What's more expensive? Your home or your car? (Garland, Rockport: sales, oceanfront)

[bencronin04]

Originally Posted by Ralph_Kirk

You do realize that is the fallacy of "selection bias," right?

Did you happen to read or look at any of the articles I posted? Where did you come up with the information from your statement?

[BLDSoon]

Originally Posted by DallasG

I was reading about some love triangle in Princeton which raised a general question, why would some one live in a $120K house and drive a $200K Lamborghini? I'm not saying wether it's wrong or right but wondering how do you justify it if you have other obligations as well? Everyone likes fancy cars but even ones who can, hardly ever justify it to the voice of reason in our heads. Of course, I'm talking about us 99%, not top 1% who can and do buy expensive toys.

Most of the time its because they can. A lot of the time its because they dont have to justify it.

Some people value homes, some like boats, others value cars, some take the bus. Its all preference and what people can afford/ get approved for.

This is probably new to dallasites but its quite a common thing in big cities for people to rent for eternity but own luxury cars that they only drive on weekends. No-one even bats an eye. There are entire businesses dedicated to storing cars for people like that. So i'd say the guy that owns a 120k home and a lamborghini is at the very least ahead. Not all homeowners are doing well. And not all renters are struggling/ want for money. Some people are shy about spending that much on a car, others are not. Either way, its very misguided to judge people based on the stack of bricks they live in or the structure of metal they drive. Behind the scenes sometimes what you see is very.... I dunno enlightening.

Also i doubt very much that any bank financed/leased an escalade to a person on food stamps as someone else said. Either they are not on food stamps as one assumed or something else is going on that probably involves law enforcement not banking.

[aggie972]

Originally Posted by bencronin04

Did you happen to read or look at any of the articles I posted? Where did you come up with the information from your statement?

Didn't you grow up in Highland Park? Don't you think it's possible that your friends aren't a representative sample of millennials?

[BLDSoon]

Originally Posted by TheOverdog

I grew up in a small town, and plenty of people had vehicles that cost more than their house, because houses were $30k and real estate was less variable than in DFW and thought of more as an expense than an investment. Productive land or a useful vehicle was an investment, not your house.


Lots of places used to be that way.

Lots of places are still that way.

[WestGuest]

My home is for sale for $770,000 on the oceanfront in Rockport Texas. My car is a 2003 Miata with 70,000 miles and might be worth $10,000 runs great though.

[mami2emily]

Originally Posted by BLDSoon

Some people value homes, some like boats, others value cars, some take the bus. Its all preference and what people can afford/ get approved for.

This is probably new to dallasites but its quite a common thing in big cities for people to rent for eternity but own luxury cars that they only drive on weekends. No-one even bats an eye. There are entire businesses dedicated to storing cars for people like that. So i'd say the guy that owns a 120k home and a lamborghini is at the very least ahead. Not all homeowners are doing well. And not all renters are struggling/ want for money. Some people are shy about spending that much on a car, others are not. Either way, its very misguided to judge people based on the stack of bricks they live in or the structure of metal they drive. Behind the scenes sometimes what you see is very.... I dunno.

this...totally agree

Some people are really into cars. We are not. My husband refuses to spend money on expensive cars, to him it's not a sound investment. So we usually buy new cars in the under $29K range and drive them at least 10 years. He is on his 3rd car since graduating college in '89...I'm on my 3rd as well. We live in UP so our cars are a minute fraction of our house. I know HP teenagers with better cars than ours. It is just not an important expense to us. My husband also takes very good care of our cars so they are in pretty good shape until we decide to get a new one (except for the time he went for a trendy color on a Mazda 626...that color did not age well...but even after driving that car 11 years it got passed down to not one, but two nieces, definitely one of the most reliable cars we've ever had).

I have also met a lot of people who choose to rent for a variety of reasons even though they can afford to buy a house. I say live and let live. Not my concern.

[shrapr]

One of my tenants is Section 8 and drives a Mercedes, I know, don't ask me but every time I visit the property in my old Toyota I park with pride.

[MurphyPl1]

Originally Posted by EDS_

Much like taroberts I'd peg the aggregate cost of our 5 cars, yea I know, at around 1/5 of our home's value.

My investment guy advices most people to keep the total cost of all cars at less than 6 mos. salary and better yet 3 mos. He tells guys with serious car hobbies, who aren't uber-millionaires, to keep the car costs to less than 1 year's salary.

Back to Lamborghinis one day a couple of years ago I was having an afternoon cocktail at a local joint......a lady maybe 70yo pulled up in a super beautiful convertible blue Lamborghini Gallardo. A few days later I saw her drive up in the Lambo followed by a guy - presumably I thought her husband - in a totally nondescript Chrysler. I asked the bartender about them........she drives the Lambo almost every day good weather, rain, slush etc. He refuses to ride in the Lambo under any circumstances so he drives the Chrysler.

I'm sure the grandkid conversations are awesome......."GRANDMA I have a date tonight can I borrow your Gallardo".

We've always lived by the philosophy that you should never finance your hobbies. Boats, classic cars, scrapbooking supplies. If you can't pay cash then you should save up for it. Essentials like your grocery getter and your home are different.

That said, we've got more tied up in cars than our home but we also pay cash for our vehicles. We happened to hit one of those vehicles that has doubled in value in the last 9 years.

[EDS_]

Originally Posted by bencronin04

So total annual car payments should equal 3-6 months of your salary?

No. Take the total sales price of all cars..........that sum should equal 6 mos. salary or less. Thinking about it though, below about $150K his formula starts to break down IMO.

[EDS_]

Originally Posted by MurphyPl1

We've always lived by the philosophy that you should never finance your hobbies. Boats, classic cars, scrapbooking supplies. If you can't pay cash then you should save up for it. Essentials like your grocery getter and your home are different.

That said, we've got more tied up in cars than our home but we also pay cash for our vehicles. We happened to hit one of those vehicles that has doubled in value in the last 9 years.

For virtually everyone that's a great philosophy.

FWIIW my guy's advise isn't that a guy/gal making $300K who loves cars should have $300K in care expenses per year but instead they should have no more that $300K worth of cars.