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Originally Posted by ngdawg
New Jersey is too expensive to live in any more. I covered this in a journal entry, but the value of my little shithole of a house was just upped to over $297k!!!! It's about 1800 sq ft on a 50ftx100ft lot-porch is in need of replacing, no sidewalks....property taxes on average just in my town are over 5 grand...People are picking up and moving to North Carolina, Tennessee, South Carolina because they can sell high here and buy there for cash with plenty left over.
Blue collar jobs here are dwindling-car manufacturers, etc have pulled up stakes and moved elsewhere for cheaper labor, better tax rates and cheaper land. I well suspect that in most any other state besides maybe California, saying one makes $25 an hour sounds good-in New Jersey, it's not a living wage.
My southern friends always ask me when I'll be a 'damned yankee'-one who moves south. Not a day goes by I don't give it a thought.
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It's not going to last. Most of my adult life, mortgage interest rates have been a lot higher than they've been over the last five-six years; I held a mortgage at 9 percent for years. When mortgage rates go back up, housing prices will decline, or at least stagnate at the current levels for years while inflation decreases the "real" price of the house year by year.
Watch. In a couple of years, people will no longer be buying houses with the assumption that they can turn 'em over in five years at a fat profit. That'll take a lot of the air out of the market.
In California, we have a boom and bust cycle in real estate that lasts about 10 years -- longer this time around, because the Fed lowered interest rates. Used to be, real estate agents told people buying at the top of a boom: "Go ahead, it's a great deal -- _If_ you're going to live in the house for five years or more." Because that would be long enough to outlast the bust. Now, the wiser heads in real estate in my town are saying, "go ahead and pay the high asking price -- if you're going to live there for _ten_ years or more." Which means they're expecting a prolonged dip or stagnation in real estate prices, worse than the usual cycle.
I'm not saying that NJ or coastal California real estate is going to be dirt cheap anytime soon. But in a year or two people will stop thinking that buying real estate at any price is going to make them rich in a few years, and in fact won't be able to pay the prices they're paying now. And that's going to change things. Both in states like NJ and California, and in the states that people are moving to in search of cheaper housing -- Nevada, Utah, and some of the others named above.