Housing Market Slowdown

[Couple of Lakers]

Originally Posted by Major

My parents owned that property from 1979 to 1986. Capri Cottages. My parents purchased it from Yvonne and Yvette Duhamel. (I loved their first names!) When my parents converted them to condominiums, they sold the four units along the north side of the property for $64,500 per unit! How things have changed!

That's funny. I have a vintage postcard when the places were pink! It's certainly not the 80's and we do miss those days.

[Major]

Originally Posted by Couple of Lakers

That's funny. I have a vintage postcard when the places were pink! It's certainly not the 80's and we do miss those days.

When my family purchased the property in 1979, my dad, who is a painting contractor, painted the main house and five units mint green. Not sure whether that was a better choice than hot pink, but I know as a 14 year old boy I was grateful that I did not live in a pink house!

[pondguy]

Back in the days when Prescott's Store was across the street.

[Major]

Originally Posted by pondguy

Back in the days when Prescott's Store was across the street.

Absolutely. And when you went there for ice cream, you hoped one of the young kids would serve you, not Mr. Tilton! He was a nice man but stingy doling out ice cream!

[TheTimeTraveler]

Originally Posted by Major

When my family purchased the property in 1979, my dad, who is a painting contractor, painted the main house and five units mint green. Not sure whether that was a better choice than hot pink, but I know as a 14 year old boy I was grateful that I did not live in a pink house!

Was that seasonal property when purchased in 1979...? Is it seasonal property now or has it been made into year 'round property.

Seems to me like any property would be of far more value if it were able to be utilized year 'round.

[Juiced06GTO]

Is it me or does it seem like double the tax assessed value or something around there has been the norm for listing prices? I wonder if appraisals aren't coming back high enough to fund the loans people are looking to take?

[John Mercier]

I don't know if people are serious about second homes at this time.

[Biggd]

Originally Posted by John Mercier

I don't know if people are serious about second homes at this time.

When people are struggling, they are going to save their primary home first, even if it means selling off the vacation home at a loss.

[Biggd]

Originally Posted by Juiced06GTO

Is it me or does it seem like double the tax assessed value or something around there has been the norm for listing prices? I wonder if appraisals aren't coming back high enough to fund the loans people are looking to take?

I think we are seeing investors pulling back from the market. They have been jumping into market over the past few years because of high rental rates and quick price appreciation.
Now that it's slowing down, it should get back to a more normal market. Unfortunately, that means future prices will reflect this correction.

[thinkxingu]

Originally Posted by Biggd

I think we are seeing investors pulling back from the market. They have been jumping into market over the past few years because of high rental rates and quick price appreciation.

Now that it's slowing down, it should get back to a more normal market. Unfortunately, that means future prices will reflect this correction.

There's also a lot to be said about the decline in the Airbnb and VRBO industry, which will impact that whole investor/available inventory piece.

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[Biggd]

Originally Posted by thinkxingu

There's also a lot to be said about the decline in the Airbnb and VRBO industry, which will impact that whole investor/available inventory piece.

Sent from my SM-S931U using Tapatalk

Plus the actions cities and towns are taking to reign in daily rentals.

[Descant]

Originally Posted by Biggd

I think we are seeing investors pulling back from the market. They have been jumping into market over the past few years because of high rental rates and quick price appreciation.
Now that it's slowing down, it should get back to a more normal market. Unfortunately, that means future prices will reflect this correction.

I agree about investors. I was ready to buy vacation/investments a couple of years ago and backed off. Now I see those places for sale witrh price drops. Many buyers thought they were buying a second home and they would pay for it with short term rental income. They didn't think of themselves as investors and probably many were too eager to buy. Now, or soon, real investores will be buyhing the dip. Making a down payment with a HELOC adds to the problem whem it means the second home/investment may be close to a 90% loan instead of the 70%+ that is common for invewstment real estate.

[Biggd]

Originally Posted by Descant

I agree about investors. I was ready to buy vacation/investments a couple of years ago and backed off. Now I see those places for sale witrh price drops. Many buyers thought they were buying a second home and they would pay for it with short term rental income. They didn't think of themselves as investors and probably many were too eager to buy. Now, or soon, real investores will be buyhing the dip. Making a down payment with a HELOC adds to the problem whem it means the second home/investment may be close to a 90% loan instead of the 70%+ that is common for invewstment real estate.

Many of the prime properties were bought by groups of investors with cash hoping to get the rental income and price appreciation. I know many of my son's friends bought into these real estate investment groups. We'll see how this all shakes out if prices drop and rentals slow down.
My son almost bought into one of these and I steered him away from them.
I took advice given to me by a smart uncle long ago and passed it on to him, "partners are for dancing"!

[FlyingScot]

Originally Posted by Biggd

Many of the prime properties were bought by groups of investors with cash hoping to get the rental income and price appreciation. I know many of my son's friends bought into these real estate investment groups. We'll see how this all shakes out if prices drop and rentals slow down.
My son almost bought into one of these and I steered him away from them.
I took advice given to me by a smart uncle long ago and passed it on to him, "partners are for dancing"!

There's a definite spectrum across the amount of time people will be renting a recently purchased place from 100% to 0%. The closer a buyer is to 100%, the more sensitive they are to market conditions.

My earlier posts were all around people with 0% rental time, and I think this group is growing as the lake becomes more expensive in general. Of course, I don't really know. We can see that fewer places are for sale than there were 10 years ago. But I wonder how the number of rental opportunities had changed?

[sky's]

Originally Posted by Biggd

Many of the prime properties were bought by groups of investors with cash hoping to get the rental income and price appreciation. I know many of my son's friends bought into these real estate investment groups. We'll see how this all shakes out if prices drop and rentals slow down.
My son almost bought into one of these and I steered him away from them.
I took advice given to me by a smart uncle long ago and passed it on to him, "partners are for dancing"!

very well said.

[Major]

As Dave Ramsey says "The only ship that won't sail is a partnership." Having been in a partnership for nearly 20 years, I can attest to this.

[Couple of Lakers]

Originally Posted by Juiced06GTO

Is it me or does it seem like double the tax assessed value or something around there has been the norm for listing prices? I wonder if appraisals aren't coming back high enough to fund the loans people are looking to take?

The assessed value of our particular property does not include the value of the private boat slip or jet ski location. That makes a huge difference! The benefit is that your taxes do not reflect that extra 200K+ in value.

An assessment would most likely be on the unit itself as the dock is owned by the association. Most of these places are cash deals.

[Major]

Originally Posted by TheTimeTraveler

Was that seasonal property when purchased in 1979...? Is it seasonal property now or has it been made into year 'round property.

Seems to me like any property would be of far more value if it were able to be utilized year 'round.

Yes, it was a seasonal property. At that time (1986) there wasn't the demand like there is now to convert seasonal properties to year 'round properties. It would have taken quite a bit of investment since each cottage was relatively rudimentary. Also, water and sewer would have required updating. Very expensive upgrades. Others that sold at that time, such as Whispering Pines and eventually the Christmas Island cottages, were sold as seasonal properties.

[Couple of Lakers]

Originally Posted by TheTimeTraveler

Was that seasonal property when purchased in 1979...? Is it seasonal property now or has it been made into year 'round property.

Seems to me like any property would be of far more value if it were able to be utilized year 'round.

All units here are year round and 3 of the 6 owners live here full time.

[Couple of Lakers]

Originally Posted by Major

When my family purchased the property in 1979, my dad, who is a painting contractor, painted the main house and five units mint green. Not sure whether that was a better choice than hot pink, but I know as a 14 year old boy I was grateful that I did not live in a pink house!

When we purchased in 1998 three of the six units were still mint green including ours. We did the windows, door, insulation, siding, etc. when we got it. They were all still seasonal back then too. You can still see the green when you open the shed to our outside electrical meter.

This place has gone through a radical transformation since the old days. They're all year round and 3 out of the 6 units live here full time including us.

Another thing about our HOA is that we don't allow rentals. That could be a turn off for some. Being a small family association we're not interested in renters taking over and destroying our peaceful place. It's happened in the past and that's definitely an ongoing problem elsewhere. Especially during bike week.

[Major]

Originally Posted by Couple of Lakers

When we purchased in 1998 three of the six units were still mint green including ours. We did the windows, door, insulation, siding, etc. when we got it. They were all still seasonal back then too. You can still see the green when you open the shed to our outside electrical meter.

This place has gone through a radical transformation since the old days. They're all year round and 3 out of the 6 units live here full time including us.

Another thing about our HOA is that we don't allow rentals. That could be a turn off for some. Being a small family association we're not interested in renters taking over and destroying our peaceful place. It's happened in the past and that's definitely an ongoing problem elsewhere. Especially during bike week.

I just realized that you purchased the property from our family's very good friends. I will let Jim know that it's for sale. He'd get a kick out of what it looks like now!

[Couple of Lakers]

Originally Posted by Major

I just realized that you purchased the property from our family's very good friends. I will let Jim know that it's for sale. He'd get a kick out of what it looks like now!

It's a small world. Jim is a great guy! We remember him well. We still have the original for sale by owner sign he had in the window. We were just driving by and stopped in to take a look. The rest is history. We couldn't pass up such a beautiful place. If we remember he moved down the street to the four seasons after he sold to us. We're guessing if the place was year round like it is today he never would have left.