Davis Square Condominiums Info

[bobobb.livejournal.com]

Does anyone know what the deal is with the Davis Square Condos?  I live down the street and am trying to figure out if units are selling or if they just flooded my neighborhood with unsellable condos. Also, what are the units like?  How big etc.?  Any info (first or third hand) would be of interest.... 

Comments

Re: What world are we living in?

[bikergeek.livejournal.com]

Who in their 20's can afford a 414K - 779K for a condo plus the associated fees and taxes?

Someone who just took out a stated-income, negative-amortization loan with an introductory teaser interest rate that resets upwards by 50% in three years, and plans on making only the minimum payment due.

Re: What world are we living in?

[ron_newman]

That would be called a "sub-prime" loan, and aren't those no longer being offered?

Re: What world are we living in?

[mrboboto.livejournal.com]

You can't even get an 80/10/10 loan these days (which isn't that risky compared to some of the subprime lending that went on), much less something like that poster describes.

Re: What world are we living in?

[bikergeek.livejournal.com]

...that would be why those places aren't selling. Because risky loans are the only way ordinary people can afford to pay those kinds of prices.

Re: What world are we living in?

[mrboboto.livejournal.com]

Perhaps you misread my post - I was agreeing with Ron that you can't even get a slightly risky loan, much less a very risky loan.

Re: What world are we living in?

[bikergeek.livejournal.com]

Yup, and if people can't get loans--the places don't sell.

There's no way someone with a $75k income should be able to buy a $600k property, absent a serious windfall like lottery winnings or an inheritance. The rough guideline that existed before the insanity of the first half of this decade was that you shouldn't borrow more than about 3-4 times your income. In the housing boom, though, banks abandoned that principle to their downfall and lent people much more money than they ordinarily would have. This had the effect of inflating home prices.

Re: What world are we living in?

[derekp.livejournal.com]

I got an 80/10/10 on condo (harder than a single family home from what I'm told) in June. A lot has change since then, though.

Re: What world are we living in?

[chumbolly.livejournal.com]

I spoke with a lender recently who told me there are only two large lenders that will still do an 80/10/10. That's the thing that concerns me most about the current market. Interest rates are still quite low, so from a monthly payment and cash flow point of view, buying is still a good deal for many people compared to renting. But coming up with 20% for a downpayment instead of 5% or 10% is a huge hurdle for first-time homebuyers. I know when I bought, the monthly payment was easy but I had to scrape, scrimp and lean on family for just 10%. As someone that will be looking to sell my perfect for first time homebuyers condo in the next year or two, I'm bummed.

An anecdote regarding the change in lenders' attitudes: I recently refinanced, and inquired with ING about their rates. I was informed that ING wouldn't go higher than 60% loan to value ratio for a condo refi, and since my LTV was 62%, they couldn't give me a loan. 60%!

Re: What world are we living in?

[witzwurst.livejournal.com]

Just because you can't get an 80/10/10 doesn't mean you can't necessarily buy with 10% down. Before 80/10/10s existed, people just got 90/10s and paid for PMI.

I have no data on the availability of 90/10+PMI loans these days, but they are considered significantly less risky than 80/10/10s.

Re: What world are we living in?

[ron_newman]

what does "80/10/10" mean?

Re: What world are we living in?

[narya.livejournal.com]

It's [first mortgage]/[second mortgage]/[down payment] so 80/10/10 would mean that 80% of the purchase price was financed with a primary mortgage, 10% was a secondary mortgage, and 10% was the down payment. Or at least that is my understanding of what that means.

Re: What world are we living in?

[bikergeek.livejournal.com]

The term "sub-prime" actually correlates with the credit rating of the borrower (usually, FICO < 620), not with the terms of the loan.

There has been a general sort of contraction in credit; people with lower FICO scores are finding it difficult to get any kind of loan.

Negative-amortization loans actually *are* appropriate for some people. They're good if your work is seasonal, or your income is irregular--think of someone who gets paid irregularly for completion of a few large contracts over the course of a year. You can make the minimum payment when you're lean and make up the difference when you're flush. They're *not* appropriate as "affordability products" for people who earn a regular paycheck and who can't afford to make a fully-amortizing payment.