Boomers cant afford they houses. boo hoo

[Sigmapolis]

I look around the DSM Metro and I seriously don't know how people do it. My wife and I both make good money and I can't fathom taking on that kind of debt.

They have billboards around here that say stuff like, "New town-homes starting in the 800s!" like it is a deal or something. It is the same set of circumstances as 2005 --

-- low interest rates/ease of financing/zero or little down payment requirements
-- assumption that prices will continue to escalate, so you immediately have equity
-- prices are never going to drop and leave you severely underwater
-- you will never lose that high-income job that can cover the interest payments

I know this board is mostly Iowans and slanted towards Ames and Des Moines, but you guys are in Summer League compared to The Show out here on real estate shenanigans.

 

[jbindm]

Because a lot of companies in San Francisco are putting offices in Reno to save $$
So you get people from San Francisco moving there, they may take pay cuts, but they probably still make more $$ than your average local Reno resident. Heck they get 13% more per check by not paying state income taxes.

Reno is going to become another Silicon Valley in time I believe.. I think it is like a 4 or 5 hour drive from SFO to Reno.

I would like to move to Reno, because of the Mountains and forests nearby, and I have looked but you cannot get the same kind of house for the $$ that you can in Vegas.

Looked at like Carson City and that area too, a tad better, but you have the state government location that drives up prices there.

Still love the state, (California) but when you pay 13% state income tax, 10% sales tax, and one of the highest gas taxes in the country, it is not a place one wants to retire in.

I have also looked at Texas, Arizona, Heck even looked to moving back Iowa, but living in a mild climate during November to March for the past 30 years has made me pretty soft

If Reno becomes a new Silicon Valley then I demand a return of Reno 911.

 

[DeereClone]

Somebody missed the memo.

The median home is as overpriced relative to median income now as it was in ~2005.

These purchases are being heavily leveraged, too, with 55% of buyers taking a mortgage only putting a down payment of 6% or less on their home.

https://smartasset.com/mortgage/what-is-the-typical-down-payment-on-a-home-purchase

 

[deadeyededric]

They have billboards around here that say stuff like, "New town-homes starting in the 800s!" like it is a deal or something. It is the same set of circumstances as 2005 --

-- low interest rates/ease of financing/zero or little down payment requirements
-- assumption that prices will continue to escalate, so you immediately have equity
-- prices are never going to drop and leave you severely underwater
-- you will never lose that high-income job that can cover the interest payments

I know this board is mostly Iowans and slanted towards Ames and Des Moines, but you guys are in Summer League compared to The Show out here on real estate shenanigans.

It's all about keeping up with the Kardashian's. I don't think half of the people that live in those homes can reasonably afford them.

 

[Peter]

It's F'ing hot...blast furnace from May to October.

Gonna keep getting hotter too. I would love to live in a warmer climate, but the Southwest is going to be like Saudi Arabia in another 20 years.

 

[Dr.bannedman]

Doubt it you are too stupid to be employed at all.

so rude so nasty

 

[Sigmapolis]

These purchases are being heavily leveraged, too, with 55% of buyers taking a mortgage only putting a down payment of 6% or less on their home.

https://smartasset.com/mortgage/what-is-the-typical-down-payment-on-a-home-purchase

Goodness gracious. Duck and cover.

 

[deadeyededric]

Gonna keep getting hotter too. I would love to live in a warmer climate, but the Southwest is going to be like Saudi Arabia in another 20 years.

Well maybe Seattle won't be so rainy in 20 years.

 

[fsanford]

I'm flirting with the idea of moving to Tuscon in a few years. I was surprised how cheap it was even compared to Phoenix(which I think is pretty affordable). I'd move to Austin if union wages weren't garbage there.

Tucson is pretty nice, I think you can get a nice home like $130/ sq ft. You have the university there as well so usually something going on.

 

[JP4CY]

I'm flirting with the idea of moving to Tuscon in a few years. I was surprised how cheap it was even compared to Phoenix(which I think is pretty affordable). I'd move to Austin if union wages weren't garbage there.

Austin has gotten really pricey on housing costs.

 

[BillBrasky4Cy]

They have billboards around here that say stuff like, "New town-homes starting in the 800s!" like it is a deal or something. It is the same set of circumstances as 2005 --

-- low interest rates/ease of financing/zero or little down payment requirements
-- assumption that prices will continue to escalate, so you immediately have equity
-- prices are never going to drop and leave you severely underwater
-- you will never lose that high-income job that can cover the interest payments

I know this board is mostly Iowans and slanted towards Ames and Des Moines, but you guys are in Summer League compared to The Show out here on real estate shenanigans.

Yeah Iowa will be in "good shape" compared to other areas of the country but we will certainly feel it. We bought our current house in the trough (and sold our starter home) and the amount of equity we have picked up by simply living in a house is dumb.

 

[fsanford]

Austin has gotten really pricey on housing costs.

It has both state Government, huge university, and high tech moving in so triple whammy.

All of these area's have higher income earners most likely.

 

[SoapyCy]

We have a few kids and i don't need a quarter acre or 7 play rooms. i'd much rather live close to a park and library and a house like that would allow us to downsize in place.

 

[deadeyededric]

Tucson is pretty nice, I think you can get a nice home like $130/ sq ft. You have the university there as well so usually something going on.

Do you ever hear of anyone buying a home on the Mexico side of the San Diego Metro? Not necessarily Tijuana but that area?

 

[chadly82]

Yeah Iowa will be in "good shape" compared to other areas of the country but we will certainly feel it. We bought our current house in the trough (and sold our starter home) and the amount of equity we have picked up by simply living in a house is dumb.

Right its pretty crazy, I bought my starter home when I was single at $129900. Sold recently for $177,000 and my balance was only $107000. Now we want to upgrade with that equity but I will have to be at gun point to move out of the townhouse my wife bought before we got married even though we will have to have our kids share a room for a year or so.

 

[somecyguy]

I'm flirting with the idea of moving to Tuscon in a few years. I was surprised how cheap it was even compared to Phoenix(which I think is pretty affordable). I'd move to Austin if union wages weren't garbage there.

I have relatives that have lived in Tucson since the 80s. I've watched it grow from decent sized town to a suburban mess. It's a ***** to get anywhere without passing through 25 stop lights. Even though they live well inside the city, coyotes at night are a real problem. They won't go in the yard at night without making noise first to scare them off. I enjoy visiting in the winter when it's a nice 68 degrees, but the summer heat is a level of hell.

 

[fsanford]

Do you ever hear of anyone buying a home on the Mexico side of the San Diego Metro? Not necessarily Tijuana but that area?

Actually know some people who bought in Rosarito Beach, they say it is great. They are on the ocean for a fraction of the cost of what it would cost vs California.

That said I would still fear crime, and I am not to keen on owning property in a country where some day they could confiscate it without cause. Not saying they would, and maybe an unfounded concern on my part.

A condo on the water, 1800 square feet will run you like 200K in Rosarito Beach.. Gated community its like 2 hours drive south of TJ

So definitely cheap, and far enough north you don't deal with hurricanes.

Oh and the seafood is amazing, and inexpensive.

 

[BMWallace]

It's all about keeping up with the Kardashian's. I don't think half of the people that live in those homes can reasonably afford them.

I've always heard it as "Keeping up with the Jones's".

And the number of people who perpetuate that owning a home is always a better investment over renting astonishes me. Owning a home doesn't make financial sense for everyone and it really does depend a lot on personal situation. Being a renter means you are not on the hook for major property repairs, and it gives you the flexibility of easily picking up and finding somewhere new if life changes call for it.

I'm not saying people shouldn't own homes, just that everyone should be encouraged to evaluate their life and financial situation thoroughly before committing to a 30 year investment.

 

[cyrocksmypants]

Maybe they should not spend so much on avocado toast so it’s more stomachable to take the loss.

 

[KnappShack]

Who knew investing everything in a single, illiquid asset with huge upkeep costs and huge transactional costs if you ever want to move it when consumer preferences for locations and housing type can entirely change (and you can do little about it) and low real returns can end up being a really bad decision and investment sometimes.

Throw in the new tax law that doesn't allow most of us to file a Schedule A and the benefits of home ownership get real cloudy.

I bought under the old tax law. Now I can't file a Schedule A, have ownership costs, and am locked into an area I absolutely hate

I'm a mortgage guy and I've never been more bearish on home ownership