Market Conditions: September Sales at 12 Year Lows But Median Price Rises 1.4%
In September, home sales fell again as rates rose. It was the lowest number of sales since 2011.
From the Illinois Association of Realtors:
The city of Chicago saw a 11.3 percent year-over-year home sales decrease in September 2023 with 1,830 sales, down from 2,064 in September 2022.
The median price of a home in the city of Chicago in September 2023 was $324,450, up 1.4 percent compared to September 2022 when it was $320,000.
September sales for the last 17 years:
- 2007: 2172 sales
- 2008: 1816 sales
- 2009: 1918 sales
- 2010: 1403 sales
- 2011: 1498 sales
- 2012: 1845 sales
- 2013: 2395 sales
- 2014: 2242 sales
- 2015: 2414 sales
- 2016: 2398 sales
- 2017: 2355 sales
- 2018: 2040 sales
- 2019: 2006 sales
- 2020: 2635 sales
- 2021: 2684 sales
- 2022: 2064 sales
- 2023: 1830 sales
Median prices for the last 17 years:
- 2007: $267,750
- 2008: $268,600
- 2009: $225,000
- 2010: $180,000
- 2011: $190,000
- 2012: $188,900
- 2013: $230,000
- 2014: $249,000
- 2015: $250,000
- 2016: $260,000
- 2017: $275,000
- 2018: $285,000
- 2019: $292,250
- 2020: $322,350
- 2021: $320,000
- 2022: $320,000
- 2023: $324,450
“In September, closed sales decreased while days on market remained consistent. The combination of these points shows there is still buyer demand in the market,” said Drussy Hernandez, president of the Chicago Association of REALTORS® and vice president of brokerage services for Coldwell Banker Realty in Chicago.
Both single family homes and condo sales fell double digits. Single family home sales fell 12.8% to 703 while condos declined 10.4% to 1127.
Statewide, inventory plunged again, falling 28.5% to 21,256 from 29,717. For comparison purposes, inventory was 33,676 in September 2021. Average days on the market was 24 days, down from 26 last year.
Chicago inventory also fell 27.9% to 5885 from 8163 last year. For comparison, it was 9478 properties in September 2021. Average days on the market was 30 days, which was the same as last year.
“Prices continued their usual seasonal decline from their peak in June for both Illinois and the Chicago area,” said Dr. Daniel McMillen, professor of real estate and associate dean for faculty affairs at the University of Illinois Chicago College of Business Administration.
“However, they remain much higher than at this time last year. Our forecasts indicate that prices will continue to decline somewhat over the next three months, while remaining higher than at this time last year. The number of sales remains low and is forecast to decline further over the next three months.”
The average 30-year fixed rate mortgage was 7.2% up from 7.07% in August. It was 6.11% in September 2022 and just 2.9% 2 years ago, in September 2021.
The story in Chicago remains the same. Sales are down big again but median price is holding near the highs.
Inventory remains near record low.
Will sales eventually hit the 2010 and 2011 lows over the next several months as those mortgage rates hit 8% or has the sales bottom already been put in?
Illinois home inventory and sales fell in September [Illinois Association of Realtors, Press Release, by Bill Kozar, October 19, 2023]
I guess mUH dEmOGRaPhiCs has been swept into the dustbin of history
Is the market still HAWT(tm)?
Move up properties are f’d
Realtors care about sales but as a homeowner all I care about are prices and the Case Shiller index is still going up YOY with Chicago at the top of the rankings.
Chicago currently leading in price appreciation, but was next to last in appreciation between 2016 – 2021 of 20 cities according to Crains.
https://www.chicagobusiness.com/residential-real-estate/chicago-still-has-fastest-growing-home-prices-us?utm_source=breaking-news&utm_medium=email&utm_campaign=20231031&utm_content=article1-headline
“Nationwide, home prices were up 2.6% in August, or roughly half the increase in Chicago.
Chicago running at the head of the pack is significant because there was a long stretch in recent memory when it consistently brought up the rear. Between September 2016 and September 2021, Chicago’s home price growth was last or second-to-last among the 20 cities in 43 monthly reports, and in most of the remainder, it was not higher than 17th of 20.”
Where are you getting your average mortgage rates for September 2023 being 7.2%?? Are you taking the shilled data from the NRA? Because mortgage news has reported rates between 7.7 & 8.02% for the month with 0 points if you have perfect credit. If your credit is less, you’re paying a higher rate. Now you can buy the rate down with points, but that doesn’t mean the real rate is any lower than 7.7%.
“Where are you getting your average mortgage rates for September 2023 being 7.2%??”
It’s right from the linked article:
“Based on the Freddie Mac data, the monthly average commitment rate for a 30-year, fixed-rate mortgage was 7.20 percent in September 2023, up from the previous month of 7.07 percent.”
And that number appears to be a simple mean of the 4 weekly abverages reported by Freddie in September:
https://www.freddiemac.com/pmms/archive
[7.31+7.19+7.18+7.12]/4=7.2
“Chicago running at the head of the pack is significant because there was a long stretch in recent memory when it consistently brought up the rear. Between September 2016 and September 2021, Chicago’s home price growth was last or second-to-last among the 20 cities in 43 monthly reports, and in most of the remainder, it was not higher than 17th of 20.”
So bringing up the rear and being last or second to last is the new HAWT(tm)?
“Where are you getting your average mortgage rates for September 2023 being 7.2%??”
Trying to make things even worse Mike HG? Chicago’s housing market isn’t the problem but Florida’s is. Going to be a big correction there if history is any guide. Florida and housing bubbles go hand in hand.
Mortgage News Daily is more accurate as it is daily. Freddie is a weekly average and lags, particularly if there was a large daily swing in rates. This is why we often laugh in the biz because some news article will come out about rates using the Freddie data, but a day or two may have passed and that rate will be long gone.
In other news, jury ruled in favor of plaintiff in Realtor commission suit. It will be interesting what happens next. Sure there will be appeals.
https://www.housingwire.com/articles/missouri-jury-finds-nar-brokerages-guilty-of-conspiring-to-inflate-commissions/
“Chicago currently leading in price appreciation, but was next to last in appreciation between 2016 – 2021 of 20 cities according to Crains.”
Yep. It’s been terrible. I’ll take being first now, though. Better than where we’ve been. And at least prices are still rising.
Most of those at the top of the list in appreciation in 2023 are those that are affordable and that have underperformed the last decade (Detroit, Cleveland, St Louis, Chicago etc.)
Austin is maybe the biggest bust so far, though. Both rents and home prices are declining there.
“Move up properties are f’d”
Depends on what you consider to be “move up” in Chicago. I’d put that at $450k to $600k range as the “move up.” Mortgage rates make it much more expensive to do so but if you have a big down payment of 30% or more, it takes the sting out of it. People have gotten pay raises and many move-ups can probably afford to do it. But will they WANT to do it, is the question.
I think most people probably stay where they are for another 5 years. The move-up properties will sell to the upper middle class as first time buyers.
The one property that is probably most impacted by the higher rates is the expensive 1-bedroom. Those that are $500k and higher. Rates make it much more expensive than renting the same thing. No reason to buy those.
Just 38 properties listed in Lakeview between $500k and $650k including the Waterloo townhouse we chattered about last week.
Reminder: 40,000 people are tracking the Lakeview neighborhood on the Redfin app.
I don’t think many people foresaw Chicago prices still moving higher even with 7% or 8% mortgage rates. I certainly didn’t expect this.
“Mortgage News Daily is more accurate as it is daily. Freddie is a weekly average and lags, particularly if there was a large daily swing in rates.”
I have always used the data in the IAR press release. That way, it stays consistent throughout the years (as long as they don’t change their method, which they haven’t.)
I think people have also forgotten that rates weren’t at 8% for most of September. Only got to 8% in October.
Also, inventory continues to be really depressed. It’s not falling further, however. But I’m not sure why sellers are listing right now. I’d probably wait until spring, if I could.
“In other news, jury ruled in favor of plaintiff in Realtor commission suit. It will be interesting what happens next. Sure there will be appeals.”
This decision baffles me. Despite the fact that my whole business model is based on the fact that commissions are too high, there is no conspiracy. Sellers have always had the ability to offer as little as $.01 co-op. It’s just too risky. Hell, when I sold my house I offered 2.5% even though many of our sellers have have successfully offered 2% or 2.25%. I might have lowered it if I had had more flexibility with timing the sale.
I find it baffling as well. Discount agencies have been around forever. I sold my first condo FSBO. IIRC, I paid $500 to have it listed on MLS and then I offered 2.5% to buyers agent as I knew practically every buyer would have agent representation.
Reading some of the complaints in suit, it seemed like some sellers were mad no one wanted to show their home if there would be no compensation. I mean why would someone work for free?
The only conspiracy I see is that the way commissions are handled, consumers are not incentivized to shop around as the commissions are kind of buried in the price of home whereas on the mortgage side we get beat up over $50 as the consumer sees their payment every month.
Decoupling buyer commissions from seller side would fix this and will likely be an outcome if not over turned in appeal. The agencies will likely change guidelines or seller concessions to cover buyers agent commissions. So the buyer will engage their own agent and agree to a commission then the mortgage lender will roll it into the financing.
“So the buyer will engage their own agent and agree to a commission then the mortgage lender will roll it into the financing.”
I’ve heard this idea bandied around today Russ. But some people said lending regulations would have to be changed to allow them to roll it into the financing. Is that true?
“In other news, jury ruled in favor of plaintiff in Realtor commission suit. It will be interesting what happens next. Sure there will be appeals.”
Could totally transform the industry. But it’s a long way off due to the appeals.
Right now, buyside agent commissions are not expressly included in the buyer financing as it shows up on the seller side of the settlement statement. Guidelines don’t allow for financing of agent commissions.
However, we all know that the buyer is paying it indirectly through price of the home so making this change should not be a big deal.
Fannie/Freddie would need to allow a disclosed buyer’s agent commission to be included on buyer side of settlement statement and rolled into the final loan amount. I suspect they’d set some regulations like with lenders where there is a national standard disclosure that must comply in order to charge the commissions.
“Depends on what you consider to be “move up” in Chicago. I’d put that at $450k to $600k range as the “move up.” Mortgage rates make it much more expensive to do so but if you have a big down payment of 30% or more, it takes the sting out of it. People have gotten pay raises and many move-ups can probably afford to do it. But will they WANT to do it, is the question.”
$600k requires about a $200K HHI (+ $120k DP) – Really not a starter. You have a very vivid imagination as to what people make and the effects of rates near tripling. Old Boomers like yourself must really enjoy f’ing younger folks
“I think most people probably stay where they are for another 5 years. The move-up properties will sell to the upper middle class as first time buyers.”
So they’re trapped in their 2/2 shitbox. Nice to see you smarten up and agree with me.
“The one property that is probably most impacted by the higher rates is the expensive 1-bedroom. Those that are $500k and higher. Rates make it much more expensive than renting the same thing. No reason to buy those.”
Theres no reason to buy 95% of 2/2’s either (See the property you linked today), but dont let math and common sense stop your shilling
“I suspect they’d set some regulations like with lenders where there is a national standard disclosure that must comply in order to charge the commissions.”
And there would probably be a cap, right? It might be that it’s 2.5%, but also maybe not.
“$600k requires about a $200K HHI (+ $120k DP)”
But the hypothesis is having 30% down, from the hawt gains on the starter home.
So that–and an ARM at ~7.25–one only needs a $180k HHI to hit the 28% front-end ratio.
That’s right around top 10% HHI for the metro. Call it top 25% of Chicago homeowners.
But the theory is that those “move up” buyers will just “move down” in what they are looking at–Portage Park instead of Jefferson Park; Oak Lawn instead of Oak Park–or, more likely, stay put or leave Illinois.
“Depends on what you consider to be “move up” in Chicago. I’d put that at $450k to $600k range as the “move up.”
I think of a move up buyer going from a condo to a SFH. If you’re buying a SFH for the first time, it’s really tough. Homes, in nice hoods were 1m-1.4m, now you can expect to pay 1.7-1.8m. That’s out if reach for most.
If regulations get in the way of financing the co-op commission then the buyer can simply ask the seller to cover it and include it in the offer price. I don’t think appraisals would get in the way of this either since it might become standard practice and appraisals have been shown to be biased towards the purchase price.
“I think of a move up buyer going from a condo to a SFH. If you’re buying a SFH for the first time, it’s really tough. Homes, in nice hoods were 1m-1.4m, now you can expect to pay 1.7-1.8m. That’s out if reach for most.”
Um…this isn’t a “move-up” buyer. That’s a rich buyer.
Why do people think everyone abandons condo living? They don’t. Kids grow up in condos.
But, yes, a true move-up buyer, probably isn’t moving up in many of the GreenZone neighborhoods. They will be priced out. But there ARE middle class neighborhoods in Chicago. Maybe they buy in Bowmanville or Bronzeville? Maybe Galewood or Sauganash? Many are priced out of what they want and head for the suburbs. Ironically, it’s more expensive in many city neighborhoods than the suburbs.
“But the hypothesis is having 30% down, from the hawt gains on the starter home.”
Has no one here EVER actually paid a mortgage? You live there a number of years. You build equity by paying it off. You roll it into the next home.
Has been done forever and ever and ever and ever and ever and ever. Ask your grandparents. They’ll tell you. My god.
Oh, and I said “move-up” homes were $450k to $600k. So, of course JohnnyU has to attack using the highest amount. Some WILL move up to the $600k house. It will be a couple where one, or both, get pay raises. And they have a lot of equity and can roll it over. It’s how it has always worked. You don’t reach peak income until your 40s.
“You have a very vivid imagination as to what people make and the effects of rates near tripling. Old Boomers like yourself must really enjoy f’ing younger folks”
You would know what old Boomers like to do JohnnyU.
But no, I live in Chicago so I’m very aware of the salaries here. It’s not the whole city. It’s mostly just certain neighborhoods. But, yes, Chicago has a large amount of people making over $100k a year. People have posted all the data here many times when bears like yourself try and argue that there aren’t enough rich people to sustain the prices in Chicago. But there are. The tech jobs are highly compensated. They may not pay Chicagoans like they do those in the Bay Area, but it’s still among the top in terms of salaries.
“Theres no reason to buy 95% of 2/2’s either (See the property you linked today), but dont let math and common sense stop your shilling”
I really hate it when people are on this blog who have NO understanding of what apartments cost in Chicago. And then they try and use examples from literally the last 6 weeks, when rates spiked to 8%, to argue that it doesn’t make sense to buy.
Luxury apartments, which would have similar finishes to this condo, are at record high price per square feet in Chicago as well. It is not necessarily so that it doesn’t make sense to buy versus to rent. I urge people to use the New York Times Rent v Own calculator. They’ve had it since the housing bust years. The advanced features allow you to plug in assessments, increases to rent and other tidbits. It also has a chart that then tells you how many years you have to own to make it better, financially, than renting.
Everyone has different schedules and goals. I have always said that if you aren’t going to own for 10 years you probably shouldn’t be buying. Chicago real estate hasn’t gone up for years and the transaction costs will mean you’ll lose money when you sell. We HAVE seen appreciation, finally, in the last 3 years, however. So, suddenly, for some, you actually can sell in 3 or 5 years and make money even subtracting all the fees and to pay your realtor.
If you think you will live in the property just 2 years, it is probably best to rent.
“But the theory is that those “move up” buyers will just “move down” in what they are looking at–Portage Park instead of Jefferson Park; Oak Lawn instead of Oak Park–or, more likely, stay put or leave Illinois.”
Really? Really. That move-up buyer is going to tell Northern Trust, Kellogg, McDonald’s or CME Group “hey, it’s so expensive with these higher mortgage rates that I’m leaving Illinois. I think I’ll go to Austin or Tampa where it’s so much cheaper.”
Oh, and that move-up buyer has one kid and a second on the way and they’re going to pack up and move to another state suddenly.
Yeah. NOT.
But, yes, they ARE moving down. You get qualified for whatever mortgage you get qualified for. Today’s buyers weren’t buying 2 years ago when their $5k a month bought them a $700k house. It now gets them $500k. So THAT is what they will buy.
There’s a reason homes under $300k in all of Chicagoland have multiple offers.
“Has no one here EVER actually paid a mortgage? You live there a number of years. You build equity by paying it off. You roll it into the next home.”
Tell me you dont know how math works without telling me you dont know how math works.
How much principal is paid off in 5 years?
Embarrassing
“Oh, and I said “move-up” homes were $450k to $600k. So, of course JohnnyU has to attack using the highest amount. Some WILL move up to the $600k house. It will be a couple where one, or both, get pay raises. And they have a lot of equity and can roll it over. It’s how it has always worked. You don’t reach peak income until your 40s.”
Must have hit the second Box ‘O Wine. My response was measured as I dont think in todays market $600k is reasonable, at sub 3% rates its a different discussion.
How will they have a lot of equity? Chicago RE has been a dog.
Did you name the unicorn couple you describe?
“But, yes, a true move-up buyer, probably isn’t moving up in many of the GreenZone neighborhoods.”
I can only speak for myself and the majority of my network of friends and family. 11 years ago, I was able to sell my condo in River North and by a SFH in Bucktown. Don’t think I would be able to that today. Most of my friends at the time we’re doing the same with regard to selling condos and purchasing SFHs in the greenzone.
“I was able to sell my condo in River North and by a SFH in Bucktown. Don’t think I would be able to that today. Most of my friends at the time we’re doing the same with regard to selling condos and purchasing SFHs in the greenzone.”
Prices are up 20% to 40% in the last 11 years in many GreenZone neighborhoods. What’s your “move-up” price? Impossible to say you wouldn’t be able to do it today without knowing that. But every greenzone neighborhood is expensive now. The $500k house doesn’t exist. In many neighborhoods, the $800k house doesn’t exist either. Many have to buy a townhouse or they look in different non-GreenZone neighborhoods either in Chicago or the suburbs.
11 years ago would have been 2012, which was at the bottom of the housing bust. Prices were at new lows in 2011 and 2012. Chicago has moved far beyond that now.
“Did you name the unicorn couple you describe?”
There are thousands of younger people affording $5,000 to $7,000 a month in rent in the new luxury buildings. Related’s new Fulton Market highrise has already sold out of nearly all the $4,000 1-bedrooms.
So, yeah, there are plenty of people living in Chicago who can afford $600,000 JohnnyU. The jobs here are good. Salesforce Tower is finished and companies have moved in.
“How much principal is paid off in 5 years?”
Plenty. Thousands of dollars.
“Plenty. Thousands of dollars.”
Better make way for the Thousandaire
LOL – total clownshoes
“There are thousands of younger people affording $5,000 to $7,000 a month in rent in the new luxury buildings. Related’s new Fulton Market highrise has already sold out of nearly all the $4,000 1-bedrooms.
So, yeah, there are plenty of people living in Chicago who can afford $600,000 JohnnyU. The jobs here are good. Salesforce Tower is finished and companies have moved in.”
This is your brain after 2 boxes of wine
“Salesforce Tower is finished and companies have moved in.”
Who? Saleforce, sure. Are they fully in?
AFAIK, the only other signed lease is Kirkland & Eliis, and they haven’t even started moving yet.
Following up on that–from public reporting:
the building is ~1.2m square feet
Salesforce was taking 500k (but reportedly looking to sublease 150k)
Kirkland is taking 662k.
24 & 25 appear to be available direct from the owner.
That’s the whole building.
So, who (aside from Salesforce) has moved in?
Instead of arguing opinions just look at the data. This page shows the income distribution. https://datausa.io/profile/geo/chicago-il
“If you’re buying a SFH for the first time, it’s really tough.”
No argument, but I was curious about what was on the market in BT/WP, and this one jumped out at me:
https://www.redfin.com/IL/Chicago/1716-W-Wabansia-Ave-60622/home/13355237
It’s pretty small–the 2800 clearly counts the roofdeck–and on a super short lot (80′), but more appealing than most THs for a similar price.
also some more relatively smaller houses (bc of the short lots and FAR limits) that appear pretty decent in the under $1.5m range.
It is tough that everything being built in the GZ is 5000+ (including the finished basement) and thus pushing or over $2m.
“No argument, but I was curious about what was on the market in BT/WP, and this one jumped out at me:”
Very tough. Middle class completely priced out of the GreenZone in SFHs. But even a lot of townhouses are now priced near $1 million. This is why many are moving south to neighborhoods like Bronzeville. You can get a new build house there for $650k to $750k.
“It’s pretty small–the 2800 clearly counts the roofdeck–and on a super short lot (80?), but more appealing than most THs for a similar price.”
If you believe Redfin’s prices, it really hasn’t gone up much in price since the 2007 bubble era. For whatever reason, this house cannot push the $1 million level.
I wonder why?
The small lot with no backyard?
Incredible source of data Gary. Thanks for the link. What’s with trade expected to double from $1 trillion to $1.94 trillion by 2050 after having been stagnant the last 10 years? Wow.
But on income, no surprise, that it’s much higher in most of the GreenZone.
“In 2021, the place with the highest Median Household Income (Total) in Chicago, IL was Census Tract 706 with a value of $250,001, followed by Census Tract 704 and Census Tract 710, with respective values of $210,147 and $203,491.”
Most of the GreenZone median is over $100,000, like I said. There are lots of highly paid professionals living downtown and in the GreenZone neighborhoods who can easily afford the luxury rents.
“So, who (aside from Salesforce) has moved in?”
Don’t know but the building is now “alive.” Lights are on, furniture is in.
I recommend walking by on the riverwalk and checking it out. At night, it is now a stunning view north up the river from any of those bridges. It’s a huge addition to downtown and will have impacts for decades to come. Really feels like an Asian city at night due to its size (and Wolf Point East to the east of it, which is also a big building.) Love all the skyscrapers we are building.
Chicago is filling in its downtown very well. It’s a truly stunning city.
“The small lot with no backyard?”
I think so. Dirt only has upside if you can get an adjoining lot, too, and best would be all 5 on that alley island. And then you’re still going to have some trouble with the 80′ depth.
Another that’s in a similar weird spot is this one:
https://www.redfin.com/IL/Chicago/2150-N-Bell-Ave-60647/home/13356839
which is probably too funky a layout for most (prob me, too) but I still like it better than most comparably priced THs. It’s a bit overassessed, but they didn’t appeal the ’22 ass ($930k), and don’t have the HO exemption, either.
“This is your brain after 2 boxes of wine”
Once again, when you don’t understand Chicago’s demographics and wealth, JohnnyU, you make some stupid attack about me drinking.
All you need to do is look at Gary’s link with the income data and you will see why the Related building in Fulton Market has sold out of a bunch of their units even at $4k a month.
Just as an aside, I noticed the other day that Huron Consulting, headquartered in Chicago, has added about 700 employees over the last year. Wonder what those jobs pay and how many are in Chicago?
Census Tract 706:
Fullerton to Diversey, Ashland to Southport, basically. 1,197 households, 3,235 people.
Don’t think anyone would have guessed that on the first try.
“Better make way for the Thousandaire”
Again, I’m assuming you don’t have a mortgage (still renting?) or you paid yours off decades ago (kudos.) But you do still pay off thousands of dollars in even the first five years. Here in Chicago, you put down 20%, pay it off 5 years, and with our recent appreciation, and, yeah, you are rolling over a nice amount into the next house. Isn’t this how it was ALWAYS done? For the last 60 years?
Oh, another interesting stat in Gary’s link is that only 62.2% of homeowners in Chicago have a mortgage. This is what I want to see. That is a TON of wealth just sitting there.
“Don’t think anyone would have guessed that on the first try.”
Not me. Not even a “prime” neighborhood. But there are a lot of big single family homes over there. Few apartment buildings, which would bring the median down.
At 3.5% rate, 30 year am, it’s a little over 10% of the loan amount in 5 years. So, with 20% down, 28% equity, before any net (of entry/exit costs) appreciation.
At 7.5% rate, 30 year am, it’s a little under 5.5% in 5 years. Lose ~4% of the equity pay-in.
40 extra months (ie, 2/3s longer) to get to 10%+ pay down at the current rates.
“At 7.5% rate, 30 year am, it’s a little under 5.5% in 5 years. Lose ~4% of the equity pay-in.
40 extra months (ie, 2/3s longer) to get to 10%+ pay down at the current rates.”
That’s the beauty of the current owners though, right? They don’t have 7.5% rates. Today’s move-up buyers bought years ago and have rates under 4%. Even if they didn’t refi, and they bought as long ago as 2016, they were under 4%. They’ve built a bunch of equity pretty quickly.
In a few years, yeah, people may not be able to “move up” which fits in with my theory that people will be staying in their properties a LONG time like the Baby Boomers and Silent Generation did in the 1970s and 80s when rates were high. You didn’t move every 3 or 5 years. You stayed put and simply paid off the mortgage.
Could be better for our communities to have people stuck in their homes for a decade or more. Kids will grow up together in the same neighborhoods. People will make more effort to get involved and make improvements to schools, parks, park district etc.
“you put down 20%, pay it off 5 years, and with our recent appreciation, and, yeah, you are rolling over a nice amount into the next house. Isn’t this how it was ALWAYS done? For the last 60 years?”
For giggles, run the math: $500k, 20% down, the principal paid after 5 years covers the sales commission.
Appreciation has been dogshit
Until Financial engineering for Home Ownership became a thing and other than a “Local Boy done good”, IME move ups were rare. Blue Collar/Trades POV
“Appreciation has been dogshit”
I don’t understand this complete gaslighting of ALL the data, in the entire country, over the last 5 years. Isn’t this why everyone is whining so incessantly about housing right now? “It’s so unaffordable.”
Because prices have gone up anywhere from 20% to 60%, depending on your location, over the last 5 years?
I guess it depends on your definition of “dogshit.” Maybe getting 4% a year over the last 5 years is “dogshit.” If so, then you have a very unrealistic view of what housing appreciation SHOULD be.
All real estate is local, so every city, neighborhood, street and property is going to be different.
“For giggles, run the math: $500k, 20% down, the principal paid after 5 years covers the sales commission.”
anon(tfo) ran the math in his comment above. For those who bought 5 years ago, they would have had a lower mortgage rate. It would have meant they paid off a lot more of the loan.