Feb 4, 2011

On the housing market...

Obviously it will come as no shock to you that we are in a "housing crisis" as a nation. Housing prices inflated, banks gave loans to almost anyone who wanted one, and then gravity took over and what goes up, must come down and down went the market. Some states are recovering faster than others, and some cities in those states are recovering even faster, like La Jolla, California.

Part of why Bobby accepted the hardship tour overseas is because of the chilly economic climate. We own a home in Colorado that we cannot sell, and because of a second mortgage on it, we owe more than it is currently worth. We have so far gotten lucky with great tenants, who's lease won't expire for another year, but I worry if they decide not to renew the lease, if we will be so lucky a second time. Part of our plan is to pay off the second mortgage with his overseas pay, so we can eventually sell. Unfortunately, websites like Zillow, do not have me too hopeful. Some websites however do suggest the market it starting to turn around, like this article on the Denver real estate market.

Part of the problem, is that we purchased our home with a zero down home loan and took out an equity loan, when our home was at its peak value. Now, even with the market starting to stabilize a bit more, we still have not built our equity back up. Once our second is paid off, we should at least be able to sell for what we owe. Next time, we will listen to Dave Ramsey's advice and put at least 20% down on a 15 year loan and spend no more than 40% of our income on housing costs.

Until our Colorado home is paid off, we will not even consider buying a home here in Washington, which is so sad because I really loved the freedom of home ownership. I still have not hung any of my paintings in the house because it never has felt like a home.

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