What % of your takehome pay are you spending on living expenses?

[BWRhasnoAC]

Most people my age rented for 5-7 years before buying a house. Those first houses were also 800-900 sq ft. Now they are 1500-2000, have granite counters and 3 car garages.

The starter homes of the past don’t seem to exist anymore.

They don't. At least not in new construction. Builders lost their asses in '09. So they just make the big expensive houses now. Less inventory, bigger margins.

Trucks are similar. There a shortage of computer chips, so they aren't making the base models forcing the consumer to buy higher end models because that's all there is.

 

[1SEIACLONE]

They don't. At least not in new construction. Builders lost their asses in '09. So they just make the big expensive houses now. Less inventory, bigger margins.

I get a lot of Zillow emails and it looks like in Ames new construction on a 1400 to 1500 square foot house is low to mid $400K without a finished basement, if the basement is completed it pushes the price up to the lower to mid $500K. You do not see a lot of homes above 1700 square feet and the average time on the market is around 64 days.

 

[BWRhasnoAC]

I get a lot of Zillow emails and it looks like in Ames new construction on a 1400 to 1500 square foot house is low to mid $400K without a finished basement, if the basement is completed it pushes the price up to the lower to mid $500K. You do not see a lot of homes above 1700 square feet and the average time on the market is around 64 days.

Yep. The prices are outrageous. Until there's a government effort to build affordable homes it won't change. The market is clearly not adjusting. It only gets higher. Then with all the private equity firms buying up homes, the rent is too high as well. No good options.

 

[1SEIACLONE]

Yep. The prices are outrageous. Until there's a government effort to build affordable homes it won't change. The market is clearly not adjusting. It only gets higher. Then with all the private equity firms buying up homes, the rent is too high as well. No good options.

Somebody is buying them, out in N. Ames they have a lot of new homes going up and have just started earth work on a new development south of the country club on the west side of the road. So houses must be selling for them to build as many as they are putting up.

 

[isufbcurt]

I know I am biased but being a CPA is a good life. Work your ass off on taxes for 3-4 months, bring in a windfall. Then the rest of the year is maintaining clients books, payroll and some special projects to bring in consistent monthly billing. Very flexible, not physically demanding and get to spend 8-9 months blowing your windfall.

 

[BWRhasnoAC]

Somebody is buying them, out in N. Ames they have a lot of new homes going up and have just started earth work on a new development south of the country club on the west side of the road. So houses must be selling for them to build as many as they are putting up.

Mostly older couples. $400k+ isn't a starter home. It's not in the price range that new buyers can typically afford.

 

[AgronAlum]

Mostly older couples. $400k+ isn't a starter home. It's not in the price range that new buyers can typically afford.

On top of that, investors are buying all the cheap inventory to do half assed flips on them. If you can find something cheap that hasn't been gobbled up by an all cash offer, they've been neglected because of how expensive it has gotten to replace things like roofs, siding or waterproof a basement.

 

[clones_jer]

We've been saying the housing market is a "little sideways" basically since the '08 crisis ended. Somehow, it never has corrected in that time. It has accelerated instead.

Someday, someday, someday. But the in meantime and the now, sucks to suck.

as someone that owned a home between 2004-2011 and sold it for exactly the same price I paid for it, I can let you know that the market had some pretty f'n low periods prior to catching fire in 2020. Not all raindrops and unicorns in the "old days"

 

[clones_jer]

Yep. The prices are outrageous. Until there's a government effort to build affordable homes it won't change. The market is clearly not adjusting. It only gets higher. Then with all the private equity firms buying up homes, the rent is too high as well. No good options.

you're in a super dark place dude.

 

[Antihawk240]

In an attempt to reel this back into topic and away from the "Do you need a Degree thread" I will go percentages:

I crunch these numbers all the time. I am blessed that my wife is a stay at home mother / homemaker to our (3) children. In order for us to pull this all off, we analyze and review the numbers often. Probably monthly, possibly every other month.

Demographic for consideration: 3 teenage sons, (5) active vehicles. Our house is 100% Electric (minus gas fireplace).

Salary - 29% Payroll deductions: fica, mica, FAMILY health insurance, dental, 401K contributions.

The percentages going forward now will be based on AFTER payroll deduction income.

21% - Debt Repayment
05% - Phones & Internet
04% - Electric Bill
14% - Gasoline
10% - Savings

So by percentages our LIVING EXPENSES would be calculated to be 17%.

Groceries are by FAR a large portion of our living expenses. Again, reference to that whole 3 teenage boys thing.

I fully expect most comments on this will be targeting our gasoline. This by far is the conversation my wife and I have every single month. It is truly amazing how much gas (5) vehicles can go through for a family who lives 10 miles out of town (away from school) constantly coming and going.

Our interesting tidbit is each payday we sweep what is ever left over in our checking account to a savings account, then proceed to start over with the fresh payroll deposit. That typical sweep is how I came up with the 10%.

 

[clones_jer]

They don't. At least not in new construction. Builders lost their asses in '09. So they just make the big expensive houses now. Less inventory, bigger margins.

Trucks are similar. There a shortage of computer chips, so they aren't making the base models forcing the consumer to buy higher end models because that's all there is.

bro, if you tell me you drive a premium trim new truck because "its all they had" and can't afford a house I'm gonna lose my ****.

 

[clones_jer]

In an attempt to reel this back into topic and away from the "Do you need a Degree thread" I will go percentages:

I crunch these numbers all the time. I am blessed that my wife is a stay at home mother / homemaker to our (3) children. In order for us to pull this all off, we analyze and review the numbers often. Probably monthly, possibly every other month.

Demographic for consideration: 3 teenage sons, (5) active vehicles. Our house is 100% Electric (minus gas fireplace).

Salary - 29% Payroll deductions: fica, mica, FAMILY health insurance, dental, 401K contributions.

The percentages going forward now will be based on AFTER payroll deduction income.

21% - Debt Repayment
05% - Phones & Internet
04% - Electric Bill
14% - Gasoline
10% - Savings

So by percentages our LIVING EXPENSES would be calculated to be 17%.

Groceries are by FAR a large portion of our living expenses. Again, reference to that whole 3 teenage boys thing.

I fully expect most comments on this will be targeting our gasoline. This by far is the conversation my wife and I have every single month. It is truly amazing how much gas (5) vehicles can go through for a family who lives 10 miles out of town (away from school) constantly coming and going.

Our interesting tidbit is each payday we sweep what is ever left over in our checking account to a savings account, then proceed to start over with the fresh payroll deposit. That typical sweep is how I came up with the 10%.

so the 17% is your mortgage? or is that in Debt repayment?

 

[BWRhasnoAC]

you're in a super dark place dude.

It's the reality of people that weren't born before 1982. There are two economies. Things are great if you're on the right side of it.

 

[BWRhasnoAC]

bro, if you tell me you drive a premium trim new truck because "its all they had" and can't afford a house I'm gonna lose my ****.

No I bought used. 55,000 miles. 2022 Ram. Base model besides 4x4. $29,300 after I talked them down. I know it's hard to believe but yes things are expensive. More than most can afford just looking at median data.

 

[clones_jer]

No I bought used. 55,000 miles. 2022 Ram. Base model besides 4x4. $29,300 after I talked them down. I know it's hard to believe but yes things are expensive. More than most can afford just looking at median data.

yeah, I've always wanted a nice truck too. Never pulled the trigger, too much missed opportunity cost for me, but driving a Malibu does suck, I would love a Ram someday.

 

[Antihawk240]

so the 17% is your mortgage? or is that in Debt repayment?

17% is what I determine living expenses- Groceries, Clothing, Entertainment.

Our mortgage is part of the 21% debt repayment

 

[clones_jer]

It's the reality of people that weren't born before 1982. There are two economies. Things are great if you're on the right side of it.

Do you live in Iowa? Just trying to see what kinda housing market is creating this woe.

 

[BWRhasnoAC]

yeah, I've always wanted a nice truck too. Never pulled the trigger, too much missed opportunity cost for me, but driving a Malibu does suck, I would love a Ram someday.

I'm a carpenter. Not really optional. I wish I could just buy some 90s Honda.

 

[AllInForISU]

I'm a carpenter. Not really optional. I wish I could just buy some 90s Honda.

The company you work for requires you to drive a pickup?

 

[BWRhasnoAC]

The company you work for requires you to drive a pickup?

I've only just started working for a company again after being independent for a long time. I still need a truck for stuff that isn't under their banner. Mostly for tools and materials.