Monday February 13, 2006
Privately, I’ve been advising home-owning friends and family thusly for the last six months or so: find a moment (and find it soon), to sell your house, put your stuff in storage and rent an apartment for a year (maybe two or three), then buy your house (or one similar) back, for a maybe $200,000 profit. It remains to be seen whether my advice is worth anything (to date, everyone has emphatically ignored it), but for the first part, housing prices are finally starting to crash.
Kidding: the Herald sugar-coats it. Clear, though, is that housing prices probably hit their peak near $400,000 for awhile in November 2005, and will now be heading south, abetted by (1) the fact that everybody who was looking to buy a home has bought one, (2) 2005 proved that hurricanes can be a bitch in SoFla, (3) the subsequent increase in insurance costs, (4) some of the folks who took out interest-only mortgages are going to be defaulting over the next few years, and finally (5):
There are, for instance, 15,080 [condo] units under construction in the city of Miami alone, compared with 11,241 built in the entire past 10 years. And that doesn’t even count the more than 28,000 units approved to go up in Miami.
Sooo…. if you just bought a house, congratulations: you’re living in the place of your dreams, carefree. (Just don’t obcess too much about its value.) If you just sold a house, you probably did so at exactly the right time (it might not be too late yet). If you’re thinking about buying, waiting a couple of years might make you look very smart.
This is good news to all of us Gen-Xers who have been renting, and drinking through the savings: now is the time to accumulate a five-digit savings account, so that when the price bottoms out, you’re set to take advantage of the next housing bubble. [links via Infomaniac]
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