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Buying a house in US
Posted: Sat Dec 22, 2007 9:12 pm
by r2i2009
Hey Guys
I have not yet brought a house in the US and planning to move to india in 2010. Looking at the subprime mess do u guys think it is good time to buy a house like townhouse in US and sell it in 2010 for some profit ? Is it a good idea or a stupid one at this stage ?
I just want to know pros and cons before deciding on the action . Any positive /negative criticism are welcome as it will help me learn.
Thanks
Buying a house in US
Posted: Sat Dec 22, 2007 9:23 pm
by Chicago Desi
Considering that your R2I is 2 to 3 years away, I would advise against it. The US RE market is likely to be depressed for a while and 2 to 3 years is not enough horizon for the house to appreciate significantly. You will most likely not make much money in that timeframe through appreciation.
Do you already have a property in India? That is the one you should worry about more, since RE in India is out of control.
Buying a house in US
Posted: Sat Dec 22, 2007 9:37 pm
by r2i2009
yes i do have 2 properties in India. People (desis) here are buying houses left and right in the US but i guess 90% of them want to stay here though. Anyways thanks for ur input
Buying a house in US
Posted: Sun Dec 23, 2007 7:25 am
by smariner
r2i2009;66519People (desis) here are buying houses left and right in the US but i guess 90% of them want to stay here though. Anyways thanks for ur input[/quote]
Just curious --- why are desis jumping into purchasing homes in the US now? Are many of them thinking that the US home-market has bottomed out already?
Buying a house in US
Posted: Sun Dec 23, 2007 9:48 am
by r2i2009
I think those who want to live forever in US think that this is a golden chance to get the houses cheap. Thats just my take though..I live in a rental apartment with lotsa other desis and what i saw is as soon their GC went to I-485 stage about 80% of the folks brought houses saying ...best time to buy house now daa.... But these folks I am talking about what to live forever in US of A. I dont know if any R2I folks would do the same though.
Buying a house in US
Posted: Wed Dec 26, 2007 5:39 am
by moreqa
In 2 years you cannot see much profit. Remember that when you have to sell 6% will go to the selling agent. You would have gone through paying taxes, interest (don't be fooled by deduction - you pay 100% and get back 25-30%), repairs, upkeeps, and so on that at the end you may not see a profit. Who knows?
Also read the other thread about R2I plan getting affected because of the RE downturn.
Buying a house in US
Posted: Wed Dec 26, 2007 6:04 am
by direstraits88
smariner;66560Just curious --- why are desis jumping into purchasing homes in the US now? Are many of them thinking that the US home-market has bottomed out already?[/quote]
Desis (like all humans) tend to go by history. The only stories you hear is how another desi made so much profit in RE in the last few years and how property prices have gone up in India.
They don't hear any stories of desi home going into foreclosure.. And desis also tend to suppress negative stories.. (Have you heard of any Desi talking of his losses in RE or Stock Market.. unless he's a close friend..)
And in today's RE market where 20% down is a minimum requirement, only desis will have 50k plus for down payment.
Though to answer the OP... there's no money to be made in the RE in the U.S.
Even in California.....
The old rule still holds good.. It takes 4-5 years to just recover costs if you plan to buy a home in the U.S. Buy a home to live in it and not to make money..
Buying a house in US
Posted: Wed Dec 26, 2007 7:00 am
by moreqa
[quote]
Though to answer the OP... there's no money to be made in the RE in the U.S.
Even in California.....
[/quote]
Not sure that it is true about California... I know a few friends who made multiple hundred thousands selling their house and went to Texas for a nice (horse) ride.
May be you are talking about the current situation?
Buying a house in US
Posted: Wed Dec 26, 2007 9:00 am
by GutsyGibbon
moreqa;67196Not sure that it is true about California... I know a few friends who made multiple hundred thousands selling their house and went to Texas for a nice (horse) ride.
May be you are talking about the current situation?
Southern california is supposed to take a 25% fall in the next five years. Looking at all the foreclosures in my neighborhood, does not make me feel any better. We had listed our place for 400K+ a few years back. We could not sell it. Now the going price is 300+. Thats a fall of 25% in front of our eyes. Another fall of 25%, & we will be well below water. Any house that you buy needs to appreciate by atleast 3 to 6%, which you would probably end up spending on closing costs. (when you sell through a good broker)
On the positive side, the rental market is supposedly very good. More so after the fires, and the sub prime mess.
Renting a nicer house that you like, seems like a much better option in these times. Especially if you are a R2I candidate. Makes you immune from any RE crash, and gives you peace of mind.
Old link, but still relevant
http://piggington.com/bubble
Buying a house in US
Posted: Wed Dec 26, 2007 8:13 pm
by r2i_100
prasadee;67217Southern california is supposed to take a 25% fall in the next five years. Looking at all the foreclosures in my neighborhood, does not make me feel any better. We had listed our place for 400K+ a few years back. We could not sell it. Now the going price is 300+. Thats a fall of 25% in front of our eyes. Another fall of 25%, & we will be well below water. Any house that you buy needs to appreciate by atleast 3 to 6%, which you would probably end up spending on closing costs. (when you sell through a good broker)
On the positive side, the rental market is supposedly very good. More so after the fires, and the sub prime mess.
Renting a nicer house that you like, seems like a much better option in these times. Especially if you are a R2I candidate. Makes you immune from any RE crash, and gives you peace of mind.
Old link, but still relevant http://piggington.com/bubble[/quote]
Prasadee, I too live in SoCal, prices are indeed down but now many folks who were waiting on sidelines are jumping in, I know 2 desis who waited for 3 years before buying house just last month, and many more are likely to do so, so what I am thinking is 25% drop in next few years may be an exaggeration, prices may be flat if not rising. It may not be bad idea to jump into RE market now if you get a house in good location.