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Thread: Real estate roller coaster! Here we go, whooooooooaaaaaaaahhhhhh!!! Hahahahaha!!!

  1. #1
    Opaque John Beef's Avatar
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    Real estate roller coaster!

    "Here we go, whooooooooaaaaaaaahhhhhh!!! Hahahahaha!!!" This was my dad on the roller coasters at Busch Gardens in Williamsburg when I was a kid.

    My wife and I bought our 1st house in South Phoenix in March 2003 for around $155k. South Phoenix has been ground zero in the housing crisis and is often mentioned in national news regarding the subject. We didn't know what would happen in 2003 of course, we just knew we were getting a reasonably nice 1400 square foot 3 bedroom place that was 3 years old and in a part of town convenient to our jobs. S. Phoenix was going through some revitalization at the time so we felt it was rough around the edges but would improve, and it did.

    According to Zillow, at the height of the bubble our place would have sold for $288k.

    In September 2008, two things happened. 1st, my 1st born daughter was born. While we were in the hospital for three days with that, the second thing happened: credit markets almost froze up and the world almost imploded. But we didn't know, we were just trying to figure out what the hell to do with a baby and how to get any sleep.

    Things went south in South Phoenix. All the growth and revitalization stopped and started to go backwards. I started thinking about schools for my daughter and the school district is one of the worst in the state, and our state is one of the worst in the country. It was time to move to a better part of town.

    In April 2010 there was the home buyer tax credit thing going on, so we listed the house and got a few offers. The day before closing in July, the deal fell through. We had already moved out, we were going to close on our new house in the North Phoenix area in three weeks and wanted to move. It appraised for $147k. We kept it on the market through October. The house sat empty and there were no offers. We were hemorrhaging cash. So, we rented it out.

    In August 2011, we decided to refinance it under Making Homes Affordable. We didn't qualify because we were so far underwater. The appraisal: $93k. 38% drop in 13 months.

    Feb 2012 they dropped the 125% requirement under Making Homes Affordable, so we went through with the refinance. Appraisal: $104k. 11% increase in 5 months.

    March 2013: Our tenant is buying a place. We talk to our real estate agent and decide to list it again. Prices are skyrocketing. Our neighborhood is suddenly selling in the $110 per square foot range again. We listed it for $158k. In four days, we got five offers, all of which were at or above the asking price. We're agreeing to one of them today. So, if all goes well, we'll get a happy ending. We're looking at a 61% increase in value in 13 months.

    This is the second roller coaster I don't like. The 1st was the Shockwave at King's Dominion in Virginia. At least that one just gave me a headache.
    Last edited by John Beef; 04-11-2013 at 04:03 PM.
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    Senior Member gush's Avatar
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    My wife is a realtor. Has been for almost 20 years. 2008 was the worst year to date with markets getting better every year

    What blows my mind is how many forclosures she handles. It is insane how many people hand over the keys and walk away. What happened to being responsible and paying your bills?

    We are in crazy times we are.

  3. #3
    Senior Member garrett's Avatar
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    I feel ya, man. My wife and I bought our first house mid 2003. At the peak, it had gained about 60% in value. We sold it early 2008. We had ONE person look at it, and fortunately he wanted it. We sold at about 30% above what we paid. I feel kind of bad for the guy who bought it, because even now it's worth less than what we paid almost 10 years ago!

    So glad we got out when we did. We bought again early last year, and I've been glad to see the market is on the rise again.
    --Garrett--

  4. #4
    Opaque John Beef's Avatar
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    Quote Originally Posted by gush View Post
    It is insane how many people hand over the keys and walk away. What happened to being responsible and paying your bills?
    There are a couple things here worth noting.

    1st, if we hadn't had a tenant in Aug 2011, after 8 and a half years of not missing one payment, when the house appraised for 93K, I seriously would have considered some of the foreclosure/short sale type options. I was SO pissed off and wanted to burn the place down and leave the keys to smoldering rubble on the driveway. I was responsible, I did pay my bills, and I was taking it in the rear!!! If it was real money instead of funny asset money, I had something that cost me $54,000 over 13 months... $4,150 per month flushed down the toilet. I could have bought a new friggin' Modern Eagle every month or a new Private Stock every two months. At some point you gotta pull the plug.

    2nd - the banks and government set the system up so it's advantageous to fail. If you wanted to talk about loan reduction programs, the banks wouldn't even talk to you unless you were 90 days past due. Some people intentionally didn't pay their bills just to get to that point, just to take advantage of the programs offered to people "struggling" with their payments.
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  5. #5
    PRS Faithful Solocaller's Avatar
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    I'm glad it worked out for you. Our area didn't really suffer from the housing crash. My wife and I did buy a foreclosure house a year and a half ago, so I'm on the other side of the fence concerning foreclosures. We were patient and got a good house with a 30'x50' shop with a fully finished cement floor (this is my space and I love it!). This was just due to some irresponsible owners before us and not the market crash.

  6. #6
    Cream Crackered Mikegarveyblues's Avatar
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    So fed up of the state of the housing market...

    We've been trying to get on the ladder for 5 years. Two steps forward and one back! We'll get there but it's taking a lot longer than we hoped.

    I remember when my Girlfriend and I first started to rent in late 2007. The landlord of the house we where in at the time was desperate to sell and asked if we wanted to buy. Shortly after the financial crisis hit and that house lost many thousands off it's value. Negatve Equity? No thank you!!!
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  7. #7
    My dad died in 2009 and i'm still trying to unload some of his properties. Congratulations, on the sale, John!
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    Senior Member Daniel's Avatar
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    Glad your luck turned around. Also glad to hear Phoenix real estate is turning around.

  9. #9
    Senior Member gush's Avatar
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    Hey there John Beef, my post wasnt directed towards you. When you see the amount of forclosures my wife does it really makes a person wonder. I know a few people that live beyond their means running up credit card debt and filing for bankruptcy more than once. Obviously thats not you. It just puts more burden on others and shouldnt be allowed.

  10. #10
    Opaque John Beef's Avatar
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    I totally agree!
    The Bovine Fury <-- stream and download our album "Eleven by Twelve" for free.
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  11. #11
    Member dmorton67's Avatar
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    you're lucky to have made a few bucks. I finally sold my house in january after 5 years of trying to sell it and lost over $150K
    Sometimes in life you get shown the light in the strangest of places if you look at it right.

    Dave

  12. #12
    Opaque John Beef's Avatar
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    I'm sorry to hear that, Dave. At least you have those two excellent dalmatians!

    The deal closed and recorded today, and the money is in our account! I'm pretty stoked. Glad to be off this roller coaster!
    The Bovine Fury <-- stream and download our album "Eleven by Twelve" for free.
    05 Custom 22 with DGT pickups ~ 07 Mira with old birds ~ 08 SE Baritone Fralin/Suhr pickups ~ 03 SE Santana

  13. #13
    Senior Member jfb's Avatar
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    Quote Originally Posted by John Beef View Post
    I'm sorry to hear that, Dave. At least you have those two excellent dalmatians!

    The deal closed and recorded today, and the money is in our account! I'm pretty stoked. Glad to be off this roller coaster!
    Those Dalmatians are awesome.
    Plank Owner

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    Quote Originally Posted by gush View Post
    My wife is a realtor. Has been for almost 20 years. 2008 was the worst year to date with markets getting better every year

    What blows my mind is how many forclosures she handles. It is insane how many people hand over the keys and walk away. What happened to being responsible and paying your bills?

    We are in crazy times we are.
    I used to agree with you....however I have watched businesses do this time and time again and everyone just says "thats part of doing business"....even the company I worked for did a "Fast Track Bankruptcy" where they filed BK, got out from under all the leases they had signed, let a 3rd of the company go, then came out of BK 3 months later, did a huge deal with Bellsouth, and then sold the company to a larger company for over 2 Billion dollars?????

    Sorry, but I have no issues with REAL people doing what they have to do or even just being SMART and walking away from a bad deal just like a business would do... Is it smart to just throw away your life savings vice just walking away from a bad investment...if it was a business you would say "why didnt you just walk away before you lost it all" but when its someones home you say "you signed up for this"

    I have now seen at least 3 people I know file BK in the last 4 years, one of which walked away from a mountain of credit card debt and an upside down house and a severely upside down truck....over the last 4 years I have watched him buy and sell 5 brand new cars (2 for his wife, one for his daughter and two for himself), he has zero credit card debt, and closed on a new house this month....meanwhile I have literally scraped it together the last 3 years...he is WELL ahead of the game now while I am still pretty much in the same boat I have been in for years....good guys - you know where they finish....
    Last edited by RedRider; 04-13-2013 at 08:11 AM.

  15. #15
    Try having health issues and not being able to work on top of the recession, layoffs, etc. I went off work 2007. Begged my doctors to let me work at something and got back to work in 2010. Now since December I'm having constant health issues again. Having to deal with pain and health issues every day is miserable, but you can't imagine the stress and frustration of having no ability to work and provide for your family. I keep trying to do things the "right way" as well, but I see people around me taking the short cuts and tricks to cheat the system doing far better while working so much less then me its just frustrating. I continue to work each day, even though I am technically disabled, I'm just trying to enjoy my life to some degree, keep the house going, keep spirits up during hard times etc, meanwhile the "system" is constantly trying to screw me but it lets others rack up credit cards, go bankrupt, break the law etc. and offer them all sorts of deals and programs while they buy their 3rd vehicle for the year, new home, etc. Sickening.

    I'll stop now. Just venting lol.

  16. #16
    Senior Member andy474x's Avatar
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    I worked for a smaller local bank (12 or so branches) for a couple years, and had my hand in a bit of everything, including mortgages and collections - saw some pretty crazy stuff. Usually the people that were behind on their mortgages fell into 2 camps, the ones that were struggling to make it, but still trying to be responsible and paying what they could, and then the people that thought that bigscreen tv's, vacations, cars, and general pissing away of money were all necessities, and the bank should understand this. The latter group were usually the ones where the bank shows up at the foreclosed home and finds it purposefully TRASHED - walls and windows broken, flooded, dirty, carpet and floors ruined, stripped for anything they could get. I won't say I saw it all, but I saw a lot. And then there were the people that tried to apply for mortgages and other loans - sweet moses, the things I saw. In 2 years, not once did I send a referral to our mortgage department and have it go through. Not that I expected any of them to, but by law you have to give everyone the opportunity to apply. People with credit scores in the 500's, trying to secure loans with no collateral, using their unemployment benefits as a source of income - even as a young guy that's never had to take out anything but a student loan, I was shocked by the bad ideas that rolled in.

    The nice thing about working for a local bank was that they genuinely cared about the people that were making an honest effort and still struggling to make ends meet. Usually they would work very hard with those families, and extend a lot of grace to them if they made payment arrangements and stuck to them, even if they were technically not making their full monthly payment.
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  17. #17
    deus ex machina
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    Quote Originally Posted by gush View Post
    What blows my mind is how many forclosures she handles. It is insane how many people hand over the keys and walk away. What happened to being responsible and paying your bills?
    It went the way of corporate responsibility and bank due diligence.

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