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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region Forumsthree quarters of recent home buyers expressed some regret
They Rushed to Buy in the Pandemic. Heres What They Would Change.A frenzied sellers market led some people to make harried decisions when buying their homes that they now regret.
Surveys by the WAV Group and Zillow found about three quarters of recent buyers expressed some regret. In the Zillow survey, released on Feb. 4, the findings paint a picture of homeowners second-guessing the choices they made and wishing theyd had more time, more patience or considered living somewhere else. About a third of respondents regret buying a house that needed more work than they anticipated, 31 percent wish the home they bought was bigger and 21 percent thought they overpaid.
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Recent buyers those who are remorseful and others who are content with their homes have some sage advice about how they would do it differently if they had to do it all over again.
The farmhouse in Lake Wales, Fla., was picturesque, but Ms. Mohan and Mr. Flynn had to leave it behind. They plan to turn it into an AirBnB.Credit...Todd Anderson for The New York Times
Almost immediately, the couple regretted their decision. The property felt eerily quiet and isolated, and maintaining five acres and two cows was more work than they anticipated. You see these people on Instagram with their farm life, Ms. Mohan said. Nobody tells you what actual hard work that is and how time consuming it is.
Ms. DiSantis bought a spacious home for $1.45 million, which exceeded her maximum budget. She now feels financially tethered to the home.Credit...Ruth Fremson/The New York Times
The house gave her more space, but at a significant financial cost. In 2021, her priorities shifted, and she suddenly felt the burden of a huge mortgage. I got super burned out at work, she said. I remember thinking, Man, if I was still in that townhouse, I could just quit my job for a year and be fine. The mortgage was so low, I could take a year off, I could relax, I could refuel and now I really cant.
https://www.nytimes.com/2022/02/04/realestate/home-buying-regret.html
dalton99a
(81,433 posts)elleng
(130,861 posts)Different during pandemic?
Demovictory9
(32,445 posts)elleng
(130,861 posts)Demovictory9
(32,445 posts)Demovictory9
(32,445 posts)elleng
(130,861 posts)Something about the pandemic, or other feature in the economy?
DFW
(54,335 posts)The pandemic caused a huge labor shortage in the construction industry, and many people with extra money couldnt get out to spend it on their usual whatever, and instead looked for bigger or second homes, which diminished a finite supply being chased by increasing demand.
Interest rates are near zero, so debt currently costs little. When interest rates head upward again, this will start to return things back to balance. Here jn Germany, the government was so desperate to keep the economy going, and keep people spending, they instituted NEGATIVE interest rates. At many banks, if you had a large balance, they would penalize you for it. Not only would you get no interest on your 100,000, they would take 500 away from you for keeping it there. This encouraged the well heeled go go out and spend money on things they didnt need, which, in the case of housing, meant residences.
elleng
(130,861 posts)As to interest rate results, reaction you describe is too weird for me to contemplate, but I'm not an economist.
But I do have a recently wealthy German daughter. Instead of letting a German bank take money from her for leaving it with them, she instead bought several apartments that she rents out. I dont know that business at all, but Germany is densely populated, and the Frankfurt area, where she lives, always needs apartments due to banks and foreign consulates constantly needing to rent apartments for workers from abroad that only intend to stay for several years. She makes so much money at her job, I never even asked her if her real estate investments are doing well, but she is very meticulous, and probably keeps a sharp eye on every one of them.
To give you an idea of what shes like, we are looking to get to get the extended family together this April for our 40th anniversary. She suggested that my wife and I fly with them from Frankfurt with Lufthansa in business class. I said that would be nice, but its 3000 more to me than if we fly on Air France/Delta from Düsseldorf. But she said her two daughters would have more fun if Grandma and Grandpa were along. So she went out and bought our plane tickets. One day many years ago, she said that if she ever made a lot of money, she was going to pay me back for what I spent on her US education. I said no, I inherited the money, and always intended to spend it on her(and her sisters) education. Maybe she considers this an installment.
Bon voyage!
Haggard Celine
(16,844 posts)I have some family in the real estate business, and they've told me that everybody knows that they're about to raise the interest rates, so they're all in a hurry to buy. All that demand is pushing prices higher and higher. They say that my little house is worth about 50% more than what I'm paying for it. I just bought the house about 4 years ago! I don't want to sell it anyway, but if I did, where would I live? I'd have to either buy another house with an inflated value or I would be stuck paying expensive rent somewhere.
I guess I could go live in a cheaper country. I might have to do that anyway. If all the crazy shit in this country continues to get worse, I might have to move. Hope there's a nice South American country who wants a 50+ year-old gay man. They might be more welcoming than some places in the US right now.
DFW
(54,335 posts)Though were all straight, my housemates back in Dallas are involved in projects with a large percentage of gay participants, and being gay hardly raises an eyebrow there. Not in our circles, anyway, though I dont spend a lot if time there these days.
Of course, Dallas is hardly the big real estate secret it was 40 years ago, and finding a cheap house near town isnt as easy as it was.
Haggard Celine
(16,844 posts)I know very little about it, though. I don't want to give the impression that people are intolerant of gay people where I am now, because for the most part, people here treat gay people the same as anyone else. There's not any kind of stigma or anything.
But I look at the news here every day and it seems like the country has a battle on its hands regarding GLBT issues, as well as racial hatred and other forms of bigotry. A mayor in my state is holding back funds from the library in his town because it has books about gay people. There's stupid shit going on everywhere in America right now. Some of these idiots are having book burnings like the Nazis. I don't know if the soul of this country is sick or where we're headed, but I'm wondering if maybe it's time to get out of here, and not just out of my town. I'd probably leave the planet if I could.
DFW
(54,335 posts)But it is a very big and cosmopolitain island. More like Manhattan than Nantucket. But it is no longer a secret, and affordable housing has for many years not been the cinch it once was. The word is definitely out.
Of course, since I now live mostly in the Düsseldorf area, I am confronted with a very different set of advantages and disadvantages.
Haggard Celine
(16,844 posts)That's why, if I stay in America, I feel like I might as well stay where I am. At least I know what the evils are here and how to avoid them. But as far as people go, they aren't bad here.
There are a lot of people here who haven't gotten vaccinated for whatever reason and they don't wear masks like they should. But they aren't militant about it or anything and they don't mess with people who do wear masks. It's not so much that they're being political about it, they just have a strong libertarian streak. They don't like rules.
But most of them would help you in a minute if you asked. My feelings about this place are complex. I've lived most of my life here, and I generally love the people here despite their faults and they seem to feel the same about me, despite my faults. I would hate to leave them. But I don't know what to expect from the next few years in America. I feel like something momentous is happening here, and it isn't good. Maybe I should just be prepared for any eventuality. It's causing some anxiety.
Response to DFW (Reply #22)
Haggard Celine This message was self-deleted by its author.
Amishman
(5,554 posts)So many people are now locked in at 3% on their mortgage that it will be a disincentive to move or sell.
If interest goes to 5%, home owners will find that even making a lateral move on the housing ladder comes with a big increase in the monthly cost of home ownership. This encourages people not to move, and reduces inventory /market liquidity
cinematicdiversions
(1,969 posts)The inventory will simply not be there in desirable or even semi-desirable areas.
mnhtnbb
(31,382 posts)This is a good read and I recommend the entire article.
Unlike the last housing boom, one could argue that home price growth since the start of the pandemic was justifiable. The demographics of the U.S. were already supporting housing growth and the desire to own only increased as people saved more and spent more time at home. The lifestyle change brought on by the pandemic caused many Americans to reassess their living arrangements, including some renters that turned into house hunters and some existing homeowners that sold to move into a larger home.
The jump in homebuying demand hit right as existing housing supply declined rapidly for a variety of reasons, including fear of COVID-19. Homebuilders, most of whom became more prudent following the last cycle, were cautious with how many homes they were bringing to the market, resulting in equally tight new home inventory.
The supply and demand mismatch pushed prices upward, but that was just the tip of the iceberg for rising home values. Some Americans became much wealthier over the past year following a 31% run-up in the S&P 500 and a nearly 20% jump in home equity. Others became wealthier on a relative basis as remote work led to increased migration, often from higher cost areas to lower cost ones.
Further, safety measures have been put in place since the Great Recession to help prevent a similar housing collapse. Mortgage credit availability is starkly tighter than in the mid-2000s and the often more risky adjustable rate mortgages represent less than 5% of total purchase and refinanced loans compared with over 35% at the peak of the last cycle.
https://fortune.com/2021/09/09/housing-bubble-2008-market-correction-great-recession/
Mosby
(16,297 posts)And reasonable for more than 20 years. They aren't going to go up much. It's been a seller's market the entire time, so this is nothing new.
Sherman A1
(38,958 posts)Of 2008+. Many were turned into rentals by large investors buying them for a song and never have come back as inventory to the housing market. There are plenty of houses, just not as many needed for sale as we had before the financial crisis.
DFW
(54,335 posts)Housing is not a tradable paper commodity. You either have it or you dont.
A European banker once told me that if all the holders of gold contracts suddenly demanded physical delivery, gold would be $8000 an ounce, since the amount being traded by contract was about five times as much gold as there was that could actually be physically delivered.
ecstatic
(32,679 posts)Took me years to get past being upside down after the crash of '08. I guess we'll have to see what the prices will do. Who knows.... maybe they'll just keep going up.
TheBlackAdder
(28,182 posts).
Between the property maintenance, the taxes, the mortgage, I'd be hundreds of thousands above if I rented.
.
LittleGirl
(8,282 posts)Opted out of inspection and appraisals. Ive purchased several homes and all of my purchases have been contingent on those two things. Ive still been burned as two homes needed new roofs before the sale was complete. My advice is to always get an independent inspector and get appraisals on repairs first.
Demsrule86
(68,539 posts)'inspectors' have very little knowledge. And they can't see through walls, thus there are always surprises in every house. I have a great deal of knowledge myself...and have my friend look at what he can see. I look for all the big stuff. I flipped a house this year and bought a warranty that covers furnaces etcs for the new buyers. I knew the furnace was older but worked fine and was energy efficient (we had it tested).
I shared this with the buyer and advised them to keep a warranty. I paid the first year. I chose the buyer who didn't want an inspection (experienced buyer) because all they are is a way to nickel and dime a seller with minor crap because you can't always see the big stuff and people use it to get the price down...our first inspection when we were newbies, missed the fact that there was no heat on the second floor...they had a cut out at the end of the hall..dangerous to kids and pretty useless. That first year, we heated our house with a wood stove...the only way it would stay warm. I never bothered after that realizing it was futile at best and only to be used if you wanted to get the price down.
Scrivener7
(50,935 posts)saved me from disasters. I'd never buy without having him look a place over first.
Demsrule86
(68,539 posts)I would not waste my money.
Scrivener7
(50,935 posts)Demsrule86
(68,539 posts)reduced.
Scrivener7
(50,935 posts)LittleGirl
(8,282 posts)Arent worth the paper they are printed on either.
Thanks
Demsrule86
(68,539 posts)and they came out and fixed numerous things...and replaced a microwave.
Wingus Dingus
(8,052 posts)All have had inspections prior to sale, some issues caught, some not so much. They are of limited value.
I think a lot of people are unrealistic that a house will somehow get a "clean bill of health" and be problem-free for decades. Guess what, your sinkhole hasn't opened up yet, but it will. Your basement wall hasn't leaked yet, but it will. Your house isn't in a flood zone, until it floods. Your septic tank and leach field are secretly corroding or clogging. Sewer line? Good luck with that. Roof? Unless a new one (regular shingle) was put on in the last 5 years or less, you shouldn't feel that smug about it. Have you LOOKED at your electrical panel lately?
Note I don't mention stuff like hot water heaters, furnaces, appliances. Barely even worth mentioning--everything mechanical breaks down, most easily swapped out at a range of prices. I always think it's weird when people buy real estate and get their panties in a bunch over the age of a hot water heater or other appliances that don't have squat to do with the ultimate value of the real estate.
Scrivener7
(50,935 posts)Demsrule86
(68,539 posts)and they were worthless...my son's house had the living room floor about to collapse as the idiot owner cut the joists when putting a ceiling up in the basement. His clean-out for the sewer was under his house just stuck in the dirt and there was no foundation under that part of the House...it cost him well over 10,000 for the repairs on the house.
The so-called inspector picked up none of this stuff. Our family friend whom I renovate houses with for years now took a trip to where my son lived and found the issues in about a minute and a half...and there is no way redress with a bad inspection either. I would not waste my time as a I said before...I could go on...so many times this happened to people I know and to family members. My family now doesn't bother with so-called inspections.
Scrivener7
(50,935 posts)Demsrule86
(68,539 posts)My husband was a GM gypsy, we lived all over the place. And before that I was a Navy brat and moved numerous times with my parents...but to each their own.
uncle ray
(3,156 posts)they have no choice but to rely on "professionals", and yes, many suck and do not have x-ray vision. if buyers are getting a FHA loan, the decision is usually made for them.
EarthFirst
(2,900 posts)Again.
The majority of the inventory resulted in bidding wars; where many of these homes went for 20,30,40K over asking price.
When market prices eventually retreat; theres going to be a lot more regret
Demsrule86
(68,539 posts)significantly. Our best returns on investments have always been in real estate. And even in 2008, the rents went through the roof.
Amishman
(5,554 posts)Huge inventory shortage and construction isn't keeping pace. Remote work increases location options and is increasing interest in single family homes.
New construction is really expensive. Permits, land, insurance, and other fixed costs deter building 'starter' homes. Labor is a problem; after the 08 crash, a lot of people in the construction trade were left unemployed and changed careers. Now that skilled labor pool has contracted significantly, and it will be very difficult to expand construction capacity to reduce the current shortage
cinematicdiversions
(1,969 posts)The real question is how do you feel about the purchase after five years with a little distance.
True Dough
(17,301 posts)Even two years later you might get a different response. My wife and I are living in our sixth house (we sold the previous five because we cannot afford to own multiple houses and we made money on three of those previous transactions, essentially broke even once and lost money once).
But if you'd asked me within a year whether I'd regretted the purchase, even if we'd paid a decent sum, I'd probably lean toward "Yes" because I tend to scrutinize before and after, but then settle in and start looking at the bright side of things. It's just the way I am.
Of course there's so much else that can transpire in our lives that influences our outlooks either way. Rarely is homeownership viewed in a bubble (and you certainly hope it's not a bubble!).
mnhtnbb
(31,382 posts)will result in higher prices all the time.
That's Econ 101 in a nutshell. Classic situation.
The US hasn't been adding enough new homes to the housing supply for years, since the recession of 2008. The pandemic pushed demand for single family homes for all kinds of reasons. I know, I was one of the buyers who wanted out of a high rise apartment because I felt like I was playing Russian roulette every time I rode the elevator. And I wanted my own little outdoor space for a garden, more than just a patio or terrace. So I bought a house to be built, where I got to make design choices, and moved in (January 6, 2021) eight months later. Now I'm dealing with issues around freezing water lines that weren't adequately insulated. Just yesterday I was bemoaning not being in my apartment where I could file a maintenance request online and management would send someone to fix whatever the problem was. But rent is now a lot higher for that apartment. And Zillow says my house is worth 33% more than I paid for it when I signed the contract in April 2020.
There is still inadequate supply in the area where I live. Big employers are moving here. Retirees are moving here. I watch the local real estate market. Houses that closed in January--that went on the market in December-- are still selling for 10's of thousands over list price in only a day or two. It remains to be seen how much the market will cool come spring when rising interest rates might start dampening demand. But rents have risen here, too.
It remains to be seen how this plays out. Supply might catch up with demand or prices might rise to the point that demand cools.
Personally, I regret being forced to change my downtown high rise living because of the pandemic. I loved it. But I'm happy I was fortunate to be able to buy a house that I like and that will hopefully continue to be a good investment. This is my last house. My plan is to have the mortgage paid off in 10 years, if I live that long, since I'll be 71 next month. Then the equity goes to my sons.
Vinca
(50,255 posts)if they decided to sell a few years later they took a beating on the sale price.
Demsrule86
(68,539 posts)In O8, I had trouble getting insurance as my house was considered upside down...but I sold it three years ago and got substantially more than I paid for it. If you were not forced to sell, you made money and that has been true in all the housing downturns in the last 40 years or so.
Sympthsical
(9,067 posts)We bought in Dec 2019 and moved in literally just as the pandemic was starting. It was the first home either of us had ever bought, and both put a nice chunk of our savings into the down payment. We took our time, but there are always things.
Once you actually settle into a place and spend tons of time in it, you begin noticing things and adjustments you have to make that you didn't think about before. Especially during lockdown. That first year, did we ever live in this house far more than either of us had assumed we would. And given allllll of that time we spent staring at the walls, we probably started second guessing more than we might have had we both been away at work all day.
- What's up with the sprinkler system over there? We should have someone come fix that.
- You know, now that I stare at that wall paint, it seems odd. We should probably redo the entire living room (note: front room has 22 foot ceilings).
- Do we want wood in that bathroom? It gets wet.
- Why did they put carpeting in front of this sink?
- There are way too many small trees back here. We need to cut at least eight of these down.
And so on and so on. The idea behind the house was to be able to host family and friends. So, Covid put that whole thing on hold. What we ended up with is a rather large house that two people didn't really need. We're both in our respective home offices all day. There are rooms no one goes into. We started second guessing. "Should we think about getting something smaller?"
But, we managed. We took on a friend of a friend as a tenant for a downstairs bedroom. We adopted two kittens. We have had people over gradually. Hopefully this spring we'll actually use what is a rather gorgeous backyard and deck for BBQs.
In other words, we're finally settling in and using the place as normal people would. Covid was not a normal house transition period. It just gave us a lot of endless time picking over the flaws for lack of anything better to do. And without using the home as any kind of social space, we wondered why we had so much space.
And given it's California and people are moving away from SF and Silicon Valley into North Bay, our valuation is up 34% in two years. So, you know, not the worst investment. We have 70% of equity in the place. So while we doubted our decision for quite a long time until recently, it's ultimately working out. We finally decided to install solar, which is kind of our, "Yeah, we're staying," declaration.
But yeah. Covid really threw a monkey wrench into the entire process and experience.
Demsrule86
(68,539 posts)as people dived into home renovation.
Demsrule86
(68,539 posts)many houses and renovated a number for sale also...I never bought a house that at some point I felt and said...' what was I thinking ?'
Demsrule86
(68,539 posts)the Times says with a grain of salt...they are after Biden and would be happy if the economy faltered IMHO.
onethatcares
(16,165 posts)The farmhouse in Lake Wales, Fla., was picturesque, but Ms. Mohan and Mr. Flynn had to leave it behind. They plan to turn it into an AirBnB.Credit...Todd Anderson for The New York Times
Almost immediately, the couple regretted their decision. The property felt eerily quiet and isolated, and maintaining five acres and two cows was more work than they anticipated. You see these people on Instagram with their farm life, Ms. Mohan said. Nobody tells you what actual hard work that is and how time consuming it is.
What the hell did they expect, Elsie the cow to milk herself?
Ahhh, life by Instagram...
MissB
(15,805 posts)There were two houses that we thought about buying in the last two years. Both were hobby farm size- right about 5 acres.
The one that I truly wish wed had a chance on was a one bedroom house. It was billed as a two bedroom but the second one had no closet and it was functionally a den/office off the dining room. The house wasnt small per se, it was just that it was built for a couple looking to retire and slightly downsize. One level. Also had a MIL house, two rooms - not bedrooms, just small two room structure perfect for an Airbnb. Or a MIL.
It had a barn and an established raised bed garden. The pasture was filled with cows that didnt come with the place. We werent planning on raising cows- yes, too much work. We have a dozen hens, and thats as much as we need for farm animals.
By the time we saw it, the realtor wasnt even answering calls. Didnt even get to tour it before it left the market.
But thats ok. Our house is fine, if not a bit big. Plenty of room for guests once the pandemic is over. And its ours, so there is some benefit to that.
Demsrule86
(68,539 posts)farm.
onethatcares
(16,165 posts)went from a 3 br/1 bath with a lot and a half in the city that was pretty nice while we were younger. Bought a 3 br/1 1/2 bath in the same city with a lot and a half with a new roof, impact windows, attached garage in the same city and made money on the deal. Wouldn't want to maintain 5 acres and out buildings at my age. Luckily, I'm not on social media to see what I'm missing out on.
I am building a side yard garden and it takes as much time as I care to spend, just on the soil, plants, mulching and cutting the front yard. I would like to get 3-4 chickens but I don't want to leave them unattended if we go on a wknd vacay or a week long trip.
Demsrule86
(68,539 posts)use raised beds. This way you only have to prepare the soil you use and you save water...I have found pests to be less of an issue as well. Maybe a nice neighbor will watch your chickens...I had a pet chicken that lived in my closet as a kid. I will never forget how he dive-bombed my Mom's bridge club. The chicken was paper trained.
onethatcares
(16,165 posts)Soil is doing great, I'm a composter to the max and use my paper shreddings as mulch, save rainwater in 5 55 gal barrels and every milk or soda bottle I generate.
When the bottles reach the end of their useful life they go to the recycling place.
No mortgage payment, low taxes and I avoid credit as much as possible. What's not to like? I wish I could invite you over for a libation and a look see.
shrike3
(3,567 posts)One woman agog with rural life said to me, "Why are people who grow up on farms not into them later on?"
Wingus Dingus
(8,052 posts)I'm confused as to how this makes their lives easier.
shrike3
(3,567 posts)And need to be fed.
Reminds me of people who move out to the country and complain about the smell from the dairy farm down the road.
shrike3
(3,567 posts)Try a hundred-plus acres with horses, cows, pigs, chickens.
I grew up such a farm and people have no clue. They emote over how wonderful it must have been and do not believe when I stress how hard of a life it ws.
tenderfoot
(8,425 posts)Wow. This reads like an Onion article.
You see these people on Instagram with their farm life. Nobody tells you what actual hard work that is and how time consuming it is.
I decided, Ive done a lot of traveling, Ive had a lot of fun. Ive done the thing where Im like, Im hungry for pasta, Im going to go to Rome for three days.
When I first saw it, I cried, she said of the house with views of the Puget Sound. I fell in love.
I'm a social worker who shelters (or tries to anyhow) homeless families, in a city with a well-publicized homelessness crisis and major housing shortages. My org and others like it put on a positive face and try to present our successes to the world, but in truth the level of need out there is so far beyond what our funding & resources can provide, it's overwhelming. Reading the shallow self-deluded entitlement on display here hurts my heart a little.
https://nyti.ms/3HzlddB#permid=116763599
Wingus Dingus
(8,052 posts)so relatable.
shrike3
(3,567 posts)They've been about the too much money, too little sense people for a long time.
I remember their article about young women opting not to have a career or even work at all, going home to Mom and Dad and then marrying. All were incredible affluent.
btw, I grew up on a farm. NO ONE has a clue what it's like to work one until they've done it.