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cable
Member since Oct 2018
8591 posts
 Online 

re: Could you afford to buy your own house if you had to buy it today?
I probably wouldn't pay the $220/sq ft that people are getting where I live now. I'd find somewhere else to buy a home. However, where I live has always been expensive relative to surrounding areas.


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thegreatboudini
USA Fan
Member since Oct 2008
5694 posts

Seeing all the responses here begs a question.

What's next for you all?

Is this your forever home?

The more I watch the market, the more I think this is the new normal. Not that these prices will continue to go up at the rate they have the last 2 years, but these prices, +/- a few percentage points, is the new baseline.


FLObserver
LSU Fan
Jacksonville
Member since Nov 2005
12039 posts

The house i'm in over 3,000 sq ft . In a few years when all the kids have moved out there will be no need to have a house and a yard that's this big. You do make a good point though with people not really wanting to move especially now with rates high and all. My property taxes have doubled in the time ive been in the house so i'm expecting it to keep going up every year in the house. My plans are to sell this place and buy a home, all cash, out in the country that is much smaller and cheaper hopefully when housing markets have cooled.


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TigerFanatic99
Chicago Cubs Fan
South Bend, Indiana
Member since Jan 2007
22681 posts

Could I afford to, yes. Would I spend this much on a house, no.


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I Love Bama
Alabama Fan
Alabama
Member since Nov 2007
36927 posts

quote:

The more I watch the market, the more I think this is the new normal. Not that these prices will continue to go up at the rate they have the last 2 years, but these prices, +/- a few percentage points, is the new baseline.


Everyone was saying this in 2007, FYI.



BottomlandBrew
LSU Fan
Member since Aug 2010
25147 posts

quote:

Is this your forever home?


Too many unknowns in life to say we've settled, but we aren't going anywhere for a while. The idea of adding on is very much on the table. Our house is okay while we have two toddlers. As they get older, or if we have more kids, things change.


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thunderbird1100
LSU Fan
GSU Eagles fan
Member since Oct 2007
64704 posts
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We bought our house in 2017 for $275k with 5% down at 4.25% on a 30 year.

Monthly mortgage payment was $1,285 (just mortgage), our PMI was like $80/mo on top of that, sp $1,365 in total with PMI (again, no tax/ins).

We refinanced $248,000 to a 15 year at 2.375% end of 2020. New payment is $1,639 (just mortgage). No PMI anymore. We had option of 2.85% on 30 year which would have been $1,026 a month as well.

Today, zillow says house is worth $438,400. Assuming we put same 5% down, which is way more than we put down on the $275k, we'd be mortgaging $416,480 @ 5.7% 30 year (using freddie mac website for rates) and payment would be $2,417 a month without PMI, tack on another $100 at least for PMI probably bringing us up to about $2,550 a month. On a 15 year at 4.83% the payments would be $3,257 a month without PMI

Could we afford it - yeah, would we do it, hell no.

Once you throw in PMI, HOA, taxes and insurance on the $3,257 a month mortgage, we'd be talking $4k a month easy. Or on the 30 year in excess of $3k.
This post was edited on 7/5 at 7:59 am


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thunderbird1100
LSU Fan
GSU Eagles fan
Member since Oct 2007
64704 posts
 Online 

quote:

Everyone was saying this in 2007, FYI.



Other than housing prices going up quick, nothing about this housing market is similar to 2007.

2007 had an oversupply of homes (just look at new home builds alone) that was made even worse on the resell market when the banks came down hard on all the people losing their jobs, mostly people who never should have qualified for a house they got in the first place. We have a lot more protections in place now so that people dont get as caught up in homes they cant afford from the get go when the slightest change in things can put them underwater.

Housing prices wont continue to go up nearly like we've seen, and we have even started seeing some houses get price cuts in recent months due to the fast interest rate increases, but we arent going to see houses suddenly fall 20-40% over the next year or anything crazy like that. Right now we're just seeing the market cool down some and people not being able to get crazy asking prices right away necessarily any more and having to adjust.


slackster
Stanford Fan
Houston
Member since Mar 2009
78174 posts

quote:

My house fell in the 700k to 800k range when I closed on it in November of 2020.

The note is 6% to 7% of my household monthly gross income.


Congrats?


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oneg8rh8r
LSU Fan
Port Ludlow, WA
Member since Dec 2003
2339 posts

No way, no how.

Too look at the mortgage would scare the crap out of anyone.

Current MTG at 2.25% is $4500.

Todays value at 2.25% would be over $9130 @ mth. Yikes

Todays value at 5.1% would be over $12400 @ mth.


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slackster
Stanford Fan
Houston
Member since Mar 2009
78174 posts

quote:

Current MTG at 2.25% is $4500. Todays value at 2.25% would be over $9130 @ mth. Yikes Todays value at 5.1% would be over $12400 @ mth.


All of these are insane to me, regardless of their affordability.

30 year??
This post was edited on 7/5 at 8:46 am


Weekend Warrior79
LSU Fan
Member since Aug 2014
11821 posts
 Online 

I could afford it, but I doubt I would buy it. If I'm going to spend that much more money on a house, I won't have the same compromises that I had when I bought my house.

We settled for smaller bathrooms, for a larger family area and yard. Based on other sales in my immediate neighborhood, my house is ~60% more expensive. Then when you factor in doubling my interest rate; no way I could justify spending that much and not getting everything I want


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oneg8rh8r
LSU Fan
Port Ludlow, WA
Member since Dec 2003
2339 posts

That's why I'm never selling!


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tigerfoot
LA-Monroe Fan
Alexandria
Member since Sep 2006
51105 posts
 Online 

quote:

What's next for you all?

Is this your forever home?

We bought more than I thought we would ever buy in August of 21. Had a bunch of cash on hand and rates were low so we did the deal, kept note where it was at prior house.

I imagine I stay in Alex till my last breath and it should be in this house.

We liked the house, but we had come from a spec type home that was cheaply built. This thing is a tank. Custom built and built well with just about every aspect of it overbuilt. So happy we did it.

And, no, I would not buy it at 6% interest.


MrJimBeam
New Orleans Saints Fan
Member since Apr 2009
8113 posts
 Online 

Plan on being in house until retirement most likely. Note is really low and we have gotten a few raises so in the last year. All that extra money keeps adding to retirement or kids funds. We are comfortable currently and will adjust if inflation starts affecting us.


tigerfoot
LA-Monroe Fan
Alexandria
Member since Sep 2006
51105 posts
 Online 

quote:

and will adjust if inflation starts affecting us.


It is affecting the hell out of us. I havent been price aware in some time, but the last few months I have changed my grocery shopping habits quite a bit.


oneg8rh8r
LSU Fan
Port Ludlow, WA
Member since Dec 2003
2339 posts

I'm always curious, lets see some pics of our houses.


MattA
Member since Nov 2019
1082 posts

Sure I could afford it… However no more private school etc for the kids lol. So in reality, no the house today at today’s rates would be 4 figures higher than we pay now and that would just be a no-go. Would blow the budget up.


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Joshjrn
LSU Fan
Baton Rouge
Member since Dec 2008
21833 posts

quote:

Yes, but I was smart and bought a decade ago.


“Smart”

The next time someone says that the reason young adults can’t afford to buy houses is because they spend too much on coffee and avocados, I’m going to point to this thread

Eta: Yes, I would be able to afford it, but it would be at the tippy-top of my budget comfort zone, and I would be extremely unhappy about it.
This post was edited on 7/5 at 1:53 pm


NC_Tigah
LSU Fan
Carolinas
Member since Sep 2003
111725 posts

quote:

“Smart”

The next time someone says that the reason young adults can’t afford to buy houses is because they spend too much on coffee and avocados, I’m going to point to this thread



The youngest millennials were 23yrs-old in 2019. The average millennial was 30yrs-old in 2019. The average home was $375K. Loan rates were historically low. Many chose to not buy.

Whether, in that market, the decision not to buy was d/t avocados and Starbucks, or desire to take vacay selfies with the buds off the Amalfi Coast, or sugarplum fairies and nosedust .... macht nichts.

It's always something though ... the houses were either too small, or not in the right location, or the only way to afford a downpayment would be to go with a used car instead of a hot new ride, etc., etc., etc.

In fact, loan rates for the last 10yrs were obscenely low. But that was juxtaposed with youthful desire to not get "locked-down" with a house payment. Get married, buy a house, pool savings, have a kid .... nah what a drag.

Anyone with a brain realized historically low home loan rates would be inflationary in the housing sector. Given any reasonable purchase choice, renting in that situation was ill-conceived.

Three years later in 2022, homes average $507K. A 10% downpayment on those $375K homes in 2019, would rate a 350% ROI over the timespan.

Thankfully, it sounds like you bought. Hopefully, that will work out nicely for you.


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