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Thread: OKC Real Estate Market

  1. #1051

    Default Re: OKC Real Estate Market

    Quote Originally Posted by OKCRealtor View Post
    And perhaps the most sobering statistic of all 1st time buyers now make up just 24% of the market, an all time low since that metric has been tracked since 1981!
    And it says 25% of those FTBs did it using a loan or gift from relatives. That is incredibly depressing for anyone under 40 that doesn't have a wealthy family.

    Here in OKC where wages are low, it is essentially impossible to save for a home unless you fall into the wealthy family category or live dramatically under your means for a long time and save.

  2. #1052

    Default Re: OKC Real Estate Market

    Quote Originally Posted by OKCRealtor View Post
    Good stuff! I wish more people understood the sacrifice in the beginning but alas we're in an instant gratification world.
    It's certainly what people have always done in the past.

    With the advent of HGTV and Instagram, now everyone wants the perfect place as their first home and feels entitled to nothing less. That's simply not how things work, unless you have rich parents who are willing to give you a lot of help.

  3. #1053

    Default Re: OKC Real Estate Market

    In 1981 I was a first-time buyer in Edmond and was looking for a place that I could keep my horses. I found a 700 sq ft small 2 bed, 1 bath with a one wall kitchen. The house was solid built in the late 40s. It was not mine or anyone's dream house, but it was on 2 ac with outbuildings. It was just off of downtown and was wider then deep, great for future development. I kept it for 2 yrs, then sold it to a developer to divide up and put more starter homes on. I tripled my money in those 2 years. I was then able to buy my current 10 ac and build a bit larger home that has been my forever home also in Edmond. Point is that you look and find the deal that can be a springboard to what you want.

  4. #1054

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Anonymous. View Post
    And it says 25% of those FTBs did it using a loan or gift from relatives. That is incredibly depressing for anyone under 40 that doesn't have a wealthy family.

    Here in OKC where wages are low, it is essentially impossible to save for a home unless you fall into the wealthy family category or live dramatically under your means for a long time and save.
    Yea it's fairly common for FTB's to get a gift or have a little help but many are able to still do it on their own. We've always had some sort of down payment assistance program as well. I think up until things got really crazy in '21 it was relatively easy and affordable to buy your first home in OKC especially from 09 on when we had a period of ultra low rates & a lot of years that didn't have strong demand.

    That all changed in the 2nd quarter of '22 when affordability just went totally through the roof only to never go back down. Since wages haven't even come close to keeping up with housing inflation over the years & particularly since the pandemic it's a sobering reality for those still waiting to enter the market. I'm hopeful conditions will ease slightly next year and provide more opportunities.

    All of that said though I still think home ownership here even at a young age is pretty doable if you're willing the make the sacrifices and live below your means in order to save money. It's not that hard to save 10k for closing costs in a modern economy like we have with all of the gig jobs & part-time opportunities. Especially if there are 2 of you it can be done if you buckle up. The problem now though apart from that is the income required to qualify compared to before. We didn't realize how easy things were before.

  5. #1055

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Pete View Post
    It's certainly what people have always done in the past.

    With the advent of HGTV and Instagram, now everyone wants the perfect place as their first home and feels entitled to nothing less. That's simply not how things work, unless you have rich parents who are willing to give you a lot of help.
    Yep, just like everyone driving a luxury car & still renting. You could have bought a starter home instead in many cases.

  6. #1056

    Default Re: OKC Real Estate Market

    Quote Originally Posted by OKCRealtor View Post
    Yep, just like everyone driving a luxury car & still renting. You could have bought a starter home instead in many cases.
    There are some pretty inexpensive apartments near me. Almost all the cars in the lots are newer and more expensive than the Lexus I drove for 21 years.

    It also has to be said that younger generations don't seem to be as interested in home ownership. The whole "experiences are better than possessions" philosophy. That is all well and good, but what are you going to do when you are nearing 40, the housing market has gone way up in the last 15 years, and then you decide you want to buy and can't afford it? As it turns out, what they mainly do is complain and blame boomers.

  7. #1057

    Default Re: OKC Real Estate Market

    Adding to the problem is ever-increasing college tuition destroys the income of young professionals if they (once again) did not come from wealth and had to take loans.

    I am in my upper 30s and I still pay monthly for loans I took out when I was 18. Luckily the interest rate is extremely low, but it shows how long this sort of thing can haunt you when you start without money.

  8. #1058

    Default Re: OKC Real Estate Market

    ^

    But then again, rather than take out monster loans, you can easily go to community college for the first two years (or even UCO), then transfer to OU or OSU to get your degree. You can also choose not to live in a very expensive fraternity or sorority house (they used to cost about the same as the dorms, but no more).

    And frankly, it's downright silly to go to a private college unless you have a big scholarship. I went to school with people at Pepperdine who came out with well over $200K in debt, which just boggles the mind. And that's for a bachelor's degree. People that go to law school or med school at least have the prospect of earning that back.

    But nobody wants to make these sacrifices, either.

  9. #1059

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Pete View Post
    There are some pretty inexpensive apartments near me. Almost all the cars in the lots are newer and more expensive than the Lexus I drove for 21 years.

    It also has to be said that younger generations don't seem to be as interested in home ownership. The whole "experiences are better than possessions" philosophy. That is all well and good, but what are you going to do when you are nearing 40, the housing market has gone way up in the last 15 years, and then you decide you want to buy and can't afford it? As it turns out, what they mainly do is complain and blame boomers.
    This is definitely part of it as well, YOLO. If only we taught high schoolers personal finance & housing education we would be so much better off. Not that everyone would apply the knowledge but at least they would have it.

    Quote Originally Posted by Anonymous. View Post
    Adding to the problem is ever-increasing college tuition destroys the income of young professionals if they (once again) did not come from wealth and had to take loans.

    I am in my upper 30s and I still pay monthly for loans I took out when I was 18. Luckily the interest rate is extremely low, but it shows how long this sort of thing can haunt you when you start without money.
    College tuition has gotten out of control relative to income potential in many cases. I think the whole scenario has to be re-thought if you're not going for something specialized that requires significant higher education. I don't think it's fair to pin it all on those who come from wealth however as there are lots of examples of people who did it without family help. I've helped quite a few younger 20's buyers during my real estate career who did it without help. That was my story as well, I saved $10k first year out of college, lived dirt cheap other than I did buy a nice car but I was still able to swing both & bought in 09. I graduated in 08. To your point about the student loans though yes those can be debilitating. I wanted to get my MBA after undergrad but ultimately decided against going back because student loans was my only option. While disappointing to me at the time and honestly for awhile down the road now that I am where I am very glad I didn't do it.

  10. #1060

    Default Re: OKC Real Estate Market

    I waited seven years after getting my bachelor's before going to MBA school.

    I had long paid off my student loans from undergrad and spent a lot of time negotiating with schools on costs. Ironically, my three finalists were all private schools because they all offered the best value, and it was only because I worked them. I paid 100% of my way through both undergrad and grad school.

    When I started at Pepperdine, I quickly found out I had the best deal of anyone in my section. Some of them didn't get any help at all and it was hard to feel for them when they racked up huge student loans. I never would have done that unless I had gotten into Stanford or one of the Ivies, where starting salaries would be large enough to justify the outlay.

    For both my degrees, I had to strongly weigh the cost versus return long before starting. Almost nobody does that anymore; just rack up huge debt and worry about it later.

  11. #1061

    Default Re: OKC Real Estate Market

    Yea you're talking astronomical sums of money for places like that. Unless your family is wealthy enough to pay your way & gift you the experience it makes no literal sense.

  12. #1062

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Pete View Post
    This is exactly what has been going on in California and most larger metros, we're just late to the party because our housing costs have been so much lower.

    What I always tell people is this: you have to enter the market, because it's only going to go up and owning will become increasingly difficult.

    I broke down and did this in California after living there over 10 years. I hated the prices and didn't want to leave the beach, but while I was on the sidelines, things were getting worse right before my eyes.

    I would look and then get completely depressed: the homes were super expensive, nowhere near the water, and far below my previous standards. I had to finally shift my expectations and I ended up buying a house in Thousand Oaks, which is pretty far out by L.A. standards, and it needed a lot of work. I literally moved from a bluff-top dream home in Malibu (which was just a rental) into a place with bad carpet, a cheap kitchen, and popcorn ceilings.

    I cried like a baby and had enormous buyer's remorse.

    But then I settled in, had a great view atop a hill, could walk to a small college that had a fantastic swim complex and workout facilities, had nearly unlimited open space right outside my door, and discovered T.O. was an incredibly nice place to live.

    Over the 13 years I was there, I remodeled the entire place inside and out and did a ton of the work myself, like replacing all the interior doors, all the flooring, all the casings and baseboards, scraping ceilings, painting, landscaping, etc.

    That house tripled in value in that time and by the time I left, I cried just as hard as when I left Malibu.


    With a little creativity and elbow grease, you can have a really nice home in OKC that is affordable to almost everyone.
    I recall reading that Tom Selleck has his ranch in (or near) Thousand Oaks. He bought it from Dean Martin in the late 1980s, IIRC.

  13. #1063

    Default Re: OKC Real Estate Market

    Quote Originally Posted by OKCRealtor View Post
    Yea you're talking astronomical sums of money for places like that. Unless your family is wealthy enough to pay your way & gift you the experience it makes no literal sense.
    At private colleges, there are the rich kids whose parents pay for everything. The schools need them because they pay full freight.

    Then there are the scholarship kids, and they need them too to pad their stats and help their overall rating.

    If you don't fit into one of those categories, you are going to come out with hundreds of thousands in debt, and it's just an irresponsible thing to do.

  14. #1064

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Dob Hooligan View Post
    I recall reading that Tom Selleck has his ranch in (or near) Thousand Oaks. He bought it from Dean Martin in the late 1980s, IIRC.
    There are parts of T.O. that are super expensive. Pamela Anderson, Brittany Spears, a bunch of others live very close, like the Kardashians and Justin Bieber. There are some massive estates on big acreages.

    In my relatively modest neighborhood, my only famous nearby neighbor was Sparky Anderson! Incredibly nice man and I'd see him out walking all the time.


    Now, when I lived in Malibu, that was a different story. Every current and former movie star has a place out there, and many have another close to the Hollywood studios. There was only one major grocery store, one theater. I saw dozens and dozens of celebs all the time. There was only one that stopped me in my tracks: Jane Seymour of all people. I never thought she was that pretty even though she routinely made the 'most beautiful' lists. But in person (right beside me in a movie line), she's just stunning in a way that is hard to describe. Most celebrities look worse in person, she somehow looked way better.

    While I'm playing TMZ, I will add that there was one other actress who just floored me: Tiffani Amber Theissen. Yes, from Saved by the Bell and BH 90210. In fact, I also met Jennfier Anniston and Courtney Cox at the same event and found neither that striking. Tiffani is the prettiest woman I've ever seen.

    And predictably, Matthew McConaughey is a complete jackass.

  15. #1065

    Default Re: OKC Real Estate Market

    3% mortgage rates spoiled too many people to think they can only afford to buy a house if rates are that low. Those rates were the exception not the norm for the majority of my life and I'm 69. I've said it before I bought my first house which was a 1160 sq ft house, 3 bdrm 1 1/2 bath 2 car garage slab floor central heat and air when I had just turned 23 on a 9 1/2% 30 year mortgage because that is just what rates were. I was not some college educated degreed person. I had an entry level factory production union worker job. I was single so a single earner household. I stayed in that house 19 years. The last 6 years with a wife and 2 step kids. Then bought a house on a 7 1/8% 15 year mortgage and thought that was a great rate compared to what I had.

  16. #1066

    Default Re: OKC Real Estate Market

    Sounds like you bought just before things went crazy soon in the early 80's.

    Although I wasn't alive yet the only time modern affordability has been this low was early 80's when the rates were astronomical in the high teens. My dad still talks about the oil bust and penn square bank collapse. Being a home builder was about the worst thing on the planet at the time.

    It has been a very tough few years for buyers though, I certainly feel for the modern conditions. Affordability is at once in a generation lows all around & might not get any better. But it doesn't change anything with respect to real estate. It's still going to do what it does over the long term and the prices will just continue to go up. Especially in a hot growth market like OKC. We get a lot of mentions around the country on different things I listen to & read as far as real estate investing, affordability, etc. I just hope we're not doomed to a low growth high rate environment permanently. So much depends on our governments fiscal policy & treasury yields.

  17. #1067

    Default Re: OKC Real Estate Market

    I purchased that first house in May of 1978 for $35500 and sold it in 1996 for $59000. I just ran that $35500 through 2 inflation calculators and they put that 1978 $35500 at $173000 today. And Zillow has that house valued at $171100 today so pretty much just followed normal inflation rate since 1978. It sold again in 2022 for $116000. But my point was Pete said to look for a starter house under 2000 sq ft when a nice little house like that makes a great starter house for a first time buyer. This is the house.
    https://www.zillow.com/homes/5372-NW...22036611_zpid/

  18. #1068

    Default Re: OKC Real Estate Market

    Thanks for sharing that, pretty cool to trace it back to 1978. Plenty of those out there still to the point. I think the most interesting part of that is you had it nearly 20 years and it went up slightly over 1,000/year which was the average inflation rate but in context to today doesn't seem like much. The baseline prices have gone up tremendously over the decades & we just got basically a decades worth of normal appreciation in a couple years. Rates were way higher back then but the prices were so much lower.

  19. #1069

    Default Re: OKC Real Estate Market

    But if the current value today is about the same counting for inflation were the prices on a house like that really that much lower then. And I think I was making around $5.50/hr so maybe $12k/year. If I remember the payment just P&I not counting insurance and taxes was $279/mo.

  20. #1070

    Default Re: OKC Real Estate Market

    Curious if you are seeing Property Taxes and Insurance costs effecting people being able to afford buying houses. My house is paid for but just the taxes and insurance is running about $650/mo and it's going up every year. You start adding those amounts on top of the P&I payment and I can see affordability being an issue.

  21. #1071

    Default Re: OKC Real Estate Market

    Quote Originally Posted by gjl View Post
    But if the current value today is about the same counting for inflation were the prices on a house like that really that much lower then. And I think I was making around $5.50/hr so maybe $12k/year. If I remember the payment just P&I not counting insurance and taxes was $279/mo.
    The answer is yes since mid 22. Wage growth hasn’t nearly kept up with home price growth over the last couple decades. It wasn’t that exacerbated during the ultra low rate period but now that we’ve got restrictive rates by modern standards we have record low affordability only rivaled by early 80’s oil bust from everything I’ve read. That’s to say these last couple years may actually have been the hardest years on record to buy.

    Quote Originally Posted by gjl View Post
    Curious if you are seeing Property Taxes and Insurance costs effecting people being able to afford buying houses. My house is paid for but just the taxes and insurance is running about $650/mo and it's going up every year. You start adding those amounts on top of the P&I payment and I can see affordability being an issue.
    Yea that’s part of the problem for sure, I’ve had people sell this year because payments went up so much in a short period. The final inflation dagger as taxes & insurance costs have now been fully realized. It also causes the closing costs to go up because of escrows.

  22. #1072

    Default Re: OKC Real Estate Market

    Quote Originally Posted by gjl View Post
    3% mortgage rates spoiled too many people to think they can only afford to buy a house if rates are that low. Those rates were the exception not the norm for the majority of my life and I'm 69. I've said it before I bought my first house which was a 1160 sq ft house, 3 bdrm 1 1/2 bath 2 car garage slab floor central heat and air when I had just turned 23 on a 9 1/2% 30 year mortgage because that is just what rates were. I was not some college educated degreed person. I had an entry level factory production union worker job. I was single so a single earner household. I stayed in that house 19 years. The last 6 years with a wife and 2 step kids. Then bought a house on a 7 1/8% 15 year mortgage and thought that was a great rate compared to what I had.
    The thing about interest rates is they can change affordable very quickly because they are tied to long term loans. Now in 2020 the average wage in the Oklahoma was around 53k. The average cost of a house in 2020 was 134k. The average mortgage rate in 2020 was 3.15%.

    In 2024 the income is around 54k, the house cost is 207k, and the interest rate is 7%. It is obvious that home ownership has become more expensive over the last four years. There are many factors but OKCTalk is not a political form. I just feel for the young people today.

  23. #1073

    Default Re: OKC Real Estate Market

    Quote Originally Posted by Canoe View Post
    The thing about interest rates is they can change affordable very quickly because they are tied to long term loans. Now in 2020 the average wage in the Oklahoma was around 53k. The average cost of a house in 2020 was 134k. The average mortgage rate in 2020 was 3.15%.

    In 2024 the income is around 54k, the house cost is 207k, and the interest rate is 7%. It is obvious that home ownership has become more expensive over the last four years. There are many factors but OKCTalk is not a political form. I just feel for the young people today.
    You forgot to say something about the high cost of homeowner's insurance today. The cost can sure raise up your mortgage payment. I am retired and no debt, but my auto and home insurance rates are sky high due to all the hail and damage claims of others. Also if you figure in the cost of vehicle ownership which is a necessity for most in the metro, high cost of other things like food, day care etc. the overall ability to afford a home is getting tough for the younger generations. My 3 cents.

  24. Default Re: OKC Real Estate Market

    I currently rent a house in an older neighborhood with what most would consider to be starter homes. If I were to buy a home in my neighborhood (and one that needed some pretty big updates), after taxes and insurance at current interest rates I would pay about $600 a month more than I currently pay in rent.

    So for the privilege of owning a home, I would need to not only pay more per month but also then come up with the money to update a house. Let alone deal with the normal maintenance that comes with owning a home built in the 40s or 50s.

  25. #1075

    Default Re: OKC Real Estate Market

    ^

    You need to factor in the tax deductions -- which are substantial -- and appreciation.

    Also, rents go up but a mortgage is usually fixed for 30 years.

    Most people start in homes that need updates and don't expect to do them right away. They do them over time as the house appreciates and you can always get a long-term loan to do that type of work. You can also do a ton of things yourself without spending a lot of money.


    The entire U.S. economy and taxation system strongly favors property ownership. And the longer you sit on the sidelines, the more it is going to cost you in the future.

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