‘The Pendulum Swings A Little Too Far’ In Texas
The Dallas News reports on foreclosures. “The number of mortgage defaults in the Dallas-Fort Worth area is up 30 percent this year. In North Texas, rising property taxes and increasing mortgage rates on adjustable loans are also taking a toll.”
“Kemisha Jones doesn’t want to leave her 2-year-old southeast Dallas home. But the single mother may not have a choice. She’s one of more than 28,000 North Texans whose homes have been posted for foreclosure this year.”
“‘My house payments went from $871 to $1,385 a month,’ said Ms. Jones, whose house is valued at about $106,000. ‘For a while I was making it, I was rocking and rolling,’ she said. ‘But now I realize that I can’t afford this house.’”
“For Eric Fenton, who gave up his house in June, the loss of overtime income in his telecommunications job came at the same time his mortgage payments ratcheted up. ‘Since I had to get an adjustable rate loan, I watched my payments grow from $700 to $900,’ Mr. Fenton said. ‘And then utilities, they went from $200 to $400.’”
“Mr. Fenton tried to sell his Dallas house but had no luck. ‘My house was listed for over two years at its tax-appraised value, $113,000, with no lookers,’ he said.”
“North Texas’ low home appreciation rates make it difficult for many homeowners to get out of their house when they wind up in financial trouble. That adds to the foreclosure bubble, said George Roddy, president of Foreclosure Listing Service. ‘Especially if they are financing 110 percent of the property to begin with,’ Mr. Roddy said. ‘They finance all the closing costs and end up owing the mortgage company if they decide to sell.’”
“FLS has found that about 44 percent of homes posted for foreclosure each month actually sell at auction. Through the first six months of 2006, lenders had taken back 8,452 D-FW area homes. The average mortgage on the houses foreclosed on was $148,418.”
“And a look at the monthly foreclosure postings proves that hard times hit in all communities. Everything from million-dollar mansions in exclusive Plano neighborhoods to $32,000 condos in East Dallas are in foreclosure, county records show.”
“‘Customers have gotten themselves into loans they probably didn’t understand,’ said Bob Caruso, a mortgage servicing executive with Bank of America. ‘Loans with adjustable rates do actually adjust upward.’”
“Gordon Griffith and his family are leaving their Garland home at the end of the month. ‘We agreed to an adjustable rate mortgage when we refinanced the house, and now it is killing us,’ Mr. Griffith said. ‘The rate is going up every six months,’ he said.”
“Fort Worth mortgage originator Vernetta Wills blames some homebuilders for not correctly estimating taxes on the houses they sell. Sometimes property tax estimates are just for the lot and don’t include the new home being built. ‘If the builders in the area would stop putting people in houses that they cannot afford and qualify them with the correct taxes, this would not happen,’ she said.”
“Most troubling for North Texas homeowners, the flood of foreclosures could affect the overall housing market, industry analysts say. In the late 1980s and early 1990s, a frenzy of home foreclosures caused by the regional economic collapse contributed to more than a 25 percent decline in overall residential values.”
“‘We know that most of the foreclosures are going back to the lenders and then being offered for resale,’ economist James Gaines said. ‘We also know that historically, the lenders are generally forced to offer the properties at discounts in order to move them.’”
“Connie Zetterlund, a Dallas real estate agent who specializes in foreclosed-home resales, said the number of such listings is ballooning. So far, lenders have been unwilling to slash their prices, she said. ‘I don’t think they have gotten the news that the market is slowing and there is a glut of foreclosures,’ Ms. Zetterlund said.”
“The timing is bad for these distressed properties to land on the market. Overall home resales have been dropping in recent months. ‘Everyone of us needs to be heads-up about what this is saying about the stability of our economy,’ Ms. Cunningham said. ‘Housing has held up our economy for so long.’”
The Waco Tribune. “Forty-year fixed-rate mortgages are popping up in Waco, and whether that’s a good thing depends on who you ask. One local banker calls 40-year fixed-rate mortgages ‘a bad practice.’ Another voices excitement about offering such mortgages, saying more people can now afford homes.”
“Bill Nesbitt, CEO of Central National Bank, says he fears 40-year mortgages ‘can lure people into making bad financial decisions.’ If a buyer can afford a house only by spreading payments over 40 years, Nesbitt said, he or she may be knocked into financial difficulty by the ‘bumps of life.’”
“‘They are having to use so much income to make the mortgage payment that they could be backed into a corner if taxes go up, inflation goes up or utilities go up,’ Nesbitt said.”
“‘I’m not aware of any downside,’ said Brad German, a Freddie Mac spokesman, commenting on the 40-year product. ‘The advantage is that those looking for a lower monthly payment can get it, though it will require a longer payment schedule.’”
“‘If you’re going to be in your home for a short time, check it out,’ mortgage loan officer Pam Hebert said. ‘If you’re going to stay there long term, it’s not for you.’”
“Nesbitt said he believes 40-year mortgages arose out of the national housing and refinancing boom of recent years. ‘The euphoria of all that stirred the competitive spirit in lenders, who came up with more and more creative ways to get a share of that boom,’ Nesbitt said. ‘We always kind of go to excess; the pendulum swings a little too far.’”
Looks like they’re going to try the same crap they did in Japan in a futile attempt to keep this Ponzi scheme going. 100 year mortgages you can will to your children….
When you seperate the bottom line from the marketing BS, you see that there is little difference in the initial payment level for an I/O mortgage and a 100 year mortgage. And in both cases, the buyer is tempted to buy a home which will eventually bankrupt him, as the fact that one can purchase much more house than under a traditional (
… (30 yrs or less) mortgage results in the buyer biting off a bigger home than his permanent income can afford.
As far as I’m concerned, there’s not much difference between interest only and a 40 year. Heck, even even a 30 year required 23.5 years of payments just to get the principal down by half.
I will not finance anything longer than 20 years.
My amort a little off. OK, more like 22 years to pay half of a 30 year loan. Point remains, though…
Unless of course other returns, for what might be your capital pay-off, can more than offset your tax-deductible mortgage interest payments.
There’s nothing wrong with a 30 year mortgage if you make extra principal payments. In other words, make payments based on a 10 or 15 year amortization. If a spouse loses a job, then you can make the 30 year payment instead.
In principle, you would do better by initially financing over a shorter time horizon, as the lender should give a lower interest rate in exchange for getting back the money sooner. But I am not sure whether this works given the conundrum (no risk premiums), not to mention a broke-back (inverted) yield curve.
Jesus H. Christ! If we have reached the point where we can’t afford to buy houses with conventional 30-year mortgages then we really are screwed. A 40-yr mortgage is really equal to an interest-only mortgage. You telling me that a 40-year old buying with a 40-yr mortgage will be able to keep up the payments until he’s 80? WTF!! With what income? News flash….most retirees can not afford to rent a decent home or carry a mortgage into retirement. Won’t work, period! These people stopped thinking years ago.
What’s amazing is that compared to other countries, a 30 year mortgage, especially with a fixed rate, is a fabulous luxury.
Many other places have only ARMs (to protect lender) and won’t at all lend money on that long a schedule. In one even reasonably civilized but sliding to 3rd world country, common practice is to pay cash—I mean literally a suitcase full of bills—at closing. If a bank gives you a mortgage, it might be for one or two years at most.
The USA (and maybe now Japan) was virtually the only place with sufficiently robust and developed capital markets that a 30 year *fixed* mortage was regularly available to ordinary borrowers. It’s a dream, and I can’t believe people are flushing this down the toilet.
I’m with foobeca… I had a 30 yr mortgage (safety net) and paid it off in 12 yrs.
I often compare situation in US and Japan, having lived in Tokyo from 1990 to 2000. Mortgage rates got down to 2%-2.5% (probably still around 4%-5%) in mid 90s. I’ve been keeping a long-term chart of US 30 yr bond and it is STILL in a long-term downward channel, having recently turned away from the upper trendline. But unlike US, during entire Japanese recession, people still saved money. Unfortunately, property prices are ONLY NOW starting to turn back up again (and only in certain areas) after literally 15 years of falling prices. So anyone who says it can’t happen here, sorry, but it can.
“But unlike US, during entire Japanese recession, people still saved money.”
This is why the Japanese deflationary scenario would be so much worse here. Also why at least some top economic policymakers must be thinking up a plan to move past the conundrum by fire (inflation) rather than ice (deflation).
unless they are pushing on a string. they sure pushed on a string in japan. however, japan’s deflation had the help of the commodity bubble bursting in the 1980s, I’m not so sure we have that now.
Way to solve this….the government really “prints” money and pay down 30-40% (or?) of the balance of all home owner occupied mortgages. Then enact laws like Texas used to have about home refinancing to eliminate rerun of the current bubble. Force 20% down on all future purchases (owner occ or investment). Make it illegal for anything less.
This would be inflationary….but would probably avoid a depression.
Investors still get nailed. If you don’t have a mortgage - perhaps you get 20% (or?) of median price where you live.
‘If you’re going to be in your home for a short time, check it out,’
This is also how they’ve lured so many people into IO ARMs. Problem is, real estate doesn’t always go up, and sometimes life throws you a curve ball and you have to sell. Then what?
All the folks who “checked it out” and took the bait have helped drive prices up to the all-time record high level US real estate market history. The flip side is that affordability is very low, which helps explain why lenders are pumping 100% financing, Option ARMs and 100 year mortgages: Otherwise, nobody could afford to buy, and prices would come down.
WAPO newspaper has loudoun county va up 100k median for 06
I know for a fact it’s off 10-12%
those lying shtd !
“North Texas’ low home appreciation rates make it difficult for many homeowners to get out of their house when they wind up in financial trouble.
- That adds to the foreclosure bubble, Well Duh!
“Most troubling for North Texas homeowners, the flood of foreclosures could affect the overall housing market, industry analysts say. —- Well Duh!
No problems. The more HBs think prices have gone up, the more homes they will add to the inventory glut, and the more prices will have to go down to restore balance. Fundamentals will prevail at the end of the day.
I saw that as well. It didn’t make sense until I realized they were only comparing the first quarters of 2005 and 2006. And even those numbers look suspiciously inflated.
“100 year mortgages you can will to your children….”
You know there were past generations of Americans who willed ASSETS to their children rather than liabilities.
Perhaps that the next bankruptcy law reform: you can finance your current lifestyle using a portion of your childrens’ future earnings as collateral. They’ll have no problem with the burden, because real wages always to up!
You can’t do it now individually, but you can collectively. It’s call the national debt.
cool, after 08 we’ll have FREE-er healthacre so we can sck the life out of our kids !
The pendulum has only begun to swing.
As in, “The Pit and the Pendulum”.
Texans ought to know better than most, housing booms and busts ain’t no pendulum, it’s a wrecking ball.
A Texan once told me that Texas poor is better off than anywhere else rich. Why? Because when the economy goes down, everything gets so cheap!
“‘I’m not aware of any downside,’ said Brad German, a Freddie Mac spokesman, commenting on the 40-year product
Of course not, as long as we (taxpayers) are on the hook….
“‘Customers have gotten themselves into loans they probably didn’t understand,’ said Bob Caruso, a mortgage servicing executive with Bank of America. ‘Loans with adjustable rates do actually adjust upward.’”
I guess it is not Bob’s job to inform customers that they are buying homes that they cannot afford using loans they will never be able to repay, but rather to comment to the press on what a bunch of idiots their customers are for not understanding their loans?
I lived there for 9 years - NEVER, EVER buy a house in TX (especially Dallas!)!! There is far too much land and the values never go up!! I thank God every day for being able to sell our house in Plano after 2 years (even with having to take $20k to closing!). We were able to sell the house in May in 7 days due to my flying to TX and spending a week painting and remodeling. I was scared this was going to happen and it has! Foreclosure rates have been high in Dallas for years, ever since the Telecom bust in the late ’90’s. 9/11 Just pushed it over the edge. I don’t know what is new. The property market has always been bad. A lady on a flight told my husband one time never to own propery in TX, RENT. We should have listened!!!!
‘Foreclosure rates have been high in Dallas for years, ever since the Telecom bust in the late ’90’s’
That’s a good point, and comes up when people say, ‘there’s no bubble in xyz.’ Dallas has never given up those bubble gains from the late 90’s, just like Denver and Austin. This run-up started earlier than most suspect in some cities.
Wow, actually I was just about to post a question as to why Texas never got involved in the real estate boom/bubble of the past few years. It seems like the ingredients are there for a boom: strong job growth (well, some magazines always rate places like Austin and Houston as strong job centers); some influx of people from other high-priced states like California, and immigrants (maybe both legal and illegal??); low taxes; and dirt-cheap prices. I suppose when there is so much land available, it’s one less excuse the realtors can use to try to force people into buying a house.
While it’s true that property outside of the I635 loop has remained relatively flat over the last number of years, properties closer to downtown have gone through the roof. Lot’s of teardowns being replaced by McMansions and lots of 2/1’s and 3/2’s being dusted off, painted and loaded with stainless doubling or more in price over the last 3 or 4 years. Add in the huge increase in building townhomes, and the inevitible condo craze and Dallas is poised for a huge meltdown. I was speaking with a guy last night (a chef at a successful restaurant) and he is in full meltdown mode. He bought in a fairly bad neighborhood at the top a year ago; he went 100%, nothing down; and his ARM just reset. In his words, he is screwed. He’s two months behind on the mortgage, the house has been for sale for 4 months (no lookers) and has gone down in value. This is true for so many people around here. Dallas as a whole hasn’t seen the runup in prices the rest of the mega-bubble areas have seen, but, we’ve had building like crazy, we’ve got CENTEX and DR Horton based here, and certain areas have gone through the roof. The Morning News just ran a story about how incomes have gone down over the last fews years, and I personally don’t see much left propping up the local economy.
My prediction: Dallas, like the rest of the country, is toast.
Oh, email me please and dish the dirt! Is it the guy from Hector’s on Henderson?
It’s not Hector’s on Henderson - although that place looks like it’s doing well. The place where this guy works is in Uptown. Very good food, but, there are too many restaurants and too many fickle folks in Dallas for this place to flourish. I feel bad for the guy. He’s in his mid 20’s, wife, small child. I imagine it’s just a matter of time before the marriage is on the rocks. He bought into the “gotta own a home, prices never go down, buy now or be priced out forever, real estate is a great investment, etc.” bullsh!t, and now, he’s done. It’s just a matter of time before it goes back to the bank. And the banks better wake up, because they aren’t going to be able to unload this guys house unless they cut the price in half. This time next year we’ll be hearing all the horror stories about the impending depression. I don’t see a bottom in prices until 2008 or 9.
Did you see the stories about Trammell Crow et al using over a million gallons on water a month IN THEIR RESIDENTIAL YARDS? Let everyone else eat cake!
Dallas is one of the most diseased places I have ever seen. Your friend is a typical victim of the all show and no go mentality there.
I live about a mile from DR Horton’s former corporate offices ( they moved to 20 story building in downtown Fort Worth about a little over a year ago).
It is still for sale.
There are a multitude of reasons why Texas is cheap. For one thing, most of those jobs you are talking about don’t pay squat, the weather sucks and property taxes are high. Aside from housing and no state income taxes everything else there is just as expensive IMO.
“some influx of people from other high-priced states like California, and immigrants (maybe both legal and illegal??); low taxes; and dirt-cheap prices. I suppose”
Sure illegals buying homes is very common here in N. Texas. I personally know some of them. No need to document any income, just bring 3k to the table and sign the contract. This has to be a Ponzi Scheme of some sort. How can these people afford their homes??
They don’t in a cyclical recession, but the advantage is that they have citizenship in another nearby country.
I haven’t heard of extradition for civil suits, but even if it were possible I’d imagine the court costs would be bigger than the mortgage loss.
I lived there for 9 years - NEVER, EVER buy a house in TX (especially Dallas!)!!
That’s a bit of a sweeping statement which obviously doesn’t apply to everyone. If you changed it to say NEVER, EVER buy a house in TX you CAN’T AFFORD, then I’d agree with you. Foreclosure rates don’t just magically spring up because the home is in Texas.
I bought a house I can afford, and short of a prolonged job loss I have no fear of losing my house (but every American is in that boat - even a renter with no job isn’t any better off). Every housing market goes up and down so you obviously had to sell at a bad time. I guess right now you should tell everyone in CA, NV and FL NEVER, EVER buy in those states because they’d be lucky to sell right now.
“If you changed it to say NEVER, EVER buy a house in TX you CAN’T AFFORD, then I’d agree with you. Foreclosure rates don’t just magically spring up because the home is in Texas.”
Finding an affordable house in Texas is easy. How people get in over their heads is a mystery to me. 50’s house in San Antonio is 32,000 to 50,000, a comparable house in San Diego is a half mil.
My husband and I had a very bad experience in Texas. As one of the previous posters said, the weather is horrible, property and sales taxes are high and the people are nasty. Plus property in the outlying areas hardly goes up in value at all!! It just sucks! I am glad to be gone. Wild horses couldn’t drag me back!!
I’ve lived in Austin,TX [actually 90+% of it was next door in Cedar Park] for 11 years and we couldn’t be happier. The summers were hot and long (6+ months) and winters were cold (2-4 months) but relative to the housing prices in Calif, it was affordable and comfortable (my wife and I have lived in the mid-west so we know what horrible winters are). And we’re Asian-Americans who stood out among almost all white Austin [although the last 5 years, we seemed to have stood out less and less] and didn’t meet any nasty people.
As for taxes: sales tax is the same as California and property tax in lieu of income tax was preferable to me.
We would have lived there even more if we could have gotten my parents to join us. Alas, if you can’t beat them, you got to join them and join them we did [last month] here in SoCal. I have a job lined up and have signed a lease to start this month….
I guess right now you should tell everyone in CA, NV and FL NEVER, EVER buy in those states because they’d be lucky to sell right now.Well, buying to sell right away in this market is probably not a good idea.
Well, drat! I was kinda happy living here, but now I guess I’ll just have to go out back and throw myself under my John Deere. Bye, y’all.
Seriously, it’s not that bad if you buy what you can afford. I live in NE Tarrant County, and that area has seen 9.1 average annual assessed value appreciation 2000-2006. I didn’t buy to make money; I wanted some acreage and found something I could afford.
TXChick doesn’t like the area, and I respect her opinion, but that’s why they have horse races and beauty contests.
“”So far, lenders have been unwilling to slash their prices, she said. ‘I don’t think they have gotten the news that the market is slowing and there is a glut of foreclosures,’ Ms. Zetterlund said.”
Do you suppose these clueless lenders missed out on David Lereah’s recent NAR conference presentation, which included a graph showing national housing inventory rocketing up to near 4m used homes for sale?
I heard about this. I think it’s called The Ownership Society.
Now the crybabies will complain that they’re losing their homes. Boo-Hoo!
Texas toast, locusts and honey. Repent flippers, the end is nigh.
congrats on barron’s mention
Details? Thanks
I didn’t pick up the issue, but the recent Barron’s did have a nice “drowning in housing” cover.
I assume it is barron’s, that’s who this chick writes for:
http://www.siliconinvestor.com/readmsg.aspx?msgid=22775356
confirmed it is barron’s, page 30 of this weekend’s edition
“In North Texas, rising property taxes and increasing mortgage rates on adjustable loans are also taking a toll.”
Sadly, it is the “old-timers” who have in many cases lived in their house “forever” that are now on fixed incomes and who are being pinched by higher property taxes due to the fallout from the biggest ponzi scheme since SS.
Just like corporations never talk about the “externalized” business costs (pollution, layoffs & societal decay, etc.) you will never hear Liarreah and his ilk talking about the “externalized” costs (old ladies eating dog food, families having to move out of the old family home, etc.) due to the Bubble he and his ilk helped pimp up.
Where is the accountability for the suffering imposed on those who gained nothing from the bubble but now bear the suffering thereof?
At least the “Smartest Guys In The Room” had to stand trial…
ok, time to clear something up.
Propery Taxes in Texas are very, very high relative to much of the country (due in no small part to no state income tax), and effectively demand employment by the homeowner. Local governments are very aware of the problem that causes the retired/fixed-income set. Citizens bit a whole lot when family has to move away in order to retire. As a result, almost all taxing municipalities offer a significant rate break and/or tax-freeze to the over 65 set.
Where I live, (Rockwall) if the home owner is over 65 and claims the assosiated expemption, their propery taxes are about 1/3 of what they otherwise would be, and the assessment on their house is frozen most years.
The breaks vary across Texqas from location to location, but basically if you are over-65, you can get a good deal as in property taxe rates lower than CA with no income tax.
There are several way to escape property taxes in Texas.
In addition to the elderly, taxes are frozen for those citzens that are classified as disabled.
If you are rich enough( or well connected ), you can also have your property zoned for ‘recreational use’ and pay almost no property taxes.
If have live stock on your property, you can have it classified as a farm ( I think you need a total of 12 hooves ) and pay a lot less ( your SUV can then be claimed for ‘farm use’ and your vehicle taxes are 1/2 as well ).
“Another voices excitement about offering such mortgages, saying more people can now afford homes.”
I disagree with this point of view. I think that rather than help people afford a home, these 40 year mtgs. as well as int. only, neg am, no doc etc are actually what is driving prices higher rather than normal market conditions. If people actually had to qualify for a real loan this could never have gotten out of hand the way it has. That is why the real facilitators of this mess are the banks, Fannie Freddie and the over zealous mortgage brokers!
Just because the initial payment on exotic loans is lower does not mean that homes became more affordable. I believe that over time, the view that many of us have set forth here — that exotics’ primary effect was to help push prices to unaffordable levels and to tempt unsophisticated buyers to purchase homes they could not afford — will become so obvious to everyone that even the “experts” like David Lereah will be forced to come right out and say it.
Yes, but it will be in flowery language.
even though I am a total bubble believer, I was a closet texas might not be a bubble believer. I can’t believe it’s happening, but there it is.
“Fort Worth mortgage originator Vernetta Wills blames some homebuilders for not correctly estimating taxes on the houses they sell. Sometimes property tax estimates are just for the lot and don’t include the new home being built. ‘If the builders in the area would stop putting people in houses that they cannot afford and qualify them with the correct taxes, this would not happen,’ she said.”
It seems she is trying to place the blame elsewhere.
I wonder how many suicide loans she originated for her clients…
It seems she is trying to place the blame elsewhere.
No, she’s correct. One of the selling points over the past few years was the initial low property tax valuations, since the builder could estimate to the low side the payments were much lower. Add to this the initial low HOA fees and you had about a two year period before reality set in for the new development and HOA fees soared along with the local government catching up with tax valuations. So our intrepid homeowners and wannbe investors could now be getting hit with higher payments from several directions and we haven’t even mentioned water & utilities soaring either.
Wait a minute, she stated
“Sometimes property tax estimates are just for the lot and don’t include the new home being built.”
Usually (at least when I was doing loans), the L.O. prepared what is called a G.F.E. and it includes the property taxes. You dont use the homebuilders’ estimates, you use a standard rate for the area (in CA it was .0125 not counting Mello Roos, which usually are additional bonds, etc. for financing schools and what not).
She is supposed to use the sales price, not the land value estimated, as the basis for the tax extimate. What would the vacant land or finished lot have to do with the final sale on a completed home and/or the assessed tax?
It just shows you that the average L.O. doesn’t know anything about R.E., mortgage or anything else that relates to their job. They are just there as a warm body to fill out paperwork and make everyone money.
“In the late 1980s and early 1990s, a frenzy of home foreclosures caused by the regional economic collapse contributed to more than a 25 percent decline in overall residential values.”
So that’s when it happened. We left Dallas in 1985. In 2004 I saw our old house listed on realtor.com. The asking price was less than our selling price 19 years earlier!
I had to stop reading the blog when I came up to this section and immediately respond..
Fort Worth mortgage originator Vernetta Wills blames some homebuilders for not correctly estimating taxes on the houses they sell. Sometimes property tax estimates are just for the lot and don’t include the new home being built. ‘If the builders in the area would stop putting people in houses that they cannot afford and qualify them with the correct taxes, this would not happen,’ she said.”
Well maybe you should be financing the loan if the taxes put her into the Red… maybe she can’t afford it.. instead she blames the builder.. It’s the builders fault for not gauging the assessment from the city or town. WOW. I just have to shake my head. These scum of the earth originators can’t except the fact that the mortgage industry is toast.. Every loan now is soo important to these commision driven bastards.
Whenever inquiring about a property, the first words out of one’s mouth should be, “How much are the taxes?”. Followed by,”How much are the home association/condo/co-op fees?” (If applicable) (Mileage may vary)
Followed by: I’m sorry, we could NEVER afford this price. I guess we’ll have to look in _________.
(Name of slightly less desireable town next door)
I have been renting here in Dallas since the early 90’s. The only time I had a real rent increase was back in the heydays of the internet bubble. Since then I have been paying around 50 cents a month per square on a townhome of 1200 sq. feet. To own similar property you have to shell ~ $180,000 right around here in a new townhome development and that does not count property taxes which are through the roof (2.5-3% of appraised value) and HOA. Who in the right mind will buy at this inflated prices?? Wait and see.
You are very smart!!! Keep renting! Don’t ever let anyone convince you to buy!!
It’s the taxes that kill ya!
Forty year loans are OK, as long as the price is reasonable, and that there is NO prepayment penalty.
You can always pay it down to bring it to to a thirty year loan wih prepayments.
But if you’re struggling over a couple of hundred dollars every month anyway, you have no business buying a house in this mania.