re: Why are homeownership rates precipitously declining?

Ya, Austin definitely made us nervous since we knew it already has run up for some time and unlike New Orleans, you can actually build out from downtown, which the MS River and Ponchartrain prevent, which puts demand on those homes in Orleans parish.

The house we ended up offering on has come down 60k or so from when they originally listed it and had been sitting awhile, so hopefully we've mitigated some downside there. That's pretty much been our MO for our two purchases. Find something we like that has been sitting too long.

But yes, certainly more worrisome than just checking rental rates and picking one. If you don't like the price after a year, move.

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Yes, but renting will always go up and never acquire any value.

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Renting doesn't necessarily always go up, but you are correct that it doesn't build equity.

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If you do it 'right' and buy a house with a 15 year mortgage at a reasonable price then by age 55-60 you should own your home and stop having to pay rent.

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That is a great dream, but it is much harder to realize now than it used to be. Even within one city, my company has three locations scattered about an honor from each other. Over the next fifteen years I can (and probably will) get moved between those locations. Plus there is a significant chance I get moved away from this city. The safe choice is to buy in the city (which is a protection against depreciation and job movements), but that comes at a higher price which changed the timeline.

Even outside of those risks, if development moves away from your suburb or a Sec. 8 development comes in nearby then your investment can go upside down pretty quickly. Further for that whole time you are carrying my almost as many non-equity bearing costs as I am anyway. I am essentially risk free though.

Too many older folks are still of the mindset that you can put down roots, take a job, and be there for your whole life. With how transitory the current job market can be, it just doesn't work that way anymore.

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There are a ton of people in this country who are upside down on their mortgages through factors that they couldn't control.

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I agree with this. The whole "gig/contract" economy has made many people more risk averse to owning. Good luck if you're a homeowner and ever on the receiving end of a pink slip from your employer.

I like how in Houston you can buy your own little skyscraper/apartment building as your home.

They really cram those any where they can build them inside the loop.

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That is a great dream, but it is much harder to realize now than it used to be.

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No its not. In many aspects it may be easier. You are looking to buy a home in a fictitious bubble, that's not life. That doesn't mean there is a good chance you will lose money. Rates are super low, in the 80s rates were 8-10%+. Yet many people did it. We have websites like Zillow and the property appraisers are all online now so you can see housing prices and trends almost instantly. You could never do that in the past, without spending days of work you had no idea in the 1990s and before what houses sold for outside of what your Realtor told youl

Section 8 housing and neighborhoods don't change that much over time. If you buy in a neighborhood of $200k houses they aren't going to turn to section 8, that's a laughable idea.

I'm not saying you can buy any house and live there forever care free. But there are plenty of ways to conservatively buy a house even if you plan to move every 4-5 years that will get you to owning a home outright between 50-60 years of age.

Most people that are still underwater on their house were "investing" in some way or another. They sold their first house for a huge profit and got greedy and bought up planning to sell that one quickly, and the bubble burst. That bubble was a 2 or 3 years in a century type of thing, and if you didn't see the risk at the time you had your head in the sand.

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No its not. In many aspects it may be easier. You are looking to buy a home in a fictitious bubble, that's not life

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By the time everyone realizes a bubble is a bubble it is too late. That's kinda the nature of the beast. I'm not say there is a huge bubble (if I thought so, I wouldn't be looking). What I am saying is that if you are taking a house as an investment you have to factor in some risk of a downturn in the market.

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Rates are super low, in the 80s rates were 8-10%+. Yet many people did it. We have websites like Zillow and the property appraisers are all online now so you can see housing prices and trends almost instantly. You could never do that in the past, without spending days of work you had no idea in the 1990s and before what houses sold for outside of what your Realtor told youl

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Yes rates are good right now, but making a bad move because you can get a good rate isn't a good choice. That is similar thinking to people getting adjustable rate mortgages. Buy a house you can afford and feel secure in your investment, don't make hasty moves based on rates. Yes we have more access to information now, but that doesn't actually lead to any competitive advantage in the market since everyone has the same information.

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Section 8 housing and neighborhoods don't change that much over time. If you buy in a neighborhood of $200k houses they aren't going to turn to section 8, that's a laughable idea.

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You don't understand how neighborhoods work and how this stuff affects the urban core. Sure they aren't going to go bulldoze $200,000 houses to build Sec. 8 (though $200,00 is probably worth a lot less than you think it is in a big city). They can and will though put Sec. 8 properties in area near your gentrification. You wind up buying into an area you think is up and coming until 5 years down the road, the gentrified area is surrounded by Sec. 8 housing and/or rapidly deteriorating private apartments.

I've been looking at houses. This literally does happen because I've seen it.

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I'm not saying you can buy any house and live there forever care free. But there are plenty of ways to conservatively buy a house even if you plan to move every 4-5 years that will get you to owning a home outright between 50-60 years of age.

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If things go according to plan, yes. If you go upside down on a mortgage or two... Or have to pay some big out of pocket maintenance then that plan can be shot to shite. As I've said I'm looking to buy, so I don't think it is an awful move. Right now the rental market is really good though.

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That bubble was a 2 or 3 years in a century type of thing, and if you didn't see the risk at the time you had your head in the sand.

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This is laughable.

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Today, millinials are aghast if you suggest that they inhabit less than 3,200 SF.

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That is an absolutely ridiculous statement. Millennials are the ones moving back into the city to live in Old small houses with character, as apposed to the 3000 sqft cookie cutter McMansions gen X and the baby boomers swoon over

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Flat out not true.

In my office alone, there are three men who bought a house just this year (so far). Two of those guys are millennials (I'm one of the two).

The millenials' houses are 2200 sq ft. Apiece.

The baby boomer's house tops 5k

In fact, I can't think of more than two or three of my millenial friends who have houses over 3k sq ft. Hell, most of the ones i know that do own homes below that are contemplating downsizing.

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It was a terrible statement. Millennials are actually known for the opposite. Cramming into a 500sqft shoe box because it is in a great location

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I knew this would be said at some point in this thread. Probably because the baby boomers have been preaching about the american dream since we were fricking born. You've priced us out of it. Not ourselves. It costs far more to live the same comfortable lifestyle today than it did for you lazy fricks living in the 60s and 70s. Have we constantly raised tuition, housing prices, and everything else? No, that was you assholes. Hurry up and die.

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What does an engineer, attorney, Doctor, hell even a skilled plumber, electrician craftsman make now versus 1970?

My father put 6 kids through school and traveled with them as upper middle class small business owner and I bet he never took home more than 40k a year. I do essentially the same business for many times more than 40. It's all relative.

Buy or rent is a personal choice and not one fits all. I've always been if the mindset to buy-houses, other real estate, vehicles etc...rather than rent of lease and I've always done well with my choices. I buy a vehicle, pay it off and drive it for years without owing anything and it's a savings for me. Plenty of friends who lease vehicles, pay a ton but don't care about a car note and like a new vehicle every couple of years.

Peoples tastes, habits and lifestyles change over all generations and most people know how to adapt.

My best advice to anyone? Live within your means whether renting or buying and quit blaming all of the worlds problems on other people. Your kids will blame you for sucking up good oxygen. If you are going to be bitter than perhaps you should just die as well.