Ramblings after a Weekend of HouseHunting

My wife and I spent the better part of this past weekend looking at houses in the Raleigh/Durham area. Unfortunately I quickly soured when I was looking at the opportunities available in the so-called housing crisis.

I guess I have been out of the loop in terms of the housing market, but I am frustrated by the lack of affordable housing options. I'll admit my standards are high, but this area has been known for its affordability (and supposedly still is), but my wife and I can't find what we are looking for in our price range (was $250k, we have since gone up to $300k). We have certainly seen plenty of houses we think would make a beautiful home, but none are close to what we think is the most we can afford to pay and still meet our retirement/financial goals.

Hopefully whatever patience we can muster will pay off. Prices are bound to start going down, but I think the market is slow to correct itself given homeowners don't want to admit they have lost significant value in their house (nor can they necessarily afford to).

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Comments (10)

2mill:

"Prices are bound to start going down, but I think the market is slow to correct itself given homeowners don't want to admit they have lost significant value in their house (nor can they necessarily afford to)."

ha ha! your networth shows your units also at the same value 10/07 to 10/08 :-). well, maybe your subdivision might be maintaining its value!

- s.b.

Posted by some body | November 17, 2008 11:39 AM

Would it be a better option to rent now? Or how about buying a smaller house and basically living below your means. This way you will have no worries about future spending/retirement plans. Is that something you guys have talked about?

Craig
www.budgetpulse.com

Posted by Craig | November 17, 2008 11:43 AM

sb - good point. I do think there is a big difference though - I have only listed our houses by cost basis and not by market value. My house value never went up while the market value went up. However, I am beginning to agree the market reality is grim. Its even hard for me to put a realistic value on our properties at this point. They are only worth what someone is willing to pay and that is probably not much right now.

Posted by 2million | November 17, 2008 2:43 PM

I would personally recommend to make a lowball offer on multiple house your interested in. even if they are $400~$450k and your willing to sell for $300, Chances are in this market you may get a seller that has had little or NO offers in the past year and would seriously consider selling just to get it over with. Some people have been waiting FOREVER to sell (One of my relatives is one of these desperate sellers.). Good luck!

Posted by Mr.ArfArf | November 17, 2008 3:43 PM

What are your requirements or what are you looking for? A big house for a family, an exclusive neighborhood? I don't know that area but I would think you could find something pretty nice in that price range. I 2nd the low balling higher priced homes, the worst that can happen is they say no.

Posted by Miss M | November 18, 2008 8:11 PM

I live in Cary, and in our neighborhood, houses are taking much longer to sell (up to 9 months). However, sellers are still getting close to the original listing price. So far it seems that people have been able to hold out for the price they want.

When we bought our house in late 2003, it was just before prices rapidly increased. We paid $240K, and within the next two years, all of the houses in our neighborhood were listing for over $300K, even the ones with only 3 BR (most have 4-5).

Good luck finding a $250K house that has the features you want--it was a tough move 5 years ago!

Posted by First Step | November 19, 2008 10:13 AM

I also live in Cary (an older neighborhood of $300k houses) and I have not noticed any housing crisis here. Houses that come up for sale are usually under contract within a few weeks. I would say that you can definitely find bargains in less-desirable areas of RDU. But if you want a nice home in a premium neighborhood, you are going to have to bite the bullet and pay for it - there aren't any discounts on what you're looking for. Best of luck.

Posted by dedra | November 19, 2008 12:59 PM

The nicer places here aren't affordable. Cary is off the charts, so is Chapel Hill. The former is for conservatives who are obsessed with good schools, the latter for liberals obsessed with good schools.

The good urban amenities are all in center city Durham, ITB Raleigh, and Chapel Hill/Carrboro. These are the only places in the Triangle I would live, but I'm a city mouse.

A lot of the second-tier suburbs are filling up with crappy tract housing. Drive out to Brier Creek in North Raleigh, or down around Beaver Creek Commons in APex, and you'll see some real garbage.

Johnston and Alamance Counties are ruled by hateful bigots. Try not to spend money in either backwater if you move here.

Morrisville is convenient to RTP and not as pricey, and is getting to be a better place. Maybe look there?

Posted by Anonymous | November 19, 2008 8:17 PM

I also live in Cary and have been watching the housing market for several years here. The area did not see a big boom in prices so most areas are also not seeing a big drop. You will wait forever if you think prices in the Triangle are going to drop significantly. Between the low interest rates we're looking at and the reasonable choices you can find in the 300k range, things look good.

There are plenty of 4/3 in Cary at 300 or under, what are you looking for?

Second on the lowball offer, there are some motivated sellers out here.

Posted by another RDU reader | December 4, 2008 10:50 AM

I just bought a house in the SF Bay Area after four months of house hunting. It took awhile to reset my expectations thinking everything was going to be heavily discounted. In reality houses in good cities with great schools and centrally located either only lost very little or held their value. The huge discounted homes are in places most people would prefer not to live. It seems the only way to get a deal is what another poster already said, find a home that's been sitting on the market a long time see how desperate they are.

Posted by Lev | December 12, 2008 1:07 PM