so your house isnt for sale. what its worth is now irrelevent as it isnt for sale for less than 385k. your neighbor next door lost his job and cant make the mortgage on his house that is exactly like yours....is his house worth 385k. if he doesnt get an offer above $385k but gets one for $380k...he either accepts that as the price or sells it for zero to the bank when they foreclose.....get real.

Hannah:

just curious - why are you so angry? He believes that his house is worth more than the current offer. He can hold out for another offer or pull it off the market. It's his deal, and you seem pissed.

elliemae says

So, Techie… why do you have so many women pissed off at you? (two and counting…)

I'm just getting warmed up.

709hannah says

gromit…so your house isnt for sale. what its worth is now irrelevent as it isnt for sale for less than 385k. your neighbor next door lost his job and cant make the mortgage on his house that is exactly like yours….is his house worth 385k. if he doesnt get an offer above $385k but gets one for $380k…he either accepts that as the price or sells it for zero to the bank when they foreclose…..get real.

Sorry to disappoint you, but there are no houses "exactly like mine" anywhere near by. The closest house down the street is for on the market for 500k. I don't live in a development where there are 20 houses on the block with block after block of all 3 or 4 different model houses on 80x100 lots. I live in a area where the property sizes range from 2 to 10 acres. There are plenty of clone ville house developments in the township, but I'm no where near them.

In my township, there are generally three types of houses. There are developments where everyone has small properties with only a few models or houses repeated over and over for 250k to 350k. There are older houses (1950's to 1970's) on larger lots for 250k to 300k and there are mansions on larger lots that run 600k to well over a million. A newer house on a decent sized lot is a endangered species, they exist, but tough to find. That's what I have.

Incidentally, the buyers came back with 370k and 375k and we turned them down both times. Selling a house is kinda like playing poker, it depends on what cards your holding and how well you can bluff. If your in pre-foreclosure and the bank is knocking at your door, you have lousy cards (and you can't bluff cause troubled mortgages are public knowledge), if you don't have to sell and want your price, you can afford to turn down all offers that don't meet your price. No need to get mad at us because we can afford not accept the less then what we want.

elliemae says

Hannah:
just curious - why are you so angry? He believes that his house is worth more than the current offer. He can hold out for another offer or pull it off the market. It’s his deal, and you seem pissed.

That's pretty much my point. After receiving the 375k offer we gave it serious consideration, but after looking at what was available in our price range we remembered why we purchased this house in the first place. Everything available is either in a cookie cutter development with no property or an old house that needs work on a larger property. We did see some houses we loved in some executive developments (mansions), but they are in 600k+ range, we were hoping to cut our mortgage by 100k.

Happy Thanksgiving Techie, and to everyone!