My salary didn’t change at all, but homes went up 82%. The money I saved for a down payment and my salary no longer are good enough for this home and many others. This ain’t even a “good” home either. It was a 200k meh average ok home before. Now it’s simply unaffordable
Being able to buy a $200,000 house in the town I live in would change my life so much.
Tbh this is more than mildly infuriating…
That you don’t understand the realestate market? Or you didn’t know this has been projected for a decade now from millennials getting as old as the avg age of first time home buyers and being the largest % share of the US population creating more demand than available supply?
More like that they probably are too young to have bought a home earlier. All people in their 20s (and I think we make a large percentage of Lemmy users) simply have to cope and buy some overpriced home regardless.
To add to that, we also the only generation who lived thru the only housing bubble giving a hesitation to the concept that realestate has always been the safest investment. They’re buying high but are able to control most of not all extrinsic variables that could keep them from selling higher than they purchased. There aren’t many ways to invest money that you 100% either control the out come of or can insure what you cant control. The exceptions like community wide property value loss are still specific to the properties location that you decide before purchase. I know there are cases where your research before buying can fuck you but it’s still more control than investing in the market where everything about the value of your asset is out of your hands. All you can control is how it’s value is managed.
Friend of mine was saving up for a house 5 years ago. Prices have gone up almost 150%
Yeah that was me too… I FINALLY got to the point where I could realistically start looking, got the pre-approval and everything just after COVID started… People had already starting WFH and moving away from where they worked and investment companies kept buying and now I’m still living in someone else’s garage because prices went through the roof pretty much as I was looking…
Of course once you mention WFH everyone gets defensive and claims this was a trend, but those charts are the same everywhere. Houses in 2018-19 were often less than half of what they cost now…
WFH is a logical thing to imagine, but there’s a simpler trend that can be seen by looking at two graphs:
https://fred.stlouisfed.org/series/M2SL
https://fred.stlouisfed.org/series/MSPUS
“Please don’t melt the economy” printing press fired up in 2020 and real estate investors seemed to get plenty of that cash. While inflation didn’t quite match the M2 injection, anything “investment” like saw that bump. The M2 injection was enough to save the stock market, but housing, which did not see the same crash as stocks, got the same boost.
This is why, more than ever, people see that individuals almost don’t get to participate and big companies are instead buying the stuff and maybe letting people rent them if they feel so inclined. The big companies got the boon of the M2 and most individuals got a modest bump by comparison.
printing press fired up in 2020 and real estate investors seemed to get plenty of that cash.
Maybe I’m just ignorant, but in a just world that should have never been allowed to happen… I’m sure our politicians had nothingggg to do with that “oversight.” :/
Thanks for the links!
Generally speaking, one would have hoped for a better solution. To be fair though, we faced an unprecedented scenario in 2020, and for many of the indicators, the closest to precedent that we ever had was the Great Depression. So they did manage to dump truck enough money into the market to patch up the catastrophic drop of the stock market, and provide enough to keep the every day economy vaguely functional. Unfortunately the ‘fix’ was still very ‘trickle down’ style and ended up with an enduring imbalance favoring those already wealthy rather than some alternative that might have left folks on a level playing field.
Only 37 more years until he has that down payment.
In the lat 80s / early 90s, my SO and I saved up for 7 years to be able to afford the down payment for our first home. Now, that would be more like 20 years, which is too much.
Time to consider moving to Europe or Costa Rica or Mexico City or somewhere, if you’re in that boat now.
It’s not as bad in Germany, but pretty close. It’s a very good time to sell houses. And on top of that they are generally much more expensive than American houses to begin with.
And on top of that they are generally much more expensive than American houses to begin with.
That very much depends on the area and the house itself.
Well you would try to match features 1:1, else it’s a foolish comparison
About everywhere… In Toronto it’s now 1 million+. In Vancouver it’s now 2 millions+
Right but OP is talking about a house in Waleska, Georgia, which has a population of 921 (as of 2020 census). Not really on the same level as Toronto or Vancouver!
People from big city retire, sell their house now worth a fortune and move out of the city and can afford to pay whatever people want for their house, this inflates the price of housing in rural areas and people born there can’t afford to live there anymore.
Hi, Georgian here. Trust me, nobody wants to live in the ass-end of Cherokee County, so far north it’s only barely in Metro Atlanta, but not far enough north to have decent mountain scenery or anything. Frankly, I’m appalled at how overpriced it was at $200K four years ago, let alone now.
Y’all realize this is a bubble, right? I almost feel sorry for these investors, gonna have their ass handed to them in the coming decade.
Y’all realize this is a bubble, right?
Can you explain why you feel that way?
Shout out to [email protected]
It depends on the area. Some places are actually gowning that fast in population
I feel sorry for any one whose bought a house over the last couple years.
I don’t, it’s strictly better than renting
Is it though? My understanding is it’s more complicated than “simply better”. You need to account for property tax, home repairs, lack of mobility, housing market, etc.
It’s more along the lines of “buying is generally better than renting, but there are about 100 different factors to consider.”
The main downside is you have to pay closing costs to move. That means you should plan to stay in the home at least a handful of years or else you’d lose money likely. But with the market the way it is, get a house ASAP cause its going up like a roller coaster.
I bought mine 5 years ago and its gone up 50% in value since then.
There are advantages I’m not actually culpable for all of the maintenance of my property my actual rent right now is just about on par with anybody who is going to be paying to purchase their house and granted I’m not actually gaining anything as far as property value I also didn’t have to come up with a down payment or jump through hoops and try and get the house in the first place and very safe in my position and I’m very capable at this point after having lived here for many years landlord hasn’t asked for a new lease in the last couple years so I could actually walk away at any moment… there are benefits but they’re few
Bought a house 5 years ago. Cheaper than renting and equity says I made 100k. It’s good.
It’s just lame how expensive they are now. BTW, they were to expensive 5 years ago too.
Not really. The system will instead keep finding ways to get people to rent at higher prices or take out low down payment loans with ever larger monthly payments taking a lot more of take home salaries and making it harder than ever to save and invest.
The rental aspect isn’t a bubble. Until they start viciously taxing single-family home rental, home prices are going to stay high because they’re not being bought as homes but as assets for rent-seeking.
If Big Macs, houses, gas and college tuition all went up, it’s time to realize these are not all in bubbles and instead realize due to inflation your salary has been halved.
No true! Plebs got 12% raises over last few years ans even for one quarter outpaced inflation 🤡
The answer is to go somewhere cheaper. If you go far enough out of town the prices will go down.
Plus when the town grows your property value will go up and up.
This is a boomer logic…
- You are going out so far out that commute arouns trip will start @ 2 hours
- Both people must have reliable vehicles, cost of whivh also spiked. Whats total cost for a reliable vehicle now?
Congrats, you are living a miserable life with mortgage, 2 car notes and commute that destroys your health.
Played yourself really.
Yes this thinking really underestimates the cost of driving and devalues your time.
And as you mentioned, long commutes are uniquely unhealthy.
The answer is to go somewhere cheaper. If you go far enough out of town the prices will go down.
So basically, somewhere no one wants to live because of distasters, is boring AF, no jobs there.
If it’s boring, then so are you. There’s plenty to do in the country, just not much that involves “going to crowded places and spending ridiculous amounts of money on things that would be 20x cheaper at a regular store”
No argument on anything else though…
Most jobs are located within urban areas and people life around their jobs.
Yes, that’s why I have no arguments against the “no jobs” part.
You’ve never been to a rural area of the country, have you? I traveled to Idaho recently and good fuck was it boring. Hiking is fun for a few days, but then there’s 20 degree weather, snow, ice, hail, poor Internet that’s basically DSL so you can’t play any games or access the Internet. People live within 50 miles of cities for their own sanity
ve never been to a rural area of the country, have you?
I’ve lived in them almost exclusively.
Yep, everyone who lives in the less populated areas is miserable and bored constantly. Those poor people, so sad. They should be more like you.
Kind of yes. However if you want home ownership at a reasonable cost that’s the way to go. It doesn’t need to be in the middle of no where but it doesn’t need to be in the upper tier locations.
I like the utility feed hanging off the front of the house going straight through the roof and blocking them from installing the other fake shutter. I wonder what other construction horrors lurk inside.
This is everywhere. I’ve been looking for houses for 3 months in NW Ohio. 300k is the new 150k, and all the houses are beat to shit on the inside needing 50k just to make them passable inside because nobody takes care of them.
I wonder what proportion of it is also due to people fleeing 1 million + average house markets during the pandemic work from home wave. Not saying this about you, but it makes me think it’s funny how the common refrain of “Don’t like it? Just move” is often uttered by NIMBYs.
I think a big part of it is we’re on the other side of the peak of all houses going for 100k over asking regardless of condition. A number of houses have that grey vinyl flooring installed in a bunch of rooms that’s as cheap as it is ugly.
grey vinyl flooring
I hate that shit even more than I hated the fake wood paneling and shag carpet of the '70s. I bought a house last year that had the grey vinyl flooring in the living room and I’ve tried my hardest to fuck it up during the renovation so I have to replace it, but unfortunately it holds up to extreme abuse pretty well.
A former housemate did so much water damage with a portable A/C unit, that not even two months ago I had to rip up the whisper walk, and the original wooden flooring (house was built in the '30s) all the way down to the subfloor. Replacing the whisper walk would have been $3000 for just that room. We managed to find vinyl flooring that matched the rest of the flooring in the house and redid the floor for $1500.
My point is that you can get nice vinyl flooring, and it’s not terribly expensive to replace/ install.
Heh, according to the guy who sold me the house, he had to put the grey vinyl flooring in because of water damage from a portable AC unit.
Yep, that’s on track! My house has almost tripled in price since I bought it 12 years ago. Denver metro. No way I could afford it if I had to buy it today.
Houses in my neighborhood are up 150-200%.
Keep in mind that inflation has risen over 30% in just the last 4 years, which explains at least part of the rise in prices. I wouldn’t be surprised if inflation is even higher in certain areas of the country. I’d also not be surprised if Georgia is getting a lot of natural disaster refugees from places like Florida.
The other part i don’t see anyone mentioning is that this was all projected as a result of millennial generation, the largest % of population by generation comparison, came into the age of buying homes. Creating a sharp spike in demand over supply.
Real talk, forget about a down payment. There are a bunch of different ways to get a 0 down mortgage with varying qualifiers so that chances you qualify for one of them is quite decent.
Even if not, there are still a bunch of other ways to get low down payment mortgages for ~3% down or less.
Toss out the old adage of “20% down or bust” and keep any money saved towards it for savings for all the other costs of home/closing
What income to loan ratio are you talking here?
This is terrible advice. Paying anything you can up front saves you several times over in the long run.
Let’s talk 500k house, 6%, 30 years, no pmi, no taxes, no extras… Paying 100k (20%) up front you’ll pay: $863,352.76 Paying 50k (10%) up front you’ll pay: $971,271.85 Paying 0 up front you’ll pay: $1,079,190.95
Paying 20% down (100k) will save you over 200k.
If you intend to live in the house indefinitely, you’re so much better off if you put as much into the down payment as you can.
This is terrible advice. Paying anything you can up front saves you several times over in the long run.
Usually, yes, but it’s situational.
For example, I bought my house in 2009 during the depths of the Great Recession, with no down payment, and got a screaming deal. If I had decided to wait a few years to save up for a down payment, I would’ve been 500% screwed.
(That “500%” isn’t hyperbole, by the way: that’s how much more I would’ve had to spend to buy my house now instead of back then! Actually, I’d have been even more screwed than that, considering that I’d be paying ever-increasing rent the whole time, too.)
Also pay on time and as much as you can. Don’t fall into the trap of paying to close to or at the minimum. If you do that you will be in loads of dept.
The longer you wait to pay something off the more interest it gains.
This presumes you can elect to either just spend the 100k now, that you may not have.
If you declare you want 100k, but let’s say that would take you 10 years (and the goalposts wil move). That’s likely 120 months of rent you will have to pay, so while you’ll end up saving on interest, you’ll more than lose out on rent.
Paying down aggressively and going with as big a down payment as you can reasonably afford makes sense. However waiting to save up for that downpayment may cost more in rental expenses than you’d save.
Good thing what I actually said was
Paying anything you can up front saves you several times over in the long run.
My point was that the advice was terrible. Not that there are other circumstances that could make it useful. Overall, as a general rule you shouldn’t want to just hold onto debt for no reason if you have means to pay it down. It’s also why I specifically showed 10% as well rather than just the typical 20% downpayment, it furthers my point that
you’re so much better off if you put as much into the down payment as you can.
“As much […] as you can” And not just some 20% or whatever magic number.
That’s great, in theory. In reality, you’ll get stuck in a perpetual savings cycle like OP and in many cases never reach the mythical threshold.
200k savings sounds nice, but if you have to spend 5 years saving and housing prices jump 80, 90, 200% in that time that savings lead gets entirely erased.
You can always play around with your interest rate later on, but you can never change what you paid for the house
housing prices jump 80, 90, 200%
Happened once and we are currently dealing with the consequences., tbd
So occasionally I look out of curiosity and the reason is pretty plain.
I look for houses for sale in a suburban area as public listings, and there’s like 1 within a few square miles of the area.
I switch over to renting, and there’s like 12 houses just like the one for sale available, all owned by companies. I also know a coule that aren’t listed that have no tenants, but are still owned by one of those companies. You can tell because those yards are now waist deep grasses (in an area where HOA throws a hissy fit if your yard looks just a smidge unkempt).
Don’t know why the companies find it more profitable to buy houses people aren’t looking to actually move into, at least at the rent they are willing to accept. If I fully understood why, it might just piss me off more. Like maybe the houses work better as a loan basis than other assets, so even empty and unused they are valuable as some sort of financial trick.
Don’t know why the companies find it more profitable to buy houses people aren’t looking to actually move into, at least at the rent they are willing to accept. If I fully understood why, it might just piss me off more. Like maybe the houses work better as a loan basis than other assets, so even empty and unused they are valuable as some sort of financial trick.
That’s one thing, but housing has been a low-risk investment for a long, long time. If they bought the house OP posted in 2020 and sold it in 2024 they would have almost doubled their money even without renting it out.
A 1200 sqft bungalow near me just sold for 1 million Canadian rubles
And in the past I would ask “Toronto or Vancouver?” But I know that that could be in any city these days.
Not Vancouver. Nothing that size would go less than 2 million until you hit Coquitlam. MAYBE.
Yeah, we are boned all over the nation.
For fun here are some places you can buy for $1 million https://www.realtor.ca/real-estate/27507233/161-moyle-drive-yellowknife
https://www.realtor.ca/real-estate/27587880/7077-quinpool-road-halifax-halifax
https://www.realtor.ca/real-estate/27532186/1132-osler-street-saskatoon-varsity-view
Yeah. I’m pretty much resigned to living in our rental until we get renovicted. No kids, double income, a lot of savings… but the mortgage payments would be way more than it’s worth to have a minor upgrade. Strata payments alone are often more than our rent!
Condo/HOA/Strata fees are a big way people are kept out of owning their own place. Its crazy that almost every place even remotely affordable is part of one.
I get the need for them, to pay for shared building services. Strata fees pay for exercise rooms, pools, grounds maintenance, whatever. I 100% am behind them, as long as the Strata council is responsive to needs and not corrupted, but there’s the rub.
I’d generally be happier with few services and low strata fees tho.
