Single-family homes are out of reach for most ( S Florida)
06-25-2006, 06:23 PM
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Single-family homes are out of reach for most ( S Florida)
The average cost to build a house in Ft lauderdale.
$120,000 -- Cost of a standard lot
$150,000 -- Building materials and labor
$30,000 -- Site development
$190,000 -- Designers, engineers, fees and permits
$98,000 -- 20 percent profit for the builder
$588,000 -- Total cost for a 1,800 square-foot new home
ay you earn $58,100 a year, the median income in Broward County. How realistic is it to expect to be able to buy a new single-family house here? The answer: Dream on.
That's because in Broward, a new 1,800-square-foot house without luxury upgrades costs almost $600,000 to build, those in the industry say. Typically, that would require an income of about $133,000 a year to afford, experts say, assuming a 20 percent down payment and a 30-year fixed rate mortgage at 6.5 percent
"The [new] detached single-family home in Broward County is unattainable" for most South Florida workers, said Joe Kocy, the former assistant to the county administrator for housing. "It's become the American fantasy."
Blame soaring costs for land ($120,000 per standard lot), building materials and labor ($150,000) and site development ($30,000). Then there are government fees and permits, costs for architects, engineers and marketing plus the financing of bank loans, which add $190,000 to the cost. Factor in 20 percent profit for the builder and that house costs $588,000.
Wages, meanwhile, have remained stagnant.
As a result, Broward's future is in multifamily developments like townhouses and condominiums, builders say. Even Habitat for Humanity, the charity that has built more than 200 single-family homes for low-income people in Broward since 1983, is getting into multifamily construction here for the first time ever this year.......continued.
http://www.sun-sentinel.com/news/loc...ostemailedlink
$120,000 -- Cost of a standard lot
$150,000 -- Building materials and labor
$30,000 -- Site development
$190,000 -- Designers, engineers, fees and permits
$98,000 -- 20 percent profit for the builder
$588,000 -- Total cost for a 1,800 square-foot new home
ay you earn $58,100 a year, the median income in Broward County. How realistic is it to expect to be able to buy a new single-family house here? The answer: Dream on.
That's because in Broward, a new 1,800-square-foot house without luxury upgrades costs almost $600,000 to build, those in the industry say. Typically, that would require an income of about $133,000 a year to afford, experts say, assuming a 20 percent down payment and a 30-year fixed rate mortgage at 6.5 percent
"The [new] detached single-family home in Broward County is unattainable" for most South Florida workers, said Joe Kocy, the former assistant to the county administrator for housing. "It's become the American fantasy."
Blame soaring costs for land ($120,000 per standard lot), building materials and labor ($150,000) and site development ($30,000). Then there are government fees and permits, costs for architects, engineers and marketing plus the financing of bank loans, which add $190,000 to the cost. Factor in 20 percent profit for the builder and that house costs $588,000.
Wages, meanwhile, have remained stagnant.
As a result, Broward's future is in multifamily developments like townhouses and condominiums, builders say. Even Habitat for Humanity, the charity that has built more than 200 single-family homes for low-income people in Broward since 1983, is getting into multifamily construction here for the first time ever this year.......continued.
http://www.sun-sentinel.com/news/loc...ostemailedlink
06-25-2006, 08:33 PM
#4
Suzuka Master
"government fees and permits, costs for architects, engineers and marketing plus the financing of bank loans, which add $190,000 to the cost...
WTF?
That number seems outrageously high.
WTF?
That number seems outrageously high.
06-26-2006, 08:36 AM
#7
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Originally Posted by SakiGT
Uhh...dont buy new? 
I agree buying a home is more difficult than it has been in the past... but I think this article is a bit exaggerated.
I agree buying a home is more difficult than it has been in the past... but I think this article is a bit exaggerated.
it's hard to get anything built around here for under $600 but there is plenty of stuff in good neighborhoods in the $300s.
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Palm Beach County is worse then Broward.
06-26-2006, 08:46 AM
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Where's the drama? 
I don't remember reading that your first home has to be a $600,000 McMansion. My first place was a 1200 sq ft townhouse and I loved it.
06-26-2006, 09:47 AM
#11
Originally Posted by NSXNEXT
Where's the drama? I don't remember reading that your first home has to be a $600,000 McMansion. My first place was a 1200 sq ft townhouse and I loved it.
Townhomes, condo's, houses, they all are priced this way. While S FLA income has remained the same or little change.
Add to this the price of insurance which has doubled & tripled in some areas & the fact it's hard to get insurance anyway because of the huricane mess the last 2 years & that's why we can't afford to buy.
I know people that have to sell their homes cause they can't afford it anymore due to tax & insurance increases.
Almost all of the condo's that are at $100k are in 55+ complexes or are shoe boxes.
It makes me sick.
Last edited by fuzzy02CLS; 06-26-2006 at 09:51 AM.
06-26-2006, 09:54 AM
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Originally Posted by fuzzy02CLS
If you want to live anywhere that's nice down here you have to fork over $200K+
Townhomes, condo's, houses, they all are priced this way. While S FLA income has remained the same or little change.
Add to this the price of insurance which has doubled & tripled in some areas & the fact it's hard to get insurance anyway because of the huricane mess the last 2 years & that's why we can't afford to buy.
I know people that have to sell their homes cause they can't afford it anymore due to tax & insurance increases.
Almost all of the condo's that are at $100k are in 55+ complexes or are shoe boxes.
It makes me sick.
Townhomes, condo's, houses, they all are priced this way. While S FLA income has remained the same or little change.
Add to this the price of insurance which has doubled & tripled in some areas & the fact it's hard to get insurance anyway because of the huricane mess the last 2 years & that's why we can't afford to buy.
I know people that have to sell their homes cause they can't afford it anymore due to tax & insurance increases.
Almost all of the condo's that are at $100k are in 55+ complexes or are shoe boxes.
It makes me sick.
Well $200K is not $600K. Yeah it's a shame about the insurance but what were you expecting living deep in the heart of hurricane country?
It's like the people who buy in flood prone areas because they got such a great deal, only to bitch and complain about the water damage.
06-26-2006, 09:55 AM
#13
Weird.. friends of our purchased a lot in late 2004 in West Palm Beach.... 1.2 acres if I remember correctly. Lot was around $100k.
They went to contract with a home builder in Feb 2005 and built a nice ~2800 square foot home. Closed in March 2006. House was around $250k for everything (house, upgrades, permits, lot clearing, etc).
Total for the lot and home ~$350k.
Not sure where that paper is getting its numbers from... but my friends house is 1000 square feet larger and cost $238k less...
Maybe that reporter needs to shop around
.
They went to contract with a home builder in Feb 2005 and built a nice ~2800 square foot home. Closed in March 2006. House was around $250k for everything (house, upgrades, permits, lot clearing, etc).
Total for the lot and home ~$350k.
Not sure where that paper is getting its numbers from... but my friends house is 1000 square feet larger and cost $238k less...
Maybe that reporter needs to shop around
.
Last edited by juniorbean; 06-26-2006 at 09:58 AM.
06-26-2006, 10:21 AM
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Originally Posted by NSXNEXT
Where's the drama? I don't remember reading that your first home has to be a $600,000 McMansion. My first place was a 1200 sq ft townhouse and I loved it.
06-26-2006, 10:51 AM
#16
FL hurricanes have only been bad the last 2 years. The last major hurricane to hit this area were in the mid 90's. I didn't choose to live here either. Just happend that way. I rather be in NYC.
It's a cominantion of factors. Weather, economy, real estate, etc. Just all bad factors in 1 place at the wrong time.
That paper is a little misleading. It's not that much for sure, but it's not cheap either.
It's a cominantion of factors. Weather, economy, real estate, etc. Just all bad factors in 1 place at the wrong time.
That paper is a little misleading. It's not that much for sure, but it's not cheap either.
06-26-2006, 10:58 AM
#17
I've also read that South Florida real-estate is 59% overvalued. Since real-estate is starting to level off and it's become a buyers market, that area should start seeing some corrections.
Not good for our friends who just moved in (although they've already seen enough of a gain to be OK), but good for people looking to buy. First thing to take a hit will be condos and townhomes...
Not good for our friends who just moved in (although they've already seen enough of a gain to be OK), but good for people looking to buy. First thing to take a hit will be condos and townhomes...
06-26-2006, 11:47 AM
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Originally Posted by juniorbean
First thing to take a hit will be condos and townhomes...
In South Florida? No way man. Rental properties are huge down there. I would expect the single family homes to get hit harder.
06-26-2006, 12:08 PM
#19
It's all going to get hit.
I'm renting my condo. The place next door to me. Sold for $98K in 01, sold again in 03 for $160, sold again in feb of 06 for $210K
The place under me went for $206K in April.
All the same units, 2/2's with no pool, clubhouse, or gated. Thin walls & 1100 SF.
I'm renting my condo. The place next door to me. Sold for $98K in 01, sold again in 03 for $160, sold again in feb of 06 for $210K
The place under me went for $206K in April.
All the same units, 2/2's with no pool, clubhouse, or gated. Thin walls & 1100 SF.
06-26-2006, 12:17 PM
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While I appreciate the fact that homes are expensive...people are still buying, whether they are worth it or not.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
06-26-2006, 12:37 PM
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Originally Posted by SakiGT
While I appreciate the fact that homes are expensive...people are still buying, whether they are worth it or not.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
06-26-2006, 12:49 PM
#22
Suzuka Master
Originally Posted by SakiGT
While I appreciate the fact that homes are expensive...people are still buying, whether they are worth it or not.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
06-26-2006, 02:44 PM
#23
Originally Posted by NSXNEXT
In South Florida? No way man. Rental properties are huge down there. I would expect the single family homes to get hit harder.
Prices won't drop or anything, the increases will just slow down...
06-26-2006, 02:48 PM
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Originally Posted by SakiGT
While I appreciate the fact that homes are expensive...people are still buying, whether they are worth it or not.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
So youve got two choices:
1) Make the sacrifices necessary to own your own home
2) Continue to wait for homes to stop increasing in value
2 aint gonna happen.
06-26-2006, 10:34 PM
#26
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you know what makes things worse, its mortgage rates. Suppose you buy a 300000 dollar home with the average 30 year fixed mortage at todays rate (6.35 percent according to bankrate.com). It turns out that you will spend 19050 a year just on interest, over 30 years, you will alone pay 571500 in interest.
06-26-2006, 10:36 PM
#27
I feel the need...
Originally Posted by csmeance
you know what makes things worse, its mortgage rates. Suppose you buy a 300000 dollar home with the average 30 year fixed mortage at todays rate (6.35 percent according to bankrate.com). It turns out that you will spend 19050 a year just on interest, over 30 years, you will alone pay 571500 in interest.
Muhahah
That's IF, one assumes a purchaser is actually wise enough to lock in a fixed rate.
06-27-2006, 07:51 AM
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Yea. I got a good intrest rate (for these days, at least) and over the course of the 30 years Ill be paying 100 grand in intrest!
Well...thats someone who pays the minimum monthly. I figured out my extra $70 a month will shave $30,000 off that total.
Well...thats someone who pays the minimum monthly. I figured out my extra $70 a month will shave $30,000 off that total.
06-27-2006, 09:07 AM
#29
Originally Posted by csmeance
you know what makes things worse, its mortgage rates. Suppose you buy a 300000 dollar home with the average 30 year fixed mortage at todays rate (6.35 percent according to bankrate.com). It turns out that you will spend 19050 a year just on interest, over 30 years, you will alone pay 571500 in interest.
But you're going to pay interest regardless. The interest rates rising are why it's becoming a buyers market... however, when stepping back and looking at the big picture, interest rates in the low to mid 6's are still very, very good. People just got spoiled over the last 5-6 years with mortgage rates being at all time lows. In reality, they're still not that high.
Also, one thing we always do is pay extra each month, plus send an extra principal payment each year (although with the new business, not sure if we'll be able to make as large of an additional payment this year). Anyone who actually keeps their mortgage for 30 years is an idiot. Paying slightly more towards principal per month can shave years off. Heck.. setting up a bi-weekly plan will knock off 7 years alone... and you're not even paying extra, just paying half the payment twice per month.
The rate we're going we should own the house in about 20 years. My goal is to get that down to 15. Sounds crazy, but like I said, just a few hundred extra per month in principal goes a very, very long way....
06-27-2006, 10:12 AM
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Originally Posted by csmeance
you know what makes things worse, its mortgage rates. Suppose you buy a 300000 dollar home with the average 30 year fixed mortage at todays rate (6.35 percent according to bankrate.com). It turns out that you will spend 19050 a year just on interest, over 30 years, you will alone pay 571500 in interest.
Your calculation is wrong. The total interest over the life of the loan (30 years- no prepay) would be $372,014.56. As the loan amortizes, you start paying more principal and less interest.
What the big deal anyways, at least you can write off the interest.
06-27-2006, 10:15 AM
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Originally Posted by juniorbean
...
Anyone who actually keeps their mortgage for 30 years is an idiot. Paying slightly more towards principal per month can shave years off. Heck.. setting up a bi-weekly plan will knock off 7 years alone... and you're not even paying extra, just paying half the payment twice per month.
Anyone who actually keeps their mortgage for 30 years is an idiot. Paying slightly more towards principal per month can shave years off. Heck.. setting up a bi-weekly plan will knock off 7 years alone... and you're not even paying extra, just paying half the payment twice per month.
06-27-2006, 12:58 PM
#32
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I work for an insurance company. Lately, people have to refiance because they were only paying the interest only and not making payemnts
06-27-2006, 01:58 PM
#33
Originally Posted by corey415
Not necessarily, depending on the real estate market. Instead of putting all of your money into your own house, you could instead put money into other properties. Properties that could potentially appreciate faster than the property you currently reside in.
Buying a second property to rent or for an investment is never a bad thing, but not paying some extra principal on a monthly basis to allow you to own the house quicker makes no sense. Why pay all of that interest to the bank for no reason?
06-27-2006, 02:27 PM
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Originally Posted by csmeance
I work for an insurance company. Lately, people have to refiance because they were only paying the interest only and not making payemnts
Why would you have an interest only loan for 30 years? Or even 10?
06-27-2006, 05:59 PM
#36
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true, all the markets in florida are overvalued. since people can not make mortgage payments now, more and more housing are coming on the market
06-28-2006, 12:16 AM
#38
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My, we aren't opinionated or harsh and close minded are we??? 
While I agree that that where possible one should pay ahead, for some it just isn't possible. Likewise, some can only just afford the monthly payment and are very happy to be able to own a home at all. Paying off the mortgage early or even bi-weekly payments can't happen. Everyone one is not as gifted, talented and affulent as you seem to be. That certainly does not classify them as idiots. There are also people who have different priorities than you, imagine! FWIW, my situation is more similar to yours but I know plenty of of people 'poor but proud and hard working'. Then there are the people with the new cars, clothes etc that continue to pay the rent for our income property.
It's all good, just different paths. End of rant.
While I agree that that where possible one should pay ahead, for some it just isn't possible. Likewise, some can only just afford the monthly payment and are very happy to be able to own a home at all. Paying off the mortgage early or even bi-weekly payments can't happen. Everyone one is not as gifted, talented and affulent as you seem to be. That certainly does not classify them as idiots. There are also people who have different priorities than you, imagine! FWIW, my situation is more similar to yours but I know plenty of of people 'poor but proud and hard working'. Then there are the people with the new cars, clothes etc that continue to pay the rent for our income property.
It's all good, just different paths. End of rant.
Originally Posted by juniorbean
Tis true. That's why when you close on a house you never look at the final number which shows what you'll actually pay for the house... b/c you'll pass out.
But you're going to pay interest regardless. The interest rates rising are why it's becoming a buyers market... however, when stepping back and looking at the big picture, interest rates in the low to mid 6's are still very, very good. People just got spoiled over the last 5-6 years with mortgage rates being at all time lows. In reality, they're still not that high.
Also, one thing we always do is pay extra each month, plus send an extra principal payment each year (although with the new business, not sure if we'll be able to make as large of an additional payment this year). Anyone who actually keeps their mortgage for 30 years is an idiot. Paying slightly more towards principal per month can shave years off. Heck.. setting up a bi-weekly plan will knock off 7 years alone... and you're not even paying extra, just paying half the payment twice per month.
The rate we're going we should own the house in about 20 years. My goal is to get that down to 15. Sounds crazy, but like I said, just a few hundred extra per month in principal goes a very, very long way....
But you're going to pay interest regardless. The interest rates rising are why it's becoming a buyers market... however, when stepping back and looking at the big picture, interest rates in the low to mid 6's are still very, very good. People just got spoiled over the last 5-6 years with mortgage rates being at all time lows. In reality, they're still not that high.
Also, one thing we always do is pay extra each month, plus send an extra principal payment each year (although with the new business, not sure if we'll be able to make as large of an additional payment this year). Anyone who actually keeps their mortgage for 30 years is an idiot. Paying slightly more towards principal per month can shave years off. Heck.. setting up a bi-weekly plan will knock off 7 years alone... and you're not even paying extra, just paying half the payment twice per month.
The rate we're going we should own the house in about 20 years. My goal is to get that down to 15. Sounds crazy, but like I said, just a few hundred extra per month in principal goes a very, very long way....
06-28-2006, 02:07 AM
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Originally Posted by fuzzy02CLS
Cause people think they could afford a house cause intreast rates were so low. It's one reason the S FLA market is over valued. Another is flipping.
Another reason.....
Retirement condos flooding the market in South Florida
Published June 26, 2006
David Dweck couldn't believe it.
The founder of the Boca Real Estate Investment Club scanned the multiple listing service last week and found 2,700 condominiums for sale just in Palm Beach County retirement communities. That represents roughly 9 percent of the county's total listings.
"That's a staggering number," Dweck said.
Century Village west of Boca has 282 listings, he said. Kings Point west of Delray has 255, and roughly 20 percent of those have been on the market for 200 or more days, continued.......
http://www.sun-sentinel.com/business...ostemailedlink
06-28-2006, 07:09 AM
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Originally Posted by MR1
My, we aren't opinionated or harsh and close minded are we???
While I agree that that where possible one should pay ahead, for some it just isn't possible. Likewise, some can only just afford the monthly payment and are very happy to be able to own a home at all. Paying off the mortgage early or even bi-weekly payments can't happen. Everyone one is not as gifted, talented and affulent as you seem to be. That certainly does not classify them as idiots. There are also people who have different priorities than you, imagine! FWIW, my situation is more similar to yours but I know plenty of of people 'poor but proud and hard working'. Then there are the people with the new cars, clothes etc that continue to pay the rent for our income property. It's all good, just different paths. End of rant.
While I agree that that where possible one should pay ahead, for some it just isn't possible. Likewise, some can only just afford the monthly payment and are very happy to be able to own a home at all. Paying off the mortgage early or even bi-weekly payments can't happen. Everyone one is not as gifted, talented and affulent as you seem to be. That certainly does not classify them as idiots. There are also people who have different priorities than you, imagine! FWIW, my situation is more similar to yours but I know plenty of of people 'poor but proud and hard working'. Then there are the people with the new cars, clothes etc that continue to pay the rent for our income property.
It's all good, just different paths. End of rant.Of course this all changes if your money can be better invested elsewhere. If you were to save in an account earning 8% a year and your home's intrest rate is 5% you could save in that account then pay your house off in bulk sooner.
But for most people the psychological effect of paying off your house is worth it.