the times of kryptoniteglows

So the offers on that house I mentioned previously have been published:
155k – Accepted
140k – Accepted
125k
120k
110k

155k guy made their offer after 140k had been accepted and published as such, but for some reason it was relisted (likely due to financing issue). No other competitors to really speak of, think my calculation of $134k probably being their “reserve” was correct.

15k is negligible on million dollar property, but this place was under $200k and $15k was almost 10% of the asking price!

Seeing scenarios like this, make me want to wait longer to buy. While it seems like the market is on an uptick in recent months, I feel that the numbers are not being seasonally adjusted accurately for the buying that occurs in the summer months due to families wanting to move between the school year for the kids.

Additionally, with all these FHA loans going out for mere 3.5% down and sometimes even less because the buyers are pulling in all sorts of other buyer assistance programs, there will be a whole new batch of REOs/repos in a few years time. While it is an amazing time to buy, lots of people who are not prepared are coming to the market, enticed by the low down payment and interest rates. I often see people asking about what they can do if they can’t come up with the 3.5% down for an FHA loan. My answer is simple, do not buy at this time.

Traditionally, people came up with 20% down, but now it is often not the case. When credit was flowing in 2005/2006, people were buying houses with ZERO down! I can’t believe that, that was ever allowed. Anyhow, people who can’t even come up with 3.5% easily, shouldn’t be in the market to buy a home. I mean, what would they do if the home needed a repair? They are struggling to get 3.5%, they likely aren’t going to have 5-6k around to fix a roof/hvac/broken major appliance. The latter would only be a few hundred bucks, but still probably a challenge for people struggle to put 3.5% down.

Not to mention, they are still getting ARMs, when the rate resets in 5 years, probably not going to be a pretty picture….