re: The math for buying a home no longer works, per WSJ

It says "individual" income but that sure looks like median household income.

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But to be fair, had you bought in 2019, you would have been extremely mad in 2021 when the rates were 2% lower than what you bought at


Holy shite lol

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Apparently buying in 2019 would have kept a person from refinancing in 2021 according to Upperdecker

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First time home buyers should be buying below their income levels. That allows them to build up equity and stay within an appropriate % of their income. Once they build up equity, buying housing appropriate to their income level becomes more attainable, and eventually may be able to buy above their income level

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I have friends who did this. They are stuck in a house they've outgrown and probably make 1.5x what their house is worth, but don't feel like they can afford (or just don't want to afford) to buy something larger in this current market.

On the other hand, we bought a house that was about 3x our gross, but that we could grow into as our family grows and our incomes grow. We're locked into a 2.75% interest rate on a home that is now less than 2x our income and we have space to have more kids (currently only have 1).

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A large proportion of families now have duel incomes. It seems statistics are slanted to ignore. Although one may argue that an increasing number of households require at least 2 incomes just to stay above water.

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Two incomes means much higher child care costs due to daycare, which is OUTRAGEOUS. Add skyrocketing private school costs because the public school system is failing in most parts of the country.

But yeah, DINKs have it made I guess. Most people would like to have kids though.

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Primarily by focusing on individual income vs household income. If one person makes $200k+ and the other makes $20k doing something that is a passion, the person making $20k is not at a disadvantage.

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this is household income

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Most FTHB don’t have the funds lying around liquid to buy a house and then dump 20-30k into renovations.



Are you aware that there are mortgage products made specifically to address this issue?


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Section 203(k) insurance enables homebuyers and homeowners to finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage or to finance the rehabilitation of their existing home.



HUD

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Like I said, it still isn't free. And on top of that, a 203k doesn't really fit your sweat equity point because you have to hire contractors to do the work acccording to the rules and guidelines of the loan. Fundamentally, you're just borrowing additional money. It's also, by definition, a loan. You'll be paying all of those renovation costs back to the lender, with interest.


You also better hope you pick a good contractor who doesn't bail in the middle of the job or that your lender is very much on the ball. It's a lot of moving parts to keep track of and if any of them go wrong, you can end up in a bad spot.


Not to mention closing can take longer and you'll have to pay insurance on the loan as well. I'm not saying it's impossible, but it's not as nickel and dime to do as maybe is portrayed.

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I have friends who did this. They are stuck in a house they've outgrown and probably make 1.5x what their house is worth, but don't feel like they can afford (or just don't want to afford) to buy something larger in this current market.

On the other hand, we bought a house that was about 3x our gross, but that we could grow into as our family grows and our incomes grow. We're locked into a 2.75% interest rate on a home that is now less than 2x our income and we have space to have more kids (currently only have 1).

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Truth, if you can swing it. And everyone wonders why people aren't having kids until their 30's now. Some of these responses are out of touch with reality.

I say all of this as a current 2bed 1bath homeowner

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For this year, an individual earning the median income in the U.S. — $78,642 — would have needed to allocate over 40% of their income to monthly housing costs when purchasing a median-priced home, valued at around $400,000, as per Redfin's findings. This represents the highest percentage in Redfin's records dating back to 2012, indicating an almost 3% increase from the previous year.

unusual whales tweets:

At current rates, the average household could spend more than 60% of its monthly income on mortgage payments, assuming a 10% down payment, per Credit News.

51% of Americans make a median annual salary of $75,000.

They can afford a home that costs about $256,000, per the National Association of Realtors.

The median home price in the United States is $431,000, according to Federal Reserve Economic Data.

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It's mixed data. Ultimately doesn't matter though. The wage/housing gap is massive, the middle class is screwed and the largest asset class that previously led to wealth generation in the US is now generating wealth for an increasing number of foreign and domestic entities vs individuals.

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You shouldn’t, but you can. Some people only put down 3 or 5% even. Which jacks up their mortgage costs on a monthly basis so high with straight principal plus PMI that it takes them a long time to actually build equity

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Or you could buy a house with 0% (zero) down like we did

The OT isn't gonna like this