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Our Story: Both my wife and I are 27 years old and have gone through financial hell and back. Now we are on track to financial freedom, however we are not financial advisors or professionals, just everyday people. Share our journey from a negative networth and email us if you have questions or comments! :)



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Tuesday, January 24, 2006

My Overvalued Home?

According to a recent article on CNN Money , it states that most home prices today are overvalued? The bubble has obviously been getting smaller or it has remained stagnant in certain areas. The question however is how long is this going to last? I mean some fortunate ones were able to cash out when they could and sell their home for sometimes two or three times (or more) than what they originally paid for. I believe these people timed it correctly and got out when they could. Still there seems to be some growth in certain areas that will account for most of the next year's trend articles stating 'The bubble is not over!'. I mean who wants the bubble to be over? This is great for homeowners and as a homeowner, I have seen a double digit percentage increase in the value of my home.

That leads me to the next question which is, Is my home overvalued? Given the area that I live in which is predominantly a well rounded suburban community, I can say that we can still have growth or at least right now a slow period. Because lets face it, the younger generation will find it harder and harder to get a place of their own if prices are rising near half a million for a home. I believe this will ultimately lead to more debt and bankruptcies.

TANGENT~!So how about this idea: we start to build little affordable communities that are priced between 100-200k for these new fresh work-bound 20 and 30 somethings to live in. I mean we have PLENTY of apartment complexes and people rent all the time (which rent is going nowhere but UP), but I truly believe homeownership is something that everyone should experience. Next question is where? Location is key. Around my area, its booming with high end businesses as well as mom and pop merchants. Can a banker or anyone tell me how much financing would be needed lets say on a 20 home community with around 3-4 bedrooms and 2 baths (Im guessing these are around 100-200k) ?? Im curious to know the actual price of putting something together from scratch, if the land is already purchased? The wood, materials, man hours, legalities, etc. Whats the bottom line...

1 Comments:

Blogger ncnblog said...

Hey! Just found your blog...keep up the good work. Have linked to you...(I like the charts on the right hand side...visuals are the best!)
ncnblog.com
ncnpodcast.com

8:37 PM  

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