Depreciation- Availability of Housing Options and The Overall Market
Hey look it's the Doublewide Dudes.
Mousetrap: How are we doing Ap
A.P: I'm Awesome
Mousetrap:Should we keep doing that "Yeehaw" at the beginning
A.P: yeah yeah that's my favorite part in the whole intro
Mousetrap: Yeah I think that that's mine too, that's why i keep doing it. Let's jump right back into this topic on depreciation. In the first three episodes we covered; the myth of depreciation, how to get the best initial buying price and where you choose to have your home, whether a mobile home community park or have it on your piece of property, can affect whether it goes up or down in value. In this episode we're going to cover how the overall availability of housing options can affect the resale value of your home in the future. So A.P how's the market looking these days.
A.P: Well this is a great topic to discuss, and definitely something to consider when you're making your home purchase. It was certainly one of that factors that Datacomp found that determined whether a home was going to go up or down in value. For instance right now if you look at just north of 35, the Austin and San Antonio corridor right now is experiencing a tremendous amount of growth, lots of new tech jobs up there in Austin and lots of growth around the San Marcos area and particularly New Braunfels the retirement community is really being drawn to that area. So there's actually a manufactured home community right off 35 that is just for 55 and older. And right now in that particular market there's a lot of baby boomers that are looking to downsize, their kids have moved out and gone to college, empty-nesters, a lot of these folks are really enjoying the maintenance free lifestyle that a manufactured home community has to offer. So in that particular community if you purchased a home five or ten years ago there's a really strong possibility that your home is actually worth more today, than it was when you initially purchased it.
Mousetrap: Yeah and there are some of those communities in Kerrville as well and down south where I'm from in the valley area and McAllen I see those popped up all over the place. When i'm heading down over to South Padre off 83, that there's a bunch of mobile home community parks there.
A.P: Yeah a lot of those are for what they call the winter Texans. A lot of folks from up north when they get tired of the cold up there and when they're kids move out, they decide to make a permanent home there in south Texas and enjoy the beautiful weather it has to offer.
Mousetrap: Yeah that's the best thing about Texas, it's summer all year long, if we have those 70 degree day in the winter and i can imagine those people from up north really enjoy that.
A.P: Yeah especially south Texas, right there by the beach.
Mousetrap: Yeah, so what about the oil boom a few years back A.P? I know these small towns of three to four thousand all of a sudden looking to house ten thousand plus. What did something like that do for the housing market?
A.P: Well that was a prime example of how overall market conditions can affect the price of manufactured homes. Everybody was looking to move to these oil boom towns there in the Eagle Ford Shale south of San Antonio and out there in West Texas and as the price of rental homes, hotels and apartments and everything else skyrocketed so did the cost in the factory built housing industry. Particularly for used homes, used homes and repos the price of those and value of those really went through the roof we're talking thirty, forty year old single wides going for twenty, twenty five thousand dollars and the after effects of that are still being felt today. It's gotten to the point now where it's actually the same price if not in some cases a little bit less expensive to buy one of these entry level new homes, from the factory with the one year warranty, than it is the overall cost of these used homes once you factor in refurb and the cost of moving and all that kind of stuff.
Mousetrap: Yeah with the used homes going for so much I could imagine these retailers trying to take advantage of that situation. I can see how these homeowners, a lot of them probably overpaid for the home.
A.P: Right, right and it comes down to what we talked about in the first two episodes. There are a lot of people out there that overpaid during this boom time, just because retailers were, they were drooling looking at the market and some of these cases particularly in west Texas, heck they were treated like everybody had an oil derrick in their backyard so.
Mousetrap: There was no dollar menu anymore.
A.P: No dollar menu there in the oil boom.
Mousetrap: Ten dollars for a cheese burger
A.P: Basically yea, and it's simple supply and demand. If there are more folks looking for a place to live in an area than there are homes available then everything having to do with housing is going to go up.
Mousetrap: Perfect. Well that does it for episode number four, join us on the next one we're going to wrap this short series up with depreciation. Where we're going to finish up talking about the housing market and let you in on a fool proof secret, on how to win when you and your family decide to make a housing change.
Thanks again and we'll talk to you then.