Zillow Advice: Home Buying - Would this be a good time to buy land?

Regarding your question about ...

Thu, 05 Feb 2009 00:48:00 GMT

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.

By the way, I knew there ...

Wed, 04 Feb 2009 21:00:00 GMT

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).

Also, don't forget what it ...

Wed, 04 Feb 2009 20:47:00 GMT

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.

You have already posted that ...

Wed, 04 Feb 2009 20:36:00 GMT

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?

Once again you continue to ...

Wed, 04 Feb 2009 16:07:00 GMT

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.

Arlington had a 54% rise ...

Wed, 04 Feb 2009 10:45:00 GMT

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.

Clearer copy of image:Arlington ...

Wed, 04 Feb 2009 10:38:00 GMT

Clearer copy of image:
Arlington 10-yr trend graph

As you are aware, there is ...

Wed, 04 Feb 2009 10:33:00 GMT

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.

Zillow indicates 13 empty ...

Wed, 04 Feb 2009 09:48:00 GMT

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

By the way, I've been in ...

Wed, 04 Feb 2009 09:20:00 GMT

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.