Has someone who has been around the real estate market for a long time answer this for me? I have not been able to find the answer myself on the 'net. It seems to me that I recall when I was young that a lot of the larger houses went begging due to high interest rate mortgages, high cost of upkeep & high taxes/assessments with a higher overall tax rate. If I'm not mistaken I recall something about larger homes being cheaper on a per square foot basis than smaller homes. What we saw in the latest real estate runup was a premium placed upon larger homes. In other words, a 2000 sf home might go for $225/sf. A 3000 for $275/sf and a 4000 for $325/sf (usu new constr). But I seem to recall the opposite happened back then. Because of cost concerns, the larger homes were cheaper on a square foot basis (but still overall more expensive). So, a 2000 sf home at $225/sf, but a 4000 sf home for $200/sf. Does anyone remember this happening, or am I just wrong?
It's funny. People who try to save money, by either going to Costco, driving around the corner for gas 2 cents cheaper, etc., will stay in their house and watch $50,000 come off each year.
I haven't looked at Zillow in a well over a year because the prices I saw for NY/NJ/PA were all wrong. It looks like the pricing has gotten better, but there are still clear errors. One major error for my area (Philadelphia suburbs) is pricing colonials and split levels at the same price. Colonials are more desirable and go for a 10% to 20% premium over a split level. The second error is showing that the local housing market is at its all time peak when the peak was 2 years ago. Prices around here didn't go up so fast and are flat to down 5% from 2 years ago. Main problem here is that instead of a house selling in 2 to 4 weeks it now takes 2 to 6 months to sell. There are more houses sitting on the market longer because most owners start at too high an asking price and cut the price too slowly.
HaHa....I do shop at Costco and also get my gas there,too. I haven't lost a thing in the way of house values, because I couldn't be bothered moving when the prices went up as I would have been having to upgrade to a "bigger,better house and location" and for what? More expenses and , believe me, I hate the inconvenience of moving. Week after week my real estate friends would be telling me how much my place was worth so much if I sell and all I would ask was "where would I go with the same conveniences for the same value''.....still haven't got a straight answer. I am a happy camper and haven't lost a cent on the house.
the larger the home, generally the higher quality of finish, workmanship, and everything else. no one is going to put a veinless marble bathroom into a 2000 sq foot doublewide--hence the higher PSF pricing. Most luxury homes start at 600/sqfoot then go up, and no im not talkign about toll brothers and other bogus phony mass market luxury cookie cutter builders. I read somewhere about buses full of foreclosure vultures coming soon to your neighborhood, the bottom is FAR FAR away when the naive silly money hungry masses believe they can bottom pick. when these wannabee real estate moguls are wiped out and the bus tours are sued into oblivion, only then can you start looking for the real bottom.... best wishes, surf
From what I have seen those McMansions seem of poor construction. Thin walls, you can hear footsteps going up the stairs all over the home, cheap romex wiring stapled to the walls, no CBS construction its processed wood on the outside with stucco to make it look like its made of real concrete, cheap builders grade central ac system. I could go on. Those KB home,pulte,etc.. McMansion tract homes look quality but it is an illusion. Those overpriced mass produced builders Grade McMansions are not a quality product. It is just a supersized cheap grade home. Like calling the H2 a hummer when the real hummer is an H1 and a totally different animal. A lot of people wanted to feel psuedorich living in a mcmansion, driving a leased C class Mercedes and taking on lots of debt to furnish the home and put up flat screen television sets. The party unfortunately is over and those McMansion tracts are going to plummet in value.
Yeah, I would probably not purchase a home built after 2003 - built with illegal labor who didn't care about their product and had little or no training about what they were doing. The slums of tomorrow in the peripheral suburbs far away from jobs with gas prices going the way they were. Still hoping someone 60+ will answer my original post about inversion of price/sf.
the areas in calif that are dropping hard are the less desirable areas such as stockton, merced, bakersfield, riverside, etc. these are bedroom communities for los angeles and san jose/san francisco. desirable places like sf which didn't undergo a building boom in 2003-6 have not dropped much. a home on my street recently sold for 3% below its zillow estimate. using that comp sale, my home would be ~10% below the peak. i'm in calif.