re: How imminent is a housing crisis in this country?

quote:

---

DSLD and DR Horton not having trouble selling homes… most buyers would rather a new home for a lower price

---

I can definitely see that here. Take your pick of brand new houses coming up everywhere or buy Grandmas 70s/80s ranch style with low ceilings, no natural lighting, formica, orange carpet and wood paneling for the same price.

quote:

---

They basically have.

---

So they’ve really doubled since the wives get to have jobs now too.

quote:

---

They basically have. Look up median household income in 1980 and either calculate what it should be today using standard 3% inflation or use an inflation calculator. Then compare it to median household income today and they will be approximately the same.

---

Home prices are at their least affordable levels in history

Part of it is supply/demand issues and as others have mentioned some of it is due to rate lock. People that feel trapped in their current homes with low mortgage rates. There is also another category of people - a substantial amount of people with paid off homes. They don't seem to have much of an interest in moving either.

quote:

---

So they’ve really doubled since the wives get to have jobs now too.

---

Same holds true for individual salaries.

quote:

---

Home prices are at their least affordable levels in history

---

So they say. But when you apply real world data to your market it tells a different story.

Go look at value of the previous houses you've bought or lived in and adjust your purchase price for inflation and compare that price to current estimates on Zillow or Redfin. If you live in BR current value will likely be less than inflation.

Of course this in anecdotal evidence so it can't be trusted instead we have to believe your conjecture or daily articles that imply real estate markets are the same across the country.

I’m Gen Z and a homeowner. Just getting that out the way. Long post, but here is my take…

I think people tend to oversimplify the argument of then vs now. If you actually look at the numbers, it’s a lot closer than people think. In 1981, the median new home cost around $69,000 compared to roughly $411,000 today. Mortgage rates were obviously much higher back then, averaging 16.6% compared to around 7.4% today. Assuming a 20% down payment, the mortgage alone consumed about 41% of gross annual income in 1981 versus 31% today. However, that same down payment represented about 62% of annual income in 1981 compared to 94% today. In 1981, the median new home cost about 3.6 times the median household income. Today, it’s approximately 4.7 times. That’s roughly a 30% increase in home prices relative to what households earn.

Then you have to consider everything else that goes into raising a family, including groceries, vehicles, childcare, healthcare, insurance, and utilities. When you factor in those expenses, the overall financial burden becomes much more comparable between the two periods. The difference is where that burden falls. Families in 1981 dealt with extremely high borrowing costs, while families today deal with significantly higher home prices relative to income and substantial childcare and other living expenses. I don’t think it’s accurate to say either generation universally had it easier, but I do think it’s fair to say that getting into homeownership is considerably more difficult today, even if maintaining a mortgage was harder in 1981.

quote:

---

I don’t think it’s accurate to say either generation universally had it easier

---

I agree with this part.

quote:

---

Then you have to consider everything else that goes into raising a family, including groceries, vehicles, childcare, healthcare, insurance, and utilities. When you factor in those expenses, the overall financial burden becomes much more comparable between the two periods.

---

This isn't new. Every generation has had to deal with this.

quote:

---

Assuming a 20% down payment, the mortgage alone consumed about 41% of gross annual income in 1981 versus 31% today.

---

Why assume this. You can get a mortgage with much lower down payment or do a Piggyback loan that allows you to avoid PMI.

quote:

---

You could actually send your kids to public schools back in the 70s and 80s.

---

Maybe the 70's not the 80's once bussing started.

I'm one and a half payments away from clearing my 30 year 3% mortgage after 19 years of payments. Worked my arse off, kids are out of the house, and I'm finally hitting my stride with my business. Obviously, I think I'm coasting to cross the River of Babylon.

Wife informs me she wants a bigger house with a pool.

I think that the housing crisis might be a misnomer for a marital crisis.

Being angry that fathers get to spend more time with their family.

Boomer mentality