No houses - what to do?

[Anonymous]

We moved to the area a few years ago and ended up renting because at the time it seemed hard to buy from outside the area. At first we were stuck in a lease and then Covid happened. Now houses in our neighborhood are literally $250k+ more than when we arrived a couple of years ago. There are so few houses, and I just can’t bring myself to pay $1.5 m for a house that I didn’t even want for $1.2 two years ago! I can’t figure out what to do - overpay, rent forever (and our rent has continued to increase even during Covid), move somewhere else? Are others finding themselves in this situation? What are you doing?

[Anonymous]

If there are no houses then you cannot buy. That seems pretty straightforward. Or you can just start looking outside your current neighborhood.

[Anonymous]

Anonymous wrote:If there are no houses then you cannot buy. That seems pretty straightforward. Or you can just start looking outside your current neighborhood.

yeah, OP. not really understanding your failure to understand. It's a tight market. Maybe consider moving to another area.

[Anonymous]

Probably move to an another area. I wouldn't want to rent forever.

[Anonymous]

In this area, housing prices tend to go up. Impossible to time when the dip will happen.

[Anonymous]

Can't you look at a lower price point, say, $850k, and then renovate as needed with the extra money leftover in your budget?

Might be a better strategy then looking at your mediocre 1.5m houses.

It'sa long shot, but would your landlord consider selling the rental. Negotiate with an irresistible offer and you might be pleasantly surprised.

[Anonymous]

Welcome to the reality of metropolitan DC. The same things that make the neighborhood good for your make it good for many other people, in fact good for far more people than the neighborhood has houses available. And since, like you, many of them are well into the upper income levels, many of them have the money to compete for the same houses. That's demand and that drives the prices up. Unfortunately, like you, there are more and more people moving into the region. The population has been on a steady increase for 40+ years and has no signs of stopping. Additionally, the income levels of the top 5% have been steadily increasing. The number of people that can afford houses over $1M is growing faster than other income levels so your competition is growing faster than other income levels.

So, even if houses come on at lower levels, like $1.2M, they will go for over list price and you will be paying significantly more than that just to have a chance to win that house.

Your best bet is to pick a less popular area, whether further out or one that is in need of gentrifying or looking for a fixer-upper. But the situation is not going to get any better because anywhere there are houses in the $1.2M+ range, is popular for a reason and there are more and more people who want to live in those areas that will continue to drive the prices up. Prices adjust to what the market will bear. Until there are fewer people willing to pay the list price, the prices will continue to rise.

[Anonymous]

Anonymous wrote:In this area, housing prices tend to go up. Impossible to time when the dip will happen.

Right, prices tend to go up. That’s true. But not 20 percent in a year. That is not normal. You don’t normally expect that a house that sold for $1 m a year ago would now go for $1.2 m a year later. I certainly didn’t see anyone predicting that increase a year ago - when unemployment was skyrocketing

[Anonymous]

When I lived in SF - what many of my friends did was rent in a rent controlled flat, and buy vacation home in Tahoe.

[Anonymous]

Anonymous wrote:

Anonymous wrote:In this area, housing prices tend to go up. Impossible to time when the dip will happen.

Right, prices tend to go up. That’s true. But not 20 percent in a year. That is not normal. You don’t normally expect that a house that sold for $1 m a year ago would now go for $1.2 m a year later. I certainly didn’t see anyone predicting that increase a year ago - when unemployment was skyrocketing

Panic buying is happening now. Combine that with amazingly low rates and limited supply and crushing demand, and there it is. Maybe a little, tiny bit of air will come out of the market when offices tell people to come back in. People reached for space and fence sitters got off the fence. Hidden gem markets like Cleveland shot up. I don’t know what to tell you. The line between haves (owners) and have nots (renters) is only going to get worse.

[Anonymous]

Anonymous wrote:When I lived in SF - what many of my friends did was rent in a rent controlled flat, and buy vacation home in Tahoe.

Super helpful

[Anonymous]

Anonymous wrote:

Anonymous wrote:In this area, housing prices tend to go up. Impossible to time when the dip will happen.

Right, prices tend to go up. That’s true. But not 20 percent in a year. That is not normal. You don’t normally expect that a house that sold for $1 m a year ago would now go for $1.2 m a year later. I certainly didn’t see anyone predicting that increase a year ago - when unemployment was skyrocketing

I’m frankly surprised the increase is that small.

[Anonymous]

Anonymous wrote:

Anonymous wrote:In this area, housing prices tend to go up. Impossible to time when the dip will happen.

Right, prices tend to go up. That’s true. But not 20 percent in a year. That is not normal. You don’t normally expect that a house that sold for $1 m a year ago would now go for $1.2 m a year later. I certainly didn’t see anyone predicting that increase a year ago - when unemployment was skyrocketing

Prices don't go up linearly over time. They jump, stagnate for years, fall, jump again, and so on. That's one reason why trying to time the market is dumb.

[Anonymous]

Look in a different area. this isnt hard

[Anonymous]

We were thinking of moving in 2019 and did not. We were going to flee n Arlington for the suburbs in Vienna. After covid (and now gas) we are not moving and giving up our walking lifestyle here. I think a lot of people who own homes appreciate them more and are not listing anytime soon.