Sunday, August 06, 2006

Foreclosure Redux

Hopefully now I've got this font situation resolved. Please bear with me. The notion of using an online WYSIWYG editor to create HTML has thrown me for a loop. Time for the K to evolve. I'll get it right eventually.

Now then, continuing with that housing theme from last, I hate this market. Speaking as a buyer, anyway. Some people say you shouldn't try to time the market if you plan to live in that area for 5 or more years. Whatever. I say do you. And that's not me, not right now. Nevermind that I have my doubts about how long I'll be in the DC area. But the problem here folks is affordability, or more accurately, the lack of it.

Now, why did I back out of my foreclosure? I backed out b/c I thought the bank was getting greedy. (It was either Countrywide, led by Angelo Mozilo, whom I quoted in an earlier post, or Wells Fargo, who ironically was going to be MY lender on the purchase. Kooky.) I pulled the tax records for the property and they were looking for a 50K premium to the last sale in June of this year! (Still need to learn how to read those better in the case of a foreclosure.) I didn't feel like subsidizing that when I believe we are near the beginning of the "next time down" in real estate. No sense in being early to the feast. Not to mention the mortgage costs were going to be murder. (To be precise, I am primarily speaking of PITI in those "mortgage costs" as well as maintenance costs.) So this bank wanted me to pay 319K for a foreclosure that would need 10-15K of work before it was livable at the top of a declining market in an OK but far from ideal area (IMO). Uhhh, no. It helped that the guy at the bank took his sweet time reviewing the offer, allowing doubt to creep in. He could have locked in the sale and had the property off the books, but he slept.

So I decided to hold out and continue renting. Personally, it works for me right now. I still need to do the numbers to find my break-even point on renting vs. buying, but renting will wins right now. Had I purchased any of the properties I have made offers on in the last few months, I'd have doubled my already significant housing costs. Once I move in the next few weeks, my rent will drop by anywhere from 115-300 dollars per month.

That said, I'm enjoying watching the futures market for the time being. Go corn! More on that to come. Laterz.

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