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Would this be a good time to buy land?

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vanswey

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Seeing housing prices are low i assume that is the same with land.  If I'm planning on building with the year or two years would it be wise to purchase the land now?
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February 03 - Wenatchee
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Pasadenan

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Regarding your question about the comparision of the pricing trends for Pasadena verses Compton; the shape of the bubble curves is quite similar, but the magnitude  is different.  But as we were only discussing the shape of the curve, it is a reasonable comparision.  So maybe about $100k loss in imaginary equity in a year on average.

Pasadena 10-year:


Compton 10year:


Pasadena 1-year:


Compton 1-year:


Remember, affects of economic downturns and lending issues is regional, not just local.  What happens in one city does affect its neighbors.

Even San Marino has been dropping since June of 2008.

Since you have more specific data for the trends in your area, don't ignore it.
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February 04
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Pasadenan

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By the way, I knew there were at least 10 times the number of empty lots that Zillow indicates for sale in your area.   Zillow has no county record data for empty lots, and thus typically does not show them.  The only empty lots Zillow indicates is those that Realtors specifically post for sale on Zillow.  And since Zillow is not the best advertising media, especially for empty lots, only a small percentage of those types of properties would show up on Zillow.

Apparently you missed my point.  There will be plenty of empty lots for sale in 2 years, and at lower than present prices.  They are not going anywhere, and prices continue to drop.  Typically no one lives on empty lots, and there is little income potential for them.

(Yes, there was a realtor in Seattle posting that prices weren't dropping in his area a little over a year ago. He changed his tune about March last year, stopped posting to the discussions, and changed his profile to reflect that he understood the impact of the distressed properties).
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February 04
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Pasadenan

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Also, don't forget what it means for a local market to be "flooded" with properties for sale.  That means the market is already saturated, which can only drive prices down further.  7% of ownership units on the market at any given time is "normal"  More than that means prices will drop.

And 2% of properties on the market being "foreclosures" is normal; but when it gets above 10%, the market is saturated with distressed properties that have to be liquidated, thus the prices will fall.

Perhaps you have a substantual amount of construction experience and think you can build for less, and can get exactly what you want?

I have a neighbor down the street that thought that, has been building for over 8 years, and his wife left him several years ago with the child because they just couldn't put up with living in a construction zone anymore, not to mention, his time was all taken up with work and the construction project; never any time for the family.

No, I don't know you, and I know you have a long time dream to build your dream house; I'm just stating there are some factors you need to look at, especially timing, and that it doesn't hurt to listen to close friends and family.
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February 04
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Pasadenan

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You have already posted that your property is declining in value 11% annual.

Find ANY indication that the decline has stopped.  Even if it looks like it may have, the national jobs market, national real estate market, and national mortgage market will still have an impact.

Your location is not in "issolation".  But you can believe it if you want.

I certainly don't have any objection to you refinancing your existing house to take an additional $100k out to buy an empty lot that will sit empty for 3 years, and that you will have to take another loan out to build on.  How you choose to spend your money and time is really your business.

But if the projections are correct, your home will be worth approximately the loan amount by that time.  There is absolutely nothing the government can do to prevent the continued drop in housing prices, short of devaluing the dollar to put the values back in line with the normal inflation curve.

Tell you what; since you don't believe anything I post, why don't you just go ahead and buy that $100k lot with some of the equity you have in your house and test the results to see where that will put you in 5 years?
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February 04
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vanswey

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Once again you continue to talk about things you don't know.  Arlington is over 130 miles located just off of I-5 and its mostly in a flood zone.  But thanks for the insight.  I was looking up housing prices in Pasadena and couldn't find any info so I checked Crenshaw and found some interesting things. Same thing, isn't it?  Zillow by the way has now idea how many lots are for sale in my area, there is at least 10 times as many lots for sale.  I think its a cool that you are a "professional" but are too afraid to advertise your business on here.  Obviously if people saw your comments you would lose quite a bit of business, if you have any at all.  Don't worry, I would be embarrassed too.

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February 04
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Pasadenan

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Arlington had a 54% rise in "sold" prices from January 2004 to the market peak in June 2007.  (3.5 years).  The market is still on the way down from the peak.
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February 04
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Pasadenan

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Clearer copy of image:
Arlington 10-yr trend graph
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February 04
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Pasadenan

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As you are aware, there is little county data available on this website for Wenatchee, Chelan, Douglas, Grant...

So, going a bit west - Arlington:
The 10 year Zindex trend for Arlington and Snohomish:

As you can see, the area "bubbled" as did most of the nation, and it is dropping quickly as the bubble deflates.  $10k drop just in the past month; approximately 3.5% drop in a month.  The rate of decline appears to be getting steeper.  The market peak was about June 2007.

From the county tax assessor information, the lot is about 28% of the value of a typical residential property.
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February 04
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Pasadenan

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Zillow indicates 13 empty residential lots for sale in the Chelan County area, priced between $39.9k and $3.5 million, so I guess you better hurry up and buy before more foreclosures hit the market.

Chelan County Lots
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February 04
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Pasadenan

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By the way, I've been in the building profession for almost 30 years; I just don't choose to advertise my license here, so yes, I am a "professional" according to state and federal definitions and according to Zillow guidelines, and I do cost estimates and cost projections as part of my work.
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February 04
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vanswey

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Wow, you know a lot about candy bars.  Although impressive, it's not very useful on a real estate website.  If your looking for trends then in my question you will not find it.  I mean it is freaky how much you know about the increase of 22.5 oz fun size candy bars.  Anyhow, please don't write on my threads anymore.  It just takes more time sifting throw your useless comments.  Perhaps, you should spend more time tracking candy trends at Wal-Mart.  Is there a website for that?
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February 03
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Pasadenan

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I remember when gas was 24 cents a gallon; I have not personally seen gas at 5 cents a gallon.

I remember when hambergers at McDonnalds were 10 cents each; that was mid 1980's.

I remember when fun size candybars were 10 cents each; that was only 1.5 years ago; now I can't find them for less than 12.5 cents each; even WalMart raised the price of the 22.5 oz bag 25% this month.

But we are not talking about the intentional devaluation of the dollar; you asked about property costs; and they are sinking like a rock, even in your area.  Ok, 11% this past year; same as Santa Monica; but Santa Monica Z-index trend is dropping $30k per month; which will eat up a $200k down payment in 7 months.

Sure, you should believe the "professionals" and throw your money away; they need the 6% commission.

Look at AZRob's posts; he has a very high accuracy rate on his predictions on this website.  The other realtors have other interests.

I only come to this website to look for the trends.  I really don't care if you are upsidedown and in foreclosure in 3 years or not.

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February 03
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vanswey

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Actually, locally our home values have gone down 11% in the last year and the market is flooded with homes for sale.  In regards with housing prices 7 years ago, locally its gone up 32% not 70% as you stated.  But it has gone up about 400% in the last 75 years and almost 1000% since the founding of the state!!  Remember when gas was a nickel a gallon??  I don't, but apparently it happened. So when housing prices are below what they were two years ago, I call it a decline.  I would like professionals to answer my questions Pasadenan, but thanks for the comments.
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February 03
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Pasadenan

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Not in most areas; the land values "bubbled" more than the structure values, and they are dropping faster, and have at least 18 months more to decline in most areas.  Some will continue to decline for the next 5 years due to the decrease in working age population and stricter imigration enforcement.

And with the "stimulous" package, contractors that may not be able to find work this year may be busy with government projects at "prevailing wage" by the time you want to build, so no discount for your project.

Housing prices "low"?   How can you consider it "low" when they are 70% above what they were 7 years ago?  Did you get a 70% raise in income in that time frame?




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February 03
 

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