Comments on: Highland History & HELOC Abuse http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/ Tracking the Arcadia and San Gabriel Valley Housing Market Sat, 04 Feb 2012 08:44:24 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: SavedbyGrace http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1274 SavedbyGrace Fri, 04 Apr 2008 22:28:10 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1274 I wrote about interest rates vs. purchase price here http://www.arcadiahousingblog.com/2008/02/09/interest-rates-vs-purchase-price/ Assuming you put 20% down and use 30-yr fixed mortgage, a $650k house ($520k loan) @10% has the same monthly payment as a $900k house ($720k loan) @6.5%. Rates will change over the course of 30yrs, you can't change the purchase price once you sign papers. It's better to buy when interest rates are high and home prices are low than when interest rates are low and home prices are high. I wrote about interest rates vs. purchase price here http://www.arcadiahousingblog.com/2008/02/09/interest-rates-vs-purchase-price/

Assuming you put 20% down and use 30-yr fixed mortgage, a $650k house ($520k loan) @10% has the same monthly payment as a $900k house ($720k loan) @6.5%. Rates will change over the course of 30yrs, you can’t change the purchase price once you sign papers.

It’s better to buy when interest rates are high and home prices are low than when interest rates are low and home prices are high.

]]> By: AKR http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1273 AKR Fri, 04 Apr 2008 21:55:19 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1273 AClover You can have it with the extra $4k. That will make me the only active buyer (I guess) on this board at least, so that I can lower my offering price even more. SavedbyGrace, I would love to see the low $600s price. But I am afraid that something else, such as the interest rate or the cost of food, may go wrong that makes me not being able to afford it. AClover You can have it with the extra $4k. That will make me the only active buyer (I guess) on this board at least, so that I can lower my offering price even more.
SavedbyGrace, I would love to see the low $600s price. But I am afraid that something else, such as the interest rate or the cost of food, may go wrong that makes me not being able to afford it.

]]> By: SavedbyGrace http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1269 SavedbyGrace Fri, 04 Apr 2008 18:24:49 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1269 Haha I love this. Current bids from active home hunters are already $278k or 23% off the asking price. It's clearly not priced to sell. Haha I love this. Current bids from active home hunters are already $278k or 23% off the asking price. It’s clearly not priced to sell.

]]> By: AClover http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1268 AClover Fri, 04 Apr 2008 18:17:36 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1268 AKR, I would bid for 920K, just beat you:-) I guess we both are active home hunters in current Arcadia market. AKR, I would bid for 920K, just beat you:-) I guess we both are active home hunters in current Arcadia market.

]]> By: SavedbyGrace http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1267 SavedbyGrace Fri, 04 Apr 2008 18:10:17 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1267 I understand that there are people in all walks of life in different situations with different budgets. But golly, are you kidding me?? I guess it's good for this seller that there are potential buyers out there who think it's worth $916k. I don't, but that's me. I also find it incredibly hard to subsidize the frivolous spending of others by bailing them out - which is what will happen if it sells for $916k. That however, has nothing to do with the valuation of a house. I can rent a comparable property for about half the monthly mortgage payments. If the refinance to $916k in summer of 2006 was the peak, then a correction of 21% would put it at $723k. According to Dataquick, Feb07 vs Feb08 Arcadia prices have already dropped 21%+. With further declines on the way, I would venture to say that this property could easily fall down to the low 600s in a few years. I understand that there are people in all walks of life in different situations with different budgets. But golly, are you kidding me?? I guess it’s good for this seller that there are potential buyers out there who think it’s worth $916k. I don’t, but that’s me.

I also find it incredibly hard to subsidize the frivolous spending of others by bailing them out – which is what will happen if it sells for $916k. That however, has nothing to do with the valuation of a house. I can rent a comparable property for about half the monthly mortgage payments.

If the refinance to $916k in summer of 2006 was the peak, then a correction of 21% would put it at $723k. According to Dataquick, Feb07 vs Feb08 Arcadia prices have already dropped 21%+. With further declines on the way, I would venture to say that this property could easily fall down to the low 600s in a few years.

]]> By: AKR http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/comment-page-1/#comment-1266 AKR Fri, 04 Apr 2008 17:47:11 +0000 http://www.arcadiahousingblog.com/2008/04/04/highland-history-heloc-abuse/#comment-1266 From the picture, it looks like a nice house. But the asking price is too high, $916K sounds about right. If it falls into foreclosure and the bank sells it at that price, I will jump in. From the picture, it looks like a nice house. But the asking price is too high, $916K sounds about right. If it falls into foreclosure and the bank sells it at that price, I will jump in.

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