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#1 johnfwd

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Posted 20 January 2022 - 09:57 AM

I own an old post-WWII house in southwest Fort Worth that has long been valued at between $50,000 and $60,000.  Yesterday I received in the mail an offer from one of those "we buy ugly houses" firms.  The offer was between $130,000 and $160,000!  From my reading, I know that purchase prices have increased considerably for various reasons, principally among them the current scarcity of available housing.  But what this firm was offering still astounded me.

 

 



#2 JBB

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Posted 20 January 2022 - 10:04 AM

If you go that route, steer toward an individual investor rather than one of the large commercial outfits that does it.  And read the fine print about whether or not they can change the financial terms right up to closing.  I had a co-worker that sold to one of the large commercial, buy as is home buyers and she ended up owing money at closing instead of making a small return.



#3 Nitixope

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Posted 20 January 2022 - 10:39 AM

I would hire my own appraiser before I talked to anyone or hire a realtor and list it as-is.  You might be suprised the mix of offers you get either investors or private buyers.  I don't think anyone should sell themselves short, especially in this market. 

 

I've noticed an uptick in home flippers lately now that there's some more "meat on the bone."  One project I'm keeping an eye on, they are doing standard renovations on an older home and I heard they are going to list it soon for $60-80K over comps that I just looked at four weeks ago.  If someone jumps at that deal, it will set a new record high for that neighborhood.



#4 Wkelly1989

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Posted 25 January 2022 - 03:13 PM

What neighborhood is that? If you don't mind me asking.



#5 johnfwd

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Posted 26 January 2022 - 09:04 AM

What neighborhood is that? If you don't mind me asking.

I don't wish to be too specific, but it's the area around Cedar Hill and Wycliff, just north of West Vickery.  The old post-war homes, many of which have been rehabbed in recent years.



#6 Doohickie

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Posted 27 January 2022 - 01:24 PM

Unless your home is in a bad state of disrepair it's probably worth $150k right now.  4940 Gilbert Drive:  Ask price $169k; sale is pending.  The home is 3 BR, 1 BA, 1,252 sq ft, or $135 per sq ft.


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#7 Doohickie

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Posted 27 January 2022 - 01:28 PM

7664 Osbun St:  $174k for 741 sq ft, 2 BR, 1 BA.  That's $235 per sq ft and they are under contract!  When we bought in 2018 we looked at 7624 Osbun.


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#8 johnfwd

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Posted 28 January 2022 - 09:39 AM

Looks like mortgage interest rates will be heading north this year.  That may put a crimp in the buyers' market for financing, despite the apparent shortage in residential housing.  Not being an expert in real estate economics, I don't know what effect that would have on sales price offerings.



#9 Doohickie

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Posted 29 January 2022 - 07:21 PM

Looks like mortgage interest rates will be heading north this year.  That may put a crimp in the buyers' market for financing, despite the apparent shortage in residential housing.  Not being an expert in real estate economics, I don't know what effect that would have on sales price offerings.

Right now corporate interests are buying up a lot of single family homes to either flip them or rent them out.  With those interests pumping money into the single family home market, prices are *not* going down.


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#10 elpingüino

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Posted 05 June 2022 - 05:27 AM

One in two homes sold in Tarrant County last year was bought by a company or corporation

Institutional buyers made up 52% of home purchases in Tarrant in 2021, the third highest percentage in the US among counties population 50,000 or greater.

#11 JBB

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Posted 05 June 2022 - 07:32 AM

I wonder how many of the non-institutional buyers are cash buyers.

 

The article notes that prices have increased 40% over the last decade.  Interesting notes about my current home: I purchased it 3 years ago for around 40% more than what is sold for 7 years prior.  If I sold it today, I believe I could get at least 50% more than what I paid for, maybe closer to 60%.  That would be 125% over what it sold for a decade ago.



#12 Doohickie

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Posted 05 June 2022 - 10:31 AM

It's the institutional money that's making home prices (both buy and rent) go up so much.  Perhaps some adjustments to the tax code can level that for people who what to rent or buy at a reasonable price.


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#13 WTXKid

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Posted 07 June 2022 - 04:42 PM

Yeah, I think we need to legislate and keep institutional buyers out of the primary home market.

#14 JBB

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Posted 07 June 2022 - 05:14 PM

That seems extreme.  There's a lot of middle ground between what's going on now and banning institutional buyers and there's likely a better solution in there somewhere.  And how do you define an institutional buyer?  Is it strictly property management companies and mass home flippers like open door or are we going to extend that to the savvy investor that buys a home a year to lease or flip?



#15 Doohickie

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Posted 08 June 2022 - 06:47 AM

That seems extreme.  There's a lot of middle ground between what's going on now and banning institutional buyers and there's likely a better solution in there somewhere.  And how do you define an institutional buyer?  Is it strictly property management companies and mass home flippers like open door or are we going to extend that to the savvy investor that buys a home a year to lease or flip?

I think something could be worked with the homestead exemption.  Give property tax relief to the actual live-in owners but not to the institutional buyers.

 

I got into it on Nextdoor with a small-scale institutional buyer.  She tried to portray herself as providing a valuable service to people who are behind on their payments or otherwise need to sell quickly.  I said she can look like the good guy all she wants but she's still part of a predatory industry.  (A bit extreme but hey, Nextdoor.)


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#16 gdvanc

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Posted 08 June 2022 - 09:10 AM

...  She tried to portray herself as providing a valuable service to people who are behind on their payments or otherwise need to sell quickly.  I said she can look like the good guy all she wants but she's still part of a predatory industry.  (A bit extreme but hey, Nextdoor.)


So, a valuable service like "payday loan" lenders.

#17 JBB

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Posted 08 June 2022 - 10:47 AM

I think something could be worked with the homestead exemption.  Give property tax relief to the actual live-in owners but not to the institutional buyers.

 

 

Isn't that essentially what a homestead exemption already does?  There's are plenty of federal income tax breaks for rental property owners, but I don't know that there are really any local property tax advantages.  Buyers are in it for the rental income and the cash at closing when they flip, not any tax advantages.



#18 Doohickie

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Posted 08 June 2022 - 10:51 AM

 

I think something could be worked with the homestead exemption.  Give property tax relief to the actual live-in owners but not to the institutional buyers.

 

 

Isn't that essentially what a homestead exemption already does?  There's are plenty of federal income tax breaks for rental property owners, but I don't know that there are really any local property tax advantages.  Buyers are in it for the rental income and the cash at closing when they flip, not any tax advantages.

 

That's really the problem:  plenty of federal income tax dodges for rental property owners but even when I bought my home in 2018 I didn't pay enough interest to itemize deductions.  They help the businesses but currently there's little incentive from the federal government for the individual home owner.


 

...  She tried to portray herself as providing a valuable service to people who are behind on their payments or otherwise need to sell quickly.  I said she can look like the good guy all she wants but she's still part of a predatory industry.  (A bit extreme but hey, Nextdoor.)


So, a valuable service like "payday loan" lenders.

 

Ooh, that's good.  If she answers me I can use that.  :devil:


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#19 elpingüino

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Posted 20 June 2022 - 05:58 AM

Good coverage from Fort Worth Report, with perspectives from Ann Zadeh and Michael Crain.

Fort Worth seeks 'missing middle' housing as prices soar


Fort Worth's median price for new homes hit a record high of $367,000 in May, up 24.4% from $295,000 in May 2021. I bet it's even more for some parts of town.

This says if the hot market continues, many area officials are concerned that homebuilders and developers will gravitate toward building only higher-priced homes.

#20 Nitixope

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Posted 20 June 2022 - 07:59 AM

I hate to say it but those cottage homes / detached multi-family are probably one of the few options for the missing middle.  If they do it right and incorporate some energy efficiency elements into the design, they could be super affordable at least enough to help offset the rising cost of ownership.  Are those truly owned properties or some kind of build-to-lease deal?  

 

Did you see the free event with breakfast at the bottom of the page?  That's really cool they're doing that:

 

Thursday, June 23, 2022
7:30-8 a.m. – Breakfast and Networking
8-9 a.m. – Program
Texas Wesleyan University
Nick and Lou Martin University Center (2nd Floor)
3165 E. Rosedale Street
Fort Worth, TX 76105


#21 roverone

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Posted 20 June 2022 - 09:17 AM

There are some who theorize that building houses of any kind at any price inherently helps by increasing the housing inventory.  Inevitably, if there are more houses for sale, it is going to affect the pricing of some portion of them downward (or at least reduce their upward trend).

 

One thing that I always wonder about is that we talk all of the time about the regional nature of where we live, with so many other cities being so nearby.  This seems to come up much more when it comes to employers -- even if we are maybe not getting all of the corporate relocations that we might want to, there are jobs coming into the region.

 

I wonder a lot on why this affordable housing situation is not also taken on more regionally.  What portion of residential affordability is the city of Fort Worth supposed to take on compared to the 41 other municipalities that are at least partially in Tarrant County.

 

We don't want to force ourselves into being the only affordable housing city in the area.



#22 Doohickie

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Posted 20 June 2022 - 09:35 AM

Some cities (Minneapolis/St Paul?  Seattle?) are doing away with single family zoning to open the way for accessory dwelling units which include garage apartments, mother-in-law units behind the main house, etc.  The problem with this approach is, depending on existing density, there may not be enough room for car parking.  Shortly before I moved here South Hills was rezoned as all single family.  My son said that when he was working the Census there were already a surprising number of ADUs/stealth apartments even in our single family zones.

 

But that's one way to address missing middle because it creates housing that's not necessarily providing the landlord's primary income but supplements the cost of housing for the landlord to assist their ability to keep up with property tax increases and not get priced out of their own home.


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#23 Austin55

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Posted 20 June 2022 - 02:47 PM

I think also too many folks (especially outside the forum) consider housing to only be single family homes on a quarter acre with a yard. There is simply finites amount of room for that style of living in proximity to desirable locations. And, doing with with single family zoning is only going to make SFH homes harder to find, likely driving the prices of those up. 

But obviously, there's a lot of other types of housing that still exist. 



#24 Nitixope

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Posted 20 June 2022 - 11:10 PM

You know, I dont see as many condos for sale around here as I do in other parts of the country. Im sure there are plenty out there but maybe Texas has this stigma about owning an apartment where if you are going to own, it better have a lawn and two car garage?

In Seattle you can buy a basic 2BR condo for around $500K.

#25 Shanedallas76

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Posted 28 June 2022 - 09:56 AM

I own an old post-WWII house in southwest Fort Worth that has long been valued at between $50,000 and $60,000.  Yesterday I received in the mail an offer from one of those "we buy ugly houses" firms.  The offer was between $130,000 and $160,000!  From my reading, I know that purchase prices have increased considerably for various reasons, principally among them the current scarcity of available housing.  But what this firm was offering still astounded me.

 

 

Assuming a $55k house built near 1950; after adjusting for inflation, the real purchasing power of the dollar value of that house would be equal to near $700k today. Home prices take a different shift over time if we observe their real value vs nominal value.



#26 Nitixope

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Posted 28 June 2022 - 11:00 AM

 

I own an old post-WWII house in southwest Fort Worth that has long been valued at between $50,000 and $60,000.  Yesterday I received in the mail an offer from one of those "we buy ugly houses" firms.  The offer was between $130,000 and $160,000!  From my reading, I know that purchase prices have increased considerably for various reasons, principally among them the current scarcity of available housing.  But what this firm was offering still astounded me.

 

 

Assuming a $55k house built near 1950; after adjusting for inflation, the real purchasing power of the dollar value of that house would be equal to near $700k today. Home prices take a different shift over time if we observe their real value vs nominal value.

 

 

I guess I thought he was referring to its current value had been $55K up until recent.  I'm sure your example is still true in select/premier neighborhoods but certainly not generally throughout Fort Worth.  It all depends on the neighborhood.  I don't really know the difference between real and nominal value unless you're trading baseball cards for coins or stamps, but the adage I always hear when talking about value is "something is only worth what someone else is willing to pay for it" and I would add...."or what you can insure it for."  I heard a guy on the radio the other day talking about what an ounce of gold could buy you in Biblical times vs what it could buy you today and basically, he said that same ounce of gold that would have bought you a good quality tunic, a belt and a pair of good sandals would still buy you a decent suit, a nice belt and a good pair of shoes today.

 

Here's some interesting info:

https://better.com/c...sen-since-1950/

Median home value (unadjusted): $7,354
Median home value (inflation-adjusted to 2020 dollars): $79,063


#27 Doohickie

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Posted 29 June 2022 - 06:59 AM

Yeah, $55k in 1950 would have been a mansion.

 

I'm starting to get the sense that the housing bubble may be easing a bit.  A house near me hit the market a week ago at what I would consider a bargain price ($143 per sq ft where many homes are asking $170-200) in our local market.  So far no offers yet.  Houses that were getting snatched up in bidding wars are now sitting on the market longer.  Not sure if that's true of the market in general or just my local area.


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#28 Nitixope

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Posted 29 June 2022 - 07:55 AM

Yeah, $55k in 1950 would have been a mansion.

 

I'm starting to get the sense that the housing bubble may be easing a bit.  A house near me hit the market a week ago at what I would consider a bargain price ($143 per sq ft where many homes are asking $170-200) in our local market.  So far no offers yet.  Houses that were getting snatched up in bidding wars are now sitting on the market longer.  Not sure if that's true of the market in general or just my local area.

 

I was going to mention the same thing Doohickie....I've noticed several houses that I drive past frequently that were flipped but still have a for sale sign in the front yard. There's a few on a busier road but a few tucked back on quiet streets still sitting for sale right now.  I wanted to start tracking how many weeks on the market they've sat.  There's a couple that I think sold recently after flipping but I haven't seen any activity like people moving in but there's no sign in the front yard anymore.  If sellers start majorly price reducing, does that mean the bubble has burst?  

 

I heard a blurb on the radio that said Sherman / Denison was rated nationally as being overpriced by 60%.  I wonder if buyers like that will be kicking themselves in a few months for paying too much if the values drop?  You gotta hope they locked in an OK rate but if you're overvalued on your existing loan, I don't think you can refi with negative equity if the appraisal comes back lower than what you paid unless you have some way to make up the difference.  That could be where we see an uptick in foreclosures....then you really know the bubble has burst.  



#29 Nitixope

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Posted 30 June 2022 - 03:54 PM

DMN article saying home prices still on the rise in some parts of DFW.   (for now)

https://www.dallasne...most-of-the-us/

 

I'm always looking for signals in the market.  I haven't totally thought this idea through, but if you use older neighborhoods as an early indicator for a housing market shift, I feel like those areas will show an earlier change in values before the homes with higher competition.  There was a period very recently where even those older neighborhoods were selling just as quickly as those in Collin County with multiple bidders, all cash offers etc.  We'll know when it becomes a buyer's market again especially when buyers can start being a little more choosey and those still in the market to buy will naturally gravitate towards newer areas, possibly bigger houses for less money / better value, better schools, etc.  I guess other signals would be unemployment figures rising, longer days on market for sale, higher foreclosures.



#30 Shanedallas76

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Posted 01 July 2022 - 09:27 AM

 

 

I own an old post-WWII house in southwest Fort Worth that has long been valued at between $50,000 and $60,000.  Yesterday I received in the mail an offer from one of those "we buy ugly houses" firms.  The offer was between $130,000 and $160,000!  From my reading, I know that purchase prices have increased considerably for various reasons, principally among them the current scarcity of available housing.  But what this firm was offering still astounded me.

 

 

Assuming a $55k house built near 1950; after adjusting for inflation, the real purchasing power of the dollar value of that house would be equal to near $700k today. Home prices take a different shift over time if we observe their real value vs nominal value.

 

 

I guess I thought he was referring to its current value had been $55K up until recent.  I'm sure your example is still true in select/premier neighborhoods but certainly not generally throughout Fort Worth.  It all depends on the neighborhood.  I don't really know the difference between real and nominal value unless you're trading baseball cards for coins or stamps, but the adage I always hear when talking about value is "something is only worth what someone else is willing to pay for it" and I would add...."or what you can insure it for."  I heard a guy on the radio the other day talking about what an ounce of gold could buy you in Biblical times vs what it could buy you today and basically, he said that same ounce of gold that would have bought you a good quality tunic, a belt and a pair of good sandals would still buy you a decent suit, a nice belt and a good pair of shoes today.

 

Here's some interesting info:

https://better.com/c...sen-since-1950/

Median home value (unadjusted): $7,354
Median home value (inflation-adjusted to 2020 dollars): $79,063

 

After reading it again, I see you are 100% right. His value is normally $55k until recent. Furthermore, as was mentioned, a $55k house in 1950 would have been a mansion.

Thank y'all for clarifying. 



#31 elpingüino

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Posted 23 July 2022 - 06:03 AM

Dallas Business Journal reports on the "alarming" surge in contracts being canceled for new homes in Dallas-Fort Worth. 20% of home sales in DFW fell out of contract last month, 5 percentage points higher than the national average. https://www.bizjourn...ale-dallas.html

#32 Nitixope

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Posted 23 July 2022 - 07:50 AM

I heard on the radio that builders are starting to offer more incentives for signing now. Funny how quickly they changed their tune. I seem to recall not too long ago, builders cancelling contracts on new owners to one-up them fir a higher price.




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