Worth repeating. This 100% Now add in all the high end pieces that we can't possibly live without (granite, hard wood floors, high end appliances, etc)
Housing market
- Thread starter simply1
- Start date
My grandpa raised 6 kids in a converted one car garage! We don't need no high end appliances!
Very much negated by asset appreciation.
Parents were fortunate enough to be able to pick up some $600 land in the 1980s due to rates. And 125k house at 7%+.
It all evens out in end.
In current situation (fairly asset poor and cash heavy), would welcome high rates in short term to pick up some reasonable ground/rentals if liquidated.
Oh, I understand and agree. Land is easier to compare. Houses are more difficult due to the reasons I mentioned, no one is building the 4 room, 2 bedroom houses anymore. My sons apartment is that size. You can’t really compare a 720 square foot home to a 1600 square foot home.
Built a home in 1980. The local banks wanted 15% and up. Found a private lender for much less (but still high compared to today's rate). The good news was the value of the home was 1980's value so the principle was much less than now. However, wages were also at 1980 rates.....
Had that private loan for about 8 years until the rates came back to earth.
You are correct, it sucked.
Don’t worry
www.lendingtree.com
What Is a 40-Year Mortgage and How To Get One?
A 40-year mortgage can help lower your monthly mortgage payments, but there are tradeoffs. Learn more about a 40-year loan and whether it's right for you.
I’ll take stupidest things you could do for $600, Alex.Don’t worry
What Is a 40-Year Mortgage and How To Get One?
A 40-year mortgage can help lower your monthly mortgage payments, but there are tradeoffs. Learn more about a 40-year loan and whether it's right for you.
Going to happen more and more. 30 was once crazy and look at what has happened with car loans!
The higher interest rates are felt much more in states like Iowa, due to the insane cost of property taxes (1.5%). If you live in a state like TN or AL, for instance, you're paying around 0.4% of assessed value. So, buying now with the highest interest rates is more easily digested because within a few years, you'll very likely be able to refinance for a much lower APR. Personally, I've very heavily considered moving to TN for not only this reason, but because of the absence of state income taxes. It's insane how expensive it is to live right now.
May happen more, doesn’t stop it from being stupid. Took me a few years to realize that 30 is actually dumb also. The money people put aside on the difference between 20 and 30 year payments is nice.
It’s nice because you will need that to fund the upkeep that will hit you in that 20 year area. Roof, siding, furnaces/AC, water heaters, water softeners, flooring, most will want kitchen/bathroom remodels, and more. Those things will give out before 30 years.
We’re already an anomaly across the globe with a 30 year fixed rate. The only reason this is a thing is because our government (Fannie, Freddie, Va, and FHA) back the credit risk on about 90% of loans. And those loans are heavily subsidized for lower credit quality borrowers.
No private investor would assume both the credit risk and interest rate risk for 30 years. They’ll do one but not the other. At least not for a rate any of us would consider to be reasonable.
A 40 year would just cause values to go even higher. And too many Americans would take the monthly savings and spend elsewhere. Both pouring fuel on the inflation fire.
Our housing policy apparatus continues to ignore their biggest limitation which is that they cannot control the supply side of the housing equation. Every attempt at “affordability” just makes matters worse.
No private investor would assume both the credit risk and interest rate risk for 30 years. They’ll do one but not the other. At least not for a rate any of us would consider to be reasonable.
A 40 year would just cause values to go even higher. And too many Americans would take the monthly savings and spend elsewhere. Both pouring fuel on the inflation fire.
Our housing policy apparatus continues to ignore their biggest limitation which is that they cannot control the supply side of the housing equation. Every attempt at “affordability” just makes matters worse.
We are in pretty much the exact scenario. Moved for a promotion, rented to get a feel for the town, but because we waited everything seems overpriced. Not that we can’t afford it, I just don’t want to buy a house for it to depreciate 2 years later by 20%. The bidding wars are done, prices are slowly coming down but not enough to feel confident in our purchase but we are sick of renting. We will likely buy by March regardless what the market does but if it’s going to crash, just crash already.
I wouldn’t expect a huge crash as I don’t think demand is going to dry up. It is nice that the price wars have ended, even though it helped us sell our house.
But one of the reasons we’re renting, in addition to getting to know the area is because my wife works for a start up. So we don’t know if it’ll be around by the time our lease is up. And the only reason we live where we do is because of her job. Otherwise, we have no desire to live here long term.
Don’t worry
What Is a 40-Year Mortgage and How To Get One?
A 40-year mortgage can help lower your monthly mortgage payments, but there are tradeoffs. Learn more about a 40-year loan and whether it's right for you.
How much does this even save? Even with 30 year loans most of your first payment is interest with very little principle. You're saving something like $100 a month on a $300,000 mortgage by extending that out another 10 years. This is getting into predatory lending territory.
Ahhh perspective. Back when 12% was considered a “steal”. IIRC you could get CD’s at about that rate. Good times!
But just look at the amazing educational opportunities in Iowa! Your tax dollars at work!
Some builders are buying down rates for buyers. In some cases I know builders are still offering 4.99% mortgages.
You're paying for it somewhere.
I look forward to a mad max hellscape.Don’t worry
What Is a 40-Year Mortgage and How To Get One?
A 40-year mortgage can help lower your monthly mortgage payments, but there are tradeoffs. Learn more about a 40-year loan and whether it's right for you.
I got dibs on being the guy chained up to the front of the Tatra T815 playing a guitar that shoots fire.