If you bought 2005-2007 and got hit, tell me your story, location and age

[Anonymous]

Anonymous wrote:Markets go up and then down and then up. This normal. The DC area real estate is less volatile because of the federal government. The further away you get the less stabilized prices are.

People should never think prices can only go up. But keep in mind home ownership is a good hedge against inflation for most people.

Good point.

And it’s location, location, location. Always. You’re more likely to gain home value in desirable areas with limited supply. Have we heard any negative stories from inside the beltway?

[Anonymous]

Bought a house in NC in early 2007. We were in our mid-20s. At the time, everyone we talked to and the entire way we were raised was to get into the housing market as early as we could. We saved pennies to have a solid downpayment, made smart choices, etc. Did all the "right" things. We had to move for a job relocation late 2011. Sold for about 40k less than we bought. Basically lost our entire equity/original down payment, plus all the $$ we used to slowly fix it up. We felt pretty fortunate that it wasn't worse., but it was tough to essentially start over financially.

Were able to buy in DC in 2015. Have essentially assumed since that (1) our house/equity is not part of our financial picture/net worth and (2) we will somehow get screwed and sell for a loss if/when the time comes. I will never think of a house as an "investment" again and I will always assume the financial "worst" will happen. Essentially, it made me extremely conservative in this regard.

[Anonymous]

There is only one Capitol Hill, only one NYC, only one SF downtown., location, location, location.

[Anonymous]

Young Gen-Xers, bought a small Cape Cod in Kensington for $485k in 2005 as our starter home. We sold it this spring and made a modest profit on it. We were fortunate that we didn’t need to sell it in the years immediately after we bought it because we bought at the peak and would have been underwater, and fortunate again that we were able to sell it at this year’s peak.

[Anonymous]

Ashburn, bought late 2004 (that still counts IMO). Sold for 50k loss when we were transferred for work in early 2008. Identical model across the street sold for asking price. Oh well.

[Anonymous]

We did not buy in 2005-7 but we did buy in 1989 and sold at a loss in 1997. It was a block from Overlee Pool in north Arlington.. Woulda coulda shoulda rented it out for three years and then we would have sold for double.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We are currently selling a TH in Loudoun (10 mins from Reston) we bought in 2007 for $450k. Lived there til we bought a SFH nearby in 2013. Decided to rent it out since we couldn’t break even then. It’s now worth $700k but that still isn’t a great return. $250k gain over 15 years, from which we have to pay realtors, closing costs, and cap gains tax because it was a rental and not a primary. The TH neighbor a few doors down bought in 2016 for the same $450k and sold this year for the same $700k. Now THEY got a good return!

You also got rent money for years.

That's not the point, investments should appreciate

Not how investments work, often.

See: Bonds, Annuities, Dividend stocks, etc.

Plus PP wasn't buying an investment. PP was buying a home.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The folks we know who bought at the height of the market in 2006 and ended up having to sell were genx (mostly younger ones).

Lots of millennials in their early 20s got approved for stated income loans

We're eldest millennials (Jan 1981) and were the first of our peers to buy in 2010 (which turned out to be fabulous timing). There were probably a few millennials who bough sooner, but I think the housing price timing was the worst for younger GenX. They were the ones stretching for family homes in the 2004-2008 years.

This is spot on accurate for me. Younger Gen X (1977) purchased SFH in 2007 for 340k; tried to sell for two years straight but the house was too underwater and wouldn't budge; lots of issues with the house; divorced; house foreclosed in 2014. I fully recovered and built a house in 2020.

[Anonymous]

Bought a federal,style row house in a gentrifying area in DC in 2005. Paid 530k. Moved out 4 years later when pregnant with second baby but didn’t sell. Rented it out and moved to the suburbs. We rented for two years and then bought a house in Reston for 580k using down payment from my mom’s life insurance policy when she died unexpectedly. Rented the rowhouse this whole time. Sold the rowhouse in December for 950k. Sold the Reston house in March for 890k. Bought our dream house in March in Vienna for 1.3 where we plan on staying for the next 20 years .

[Anonymous]

Anonymous wrote:

Anonymous wrote:That’s so surprising to me. We bought a row house in DC for 420k in late 2006. We have done some work on it—probably 150k in upgrades—and it’s worth 900 to one million now. Of course, we haven’t actually tried to sell it! I thought most of the DC area was similar.

What part of dc? H street etc?

Got it in one!

[Anonymous]

Anonymous wrote:

Anonymous wrote:That’s so surprising to me. We bought a row house in DC for 420k in late 2006. We have done some work on it—probably 150k in upgrades—and it’s worth 900 to one million now. Of course, we haven’t actually tried to sell it! I thought most of the DC area was similar.

When you look at the price rise from 420 to 900, there are two primary drivers — the broader market and DC gentrification. In this case DC gentrification did the heavy lifting and this example doesn’t really reflect the broader market.

So many people miss this. The gentrifying areas of DC were undervalued, considering their location. Upper NW DC has also appreciated, but it did not see the same % increase post 2011.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:That’s so surprising to me. We bought a row house in DC for 420k in late 2006. We have done some work on it—probably 150k in upgrades—and it’s worth 900 to one million now. Of course, we haven’t actually tried to sell it! I thought most of the DC area was similar.

When you look at the price rise from 420 to 900, there are two primary drivers — the broader market and DC gentrification. In this case DC gentrification did the heavy lifting and this example doesn’t really reflect the broader market.

I'm not sure that's true. Arlington saw a similar gain with no gentrification. My guess is that gain isn't evenly spread. There was a drop somewhere between 2006 and 2010, but then rapid appreciation from 2010-2016. Then things seemed to slow a bit it was a slower climb.

We bought near H St NE in 2010 for $420k and sold in 2016 for $900k (having invested about $15k in renovations plus lots of sweat equity). That gain was a combo of market recovery and gentrification. We then bought in Arlington then for $930k and could sell now for around $1.4m (having invested about $200k in renos), which is zero gentrification and all market shift.

Arlington was never scary like parts of DC, but Arlington did “gentrify” in the sense that higher income people started moving there. In the ‘90’s, Arlington was where mid-level feds lived, and it was where first year associates and Hill staff with families lived (I was one of them). Law firm partners lived in Great Falls, Potomac and McLean. Arlington was considered to be pretty déclassé. As traffic got worse, those people started moving in closer and adding on to and tearing down the old houses & bringing property values up in the process.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:That’s so surprising to me. We bought a row house in DC for 420k in late 2006. We have done some work on it—probably 150k in upgrades—and it’s worth 900 to one million now. Of course, we haven’t actually tried to sell it! I thought most of the DC area was similar.

When you look at the price rise from 420 to 900, there are two primary drivers — the broader market and DC gentrification. In this case DC gentrification did the heavy lifting and this example doesn’t really reflect the broader market.

I'm not sure that's true. Arlington saw a similar gain with no gentrification. My guess is that gain isn't evenly spread. There was a drop somewhere between 2006 and 2010, but then rapid appreciation from 2010-2016. Then things seemed to slow a bit it was a slower climb.

We bought near H St NE in 2010 for $420k and sold in 2016 for $900k (having invested about $15k in renovations plus lots of sweat equity). That gain was a combo of market recovery and gentrification. We then bought in Arlington then for $930k and could sell now for around $1.4m (having invested about $200k in renos), which is zero gentrification and all market shift.

Arlington was never scary like parts of DC, but Arlington did “gentrify” in the sense that higher income people started moving there. In the ‘90’s, Arlington was where mid-level feds lived, and it was where first year associates and Hill staff with families lived (I was one of them). Law firm partners lived in Great Falls, Potomac and McLean. Arlington was considered to be pretty déclassé. As traffic got worse, those people started moving in closer and adding on to and tearing down the old houses & bringing property values up in the process.

That may be true over the longer term 30+ years, but I didn’t any appreciable gentrification between 2016-2022 to drive the house price increases that we've seen. If anything Ballston and Clarendon (the closest urban centers to my house) are less nice now than they were in 2016.

[Anonymous]

We bought our TH in ffx county for 450 in 2011. It sold for 450 in 2004. No net increase for the previous owner those 7 years. It’s worth about 700 now, but we’re not looking to sell.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:That’s so surprising to me. We bought a row house in DC for 420k in late 2006. We have done some work on it—probably 150k in upgrades—and it’s worth 900 to one million now. Of course, we haven’t actually tried to sell it! I thought most of the DC area was similar.

When you look at the price rise from 420 to 900, there are two primary drivers — the broader market and DC gentrification. In this case DC gentrification did the heavy lifting and this example doesn’t really reflect the broader market.

I'm not sure that's true. Arlington saw a similar gain with no gentrification. My guess is that gain isn't evenly spread. There was a drop somewhere between 2006 and 2010, but then rapid appreciation from 2010-2016. Then things seemed to slow a bit it was a slower climb.

We bought near H St NE in 2010 for $420k and sold in 2016 for $900k (having invested about $15k in renovations plus lots of sweat equity). That gain was a combo of market recovery and gentrification. We then bought in Arlington then for $930k and could sell now for around $1.4m (having invested about $200k in renos), which is zero gentrification and all market shift.

Arlington was never scary like parts of DC, but Arlington did “gentrify” in the sense that higher income people started moving there. In the ‘90’s, Arlington was where mid-level feds lived, and it was where first year associates and Hill staff with families lived (I was one of them). Law firm partners lived in Great Falls, Potomac and McLean. Arlington was considered to be pretty déclassé. As traffic got worse, those people started moving in closer and adding on to and tearing down the old houses & bringing property values up in the process.

That may be true over the longer term 30+ years, but I didn’t any appreciable gentrification between 2016-2022 to drive the house price increases that we've seen. If anything Ballston and Clarendon (the closest urban centers to my house) are less nice now than they were in 2016.

Arlington definitely didn’t see the change that parts of DC did, but the demographics have continued to change, as has the housing stock, even if it’s less dramatic. That is why you saw 115% appreciation in your DC house in six years and “only” 50% increase in six years in Arlington. The post-covid premium for SFHs has to be added in there, as well.