Boomers cant afford they houses. boo hoo

Discussion in 'General Discussion' started by internetman, Jun 17, 2019.

  1. jdcyclone19

    jdcyclone19 Well-Known Member

    Apr 14, 2017
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    I bought a starter home 6 years ago in that area. paid 120K for 920sqft ranch. Now my assessed value is 169K (was 118K when I bought).... Crazy (did finish my basement but that was 12K). Still my assessed if you subtract finished basement, is $155K and could easily sell for $180K. We thought about buying a bigger house a year ago but with our current equity, but when we did some calculations and analysis, were further ahead keeping our current house and finishing the basement.
     
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  2. Bobber

    Bobber Well-Known Member

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    #202 Bobber, Jun 19, 2019
    Last edited: Jun 19, 2019
    It's all about supply and demand. Reminds me of a ponzi scheme somewhat as long as you have new fools coming in willing to pay it works, but when you don't it all goes to heck. But hey it's a free country and if people want to blow money, go right ahead.

    My mother in law is going through this right now. She's 68, recently inherited some money and is blowing it on adding on to her folks old farm house. Never mind the grand kids are almost grown and probably won't be coming back to visit near as often. It doesn't appear to make any financial sense and we've shared that with her, but hey she's going to do what she wants!

    The whole where you live debate is somewhat amusing to me. California people are going to say California of course and most other people will vote for where they are at.

    We have some friends who are thinking of moving back to Iowa from California. Their home is worth a lot more relatively speaking so if they get it sold, will be able to buy a lot more home here and probably have some spare change. Here's the thing; most of their net worth is wrapped up in that home. They don't have a lot outside of that.

    Our situation is different and our net worth is structured much differently. Buying a relatively inexpensive home in the midwest allowed me to pay it off quickly, invest in other things and have a much broader range of investments than these friends. The incremental costs to invest in the stock market also seem much more reasonable to me relative to real estate...

    We travel to places like California, Hawaii, Florida, Arizona when we want and always enjoy visiting, but never enough to want to live there(other than perhaps staying a month or two in the winter when we get older.)

    Last thought. Nothing wrong with renting. My brother is an engineer and has done that his entire life and is wealthy. I chose to own, but that's because it's relatively reasonable to do so here.
     
  3. ClonesFTW

    ClonesFTW Well-Known Member
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    This. Many people I know in IT/engineering would embarrass themselves trying to sell their product or service to an outside vendor. There is always a need for those fluent in salesmanship, no matter the degree (if any) you hold.
     
  4. Sigmapolis

    Sigmapolis Well-Known Member
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    Aug 10, 2011
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    Sure as heck worked for me as a lowly software salesman. Commission is fun.
     
  5. 2forISU

    2forISU Well-Known Member

    Oct 8, 2008
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    The risk has to be pretty high in this industry, correct? I would assume the default rate is high and might be tied to the high-interest rates. I'm not well versed in these lending firms but would be curious to see some #'s.
     
  6. 2forISU

    2forISU Well-Known Member

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    Might seem crazy but that's pretty reasonable compared to either coast. The owner next to our house in Philly bought their home in 2010 for $425K and sold it for a shade over $900K a couple of weeks ago.
     
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  7. DurangoCy

    DurangoCy Well-Known Member

    Jul 5, 2010
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    Maybe if you weren't spending all your money on the WSJ, you could afford a sweet truck like your ex's new BF?
     
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  8. DurangoCy

    DurangoCy Well-Known Member

    Jul 5, 2010
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    4% increase per year, sounds about right.
     
  9. KnappShack

    KnappShack Well-Known Member

    May 26, 2008
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    Yeah. I didn't see anything crazy about that appreciation

    What's really fun is when homes depreciate. Oh. That's good times.
     
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  10. mtowncyclone13

    mtowncyclone13 Well-Known Member

    Oct 10, 2012
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    The problem is people need a place to live. Aside from moving to the middle of nowhere, there isn't an option to not buy into the ponzi scheme.
     
  11. throwittoblythe

    throwittoblythe Well-Known Member

    Aug 7, 2006
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    I'm one of those soft skill people. I went to ISU for both bachelors and masters in engineering. Spent my first 8 years doing hard calculations/design work, but quickly made my way up to leading teams where I was doing less design and more management. I abandoned the design side altogether a few years ago and now do BD for a construction company.

    My biggest asset is that I can speak to both designers and builders and know what the hell they are talking about. I'm more of a translator than anything else. Ask the average engineer to write a proposal and it's laughable what they come up with. Being in this role, I get the impression some of my coworkers don't see any value in what I do because they don't understand it ("he's not a project manager!"). But they sure like it when those new projects keep rolling in the door.
     
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  12. Bobber

    Bobber Well-Known Member

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    Oh we are all free to make choices...I did and has worked out well for me. My brother did as well and has worked for him.
     
  13. 3TrueFans

    3TrueFans Just a Man in the Middle
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  14. capitalcityguy

    capitalcityguy Well-Known Member

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    I know....we'll never learn.
     
  15. capitalcityguy

    capitalcityguy Well-Known Member

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    Maybe, but it really goes hand-in-hand with the relaxing of credit. Too many special interests involved that profit from getting as many people in houses (regardless if they can afford them) as possible.
     
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  16. capitalcityguy

    capitalcityguy Well-Known Member

    Jun 14, 2007
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    Truth!

    What we have found is that the underlying financing mechanisms of the suburban era — our post-World War II pattern of development — operates like a classic Ponzi scheme, with ever-increasing rates of growth necessary to sustain long-term liabilities.
    .
    https://www.strongtowns.org/the-growth-ponzi-scheme
     
  17. internetman

    internetman Well-Known Member

    Aug 21, 2012
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    dam dog dont do me like that
     
  18. BillBrasky4Cy

    BillBrasky4Cy Well-Known Member

    Dec 10, 2013
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    Yeah I get that, I lived in coastal VA for a few years. You also have to look at everything in scale though...
     
  19. BillBrasky4Cy

    BillBrasky4Cy Well-Known Member

    Dec 10, 2013
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    But in reality the growth took place over the course of 2-4 years not 7 so 4% isn't really accurate.
     
  20. BoxsterCy

    BoxsterCy Well-Known Member

    Sep 14, 2009
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    Disappointing. I'd always thought you blew it all on hookers and blow. :oops:
     
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