My sister posted a rant the other day… My turn!

—Begin Rant—

We bought a condo in Cincinnati because we were told: (1) home prices never go down and (2) if you’re going to live there for more than 2 years, it is a safe investment. We now recognize both of those as lies. Always, always check a home v. rent calculator before buying (like this one).

We lost money on that condo (thousands of dollars; maybe upwards of $15,000). But we attributed the devaluation of our condo to the area, not to the market, as the housing bubble had not yet burst.

We stupidly bought a home in Florida when we moved here thinking the same thing (it was just before the housing bubble burst). I’m reading the news this morning when I see this: Mortgage lender Taylor Bean & Whitaker closes doors, shocks Ocala. So, our home in Florida is now probably worth about 1/3 less than we paid for it and our mortgage lender just went belly up. Supposedly Bank of America (a.k.a. the most evil bank on the planet) is now going to service our home loan.  Great!  Lucky us!

We’ve never missed a mortgage payment and we bought within our price range because we thought it was the right thing to do. This is the result. Argh!

Sometimes I wonder if life would be better if I lived like so many other Americans – deeper in debt every year with complete disregard for the ramifications.  This whole “live within your means” thing seems to only benefit the crooks and scoundrels out there taking advantage of people like us!

—End Rant—

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4 Replies to “Housing Market Rant”

  1. Well said, Ryan. What adds to the frustration, at least from my perspective, is now difficult it can be to find good rentals, especially if you have kids or a dog (or both).

    When we lived in Chicago, finding a landlord who was willing to rent to us was a nightmare. Twice, we took our dog to the place so the landlord could meet our old dog and see that she was totally mellow (and also a good watchdog — a good thing, considering that the police often say dogs are the best form of security). But landlords were generally convinced that dogs would tear up the place and poop everywhere (and that’s what a security deposit is for, right?).

    We will probably move again at some point, and now that we have two dogs, we expect that it will be even harder, if not impossible, to find rentals. So we’ll probably buy and take the possible financial hits.

    BTW, Paul Krugman has some really good columns about whether our policies that encourage home ownership are a bad thing for the economy.

  2. I hadn’t even considered renting with a dog or two dogs. I’m sure that is a nightmare. I wonder what moving will be like with a child… Hmmm… Maybe you’re right that taking the economic hit is pretty much the only option when you have pets or kids. That’s still pretty frustrating, but I guess it’s more reasonable.

    Maybe I shouldn’t be so frustrated considering this is really more me recognizing that this is reality than anything else. I guess waking up from a dream where everything is nice and pretty and everyone’s home increases its value can be hard. Hard but necessary!

  3. Even finding a decent home to rent in Tampa is a complete nightmare! So far, we have found 2 bedroom 1 bath homes in semi-decent neighborhoods rent from $1000 and up and 90% don’t allow a pet. Wow! I just can’t imagine paying $1000 a month for something that is not even ours and doesn’t allow a pet. The ones that do allow pets are in less desirable neighborhoods and are not kept up. So the question is, do we pay the steep rent, get rid of our cat, worry about trying to start a family and trying finding a new place to live every year, or do we bite the bullet and buy a home that we can make our own, make it a ‘home’; cats, babies, and all? Sure we may be taking a hit if we buy and there may be the prospect of our house value going down, but what about our life value? It is a stressful situation from both the buyers and renters point-of- view. Neither seem to be winning at this point.

  4. Yeah, it really does seem as though there isn’t a good answer for this quandary. If you can find a house that is worth the cost, I’d do it. But make sure you run the numbers in a rent vs. buy calculator to make sure it’s worth it.

    The problem is that most people just think about the mortgage without considering taxes (which are pretty high in Florida because there is no income tax) and insurance, along with upkeep, which is also fairly expensive. So, just be prepared.

    I just did a search on Trulia.com for single family homes:

    Looks like there are some steals, though I don’t know about neighborhoods. I hate to be a downer about buying homes, but I guess it’s always a risk.

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