Quantcast

housing market

Andyman_1970

Andyman_1970

Turbo Monkey
Apr 4, 2003
3,105
5
The Natural State
reflux said:
Like when wages increase at X and housing appreciates at X + 5? With "5" being a number completely picked at random.
Click to expand...
Yeah I don't get that, at least not how it stays sustainable.

Example: aircraft industry (which I'm in) salaries for engineers in Little Rock are below the national average. Our housing market and cost of living are about the norm or a bit below the nat'l average.

I got offered a job in Bend OR, same job, with a mid sized aircraft builder, to make what I make now in Little Rock, I would have had to make 16% more than what I make now for it to be a completely horizontal move. Their highest offer (which is what the position would top out at) was $2000 less than what I make now.

Now I know there are things like the mountains and stuff like that, and those things factor into people's decisions to take a job for less $, and that's cool. But my point is, how can a local economy survive, where the salaries, even for technical professionals are way below the nat'l average, and yet have cost of living cost's that are at least 25% above the nat'l average.

I guess I don't get how that is sustainable. That's just my experiences also, so I may be missing something in the mix.

Anyway, it's been interesting to watch that's for sure.
 
douglas

douglas

Chocolate Milk Doug
May 15, 2002
9,887
6
Shut up and Ride
Andyman_1970 said:
Yeah I don't get that, at least not how it stays sustainable.

Example: aircraft industry (which I'm in) salaries for engineers in Little Rock are below the national average. Our housing market and cost of living are about the norm or a bit below the nat'l average.

I got offered a job in Bend OR, same job, with a mid sized aircraft builder, to make what I make now in Little Rock, I would have had to make 16% more than what I make now for it to be a completely horizontal move. Their highest offer (which is what the position would top out at) was $2000 less than what I make now.

Now I know there are things like the mountains and stuff like that, and those things factor into people's decisions to take a job for less $, and that's cool. But my point is, how can a local economy survive, where the salaries, even for technical professionals are way below the nat'l average, and yet have cost of living cost's that are at least 25% above the nat'l average.

I guess I don't get how that is sustainable. That's just my experiences also, so I may be missing something in the mix.

Anyway, it's been interesting to watch that's for sure.
Click to expand...

so your basis of a comaprison between 2 cities/region's economy is on what one company offered to pay you, compared to what you make now?

:help:
 
Andyman_1970

Andyman_1970

Turbo Monkey
Apr 4, 2003
3,105
5
The Natural State
douglas said:
so your basis of a comaprison between 2 cities/region's economy is on what one company offered to pay you, compared to what you make now?

:help:
Click to expand...
I'm comparing two equal jobs, same industry, same position, same job responsibilities. The point was to compare my current salary (below nat'l average) and cost of living (about the "norm" for the nat'l average) with someplace with housing costs in need of correction. My point was that Bend not only has a high cost of living evidently in need of correction, and that the salaries in the region for my industry are even lower than in Little Rock, which is already lower than the nat'l average. How can a region with higher than nat'l average cost of living be sustained with lower than nat'l average professional level salaries?

Using my job/salaray was merely to point out the disparity in salary vs. cost of living for the Bend area.

I hope that made some sort of sense....................
 
douglas

douglas

Chocolate Milk Doug
May 15, 2002
9,887
6
Shut up and Ride
Andyman_1970 said:
I'm comparing two equal jobs, same industry, same position, same job responsibilities. The point was to compare my current salary (below nat'l average) and cost of living (about the "norm" for the nat'l average) with someplace with housing costs in need of correction. My point was that Bend not only has a high cost of living evidently in need of correction, and that the salaries in the region for my industry are even lower than in Little Rock, which is already lower than the nat'l average. How can a region with higher than nat'l average cost of living be sustained with lower than nat'l average professional level salaries?

Using my job/salaray was merely to point out the disparity in salary vs. cost of living for the Bend area.

I hope that made some sort of sense....................
Click to expand...

umm, maybe the company in Bend is a cheapo company that pays considerably less than all of its competitors (In Bend) pay

or maybe theres an oversaturation of people there that have the same job skills/experience as you, so that paticular job doesnt pay so well in Bend

or maybe you are currently overpaid

or how about you compare, lets say 100 different jobs, do an average salary for each, say with a minimum of 10 companies per job per city, then get back to us :rolleyes:
 
Andyman_1970

Andyman_1970

Turbo Monkey
Apr 4, 2003
3,105
5
The Natural State
douglas said:
umm, maybe the company in Bend is a cheapo company that pays considerably less than all of its competitors (In Bend) pay
Click to expand...
I don't think Lancair is a cheapo company..........I could be wrong.

douglas said:
or maybe theres an oversaturation of people there that have the same job skills/experience as you, so that paticular job doesnt pay so well in Bend
Click to expand...
Lancair is the only company of it's size in Bend, there are 1 or 2 very small (3-4 people employed) companies that do what they do.

douglas said:
or maybe you are currently overpaid
Click to expand...
According to the national average published by Avation Week and Space Technology I'm underpaid.............

douglas said:
or how about you compare, lets say 100 different jobs, do an average salary for each, say with a minimum of 10 companies per job per city, then get back to us :rolleyes:
Click to expand...
I'm not an economist, and don't claim to be one, and put that disclaimer in my orginal post, like I said that has been my exprience, it's not exhaustive by any means.

Dude...........chill....................
 
Zark

Zark

Hey little girl, do you want some candy?
Oct 18, 2001
6,254
7
Reno 911
blt2ride said:
It's kind of what I figured; most of the cities are right here in California. It doesn't surprise me in the least that Santa Barbara is the number one spot. A real esate agent once said that you can't touch anything in Santa Barbara for less than a million dollars.

On the other hand, I'm kind of surprised that Oxnard made the top 20...
Click to expand...

Burst bubble BURST!!!! SB is freaking rediculous. My friend recently bought a 3bd/2ba tract home from the 60's in Goleta for....(drum roll) $875,000 :mumble:


It is so bad here. Firemen and Police live in other cities and have 40 minute commutes. Rent is rediculous too. 1bd apts. go for $1k/mo. I can't even dream to own anything here, which is too bad since my company won't move. If it weren't for the insane trails, beach right down the street and loads of the most beautiful women on earth I'd move :devil:
 
I Are Baboon

I Are Baboon

Vagina man
Aug 6, 2001
32,740
10,672
MTB New England
Crashby said:
...Thats where it gets interesting... sell... and then what?

I have seen that most people who are living in bubble-land (Boston/SoCal/Phoenix, etc.) would have no interest in moving to Texas, Alabama, Tennessee, etc. So, that leaves them with a truckload of cash at the sale point, but then they have to spend that truckload on another place in a comparable environment...
Click to expand...
Very true, but it seems to me that people are thrilled to sell and make a huge profit on a home they bought 15 years ago, then turn around and buy a much bigger house in the same area with that money.

I think it's funny that market "experts" have been saying for 3, 4, 5, 6 years now that the market was going to level off or take a dive, and here we are with prices still on the rise. If me and the wife would have listened to them, we still be living in an apartment with the prospect of getting even less house for our money. I'm glad we bought when we did (last August) even though we spent more than we wanted to. The fact is, no one knows what the hell is going to happen with the market. Sure it could nose dive, but it could also keep rising.
 
douglas

douglas

Chocolate Milk Doug
May 15, 2002
9,887
6
Shut up and Ride
Andyman_1970 said:
I don't think Lancair is a cheapo company..........I could be wrong.



Lancair is the only company of it's size in Bend, there are 1 or 2 very small (3-4 people employed) companies that do what they do.



According to the national average published by Avation Week and Space Technology I'm underpaid.............



I'm not an economist, and don't claim to be one, and put that disclaimer in my orginal post, like I said that has been my exprience, it's not exhaustive by any means.

Dude...........chill....................
Click to expand...

I am chill........see:

.

 
narlus

narlus

Eastcoast Softcore
Staff member
Nov 7, 2001
24,658
65
behind the viewfinder
IAB, the main problem i see w/ it (and i've stated this before) is that house prices are rising at an annual rate far above:

1 - people's salaries
2 - people's investments (using S&P500 as a marker)

so, unless people were sitting on a huge wad of cash, OR using increased equity from a previous house purchase, they can't make the purchase based solely on income. that means they are leveraging their increased equity. can this go on forever? i kinda doubt it. the bubble could burst if the economy starts shedding jobs, and people can't cover their mortgages.

speaking of mortgages, when you hear about things like interest-only loans or 40 year loans, that's typically the sign of an over-heated market where people don't really have the means to buy in....
 
douglas

douglas

Chocolate Milk Doug
May 15, 2002
9,887
6
Shut up and Ride
don't forget how much lower interests rates are now, compared to what 12-15 years ago......

ie
before borrow 70k @ 13% = 774/month
now borrow 140 k @ 5% = 751/month
 
narlus

narlus

Eastcoast Softcore
Staff member
Nov 7, 2001
24,658
65
behind the viewfinder
true, lower rates means you can borrow more money, but the interest rates have been (historically, anyway) pretty low for the last ~6-8 years anyway.
 
N8 v2.0

N8 v2.0

Not the sharpest tool in the shed
Oct 18, 2002
11,003
149
The Cleft of Venus
I just had a set of house plans appraised for a construction loan and the prices of new homes in that area have increased over $5 per square foot in the last 9 months!

That's nearly $9,000 on a 1750_sf (heated area) home....
 
berkshire_rider

berkshire_rider

Growler
Feb 5, 2003
2,552
10
The Blackstone Valley
douglas said:
really? what is thier plan/where will this $ come from...selling the house? or remortgaging it?

I could see the market leveling off, but burst......not gonna happen(IMO)

Dont forget people renting aparts, will have rent increases year after year, mortgages stay the same.
Click to expand...
I would imagine they have the false belief that the house they live in will continue to gain value endlessly, and they can sell it at some point to make quick cash. The main problems I see with this scenario is it's far from a sure thing, and even if they could sell the house and make a bunch of cash, using their own mis-guided logic, they wouldn't be able to buy a new place to hold onto this new money without moving to a new area where prices are lower.
 
Ciaran

Ciaran

Fear my banana
Apr 5, 2004
9,841
19
So Cal
OK... I'm gonna ask a question and don't any of you financial wizards jump down my throat for asking what you will consider a pedestrian question...

When you sell your house (primary residence) how much (profit) are you allowed to keep without paying capital gains taxes? How long do you have to buy a new house? How often?

My dad bought a house in Orange County for 410,000. Two years later he sells the house for 709,000. ( :eek: yes, seriously.) Does he have to reinvest the whole amount into buying a new house or can he keep some of the money?

I'm just curious... The Dad knows what he's doing, the advice is not for him.
 
reflux

reflux

Turbo Monkey
Mar 18, 2002
4,617
2
G14 Classified
Ciaran said:
OK... I'm gonna ask a question and don't any of you financial wizards jump down my throat for asking what you will consider a pedestrian question...

When you sell your house (primary residence) how much (profit) are you allowed to keep without paying capital gains taxes? How long do you have to buy a new house? How often?

My dad bought a house in Orange County for 410,000. Two years later he sells the house for 709,000. ( :eek: yes, seriously.) Does he have to reinvest the whole amount into buying a new house or can he keep some of the money?

I'm just curious... The Dad knows what he's doing, the advice is not for him.
Click to expand...
The rules about the cap gain exclusion:

-You may exclude $250,000 of capital gain ($500k if married and file joint) from the sale of your personal residence
-Personal residence is defined as you having lived in that house, it being your primary place of living, for two of the previous five years.
-That home sale exclusion is not available if you've already used it in the previous 5(?) years.
-You do not need to purchase a replacement property, you can hold onto the money and live out of a minivan if you prefer.

I may have forgotten something, but that's it in a nutshell.

**Edit - if you sell your home for a loss, you can deduct $3,000/year from your 1040 (indefinitely), or offset future capital gains against whatever loss carryovers you have (like what a lot of stock bubble people are doing)**
 
Crashby

Crashby

Monkey
Jan 26, 2003
947
1
Rochester, NY
Ciaran said:
OK... I'm gonna ask a question and don't any of you financial wizards jump down my throat for asking what you will consider a pedestrian question...

When you sell your house (primary residence) how much (profit) are you allowed to keep without paying capital gains taxes? How long do you have to buy a new house? How often?
Click to expand...
If its more than 24 months... no tax! You are allowed to sell a principal residence once every two years and exclude up to $250,000 ($500,000 for a married couple) of the gain on the sale.

... and you can do whatever you would like with the proceeds... The best tax break in existence at this point in time...
 
N8 v2.0

N8 v2.0

Not the sharpest tool in the shed
Oct 18, 2002
11,003
149
The Cleft of Venus
Existing Home Sales Dip, Mortgage Rates Up
By JEANNINE AVERSA, AP Economics Writer
23 Aug 2005

WASHINGTON - Sales of previously owned homes dropped 2.6 percent in July as mortgage rates crept up. But even with the decline, sales clocked in at the third-highest level on record.

The latest snapshot of housing activity, released by the National Association of Realtors on Tuesday, suggested that the sizzling housing market may be cooling a bit but nonetheless remains in healthy shape.

The 2.6 percent decline from the previous month pushed sales down in July to a seasonally adjusted annual rate of 7.16 million units.

The decrease came after sales soared in June, hitting a new record pace of 7.35 million units, according to revised figures. June's performance turned out to be even stronger than previously estimated just a month ago.

The median sales price — where half sell for more and half sell for less — of an existing home was $218,000 in July, up 14.1 percent from a year ago.

Federal Reserve Chairman Alan Greenspan has warned of "speculative fervor" in some local housing markets that may be pushing prices up to unsustainable levels.

However with the inventory of homes available for sales rising in July, that could take some pressure off prices, said the association's chief economist David Lereah.

By region, sales were down in all parts of the country, except for the South, where they were flat.

The overall drop in sales of previously owned homes comes as mortgage rates rose. The average rate on 30-year mortgages in July was 5.70 percent, up from 5.58 percent in June. Even with the increase, though, mortgage rates are still considered low by historical standards.

To fend off inflation, the Federal Reserve earlier this month boosted short-term interest rates by one-quarter percentage point. It marked the 10th increase of that size since the Fed began to tighten credit in June 2004. Another bump-up is expected at the Fed's next meeting on Sept. 20.
 
N8 v2.0

N8 v2.0

Not the sharpest tool in the shed
Oct 18, 2002
11,003
149
The Cleft of Venus
OOps!!!

New-Home Sales Reach Record High in July
Aug 24 1:19 PM US/Eastern
By JEANNINE AVERSA
AP Economics Writer

WASHINGTON - Sales of new homes shot up to a record high in July, while U.S. factories saw orders for costly manufactured goods drop by the largest amount in 18 months.

The mixed-message reports released Wednesday by the Commerce Department dramatized the vibrancy of the housing market and also the occasionally erratic pace of recovery from the 2001 recession in manufacturing.

Taken together, though, the reports still pointed to an economy that is moving ahead at a decent clip.

New-home sales in July soared to a seasonally adjusted annual rate of 1.41 million units. That represented a 6.5 percent increase from June's pace of 1.32 million units, which had been the previous record.

In the department's second report, new bookings to U.S. factories for "durable" goods _ big-ticket items expected to last at least three years _ declined by 4.9 percent in July from the previous month.

It marked the biggest drop since January 2004, when durable-goods orders fell by 5.7 percent.

Some economists thought part of July's decline might reflect businesses turning a bit cautious in their buying given a toll of high energy prices that can increase their costs and squeeze their bottom lines.

The drop in orders "suggests that escalating oil prices ... might be creating skittishness on the part of business decision makers," said Clifford Waldman, economist at the Manufacturers Alliance/MAPI, a research group. On the other hand, he said, July's decline comes after nice increases in the prior three months.

In financial markets, stocks rose. The Dow Jones industrials gained 12 points and the Nasdaq was up 11 points in morning trading.

On the housing front, the performance in July surprised economists who were predicting that sales of new homes would fall in July.

By region, sales rose in the West and Northeast, but fell in the Midwest and South.

The median price of a new-home in July was $203,800, down from $212,400 a year ago. The median price is where half sell for more and half sell for less.

Existing-home sales dipped in July but still were at the third-highest level on record, a report released Tuesday showed.

While the booming housing market has been a consistent star performer for the economy in recent years, the manufacturing sector has sometimes had a bumpy ride.

The last time durable-goods orders fell was in March. Since then, manufacturers have been seeing bookings go up. In June, orders went up by 1.9 percent.

Manufacturers were hardest hit by the recession and they struggled mightily to get back to good health. Analysts believe the factory sector has shown much improvement and is in good shape, although manufacturing employment is still weak and there can be ups and downs in bookings from month to month.

The weakness seen in July hit a broad range of categories, including machinery, computers, communications equipment, electrical equipment and appliances, and airplanes. That more than offset stronger demand for automobiles and parts, and primary metals, a category that includes steel.

The decline in July was steeper than analysts were predicting. Before the release of the report, economists were forecasting a drop in durable-goods orders of around 1.2 percent.

Excluding orders for transportation equipment, which can swing widely from month to month, all other durable-goods orders fell by 3.2 percent in July. That compared with a 3.6 percent increase in June.

Shipments, a good barometer of current demand, dipped by 0.1 percent in July, after growing by 0.3 percent in June.

Businesses have had to cope with surging energy bills. Oil prices climbed to an all-time closing high of $67.10 a barrel on Aug. 12.

Wanting to make sure high energy prices don't spark a broader outbreak of inflation, the Federal Reserve earlier this month boosted short- term interest rates for a 10th time since June 2004. Another rate increase is expected at the Fed's next meeting, Sept. 20.
 
You must log in or register to reply here.
Top Bottom